Siemens Case

 The Siemens cases present a real life example of a company that needs to solve major project problems with a very large multinational project. The case involves cultural, political, technical and geographical issues. Respond to the questions below utilizing the facts from the case studies, class readings, and your outside research.

1. Why should a company consider building a global R & D Network?

First, because of local labor shortages, ICN could simply not centralize all product development atMunich. Second, having regionally-based managers, engineers and technicians facilitated rapid response to local needs such as EWSD customization

2. What are the positives and negatives to building a global R & D Network?


–         Great variance existed between different centers

–         Tension between centralizedMunichmanagement centers and global R&D centers. How much independency are we going to give them? How much direction are we going to give them?

–         Hard to co-ordinates international efforts. (virtual teams and etc)

–         Matrix project structure, hard to manage. Workers don’t know who is the boss of the tasks.

–         Slow troubleshooting and escalation process. No motivation for people to troubleshoot.


–         Pull Research talents from all over the world

–         Have regional specialization on their research expertise

–         Can increase the breath of research scope by having more resources and knowledge.

–         May save money if centers are build in countries with lower expenses.

–         Motivate internal competitions and collaboration among centers, enhancing research quality and standards.

–         Different research under local needs for product customization and internationalization.

3. What has gone wrong with the ADMOSS and NetManager projects from theBangaloreandMunichperspectives?





Not enough directions and guidance at the beginning fromMunich. People have to groups thing in the dark.

Compared to German standards, the Indian product is not on time and not in high quality.

Increase frustration and anxiety of stopping work because of cutting budget or changing requriements


Hard to do integration test or development, because they are too far away fromGermanyto communicate about the problems.


Trips to Europe fromIndiano fun. Not as fun as they expected. Have them fixed other customer problems that can be fixed by local team.

German manages want to go toBangaloreto have big meetings. But for Indian culture, they prefer small meetings.

High tuirnover rate because of heated local job market

German people think Indian are not materialistic.

Cultural awareness materials and role playing exercise is simplistic and out of date, didn’t take wide cultural variation account inindia

Indian people too polite, never complains even they have to complain sometimes.

There is no problem means: there is no problem on the sub system they are working

There is no problems means: there is no problem on the entire system

Solve problems first

Document problem first

Doesn’t care unless you give them sense of belonging

Follow customers-defined specifications out of sense of duty

Will to cover each other time to keep project rolling.

They doesn’t care. Individual is first piority









NetManager Project




They are cheap

Indian people are getting costly.Eastern Europeare even more cheaper

When crisis happen, they tend to spend extra time on their own to get things resolved. Also they give up their vacations.

Summer time, people take time off, without contact information. Hard for Indians to find them if they have problems.

Blaming German testers and analysts didn’t them enough directions and monitoring to make sure things have been done correctly.

The Indians don’t have enough knowledge to make correct assumptions for product design.

They should be able take care of themselves







4. What should Siemens ICN have done differently to avoid the NetManager crisis?

Proposal 1: Transfer all core project activities back toEurope, so that they have better time and quality control.

Proposal 2: Transfer just accountability, management and major responsibilities back toMunich, leaving all development activities back inBangalore.

Proposal 3: Enhance co-ordinations, internal understanding, communication.


5. How should the cultural differences betweenIndiaandGermanyhave been addressed early in the project before setting up a new development site abroad?

Resource report said  “2/3 of executives polled said theyhad experienced miscommunication issues within their global sourcing operations, compared with 6 out of 10 among executives at companies that offered cross-cultural training among employees. Need cross cultural training before or during the site setup. [1][2] (Paton, 2006) (Hurn 2007)

Not all training is successful. The organization must understand that merely knowing the national language is not enough. The manager assigned to the nation must be able to understand and adapt to the culture of the nations and the nature of the organizations. [3] (Hurn 2007)


6. How could project management have been improved in the areas of product planning, development, and testing?

Use the PMBOK way.

–         Have a well define scoping and planning methodology.

–         Have a well established communication plan and communication methodology

–         Have a well established quality and change management technology.

–         Have a strict development (SDLC etc) life cycle methodology.

–         Have a strong and effective project monitoring and control methodology

–         Have a better virtual team management



[1] Dean Elmuti; Benjamin Tück; Friederike Kemper,  Sep 2008, Analyzing Cross-Cultural Adaptability among Business Students: An Empirical I… International Journal of Management;

[2] Paton, N, 2006, Cultural ignorance the biggest barrier to outsourcing success. Management Issues.

[3] Hurn, B.J. (2007), Pre-departure training for international business manager, Industrial & Commercial Training. Vol 29. Issue 1

[4] Stefan Thomke, 2002, Siemen AG: Global Development Strategy (A)

[5] Stefan Thomke, 2002, Siemen AG: Global Developpment Strategy (B)

[6]  Author ,2003, Project Management Body of Knowledge, PMBOK, 3rdedition




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Eric Tse, Richmond Hill, Toronto
Tse and Tse Consulting -Security, Identity Access Management, Solution Architect, Consulting



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