Firm help SIEMENS. Using technology to ensure improved infrastructure and better service 2 FINANCIAL MAIL OCTOBER 7,

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2 CORPORATE REPORT SIEMENS Siegmar Proebstl Firm help Using technology to ensure improved infrastructure and better service Emerging markets, like SA and many other African countries, are the growth engines of the global economy. And, with its local presence and integrated technology portfolio, Siemens is in a strong position to capture a large share of the growth taking place in these markets. The global electronics and electrical engineering company has been operating in SA for more than 150 years. Siemens global strategy is aligned to four m e g at r e n d s that are shaping the world, and it believes that with its technologies and solutions it will be able to play a constructive role in Africa s success story. It believes that its technologies provide answers to the challenges posed by the following trends: Climate change. African countries can leapfrog to more efficient technologies to help fight the drastic effects of climate change and avoid some of the mistakes made by developed countries. Urbanisation. By 2030 it is estimated that Africa will have 760m urban residents. Because more people are moving to cities, the demand for efficient and sustainable infrastructure, such as energy, transportation, water and health care, is increasing. Demographic change. The rapidly growing and ageing global population is intensifying the demand for health-care solutions to create a more livable environment for an older generation. Globalisation. The world is becoming more interconnected not only through new technologies but also in economic and logistical terms. Siemens Africa CEO Siegmar Proebstl WHAT IT MEANS > Priorities are helping governments and the private sector realise their set goals says Siemens priorities lie in helping governments and the private sector across Africa realise their goals in terms of upgrading public infrastructure ne t- works. The company s focus is on solutions for sustainable urban infrastructure development, renewable energy and environmentally friendly products and services. Sustainability is in our DNA. It is the only way to be successful, he says. We have world-class solutions that can unlock value, improve service delivery and help businesses become sustainable. There are huge oppor tunities. Alex Mathole, executive board member and legal council for Siemens Southern Africa, says Siemens has identified gaps in the market and over the years learnt to innovate and bring technologies suitable to the African market. Siemens has made significant strides in implementing mechanisms to provide solutions to the challenges facing devel- 2 FINANCIAL MAIL OCTOBER 7,

3 We have world-class solutions that can unlock value, improve service delivery and help businesses become sustainable oping countries. It recently established the Siemens Wind Power Centre of Competence for Africa and the Middle East in SA, demonstrating the opportunities the company sees in the continent for green business. It will support the country s mission to create jobs in the green industry. Green solutions have become growth drivers for the global economy and climate change will transform green technologies into the leading industry of the 21st century. Siemens has been a pioneer in renewable energy in SA since 1892, when the company was a technology supplier to the Molteno Resevoir, SA s first hydro-electric power plant. Energy-efficient solutions are a priority for Siemens. In fiscal 2010, products and solutions in its environmental portfolio generated worldwide revenues of à2 7, 6 b n. One of the key areas of focus for Siemens is urbanisation. And from October , it established a fourth business sector called Infrastructure & Cities. Proebstl says Siemens will put even more focus on the needs of the cities. In future, cities will be the size of a country. More people are moving into the cities and there is a need for new infrastructure. The whole world is changing. As Africa s cities grow so does the demand for infrastructure, electricity and water, he says. Mobility is also key for Siemens. The company last year successfully assisted the Passenger Rail Association of SA with the rail signalling in some of its routes during the 2010 soccer World Cup. Mobility is a challenge. As more people move to big cities, new systems of mobility need to be implemented and existing infrastructure needs to be upgraded. These include train systems and intelligent traffic solutions, says Proebstl. With the overall demand in Africa for infrastructure solutions expected SIEGMAR PROEBSTL to grow significantly in the years ahead, the company is investing about à200m by 2012 to expand its business and especially its sales structures on the continent. Alex Mathole Siemens has five main manufacturing facilities in SA, where it manufactures high-quality, energy-efficient products to meet local demands. It has also identified skills development as critical to the country s sustainability. Siemens employs people in Africa, with of those in SA. It invests continuously in training not only its staff but also investing capital in training institutions. One of the greatest contributions it is making is the construction of the Mandela School of Science & Technology, which will accommodate about 700 students. The company is also investing in the SAJ Artisan Training Institute, to train people who will play a key role in helping to build the local energy infrastruc ture. Mathole says the shortage of skills is a challenge but Siemens commitment to training ensures that there is a pool of talent that the industry can draw from. The world is growing faster than the available skills. But as Siemens we are investing in training, learnerships and we will be launching the (global) Siemens graduate programme for the first time in SA, she s ay s. In terms of staff, Siemens has created an environment that allows its employees to leverage their full potential and develop their competences to address future market requirements. According to Mathole, Siemens has implemented a diversity programme, which provides employees an opportunity to acquire skills in different areas of the organisation. It also has the African Leadership Organisation for Women, which is aimed at the c o m p a ny s female employees. T hese are some of the programmes that Siemens has put in place to provide the employees with equal opportunities, she says. Siemens became one of the few international companies that sold shares to a black-owned entity more than 10 years ago. But its BEE commitments do not end there. About 40% of procurement is from blackowned entities. It is a level 4 BEE contributor. We will continue to improve our BEE score as part of our commitment to empowerment, s ay s Mathole. FINANCIAL MAIL OCTOBER 7,

4 CORPORATE REPORT SIEMENS E N E R GY Solutions on offer SA needs more electricity every year. As the economy grows, there are renewed calls for alternative energy resources to help generate the electricity needed to support the country s infrastructure development. This is one area of focus for Siemens, and the company is rolling out a strategy for its renewable energy technologies in Africa, in which SA will be a major hub in the supply of wind and solar power to the continent. Ute Menikheim, the head of Siemens Energy, says Siemens SA will serve as the centre of competence for wind power to Africa and the Middle East. It will have the engineering expertise and the capacity to focus on local skills development, entering into local partnerships for the manufacture of different components. A similar approach will be applied to its concentrated solar power (CSP) business, as Siemens believes CSP will play a big role in supporting government s focus on job creation through the maximisation of local content. Siemens is already a leader in the fossil Infrastructure b o ost Siemens has established a new and fourth unit Infrastructure & Cities. This unit will focus on assisting major cities in Africa to help prepare for millions of people that are expected to seek residence in urban areas. It is projected that by 2050 there will be more than 1,2bn African city dwellers. The majority of Africa s urban residents, it is predicted, will live in slums and informal settlements unless radical corrective measures are taken. Siemens Infrastructure & Cities head Kevin Pillay says the unit will focus on integrating technologies and providing tailored energy efficiency solutions for private and public infrastructure. This will include intelligent power distribution systems, building technologies and U te Menikheim Kevin Pillay power generation market and is currently providing equipment to most of Eskom s coal-fired power stations. These include turbines and transformers, as well as control and instrumentation equipment. Siemens is committed to giving the same level of service to our renewable energy partners to help grow the local marke t, she says. Dwindling resources, climate change and the fast-growing demand for energy which is caused by demographic changes and urbanisation are the main challenges for ensuring sustainable energy supplies. Though we expect significant growth in the renewable energies market, traditional fossil-fired power generation will continue to be the major source of global power supply in the future, s ay s Me n i k h e i m. That is why Siemens is also investing in technologies such as high energy efficient gas turbines to make fossil-fired power generation cleaner, as well as high-voltage transmission technologies to transport electricity across long distances efficiently and with minimal losses. More than 550m Africans lack access to electricity and we need to ensure that we have the right mix of technologies to develop a reliable and sustainable power network on the continent, she says. integrated mobility solutions. He says the move to urban areas puts pressure on cities in terms of infrastructure. It also affects the quality of life as the demand for clean water, electricity, affordable health care and mobility increases. Cities consume large quantities of natural resources in order to ensure supplies of energy and water. They also produce considerable amounts of environmentally harmful emissions. The battle for environmental sustainability will be won or lost in cities, he says. They also consume 75% of the world s energy and account for 80% of the greenhouse gases. Growth in cities will continue and we don t have a choice. By taking action today to develop Africa s urban infrastructure we can contribute towards the continent s sustainable future, he says. 4 FINANCIAL MAIL OCTOBER 7,

5 Helen Brown H E A LT H Bette r, focused care A rapidly growing and ageing global population is intensifying the demand for health care. With Africa e xperiencing some of the highest population growth rates in the world, it is predicted that the continent s population will surpass both C hina s and India s by The challenge is to make medical services more affordable and accessible to more Africans while improving the quality of individual patient care. Siemens is at the forefront of making this possible, focusing on breast cancer as SA marks global breast cancer awareness month in October. In partnership with Netcare, the company will embark on a corporate social partnership and launch a Mobile Breast Screening Project. The Sinethemba (We have hope) mobile trailer will be equipped Help for industr y With globalisation, the world is becoming more interconnected. To hold their own in global competition, SA companies and players in all of Africa s key industries must make their production processes economical, affordable and also manufacture high-quality products quickly. Development cycles in the manufacturing industry are becoming shorter. With that, the complexity of products and associated volumes of data during the whole product lifecycle are increasing. Also, energy has become a huge cost factor; resources are scarcer; and environmental requirements are stricter. Service activities are demanded over the entire lifecycle and customers expect comprehensive solutions from a single source. Raymond Padayachee, the head of Industry Sector Siemens Africa, says these challenges provide opportunities for Siemens. With a presence across 190 countries, we can leverage on our worldwide expertise and provide tailormade products, solutions and services to our customers in mining, water and waste water management as well as automotive, petrochemical and other areas of process automation. He says innovation cycles are becoming shorter, putting industry under additional competitive pressure in the with a mammography system to help alleviate the burden on public hospitals to screen and detect breast cancer. Siemens Healthcare head Helen Brown says it will be a pilot project and the selective launch will be evaluated at a later stage. Moreover, Siemens is working with funding agencies through its Resources Embracing Africa with Care & Hope project, which expands access to costeffective health care in Africa. Through this, Siemens is able to deliver HIV viral infectious disease management in environments that are too inhospitable for some other systems. Brown says there is an increased demand for low-cost health-care solutions in rural areas in Southern Africa. T here Ray m o n d Pa d aya c h e e global business arena. Only by understanding the requirements and processes typical of our market, working closely together and maintaining our partnership can we provide our customers with the right support, s ay s Pa d ay a c h e e. As such, Siemens has decided to reorganise its Industry Sector globally. It will now comprise the Industry Automation and Drive Technologies. In the future a separate Customer Services unit will address the technologybased services of industrial customers. With the new organisational structure, we will create an end-to-end approach with clear responsibilities for supporting our customers, he says. is a high-level government engagement to co-ordinate programmes and to see how we can assist in delivering our solutions to enable and improve health care in those countries, she says. The company is known for providing affordable and diagnostic health solutions for the management of diseases such as HIV and breast cancer; imaging and therapy such as CT scanners, MRIs, X-rays and ultrasound equipment. For us it s about providing technology solutions that enhance health care in the developed cities as well as rural communities, says Brown. Corporate Report written by Thabiso Mochiko Advertising executive: Wesley Peter FINANCIAL MAIL OCTOBER 7,

6 The South Africa of tomorrow needs answers that last. That s why we re building them today, with customers all over the country. It s why we re designing our technology to last longer and use fewer resources. It s why we re helping our customers reduce their CO2 emissions. And it s why we re pioneering new answers with one of the world s largest environmental portfolios. As a result, we ve been named the best in our business sector by the Dow Jones Sustainability Index. And recognized as the top company overall by the Carbon Disclosure Project, the world s largest independent database of corporate climate change information. Yet, we d never claim to have all the answers. That s why we ve been working with customers in South Africa for more than 150 years. We re helping develop South Africa s infrastructure, promoting skills development and ensuring sustainable economic growth through projects across the country. In energy, industry and healthcare. We re working with South Africa today to create answers that last for the South Africa of tomorrow. siemens.com /answers Answers_Windmills SA E Financial 190x255.indd /06/07 10:07 AM