For the first time in its history, the German conglomerate has selected an outsider for the role. Peter Löscher has his work cut out for himSiemens' (SI) employees who hoped that their new boss would be less American in his outlook than outgoing Chief Executive Klaus Kleinfeld were in for a disappointment on May 20. After a special Sunday afternoon meeting in Munich, Siemens' supervisory board chose Peter Löscher, an Austrian who is a top executive at U.S. pharmaceutical giant Merck (MRK), to run the sprawling German electronics and engineering conglomerate. Though Löscher earned his MBA in Vienna, he has spent much of his career abroad, including a stint at Siemens' archrival General Electric (GE).
As an Austrian, Löscher brings a knowledge of German language, culture, and business practices that are all crucial for dealing with Siemens' employees and labor unions in the company's home country. At the same time, his international experience, including a posting to Japan, is crucial at a company whose biggest growth opportunities lie outside Europe, particularly in emerging markets around Asia, the Middle East, and Latin America.
Löscher, 49, also fulfills another key requirement for the job: He's an outsider and thus untouched by a spreading bribery scandal that has devastated Siemens' top management. Kleinfeld wasn't accused of complicity in the scandal, in which executives are accused of paying foreign officials to win contracts, but faced criticism that he didn't do enough to uncover its full extent. Kleinfeld, who had run Siemens U.S. operations before becoming CEO in 2005, resigned in April under pressure from Supervisory Board Chairman Gerhard Cromme (see BusinessWeek.com, 4/25/07, "Siemens' Boss Steps Down").
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