The Economist has an interesting story on the re-inventionof engineering firm Siemens. One of the issues that has plagued the company (in addition to dishonest practices) concerned the company’s identity crisis. Was it going to be a consumer electronics company, or was it going to the route of a heavy industry?
The decision, under new leadership, is good news for advocates of high-speed rail and new wind energy:
The main purpose of all this has been to build Siemens’s presence in technically advanced infrastructure such as energy and transport, where the barriers to entry are high, or in areas such as health care and energy controls for buildings, where the company can bundle products and services together. This may sound like the tired and unconvincing justifications that conglomerates, including Siemens, have long trotted out for why they have disparate businesses. Yet Siemens does seem to be winning business with bundled offers. It can, for example, audit a company’s energy use and suggest improvements that will then pay for themselves out of savings. Many rivals already do this. But few offer to finance the capital spending and guarantee the energy savings, as Siemens does.
The rolling stock for HSR or for electric freight engines don’t come from local, organic coops.