Introducing New Technology Into Siemens: One of The World's Largest Users of In-House Assessment Centers

Lessons learned and trends for the future |
Presentation at the 38th Congress on Assessment Center Methods
Introducing new technology into Siemens:

one of the world’s largest users of in-
house Assessment Centers
Restricted © Siemens AG 2014. All rights reserved. siemens.com/answers

Siemens key figures, FY 2013
Revenue by Sector Revenue by Region
Healthcare Infrastructure Asia, Australia Germany

and Cities
18% 23% 20% 14%
Europe, C.I.S.,
35% 24% 28% 38% Africa,
Energy Industry Americas Middle East
(excl. Germany)
Based on customer location
Revenue and employees Continuing operations –

Revenue in millions of € Employees in thousands
comparison with previous year
100,000 500
In millions of € FY 2012 FY 2013
80,000 400 New orders 75,939 82,351
60,000 300 Revenue 77,395 75,882
40,000 200 Income 4,642 4,212
20,000 Free cash flow 4,727 5,257

100
Employees 366,000 362,000
0
FY 1986 1990 1995 2000 2005 2013
As reported in Siemens Annual Report
Restricted © Siemens AG 2014. All rights reserved.

Page 2 October 2014 Laszlo Reisch/Siemens Human Resources
Our vision
To provide answers to the great challenges of our time
Siemens –
the pioneer in
• Energy efficiency
• Industrial productivity
• Affordable and
personalized healthcare
• Intelligent infrastructures
Siemens stands for the
electrification of the world.
Digitization and automation
are transforming this value
chain
Downtown Singapore

As a result of the organization's diversity, usage
of assessments across Siemens varies to this day
• A majority of Sectors and Clusters use assessment instruments for employee

development purposes
• The quality and validity of these instruments is generally very high and there
is considerable in-house knowledge of these topics
• The most commonly assessed target group is employees with a mid-term potential
statement for the first senior management role
• The most frequently used assessment instrument is the Development Center,
followed or assisted by psychometric assessments
• However, there are considerable variations in terms of target groups, the feedback
process, the connect to subsequent development activities and the instruments used
for the assessment
• One common theme we are proud of: The overwhelming majority of assessments
are driven by an underlying "assess to develop" belief

Why Siemens wants to use assessments
to develop, rather than to validate
In the overwhelming number of assessments with internal participants,

Siemens chooses a developmental, rather than a validation or selection
approach in terms of the assessment goal
The reasons are simple
• We believe that assessments should answer "for what" there is potential,
rather than "if" there is potential
• We believe that what counts is not how the employee performed at the assessment,
but the extent to which he/she acts on the feedback received
• We believe that if you tell an employee they don't have potential,
they will prove you wrong: but probably not within your own company
• We believe that only those employees should get assessed who have already displayed
high performance and showed signs of potential
• We believe that if we want a high quality Performance Management Process, any add-on
validation assessments would send the signal to our managers that they can't identify
talent in the first place
In an ideal world, our managers would be so good at identifying and developing

talent, that no assessments would be necessary

Developmental assessments at Siemens should
provide benefits for all stakeholders
Assessing selected employees should impact positively on
The business The talents Siemens' brand image
• Successfully prepare • Ensure their • Exciting assessments as

talents for future, higher- development, engage- part of a unique Talent
level roles ment and retention Management approach
The Siemens businesses are unique – So whilst our assessment philosophy should
be shared, the actual approaches used must vary

The SLF contains measured results …
Siemens leadership framework Potential ring
Results
Business
Evaluation of achievements of set targets
People results
orientation
• Target 1
• Target 2
• Target 3 Analytical
• … Ability Capa- Change
to bility management
learn Poten- Capa-
Siemens Competency Model city
tial strategic-
Expertise Capabilities innovative
orientation
Expertise dimensions Capability
Functional Expertise Business results orientation
Strategic-innovative orientation
Ambition
Technology fields & business methods
Customer orientation
Market Change management
Field of Expertise Collaboration & influencing
Intercultural sensitivity Motivation Life choices/
• Business type experience
• Business cycle experience Leadership values
• Organizational experience Team development
• International experience
Value orientation
Supported by indicators
… as well as the Siemens Competency Model (capabilities and expertise),

impacting how potential assessments are conducted

Core elements of our "classic"
Development Centers at Siemens
Customization in our design principles
Professionally run
Action-Oriented Feedback Feedback
Feed-
back

Typical agenda of a full-blown development center
First Assessment Assessment Coaching

half day day day day
Assessors training • Presentation • Presentation • Video feedback and

• Targets of the DC • 1:1 interaction (actor), • Interview individual coaching
• Observation criteria e.g. employee • Wrap up and de-
• Observation bias dialogue, customer • Conference of all finition of next steps
meeting
• SLF in interviewing assessors
• Group discussion • Peer feedback
• Feedback
• Calls • 360 feedback
Participant • Emails • Individual feedback
introduction • Self reflection
• Targets of the DC exercises
• Observation criteria
• Time schedule and
organization
Introduction round

The assessment world we had until late 2012
and its missing puzzle piece
What we were
What we were What wedoing
already were well
missing already doing well
 High quality of talent
× Complete white spot:  High quality ofintalent
assessments use
no assessment assessments in use
instrument anywhere  Almost 100%
 Almost
mapping 100%
to SLF
to assess individual
mapping
languageto SLF
contributors with
language
potential for the 1st  Assessment tools
leadership role  Assessment tools
typically highly
typically
acceptedhighly
and
× 3000-4000
accepted
appreciatedandby the
employees get
appreciated
business by the
promoted to 1st
business
leadership role at  Generally good
Siemens annually,  Generally good
coverage assessing
globally – but how coverage assessing
talents/HIPO's for
well are these people talents/HIPO's
senior management for
prepared for that? senior
roles management
roles

Would this be a „Mission Impossible“?

The search begins
• We realized we had to When we looked under In the end we chose DDI

go virtual their hoods, we found • Simulates day-in-the-life
• We understood that our most vendors to be of a manager
target group would be disappointing • Real assessors in the
open to such • We did not want background
virtualization automatic algorithms • Openness to customize
• But we had to admit we • We wanted more than to our language
had no in-house psychometric tests • Global presence for
expertise to design this • We wanted something support
beyond multiple choice

Multiple unanticipated hurdles had to be overcome
before piloting could even commence
Customization Data German Workers

to Siemens security council
3 months 4-6 months 8-9 months

What we anticipated as challenges from our
stakeholders
„ „ „ „ „
I don't trust that these What are we doing to I was not part of Can you promise us Going virtual will
external consultants ensure the designing this, so I that the technology canibalize our
can provide proper assessment is not a don't like it will work 24/7? face-to-face
feedback one-off activity? assessments!
Solution Solution Solution Solution Solution

Train-the-trainer Next steps document Info calls and road- FAQ's & navigation Clear boundaries for
work-shops for and focused dev. show to highlight help; Tech. support target group/s and
internal HR plan benefits; use cases
communication

The additional challenges that we discovered when
we offered Manager Ready for piloting
„
It's just a game
„
I don't trust the report
„
Do written responses to the exercises
harm the dialog culture we want to
?! establish at Siemens?
• Challenge from HR experts • Challenge from HR BP’s • Challenge from our Leadership
 Extra information about validity and  Made self-assessment mandatory Excellence Developers
reliability part of HR Training for Mgr Ready  Clarified assessing vs. developing
„
Why is the price tag still higher than
„
Could you add/change/replace exercise
„
Why can't I do one part of the
other online assessments (e.g. xyz and build a specific case around assessment today, another bit
personality inventories)? this topic? tomorrow, and the rest next week?
• Challenge from management • Challenge from everyone! • Challenge from participants

 Fact Sheet on added benefits of  Expectation Mgmt on SaaS;  Raised awareness on likely impact
simulating day-in-the-ife of Emphasised comparability of data on performance

2013 Pilot wave with 82 participants
2014 forecasted to end with over 300 participants
United Kingdom
Europe Germany
Belgium Hungary Republic of South Korea
Spain China
UAE
Saudi India Asia
Arabia Vietnam
Thailand
Singapore
Malaysia
Indonesia
Pilot
phase Australia
Start in
2014

The feedback of the pilot participants has been
excellent and confirmed the value of Manager Ready
Evaluations (selected questions)
5 4 3 2 1
Excellent Not at all
4.4
Overall rating
4.3
I would recommend this assessment
4.0
Supports my career development
4.2
Relevance for own work
4.3
Media used supported learning

„
Feedback from HR colleagues in pilot countries
"The feedback is very realistic – 90% is fully in line

with my everyday observations and experiences.
„
"The simulation is really life-like, challenging (multi-
tasking, time-pressure) and 90% of the tasks are
The report helps to give a very structured picture general enough to measure objectively the capa-
about the colleagues' behavior and capabilities and bilities of young managers from all units and pro-
a very good basis for gap analysis and preparation fessions. The virtual form is fitting quite nicely to
for the development dialogue" the everyday working style of the gen X and Y
participants."
(Head of HR, European Pilot Country) (Head of L&D and TA, European Pilot Country)

Feedback from Asian pilot participants…
„
"Thank you so much for this opportunity to
participate in Manager Ready, it's provided me with
a valuable opportunity to identify clear areas for my
development."
"Now my manager and I can really talk about the

areas of my development. I was surprised that he
had the same feelings about my development
areas, but we hadn't really talked about it in-depth
before."
"I found it quite validating. It really is a good

summary of me. You always have an idea of how
you might be doing, but this confirmed what I
thought about myself. I know I have areas of
development I want to focus on."

Our lessons learned are being implemented in the
on-going roll-out of manager ready
Training HR upfront worked Communication is key System downtime, technical problems,

helpline issues all problematic
• Raises the likelihood of • Guarantees that a new • Your stakeholders are

meaningful development way of assessing used to “perfectly
planning actually gets embraced orchestrated” AC/DC’s
Workers council Integrating the assessment into an Global comparability of talent base and
entire development curriculum or strengths/dev. areas..
program
• May be surprising allies if • Will take place without • Amazing set of data to
you highlight the use much prompting identify what we need to
cases well focus on and where

Best Practice from Healthcare: Manager Ready as the
starting point for a learning journey

Virtualization of assessments: what seems lost
In face-to-face AC‘s and DC‘s, it‘s not just participants who learn…
It‘s our senior leaders, acting as observers, who learn as well!

• Calibration of beliefs and models for judging potential
• Mutual understanding of leadership qualities desired at different times
• Heated discussions to define fitting next step career targets
• Practice at delivery of tough feedback messages
• And, if run well, face-to-face assessments create a bond between

participants, senior leaders, and even HR
• the shared „boot camp“ feeling
• the gratitude that high-ranking people give their time
Questions to this audience:

• Can any of that be retained?
• Can senior leaders somehow play an active role, even in virtual assessments?
• If not, what can we do to not lose that part of our culture and the benefits we have
derived from that?
Our assessment world in 2014 – There is always
room for improvement and innovation
What we are all 3 key optimization areas

doing well already Consolidate and standardize our landscape of
 High quality of talent
1 assessments
• Make instruments and outputs comparable
assessments in use
• Clear “Siemens” quality standards design and delivery
 Virtualization of • Ensure the right instrument is available for the right target
assessments allows group, worldwide
targeting more • Connect assessment and development programs better
people earlier in their • Experiment with more targeted usage of tests for
careers personality, cognitive skills, culture-fit
 Assessment tools More focus on checking quality of incumbent leaders
typically highly 2 • Move from once a year, top-down rating of leadership skills
accepted and to…
appreciated by the • Experimenting with usage of 360°and/or Upward
business Feedback assessment data to reach opinion on displayed
 Generally good leadership behavior
coverage of talent • …and act on the findings!
assessment Re-visit our assess to develop mindset
3 • Pilot and introduce quality gates to validate leadership skills
before making placement decisions

Contact
Laszlo Reisch
Siemens Corporate
Human Resources
HR PL LD LCU
Otto-Hahn-Ring 6
81739 Munich, Germany
Phone: +49 (174) 308 9123

E-mail: laszlo.reisch@siemens.com
siemens.com/answers


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Lessons learned and trends for the future |

Presentation at the 38th Congress on Assessment Center Methods

Introducing new technology into Siemens:

Restricted © Siemens AG 2014. All rights reserved. siemens.com/answers

Revenue by Sector Revenue by Region

Healthcare Infrastructure Asia, Australia Germany

Revenue and employees Continuing operations –

20,000 Free cash flow 4,727 5,257

As reported in Siemens Annual Report

Restricted © Siemens AG 2014. All rights reserved.

Restricted © Siemens AG 2014. All rights reserved.

• A majority of Sectors and Clusters use assessment instruments for employee

Restricted © Siemens AG 2014. All rights reserved.

In the overwhelming number of assessments with internal participants,

In an ideal world, our managers would be so good at identifying and developing

Restricted © Siemens AG 2014. All rights reserved.

Assessing selected employees should impact positively on

The business The talents Siemens' brand image

• Successfully prepare • Ensure their • Exciting assessments as

Restricted © Siemens AG 2014. All rights reserved.

Siemens leadership framework Potential ring

… as well as the Siemens Competency Model (capabilities and expertise),

Restricted © Siemens AG 2014. All rights reserved.

Customization in our design principles

Action-Oriented Feedback Feedback

Restricted © Siemens AG 2014. All rights reserved.

First Assessment Assessment Coaching

Assessors training • Presentation • Presentation • Video feedback and

Restricted © Siemens AG 2014. All rights reserved.

Restricted © Siemens AG 2014. All rights reserved.

Restricted © Siemens AG 2014. All rights reserved.

• We realized we had to When we looked under In the end we chose DDI

Restricted © Siemens AG 2014. All rights reserved.

Customization Data German Workers

3 months 4-6 months 8-9 months

Restricted © Siemens AG 2014. All rights reserved.

Solution Solution Solution Solution Solution

Restricted © Siemens AG 2014. All rights reserved.

• Challenge from management • Challenge from everyone! • Challenge from participants

Restricted © Siemens AG 2014. All rights reserved.

Restricted © Siemens AG 2014. All rights reserved.

Evaluations (selected questions)

Excellent Not at all

Supports my career development

Relevance for own work

Media used supported learning

Restricted © Siemens AG 2014. All rights reserved.

"The feedback is very realistic – 90% is fully in line

Restricted © Siemens AG 2014. All rights reserved.

"Now my manager and I can really talk about the

"I found it quite validating. It really is a good

Restricted © Siemens AG 2014. All rights reserved.

Training HR upfront worked Communication is key System downtime, technical problems,

• Raises the likelihood of • Guarantees that a new • Your stakeholders are

Restricted © Siemens AG 2014. All rights reserved.

Restricted © Siemens AG 2014. All rights reserved.

It‘s our senior leaders, acting as observers, who learn as well!

• And, if run well, face-to-face assessments create a bond between

Questions to this audience:

What we are all 3 key optimization areas

Restricted © Siemens AG 2014. All rights reserved.

Phone: +49 (174) 308 9123

Restricted © Siemens AG 2014. All rights reserved.