The State of Siemens

In the world of electrical manufacturing, West Germany's Siemens considers itself more than a great corporation: it is like a state. Its chief of foreign operations -which cover 79 nations -is known in the company as "the foreign minister." The top-policy management board is a "parliament." Line executives are nicknamed "our generals." Says one of them: "We try to follow General von Moltke's motto: 'Be more than you seem.' "

Siemens is Germany's largest private employer, with 207.000 workers at home and another 28,000 around the world. But it is more than it seems to be. The Siemens reach extends from the Arctic. where its diesel engines drive icebreakers, to Saudi Arabia, where its engineers are setting up a huge communications network. Moscow's Bolshoi Theater is lighted by a Siemens electrical system: the phone calls of Indonesia's President Sukarno go through Siemens switchboards.

Family Affair. Commanding this industrial empire is Chairman Ernst von Siemens, a shy bachelor who raises exotic flowers as a hobby and says, "Our essential goal is to do sound business rather than big business." Von Siemens has surrounded himself with a staff of multilingual executives, many of whom have studied abroad or served in Siemens foreign outposts. Since working control of the company is held by the Von Siemens family, the heir apparent is a 51-year-old cousin. Peter von Siemens, now a deputy member of the management board of Siemens' sister firm. Siemens-Schuckert, which makes heavy electrical machinery.

A Siemens family man has been the chief ever since the company was started in 1847 in a small Berlin workshop by Werner Siemens and Johann Halske. Werner Siemens developed the world's first electric dynamo -and the company was on the high line. Another Von Siemens -Hermann, a grandson of Founder Werne -patched the company together after World War II had left it in smoldering ruins. He gathered the remnants of Siemens' skilled work force, gradually built new plants, and bought back Siemens' overseas properties that had been expropriated during the war. A $60 million Marshall Plan loan helped.

Challenge for Competitors. Private U.S. money is now helping Siemens to push the biggest expansion program in its history. In the first major private loan by U.S. financiers to a German firm since the war. a group of twelve lending institutions headed by Morgan Stanley and Arnhold & Bleichroeder have lent Siemens $25 million as part of its two-year, $250 million expansion (much of which will be paid for out of profits). With expanded plant, Siemens intends to give stiffer competition in world markets to its three bigger U.S. competitors -General Electric. Western Electric and Westinghouse -and to increase sales from last year's $1.2 billion to $1.4 billion next year.

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