HBR CASE DISCUSSION
“Siemens AG: Global Development Strategy (A)”

STRATEGIC OPTIONS

Option 1 : Move NetManager development and project management closer to HQ
+ NetManager is a really important project for the future of Siemens, so moving it closer to HQ will bring system developers and programmers closer to major customers for better market understanding and quicker troubleshooting and maintenance in the future. Additionally, the company can use the time to smooth out coordination problems with Indian RDC.
- Moving the project altogether will result in further delays which will make Deutsche Telekom wait even longer the product so Siemens would lose some trust from its biggest customer. Additionally, moving all the activities would incur huge extra costs to the company. Moreover, this option would send a very negative message to the Indian RDC which would bring more problems in the relationship between HQ and the RDC.

Option 2 : Keep NetManager development and project management in Indian RDC
+ Keeping the project in Indian RDC is the fastest option to deliver NetManager to Deutsche Telekom so the company would not worsen its reputation in the eye of its biggest customer. Additionally, this option will increase the capability of Indian RDC so they can become a better center with the same status as the US RDC.
- The ability of Indian RDC to troubleshoot this problem is still questionable, they have worked on this project since the beginning but the end result is still not good enough. Additionally, in the future Indian RDC would demand major investments and significant expansion of system-testing and hardware design capabilities to reach its intended status, which could be considered an inappropriate demand given their performance on this NetManager project.

Option 3 : Move NetManager major project responsibility and accountability to HQ and keep development activities in Indian RDC
+ Strict project management and quality control would be ensured by the HQ, while Indian RDC would still get some responsibility in the project for the development which would not bring a negative message to the RDC. Additionally, the RDC already has the development capability since they were the one who develop NetManager from the scratch so there won’t be any further delay (which would incur if development activities are being moved) for product delivery to Deutsche Telekom.
- Extra costs would be incurred for travel and coordination. Moreover, it’s still unclear whether a project of such complexity could be managed by people living thousands of miles away from its development center. If it couldn’t be managed well, it would bring more disaster to this very important project.

RECOMMENDATIONS OF STRATEGIC OPTIONS
Option 2 : Keep NetManager development and project management in Indian RDC * Given the condition, it’s very important to deliver NetManager to Deutsche Telekom without any further delays. Option 1 would compromise on this, so it’s not a viable option. * Based on the strategic movement Siemens had done with the Indian RDC with a view to increase the capability of Indian RDC so they can become a better RDC with the same status as the Florida RDC , it is important to also keep the project management in India. Option 3 would compromise on this, so it’s not a viable option.