Peter Löscher, president and CEO of Siemens, spoke at a special IESE Continuous Education session on IESE's Barcelona campus today under the heading "Improving European Companies' Competitiveness: The Siemens Experience."
Despite the widespread gloom about Europe and the euro, Löscher was upbeat about Europe's future. "Europe is relevant," he said, adding that it is the world leader in imports and exports. "There is a debt crisis but in reality we are talking about a confidence crisis. I think the real economy is stronger than the political discourse indicates," he said.
From a business perspective, he said the limiting factor on European competitiveness is people and talent. "Of every 100,000 degrees in Europe, only 298 are in science".
Europe needs qualified immigrants
Industrial leaders have to play their part in providing educational programs. They have to know how to leverage the experience they have in their companies while encouraging young talent. Europe also needs qualified immigrants in Europe. Only 5 percent of immigrants who come to Europe have qualifications, compared to 55 percent who enter the United States, he said.
He said that patent registrations suggest that Europe is falling behind in terms of innovation. What are needed are more entrepreneurs and policies that will fundamentally strengthen Europe's industrial base. However, Europeans should not become fixated on high-end innovation, he said, pointing to the low-tech methods of delivering healthcare to rural India.
The areas of influence are shifting - it is no longer G8, it's G20 - and these days 98 percent of innovation is happening outside your own company. "You need to be the go-to company for innovators," he said.
Asked what distinguishes Siemens he said that it has always had a culture of innovation, excellence and social relevance. "You can be a great leader," he said. "But whoever you are, you are only as good as the people you have around you."