About Siemens: An Overview Reports Example
Environmental scanning and environmental well being is an important aspect that associated with an organization to increase their financial belongings and strategic competitiveness (Adams and Periton, 2005). A business environment is basically a subject that covers under the field of economics and management. Every organization of the world is now trying to cover up the effectiveness through effectiveness. Organizations have to assess the environment of the industry or the business in which they are entitled to enter and increase their effectiveness. Both existing and new organizations will utilize the environmental scanning for their long term evaluation and effectiveness (Adams and Periton, 2008).
Economic systems have a definite impact over the financial and strategic position of a company, as it will use to direct the performance of an organization while maintaining their significance in a certain business environment (Adams and Periton, 2009). The core theme of this assignment is to answer some of the major questions that associated specifically with the economic systems on a certain organizations. The company which has been chosen for the same analysis is Siemens. There are six different sections that needed to be covered accordingly in this particular assignment to makeover the things in the manner of the chosen organization. The assignment is divided into different sections to complete it in a professional manner which are introduction, analysis & findings and conclusion.
Analysis & Findings
Economic system is extremely important for the sake of an entity, as it has the driving force through which an organization will operate accordingly within the industry with zeal. All the discussion of the economic system will be molded on the basis of Siemens.
Siemens AG is a German based multinational conglomerate company that has its headquartering located in Berlin, Germany. Siemens is known as the largest engineering organization in the European region. There are certain divisions that specifically associated with the company like health care, energy, infrastructure and cities. All of these divisions are depicting the core activities of the company. Siemens is also known as a dominating organization as far as making of medical diagnostic equipment is concerned that contributes nearly 12% in the overall sales revenue of the company (Anderson, Sweeney and Williams, 2000).
Siemens is one of those companies that offer a wide range of electrical engineering and other electronic related products and services. Apart from health care and engineering, the company has also broadened their vision into building related products and activities and in the transportation products as well. The best thing associated with this company is their large production facility. The company is currently operating in 190 countries of the world with more than 280 production and manufacturing facilities. Apart from that, the company has more than 300,000 employees under their nose, which are one of the major contributing factors for the company. Siemens generated revenues and income of €75.882 billion and €4.409 billion in the year 2013 respectively. The shares of the company are activity trading in different regional financial markets like New York Stock Exchange (NYSE), Germany and other.
Explain how Economic Systems Attempt to allocate resources effectively
Economics is the name of earning and consuming the money in an appropriate manner. It is the field that associated in almost every walk of life in particular (Anderson, Sweeney and Williams, 2000). Economic system is a major part of the field of economics. A system that used for the production and exchange of goods and services is known as Economic system. An economic system is also used to allocate the resources of an economy or a society in an appropriate manner (Anderson, Sweeney and Williams, 2001).
Economic system includes various systems and agencies into consideration to interlink different organizations to each other and assist them to have a powerful flow among them. Planning and contribution are some attributes that relates with allocation of resources and production. Economic system is also used to allocate the resources among different organizations and places, and it is one of the most important functions for them to maintain their level of significance accordingly. Economic system usually concerned and connect with such a system in which all the organizations interlinks and connected with each other to manage their operations. Sufficient amount of knowledge and information interchanged among them easily that makes them able to allocate the resources accordingly in the market (Anderson, Sweeney and Williams, 2001).
Allocation of funds is extremely important and effective for the sake of an organization as well as for the economy, because without appropriate allocation the probability of effectiveness would be on a lower level for the entities (Anderson et al., 1984). Economic system enables the external investors and shareholders to invest their funds within the organizational and economic level to allocate them in a perfect manner. Economies always try to prefer those economic systems that have the tendency to manage the funds and its allocation accordingly in an industry. Resources can be managed effectively with the help of an appropriate economic system. Siemens, one of the largest engineering companies of the world is also trying their level best to allocate their resources with perfection. The company maintained their significance in different parts of the world by expanding their networks to have high investment allocation. The shareholders are allowed to take powerful investment decisions in the prescribed regions of the financial markets (Gillespie, 2001). This particular aspect is allowing the company to maintain their significance as far as allocating their resources are concerned.
Assess the impact of fiscal and monetary policy on business organizations and their activities
The field economics is large and usually works on the policies and executions. The entire field of economics surround with theories and powerful modeling. Some of the major policies found interactive in the field of economics are Fiscal policy and Monetary Policies. Both of these policies have a direct impact over the effectiveness of the financial function of an organization (Gillespie, 2001).
In the field of economics and political sciences, fiscal policy is the usage of governmental revenue collection and expenditure that influence over an economy. Any change in the fiscal policy has a relationship with escalating demand of the economic activity. The policy that relates to fiscal belongings is the one that has a direct impact over the business cycle of an economy (Gillespie, 2001). Fiscal policy has a direct impact with the financial and economic position of a company, and it is equally applied over Siemens as well. Fiscal policy of European region will certainly impact over the existence of the company to increase or decrease the level of taxation within the company. It also increases or decreases the final taxation base authorities particularly (Gillespie, 2010). Conversely, there is a need of monetary policy as well. Monetary policy is the name of changing the key policy rate of the economy to strengthen the economy in an effective manner (Gillespie, 2010). The stance of borrowing funds and money from the banks exclusively depends upon the monetary policy stance (MPS). Siemens also has a direct impact over its financial functions and operations due to the MPS. If the key policy rate of the European region would decrease accordingly, then it will increase the stance of the company to borrow the funds from the financial institutions that will empower the entity to increase its operational assets, which most of the times are Property Plant and Equipment (PPE).
Evaluate the impact of competition policy and other regulatory mechanisms on the activities of a selected organization
Competition is the beauty of industrialization, as every company of the world has to taste the vitality of competition while operating in a certain industry. Competition is the driving force that induces numerous organizations to enter in a given industry to increase the level of identical products particularly. Every economy of the world would like to increase the level of competition through a perfect and organized competition policy and compliance in the regulatory mechanism to enhance the level of activities (Gillespie, 2010).
Competition policy is the one that encourage the enterprises to innovate efficiencies and widens the choice of the products. By considering the power and influence of the competition policy, an organization will try their level best to give its hundred percent efforts to comply with the needs of their customers through effective and quality based products. Likewise other organizations, the essence of competition policy is also very effective for Siemens as well (Griffiths and Ison, 2001).
Broadly speaking, there are number of competitors associated with Siemens which are directly and indirectly increasing the force of competition in the market. General Electric, Microsoft, Apple Inc and others are some of the major competitors that associated with the company; however Siemens broaden their effectiveness of their company by increasing the level of their product portfolio. Competition policy of Europe and in other markets in which Siemens exist is very broad and strict, thus the company has to produce new and powerful products to comply with the competition policy of the region, and become effective while competing with other organizations operating in the same line of business (Griffiths and Ison, 2001).
Apart from competition, there is an important policy that associated with an organization known as regulating policy. Every organization of the world has to comply with the mechanism of regulation of the industry in order to have their recognition in the industry in a timely manner. Siemens, which is basically a German based organization, has to comply with the doctrine of regulations. Siemens is completing with the organizations with the standards of the industry to make the regulating mechanism of the company highly powerful and interactive. The company is advised to prolong this particular activity to have effectiveness in the market.
Explain how market structures determine the pricing and output decisions of businesses
One of the major things that found interactive and essential in the field of Economics is the existence of different market structures (Griffiths and Ison, 2001). Market Structure is an important aspect through which an organization explains their market structure and set a specific price of the products of the business. There are different types of market structures are there that deem significant in terms of having an interactive pricing decision. Some of the major types of market structures are
Perfect Market Competition
Monopoly Market Competition
Perfect Market Competition is an important type of market in which numerous buyers and sellers are there to sell different products in the market. Perfect Market Competition is an important type of market competition in which the buyers have the chance to select any seller with different types of products (Malledevaru, Marulasiddhaiah and Rajagopalachar, 1978)
On the other hand, monopolistic competition is the policy of competition in which there are number of buyers and sellers exist in the market that sells somewhat identical products to each other (Nellis and Parker, 1996). This is the most common type of market that found in the current environment of different economies of the world.
Apart from this, monopoly is the type market structure in which there will be only one seller, sells a specific product to number of buyers on their prescribed market behavior (Nellis and Parker, 2004).
The pricing decision based entirely upon these three market structure. A company that operates in the perfect competition operates with PENETRATION Pricing Strategy, in which the companies will set a minimum price of their products. This particular pricing strategy typically associated with the new organizations which are intending to enter in a new region to form a new competition in the market.
The pricing decision that associated with the Monopolistic Market Structure is COMPETITIVE PRICING STRATEGY, in which the price of the products of the company will be setting up be competing with the pricing structure of other companies operating in the same market.
In the monopoly market structure, the pricing structure or decision based upon the PRIMEIUM Pricing Strategy, in which the company will charge a high price of their products.
Siemens is tapping a market which already has number of competitors in it, hence, the company is operating in the Monopolistic Market, and the pricing structure which the company the company is opting is COMPETITIVE Pricing Strategy.
Illustrate the way which market forces shape organizational responses using a range of examples
Market forces are very important and powerful for the sake of an organization, in fact powerful market forces is the one through which an organization compete with different organizations operating in the same line of business. The market forces that applied over an organization to shape them accordingly are Pricing, Place, Product and Promotion. Siemens also has the tendency to use these market forces to maintain their competitiveness in the market (Nellis and Parker, 2004).
The products strategy of Siemens is ANALYZER, in which the company is in regular practice of research and development. The main reason behind opting and selecting this particular product strategy is that this strategy will enable the company to make and lunch quality based products for their customers (Nellis, Parker and Nellis, 2002).
As discussed earlier, the pricing strategy of the company is Competitive, in which the company is distributing and selling their products in competitive prices to increase their effectiveness in the market and to have strong competition with the other organization operating in the industry.
The place strategy which the company is opting in this scenario is two way channel and offline strategy. Siemens do not deal their consumers directly, as they have retailers and wholesalers as their direct customers. The products of the company can be found offline on franchise of their retailers.
Lastly, there is a need of promotional strategy for the company, and Siemens is not fond of promoting their products through advertisement. However, the company has a strong inclination towards the utilization social media networking for maximizing the selling of their products in the market. This particular market force will certainly empower the company to promote their products in a cost efficient manner, but Siemens should promote their products in the market through electronic advertisement as well.
Judge how the business and cultural environments shape the behavior of a selected organization
Cultural difference is very important for the sake of an organization, and only those organizations can make a different in the markets which have the ability to manage their level of innovation and culture (Nellis, Parker and Nellis, 2002). Siemens is a multinational organization which has numerous employees working with them belongs to different demographics, race and mindset, but the company did an exceptional job as far as maintaining a diverse and powerful environment within their premises. Siemens use high communication power within their employees and the management to increase the level of satisfaction among their employees and make them able to give their hundred percent efforts for the productivity of the company (Sweeney et al., 2006). With the help of powerful communication, the company will become able to communicate the entire cultural difference with their employees. The company is operating with management bi objective (MBO) approach in which the company promotes innovation in their functionality and operations to increase their economic power and behavior. All of these business and cultural environment shape up the behavior of the selected company very effective and powerful to maintain its effectiveness further in the market (Sweeney et al., 2006).
Adam Smith and Alfred Marshall are the two professionals who gave the most widely used definition of economics. According to both of them “Economics is the study of wealth that deals with earning and consuming” There are two important types of economics, known as Microeconomics and macroeconomics. Microeconomics is the type of economics in which the economics of individuals will be dealing, while economics associated specifically with the country as a whole is known as Macroeconomics. Resources Allocation and market Structure are some of the major forms that found within the macroeconomic functions. This entire assignment and analysis talks about the market structure and other important aspects that make an organization able to maintain its significance in the market in a given market. From this entire analysis, it is clear that market structure and information regarding resources allocation are essential for an entity. Siemens is the company which has taken into account, and it is evaluated that the company is in the favor of allocating the funds of the company in an organized manner. The company is operating in a Monopolistic Market Competition in which they maintained the price competitive to their competitors which certainly makes them able to have a remarkable future later on.
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