SMART products meet local price levels and thereby ensure profitable business: Felix Scheffler

Interview with Head of corporate quality management at Siemens AG

Sitting in Germany, Felix Scheffler, head of Corporate Top+ and corporate quality management at Siemens AG has an important mandate. Top+ is a Siemens business excellence programme. He also coordinates among the key SMART hubs around the world and formulates the global strategy for the headquarters. He took time out during his trip to India for this interview. Edited excerpts.

Why are SMART products so strategic for Siemens?
“Grow in emerging markets” is one of the nine focus areas forming the “One Siemens” framework for value creation. Especially in the BRIC/ME countries, which account for 50 per cent of the global GDP growth, our growth is significantly driven by entry-level segments. And that’s exactly what SMART products and solutions aim for.

With the SMART portfolio addressing local customer requirements we can fully participate in the growth of emerging markets—and compete with emerging competitors on their home turf.

How do you co-ordinate the exciting ideas from around the world that keep cropping up from time to time?
The responsibility for all these innovative ideas lies with each business. One major contribution that we provide centrally to drive SMART is to foster a vivid knowledge exchange. Therefore, we have established the global SMART community consisting of colleagues across all businesses, which exchange best practices and new ideas in regular conferences, virtual meetings and intranet platforms.

What role do you see India take for Siemens in this initiative that spans emerging markets?
India offers a large market potential in the entry-level segments and is one of the key markets for our SMART products. With the right people/competencies on board and the set up of local product responsibility, India is one of the role models for our new approach.

What is the most essential element to make a SMART product work? Is it about SMART ideas or SMART pricing or SMART time and route to market?
All these characteristics are equally important. That is why we created the acronym SMART, which stands for simple, maintenance- friendly, affordable, reliable and timely-to-market products and solutions.

Globally, where is the SMART push coming from? Is it from India, China or from Brazil?
We see that SMART is important not only for individual countries but for all emerging markets where the demand for solutions targeting entry-level segments is growing.

Can India be the SMART hub for all of South East Asia?
For a couple of our businesses SMART products from India are already being exported. The other businesses are focusing on establishing SMART products in the Indian market first, then expand their scope beyond the country and finally establishing a SMART hub.

Experts say that SMART products may give Siemens more sales volumes but its margins will shrink. Do you agree?
Through a localised value chain and features fulfilling local requirements our SMART products are meeting local price levels and thereby ensuring profitable business.