With high growth economies and a larger population than Brazil and Russia combined, Southeast Asia holds much potential for Siemens, believes Ralf Deneke, senior vice president and regional industrial automation head. He talks to Bob Gill in Bangkok.

Standfirst: With high growth economies and a larger population than Brazil and Russia combined, Southeast Asia holds much potential for Siemens, believes Ralf Deneke, senior vice president and regional industrial automation head. He talks to Bob Gill in Bangkok.

BG: Can you tell me about your role for Siemens here in Thailand?

RD: Well, for Thailand itself, I am responsible at the country level as general manager for the two divisions of Industrial Automation (IA) and Drives Technologies (DT). On a broader, regional level, I also have the position of cluster lead for Industrial Automation, which means that I am responsible for this division across all the countries of Southeast Asia. This is a complementary role to Raimund Klein, who is based in Singapore and has the regional cluster lead for Drives Technologies.

All in all, I have been with Siemens for more than 20 years, including spells in sales, marketing, business development, and general management. And as well as working in many locations across Germany, I had a three and a half year stint in Canada. I have here been in Asia since 2009.

BG: How is the IA business performing across the region?

RD: When I came on board we were already well on track in Malaysia and Thailand. And after making some necessary adjustments, we are also on track now in Indonesia, Singapore and the Philippines.

As for Vietnam, this has huge potential going forward. It's not like other countries focusing only on certain sectors; they want it all – food & beverage, chemical, oil & gas, cement – you name it, they want it. In fact, I would say the two countries in the region where we will invest the most will be Vietnam and Indonesia.

Recently I have been actively promoting the potential of the region to headquarters back in Germany, and emphasizing that Southeast Asia needs to be firmly on the map for Siemens. Everybody has been talking about the BRIC countries, but if you look at the populations, Southeast Asia as a grouping has far more people than Brazil or Russia combined. And the growth predicted this year for Southeast Asia is also greater than that for either of these two countries.

BG: What changes have you made to the organization?

RD: The key one – in IA DT - has been to move away from the previous product-centric approach to a customer-centric one. And we have a name for it: Industry Sales Setup (ISS). So now, the customer does not have a product problem, he has an application problem. For OEMs we have an OEM sales force; for end customer sales we have an end customer sales force.

In the ISS organization, we approach the market through different channels: directly and indirectly. Direct is with our own sales people for the larger and key accounts, and indirect is through our partners. It is important that we make proper and effective use of all the different sales channels available.

Then after implementing ISS, Raimund Klein and I held a strategy meeting with all the division leads. As a result, we changed two-thirds of our division leads last year – for the better, I must say.

We also initiated a program called Operational Excellence. This consists of 10 modules based on the main pain points we identified and where we really needed to improve to get ourselves on the growth path again. We are now both driving this program in the region.

Then finally we have a growth program which we call Aim For 5, based on the target for Siemens (as a whole) to achieve €5 billion revenue in Asia by 2015. For our part in IA DT, we aim to triple our business in this timeframe.

BG: You obviously have a number of competitors in the industrial automation market. How do you make sure stand out in this space?

RD: Our main differentiator comes from the amount we invest in R&D to come up with the easiest solution for our customers. If you just look at the increase in complexity of production and the amount of flexibility you need in your manufacturing, it's amazing, really amazing. And this means you have to have the products and tools to match these kinds of demands.

A good example is the TIA Portal, our new software platform which integrates everything, such that once you create a piece of information you can use it in all the different automation applications. And once you change that information it is changed everywhere else automatically. For the user, this makes programming faster and easier.

As for how much I worry about the competition, Yes, I talk to customers, I talk to partners, I talk to my own staff. That is when I personally think about the competition and think about what we need to outperform. But once we start our program, start our measures, then we go. I do not want moving targets; that doesn't make sense. If I know what to do then I just go for it.

BG: You recently launched the TIA Truck in Thailand. What is this all about?

RD: It's really all about bringing Siemens' products and applications directly to the customer, through a fully equipped truck that will be travelling across the country over the next two years and making stops in strategic locations. So you can enter the truck, look and touch our products, and depending on where it is, we will show relevant applications, such as for chemicals, food, breweries, etc, and make presentations such as on the TIA Portal. The key thing is that we come to you; we don't sit at an exhibition and hope that you come to us. Because increasingly, and more so in a growing economy, people just do not have the time.

BG: How do you feel about the prospects for the PCS 7 process automation system in the region?

RD: It is definitely growing, in terms of sales and awareness, although there is probably a lot more that can be done to fully exploit its potential. One factor is that to sell PCS 7 you need very knowledgeable engineers, and what I've found out is that compared to Europe or North America, you don't have that many partners here with the right experience – mainly because all the other suppliers use their own staff and we're the only ones doing it via partners.

One thing we have done recently is installed an engineering hub in Thailand to coordinate and support all the PCS 7 projects in the region. This is staffed by some 20 engineers. The idea is that we take on bigger projects on our own to get more market awareness, to get more installed base, and then of course to attract more partners to work with us.

Of course, Siemens started later much in DCS than the competition, but one of our strengths is taking a long term view – if we want something we get it done, and if it takes 10 years, it takes 10 years. We are not in this market to make a fast buck. I wouldn't say we're stubborn but we are certainly very persistent.

BG: To what extent have you come to understand and appreciate the various different working styles and cultures in Southeast Asia?

RD: Yes, after a while you recognize the different characteristics associated with the countries in the region and you can then start to adapt your own style accordingly.

For instance, in Singapore it is a more western style and you can be a bit more blunt and straightforward, and money is very important. In contrast, for the Thais, it is more important to "feel good" at work. So you have to make sure that it's a fun environment, and that you are polite. In Vietnam, I notice that they are very proud of their country and independent of everyone else. They are very eager to learn, to work, and to perform well.

BG: What keeps you motivated, keeps you excited in this role?

RD: It's a great experience, it's a great challenge. You'll have a surprise every day in Thailand, every day. No exception, every day. I always say, now you've made my day. This was my surprise of the day! And also you come in the office here in the morning and people are smiling, which is something you hardly find back in Germany.

On a more practical level, I love to enthuse people, to get them into the mode to do something that is right for them and right for the organization. In fact, my most important task is to put the correct person in the correct position by finding out his personal strengths.

That also means you need to be honest with people. You may need to tell someone: "You know what, this is not your strength. You will never be a great manager and you will never feel comfortable in this role." And of course people hate to hear this. But after they digested the information and realize that there's still a good career path in a more appropriate role, one in which they can even earn more money, they are grateful because they are more likely to excel at what they do and be happier.

So every day, I have to present, I have to listen, I have to learn, I have to activate, I have to win others over – this is exactly what I like to do and is probably why I love my job so much.

BG: So you foresee yourself staying in Asia for a while?

RD: Oh, you never know. In Siemens, especially if you do a good job, the phone can ring tomorrow with someone saying, "We have a new position for you, are you interested?" I have already said no a couple of times already, but in the future you never know. The good thing about Siemens is the tremendous opportunities; the bad thing is that sometimes you have to take them!