Siemens, a global electronic and engineering group, recently reported a significant change in organizational structure. Due to pressures to increase profits and make the company more competitive and innovative the company hope to simplify its structure.
They plan to continue to readjust the structure of their business and shift the responsibilities of approximately fourteen regional clusters of employees.
This means that operations, human resources and information technology are part of the new responsibilities that the local management has. Siemens employees more than 370,000 people and this change will affect the 200 countries where it operates. The shift is from a centralized organizational structure towards a more decentralized structure. Upon successful elimination of regional employees is a structure where information can flow easier and more efficiently among the different layers of the business.
Christoph Niesel, the fund manager of Siemens largest shareholder, agreed that the company has to move towards a “more focused faster and more reliable structure.” Rivals in the industry such as General Motors have already made significant changes to their corporate strategy, Siemens hopes to not fall behind and moving towards the decentralized system will do just that.
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