Siemens Nixdorf Informationssysteme AG’s UK subsidiary, Siemens Nixdorf Information Systems Ltd has fared rather better than its parent (CI No 3,037), according to 1995/96 fiscal year figures just out. Where sales for the German unit up to September 30 rose by an insignificant 6%, the UK arm’s revenue was up 31% on last year to $163.1m; where orders were more or less static on the home front, the UK’s were up 19% on the previous year’s. Pre-tax profits in Germany fell 16% to $35m, while they grew eight-fold to $1.4m in the UK. Given this, the parent company has acknowledged that prosperous children should be given a certain amount of freedom to do their own thing, and has responded with what it calls the one third, one third, one third strategy. According to Richard Bearpark, managing director of Siemens Nixdorf’s UK operation, this refers to Siemens AG’s intentions to have a third of its business generated within Germany – currently standing at 63% – a third in Europe and a third from the rest of the world, within the next three to five years. By then the UK company hopes to become one of the top five firms in the UK, doubling its size and becoming a #500m turnover company by the year 2000. The company will extend its information technology services operations in health, telecommunications as well as in financial services in particular.
Government information kiosks
The bulk of its services operations are currently within the public sector and the UK government’s recent Green Paper on Electric Delivery of Government Services has opened a window of opportunity for the firm. The idea is that people will have electronic access to government licences and information without having to line up at the various departments. Many of the proposed access points will be from multimedia kiosks located in post offices, public libraries and shopping centers. Siemens Nixdorf will have to vie with the likes of British Telecommunications Plc, which launched its Touchpoint kiosk in the summer (CI No 2,890), and IBM Corp with its PeopleTeller system (CI No 2,947) for this business. It is currently conducting trials with the Department for Employment and Education to provide a system to enable ‘jobseekers’ to access details of employment opportunities. The firm has other contracts with various government departments such as the Lord Chancellor’s Department, Paymaster General and the Police’s National Computer Centre in Hendon – through the company’s Government Solutions division. It also intends to move into the local government sector. However, to be in with a real chance of attaining top five status, it will need to capture considerable share in these other private sector areas. The strategy for this is three- pronged: organic development – starting up new companies in the areas of interest, as was done with the new telecommunications arm established last year; strategic partnerships with established players in these areas, as with the healthcare division of US-based software vendor Cerner Corp, with whom Siemens is developing and marketing clinical software (CI No 2,933); and acquisitions to complement Siemens’ existing ventures as well as to introduce the company into new markets. The acquisition of US-based symmetrical multiprocessing server vendor Pyramid Technology Corp (CI No 2,615) and ICL Plc’s Medical Portfolio Ltd (CI No 2,839) satisfied the former requirement and the company is constantly on the look out for other buys to fulfil the latter. According to Bearpark, Pyramid contributed $21.3m in revenues, and Medical Portfolio brought in some $6.5m. Their profit figures are not yet available. The company also wants to develop its indirect distribution channels, making more use of other vendors, value-added resellers and systems integrators.
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