From innovation to solutions

“Logistics automation is a strategic component of Siemens‘ industrial business”, Löttner further points out, “by this merging we will be able – together with the other industry groups – to exploit our strength as a global market leader in this sector for the benefit of our customers. We can leverage the potential we have in the field of automation technology, to put us in a position to fully exploit the existing synergies across the entire Siemens Group and turn innovations into integrated total solutions. We can also use the corporation’s worldwide presence even more effectively”.

Under the umbrella of L&A there are for key divisions: material flow solutions (worldwide number one with a market share of 12%), airport solutions (#1 with 35%), postal automation (#1 with 26%), and SMT automation (formerly EA, electronics assembly) with a market share of worldwide 28% now in number-two position (now slightly passed by combined Panasonic/KME). Sales of the L&A group was € 2.6bn in 2003, and approximately 10,000 were employed. From the total turnover, 45% was gained in each of the Americas und Europe, the rest being gained in Asia.

The reorganization involves bringing together the R&D departments, previously operating separately on a regional basis, into one R&D group with global responsibility for logistics automation. Bundling the innovation process will improve and speed up the development of products and the service globally. This will go with modularization and standardization of L&A’s core logistics automation products as part of providing complete solutions, involving modules such as conveyor, sorter, as well as storage and retrieval (S/R) units, and tools for process handling and control technology, etc.

“Within in the industry, only Siemens can offer such a total integration,” underlines Johann Löttner. The corporation’s global presence will have a beneficial effect, especially in boosting operations in the Far East and Eastern Europe, as well as in the expanded service activities of the L&A group. “Our ambitious target is to almost double business volume in services over the next five years”. This should be achieved by creating comprehensive service packages across divisional boundaries, a strategy that has reportedly already proved successful.

The EA division is now expanding its Siplace development and manufacturing activities in Singapore, the regional headquarters for Southeast Asia, to optimize its high production standards for placement equipment and global manufacturing and development processes. The company wants to expand the Siplace market share in Asia to 25% over the next five years. “As a globally operating company and a market leader in SMT, we designed our entire value chain globally to continue to be the driving engine in the market. On top of our high market presence in Europe we have been intensifying our sales activities in Asia for quite some time. Now we are also adding research and development, manufacturing and purchasing,” says Tilo Brandis, president EA, during the opening reception.

During the start-up phase, individual machine components will be produced in Singapore. As soon as all processes have been securely implemented, and high and stable level of manufacturing quality has been established, complete Siplace machines will be produced over there. Singapore will be used as the base for serving the steadily increasing demand in Asia. To shorten the logistics chain, all major functions will be set up on site – from research, development and assembly to purchasing and logistics. To add more local value, suppliers from the region, mainly from China, will be increasingly involved. (gbw)