“We Shall Grow Through Acquisitions”

For 32 years, Hüseyin Gelis worked in many different posts at Siemens, from the factory to the R & D department. He held high level positions all over the world from Germany to India. Now he is CEO in Turkey and he has some ambitious targets. He will invest €1 billion over the next four years. “We want to be number one in every sector. We shall close this commercial year by buying 2-3 companies,” he says.

* Siemens is undergoing change in the rest of the world. What are its new targets?
Yes, globally the company is undergoing change. Our new CEO Peter Löscher is the first leader to have come from outside the company. This is very good because he is bringing innovation with him. In order to grow more rapidly, he is changing the company’s processes and indentifying unnecessary control mechanisms. In the past, the company’s most important functions were based in Germany and there was never any talk of this being changed. But we are now being distributed amongst different regions.

* Which characteristics of the company will not be changed?
The values and vision which have underlie it reaching the position it holds today. We have always been a company which believes very much in renewal and innovation and this philosophy continues. In fact, we are still wondering what technological solutions can be found for the world and its social problems. This is our basic philosophy. It has not changed. We work a lot on solution engineering.

* In which areas are you thinking of growing?
We have three main sectors: energy, industrial system and health – I mean medical diagnostic equipment. You will see significant changes in these three sectors. Our sectoral portfolio will not change any more. In terms of growth, there is no area from which we are thinking of withdrawing.

We shall change the organizational structure in Turkey. We shall focus on three sectors. We currently have eight different departments in Turkey and we shall gather these together into four departments. One department will be energy, the second industry and the third the health sector.

*What shape will your growth strategy in Turkey take?
We are thinking of investing €1 billion in Turkey over the next four months. Turkey is part of our global investment strategy and we shall open a new factory in Gebze. Here we shall produce medium voltage panels and products related to energy distribution.

*Will you be looking to acquire companies? Are you thinking of growing inorganically?
At the moment we are negotiating with some companies about energy and industrial production. I think that we shall have acquired 2-3 companies by the end of this commercial year. We need to invest in order not to lose our leading position. We know that organic growth will not be enough for this. This is also the target for our global organization.

*What are Siemens’ targets for turnover in the sectors in which it is active in Turkey?
We want to be number one in every sector. Profitability is very important. We need to be profitable everywhere. The Siemens companies in Turkey had turnover of €2.5 billion in 2007. Over the next five years we can become a €4 billion company. We have such a
potential.

Elçin Cirik
ecirik@capital.com.tr