Digital Manipulation | The Ethics Of Photography

Digital Manipulation | The Ethics Of Photography Photography is a form of visual communication (LESTER, Paul, 2006). Photographs are used for a range of purposes including documenting personal events such as birthdays, weddings or christenings, for advertising products or services, for decorating the home, and for appointing authority and authenticity to news stories. Passports and other official forms of identification use photographs as a way to identify people. Current culture is image driven and we are exposed to imagery every waking hour of our lives through forms of visual media on the Internet, television, newspapers, magazines, mobiles phones and now tablets. In using photography to identify an individuals identity or to document the occurrence of an event, a great amount of trust must be invested in the medium of the photograph. Photographs are used in courtrooms as evidence, an occurrence that evidences the trust invested in photographs. By using photographs as evidence it is important to question if the medium of the photograph is an accurate recording of reality. In 2012 an Iranian news agency published an apparent newly developed military drone manufactured by Iran, see Figure 1. The published image was soon discovered to be an already published image of a drone developed by a Japanese University which had been modified to give the impression it was a new and authentic image of a new machine considered desirable by a government. This example evidences the developing ambiguous and potentially dishonest role of digital manipulation within photography. Image manipulation such as this encourages those who read these images and similar im ages to consider whether images have been manipulated and if so, to what extent and for what motivation. The readers of images must question the media that they read and question the veracity of the images whilst not awarding great doubts in the media in general or jumping to the conclusion that every image read has been manipulated. This dissertation will consider more fully inspect the manipulation of imagery, whilst particularly the development of digital photography and will evaluate how this process has affected media credibility. Iran successfully tests Koker-1 VTOL drone (PHOTO) Figure Manipulated image used by Iranian Government to try substantiate deveoplemt of military drone. Journalism in our society often requires the combination of visual and written information to both reach and inform a mass target audience. There is a difference between the photograph and the written representation which is that the camera is able to capture reality (NERI, GRAZIA, 2003). Early photographic technology required a subject to be still in order for it to be recorded whereas modern technology allows for a photograph to be made in less than a second. This significant development in technology means that subjects and material capable of being photographed have become far more extensive than in the early years of photography where limitations were imposed by both camera size and slowness of film. There is also a fundamental difference between photography and the written word in documenting situations. The written word allows an author to mediate reality, choosing what aspects of a subject to detail and describe, governed often by personality and knowledge of a subject. A pho tograph however, may be taken in a situation in which time is limited which in turn forces the photographer to record a subject with little conscious consideration to other objects within the image. Additionally, because the camera is seen as a mechanical device it is not considered to mediate reality like a written account. The camera instead is seen as a device that records truth and cannot be used subjectively (BAUDELAIRE, CHARLES, 1855). If a photograph is considered to have been be manipulated, for example through the use of exposure to give a different reading of the photographs meaning then this could be regarded as providing a less than this could be regarded as a subjective representation. Whereas in regard to the written word mediation is much less alarming due to our familiarity with literature as a subjective representation of reality. It is understood that words are made up of symbols and signs that express the subject they characterise. The word cup does not innately i nform the reader it means the object cup but rather the meaning of the word cup is understood by reading the letters of the word. Yet a photograph is able to demonstrate the appearance of the object it represents and it is able to make this representation with little interpretation required. An Inherent Realism Unlike painting or writing, a photograph can record a specific moment in time. A painting can be of a place that has never existed and literature may describe any place whether real or not. However the example of the Iranian military drone demonstrates that photography shares the same ability as painting and writing in that it can be subjective. Although, painting may be able to demonstrate the emotion of a subject, it is assumed that photography is unable to. In fact, photography has a stronger relationship with specificity as opposed to generality found in painting and writing (MITCHELL, WILLIAM J, 1992). Photographys ability to accurately document is recognised by governments who use photographs for identification purposes in official documents such as passports and driving licenses. Because photography is used for such official purposes, the relationship it holds with specificity is strengthened. However, the Iranian military drone example contests that a photograph may not alway s show the reality of the situation. Photography is powerful because it carries the authority of looking like reality. When looking through a clear glass window it is easy to forget that you are looking through a glass window at reality. Because photographs look so much like reality, it is easy to disregard the complex mechanical and scientific processes which combine to create the photograph. This mechanical and scientific process is not as simple as the window analoguey and will be further reconciled or distorted by considering the technology employed. It is this increasing reliance on science, where there is even no longer a latent image as with analogue processes by which the photograph is made which prompts legitimate and valid questioning of a photographs legitimacy. Barbara Savedoff (1997) uses the analoguey of a hallucination to describe the relationship a photograph has with reality. Savedoff argues that we know photographs are not real and that we know hallucinations are not real. However, photographs seem so real that it is difficult to determine the difference between representation of reality in the photograph and the fact that the photograph is only a representation to begin with. Furthermore, Savedoff points out that photographs do not just record a scene, they also capture a segment of the moment they represent. The idea that photographs contain light from the subject they recorded was considered greatly by early photographers and theorists. In analogue photography, light bounces off the subject and enters the lens and makes contact with the film starting a chemical reaction which produces an image on the surface of the film, creating an exposed negative. This light used to expose the negative has a specific relationship with the subject, the negative and later the printed photograph. Susan Sontag (On Photography, 1977) argues that this process is called the trace and refers to it as something directly stencilled off the real. John Berger (Uses of Photography, 1980) also maintains that the value of the photograph is found within its relationship with the subject. This raises the question when a photograph is manipulation what effect does it have on this relationship between light, subject and recording medium? It is important to note that before a photograph is manipulated the photograph may not already be an objective observation of a subject (HUEPPAUFF, BERND, 1977). It is the photographers decision from where and in what manner a subject or scene should be recorded. Other decisions include what to keep inside of the frame. Once the composition of the photograph is made, there are still variables controlled by the photographer that can ultimately change the way in which the photograph is read. The exposure of the photograph is another consideration, along with the edit performed by the person who has comissioned the photographer to make these photographs. In a news environment, an editor may choose the photographs he thinks best fit the objective of the agency regardless of whether or not that is an entirely accurate representation of the events that took place. These decisions can weaken the objectivity of the photographs made. When photographs are evaluated, one consideration is aesthetic quality (BARRETT, TERRY, 1985). Photographs made for journalism are seldom truly documentary (BARRETT, TERRY, 1985). Increasing the aesthetic value of documentary photographs is not new. During the Spanish Civil War, Robert Capa made a photograph of a militant being shot. It later turned out to be staged to create a more compelling photograph. The perspective of those who produce and broadcast photographs can also affect the way in which a photograph is understood (HUEPPAUFF, BERND, 1977). For example, if a photographer is photographing a public demonstration and they feel positively toward the demonstration, it is probable that they will make photographs that show the demonstration in a positive light. However, if the photographer was opposed to the demonstration then they are likely to record anti-social behaviour of members of those involved. This example shows how the photographer can manipulate the photograph and the reality it presents (BARRETT, TERRY, 1985). In summary, the photographs objectivity which is already questionable due to the way in which the photographer makes a photograph is further questioned as it may have been manipulated by those commissioning the photographer through the process of selection, ultimately undermining the objectivity of the photographer and photograph. Adnan Hajj photographed Beirut after an Israeli bombing. Hajj edited the photograph and added more smoke to make a more compelling photograph. Hajj used the clone tool within Adobe Photoshop to clone and copy smoke to additional areas of the photograph, see Figure 2. After initially publishing the photograph, Reuters withdrew it once members of the public claimed it had been manipulated. To anyone who asked to use Hajjs photograph, Reuters stated that the work was no longer available and stated that Hajj no longer works for Reuters (DAY, JULIA, 2006). The photograph was picked up by a blog, which recognised the fake because the same piece of smoke occurred in multiple places (DAY, JULIA, 2006). Manipulated images are normally harder to identify, especially with more advanced software and more experienced digital editors. This case evidences the desire for Hajj to make a more compelling photograph for his clients by manipulating the aesthetic qualities of his photograph. https://sites.google.com/site/tsoldrin/leb-phony.jpg Figure Adnan Hajjs manipulated representation of Beiruit Bombings in 2006 Nonetheless, Hajjs photograph was created subjectively but it is important to note that even photographs that are objective can be interpreted in different ways. For instance a photograph may be used in court to prove that an event has happened. During a trial the two opposing sides may read photographic evidence of the same subject in different ways, even from the perspective of the photographer who took the photograph. (HUEPPAUFF, BERND, 1977). It is apparent that photographs have never been entirely objective now or in years past. Additionally, it is apparent that they record the views of an individual as presented as if they were actuality. While with digital photography it may be easier to manipulate photographs due to the availability of digital cameras and imaging software over darkroom equipment, the truth is that photography has a historic relationship synonymous with manipulation. Derek Bouse (2002) reasons that people generally believe that the age of a photograph relates directly to its accuracy, and that the older a photograph is the more likely it has not been manipulated. However, still numerous instances of analogue photographs exist. For instance, a photographer employed by Mathew Brady during the American Civil War named Alexander Gardner rearranged a dead person on the battlefield to make a more compelling photograph, see Figure 3 (LESTER, MARTIN, 1991). It is important to recognise that this manipulation took place before the photograph was made. The practice of digital photography is still vulnerable to manipulation before the photograph is made however manipulation is usually carried out after the phot ograph is made. http://www.spartacus.schoolnet.co.uk/USAPgardner.jpg Figure Alexander Gardner rearranges the position of a corpse and gun to increase the drama of photograph Another photographer known for manipulating a photograph prior to making one is Edward Curtis. Curtis paid Native Indians to dress in exotic clothing and photographed them to make a more compelling photograph and to turn them into a spectacle for the public to view them (MICHAELIS, PAMELA, 2008). However, by dressing these subjects the worth of the photograph as document is reduced, see Figure 4. Although analogue technology was the latest available technology, it was still used to manipulate photographs, even after being made. For instance, in family portrait photographs it was common for members of the family to be cut and pasted into a photograph (Lodriguss, 2008). People would sometimes appear to be disproportionate to others in the pictures due to the position of the subject in the original photograph. In some photographs people are also seen floating. http://blog.lib.umn.edu/melan002/melandblog/Piegan-Lodge,%20clock.jpg Figure Edward Curtis changes the traditional dress of subjects and removes clock from the photograph An example of someone who used many negatives to form one photograph print is Oscar Rejlander. In the 1860s, for some pieces of work he used in excess of 30 negatives to create his well-known The Two Ways of Life which demonstrates a philosopher between a life of virtue and vice, see Figure 5. These composite prints were made by cutting together numerous negatives and using them to create a photographic print. In order for the final photographic print to be consistent from left to right, it was vital that sizing and contrast be the same to prevent people from hovering above the ground. Rejlander, before using multiple exposures and cutting negatives in photography was a painter. These examples show that even before digital imaging technologies existed there was extensive manipulation of photographs through analogue techniques. http://twcdc.com/andycox/wp-content/uploads/2011/04/Oscar-gustave-rejlander_two_ways_of_life.jpg Figure Oscar Rejlander uses up to 30 composite negatives to create one photograph Using double exposures was also very common and was used often by photographers namely Eadweard Muybridge who photographed landscapes. The photographic materials of the 1850s were not very sensitive to green but were however very sensitive to blue. Therefore, landscape photographs were often improperly exposed. The correct exposure of the blue sky would render the foreground underexposed, or if the foreground would be exposed for the blue sky would be white with no detail. In order to solve this problem Muybridge and a handful of other photographers at the time would create negatives of desirable skies with differing cloud and all exposed properly. He would then use these negatives to add well exposed sky to his landscape photographs (SCOTT, AMY, 2006). The photograph produced would look natural to a viewer but is obviously a form of manipulation, a process often practised today by digital photographers. Muybridge photographed Yosemite and not only added a false sky but removed trees that prevented his view over the landscape, see Figure 6 (SCOTT, AMY, 2006). http://www.imaging-resource.com/ee_uploads/news/1284/muybridge-2.jpg Figure Edward Muybridge, used his collection of cloud negatives to combat technical limitations of early photography The so far discussed photographers have used manipulation to enhance the aesthetics of the photograph; however photography has also a large history with propaganda and political influences. Vladimir Lenin manipulated photographs as a form of propaganda to make historical events support his regime for the Soviet Union. Individuals who were seen as enemies of the state were often ordered to be killed by Stalin. If these individuals were to be within a photograph next to Lenin they would often be removed. Leon Trotsky is a prime example of this. Once Lenin had determined that Trotsky was an enemy of the state he was methodically removed from all traces of him from state photographs. Nikolai Yezov also suffered a similar fate once he fell out of favour with Stalin. This process of manipulation existing photographs carried on to the late 1900s. From looking at Muybridge, we can see that there are numerous stages in the manipulation and some of which are not clear that they have been altered. Edward Steichen states: A manipulated print may not be a photograph. The personal intervention between the action of the light and the print itself may be a blemish on the purity of photography. But, whether this intervention consists merely of marking, shading and tinting in a direct print, or of stippling, painting and scratching on the negative, or of using glycerine, brush and mop on a print, faking has set in, and the results must always depend on the photographer, upon his personality, his technical ability and his feeling (STEICHEN, EDWARD, 1903, p.48). Here Steichen is arguing that every decision the photograph carries out whether that be painting or scratching on the negative is a form of manipulation or as he calls it of faking. Steichen also refers to the personality, technical ability and his feeling which refers to the photographer and their intentions or motives which will manipulate or cause the process of faking. In the period of digital imaging some of these manipulations are seen as ethically acceptable and are not disputed. Media agency guidelines for manipulation, which we will talk about in greater depth soon, maintain that manipulations that were possible during analogue printing technique times are still genuine. These assertions are that if the chemicals used in the darkroom manipulated a photograph in a certain way then this would be a part of the photographic method and could not be criticised. Steichen obviously would not agree with this as he knows the extent to which analogue photographs can be manipulated. Digital Technology and Manipulation The first device invented that could digitise or make analogue photographs available in a digital format was a scanner made by Russell Kirsh in 1957 (TERRAS, MELLIA M, 2008). The scanner functioned by looking at the variations in tone within photographs and assigning a digital value to represent a tone band. Instead of creating a new photograph this scanner copied an existing photograph and recorded it digitally. Because photographs can be scanned to a digital format, the initial analogue negative can now be manipulated digitally and the truth value held by analogue photographs can now be challenged. Birth of Digital Imaging During the 1960s digital imaging technologies was still only used by large institutions such as NASA and the American government. It was not until the 1980s that the media began to use digital imaging technologies. Digital technology could be employed to enhance the clearness of television broadcasts and speed up the time in which photojournalists were able to send pictures to the media. In 1982, National Geographic published a photograph of the pyramids at Giza on the front cover of the magazine, see Figure 7. The photograph has been manipulated to fit a horizontal photograph of the pyramids onto the portrait cover of the magazine to make the front cover more captivating (TERRAS, MELLIA M, 2008). It is important to note that this instance of manipulation was one of the first by a recognised organisation. National Geographics editor, Fred Ritchen who decided to compress the pyramids felt he had achieved a new point of view by the retroactive repositioning of the photographer a few feet to one side (WRIGHT, TERRENCE, 1999, p.110). Ritchens defence to accusations of manipulating the photograph was that if the photographer had moved and taken the photograph at a different time of the day then the photograph would be the same (WRIGHT, TERRENCE, 1999). However the fact remains that this photograph was not the one that was made. The fact that the photograph was manipulated was not broadcast. It was admitted to have been manipulated when other journalists questioned the photograph. Howard Chapnick (LESTER, MARTIN, 1991, p.96) argued that the words Credibility and Responsibility allow photographers to call photography a profession due to ethical considerations rather than a business. Chapnick goes on to argue that not maintaining these ethics will damage journalistic impact and photography as a language. Lastly, he maintains the threat to credibility is permanent if people begin to disbelieve the news photograph. http://www.lagunabeachbikini.com/wordpress/wp-content/images/newspictures/national-geographic-feb82.jpg Figure National Geographic Magazine Cover 1981 In 1985 digital cameras became widely used by professional photographers. Companies also marketed digital imaging camera to the public for domestic use. During this time the processing capabilities of computers was also advancing and provided a way for individuals to load image manipulation software and manipulate photographs. In 1991 the American government and the media used digital photography as a technology for the first time in a war environment. Not only was digital photography used to photograph the war but was used in weapon systems by America (FLORIDI, LUCIANO, 1999). A much more current use of digital imaging technology is live electronic manipulation. Manipulating a live feed allows the editing of satellite image feeds. On the fly image editing may be used in sports programming to show lines on pitches or by governments to hide classified buildings from satellite imagery that is available to the public such as Google Maps. News television channels can also employ technology to sow text feeds beneath news anchors. Delta Tre supply FIFA with sports data services and on screen graphics (BEVIR, GEORGE, 2012). In 2012, the union of European Football Associations placed recorded footage of a fan crying at the opening of the game and played it after one of the teams had won the game to make for more compelling television. Ivan Amato (Lying with Pixels, 2000) argues that as this technology becomes more widespread and available the credibility of video media will be damaged permanently. In some ways this is similar to National Geographics manipulated Pyr amid in that both representations existed but were manipulated to give heightened sensation. The abilities that digital imaging technology have provided have been used by Walt Disney Imagineering Studio to take existing photographs and film of aged or dead celebrities made in the past to be used in new programmes or films (AMATO, IVAN, 2000). This use of technology to manipulate media, demonstrates how analogue photographs and films are susceptible to these processes and also questions the fundamental nature of the final product? Is it simply a manipulated piece of video footage or a new creation entirely? Mitchell (The Reconfigured Eye: Truth in the Post-Photographic Era, 1992) argues that it is a new creation entirely. Mitchell also argues that photography in recent times has entered a phase which he terms pseudophotography meaning that digital photography is not photography. Though the two methods are comparable, they possess different manipulation potentials which are examined in the next section. Manipulation Since Digital photography Savedoff (1997, p.19) argues that technologies alter rather than simply add to the resources of art. This suggests that photography as an art form has been altered by added manipulation potential. This new digital imaging practice should pose a whole range of ethical considerations relating to the manipulation of photographs. However, this has largely failed to have happened due principally to differentiating between the printed or published digital or analogue photograph creating difficulty in identifying and developing a set of different standards for each method. Photographys relationship with reality as previously outlined is apparent in digital photography, however the relationship created by the subjects personal relationship with light as evinced by Sontag and others will be absent in a digital photograph. There is no latent image. In an analogue photograph created through a chemical process there is room for argument that the relationship with light remains intact. Although t his trace looks to be evident in a photograph created by digital means, the trace is not a chemical reaction but a digital representation of reality and therefore not an embedded feature of the relationship between the subject and the photographic process as with analogue. Additionally, the very nature of digital photography means that the process is limitless in the number of alterations or manipulations that can be applied. These manipulations leave little or no evidence of themselves. Modern digital cameras allow the photographer to instantly review the image made and thus allows them amend the and other factors of image capture until the photographer is satisfied with the final result. Images are manipulated by using computers and image editing software such as Adobe Photoshop, along with scanners to digitise analogue images. Therefore, photographs made before digital photography are susceptible to manipulation just like the case of Disney outlined earlier (BOUSE, DEREK, 2002). The development of digital imaging technology has changed photography and its relative relationship with veracity permanently. This lends evidence to Bouses argument that old photographs may be more widely trusted and that digital photography makes readers of images aware not only of current manipulations but of those in the past also. The reader of an analogue photograph, although aware that the photograph was made before the invention of digital technologies is aware that the photograph might have been manipulated and nonetheless changes the way the reader interprets all photographs, manipulated or not (SAVEDOFF, BARBARA E, 1997). This suggests that digital technology has decrease the impression that photographs are mostly objective and truth-relating and that there is a greater tendency for viewers of images to question the veracity of all photographs. A key factor in this significant reduction of trust is the difficulty for the average reader to easily and readily distinguish between manipulated and non-manipulated photographs. Conversely Michelle Henning (2007) argues that digital imaging technologies have enabled limited new ways of manipulating a photograph. Henning continues that digital technologies have only made the manipulation of photographs more available. Henning also argues that the public was previously unaware of image manipulation techniques before the invention of digital imaging technology. Digital manipulation has made the public more aware of photo manipulation and paradoxically served to increase the frequency with which images are manipulated. Evolution of a Medium Photography has been constantly developing since its birth in the 1800s and many of the changes have been driven by evolving technology but were always based on chemical reactions to light. In the 1820s Joseph Niepce found a method to permanently fix a photograph using lavender oil and bitumen. Niepce swiftly developed this method further into heliographs made by using silver nitrate. Eduard Daguerre was also looking for a way to photographically record subjects and contacted Niepce to work with each other. After Niepce died, Daguerre found that mercury could fix images much more permanently and created the Daguerreotype which Daguerre believed at the time serves to draw nature and gives nature the power to reproduce herself (MARIEN, MARY WARNER, 2002, p.23). Since photographys invention the idea of a device that could create unmediated representations of reality was widely believed yet now we begin to see photography may not deserve the verisimilitude it has been ascribed. At the sa me time Henry Fox Talbot worked on a photographic method using paper print. Like the creation of photography and the creation of digital photography these changes and advances were driven simultaneously by several individuals at once. The daguerreotype became the most popular and was widely used to make very simple portraits. Later though, interest was given to the Calotype created by Talbot. The Calotype was less reliable but allowed for prints to be reproduced much more easily and allowed greater detail with the print at least initially. During the mid-1800s negatives were made from glass and coated with albumen paper. These proved much more reproducible and gave more detailed and sharper results than earlier methods. With regard to contemporary digital methods, has digital photography made reproducing images easier due to the fact that digital images when stored on a computer can be duplicated instantly, require no specialist education, now contain little or no cost and can be tr ansmitted and viewed globally without a physical print ever being produced? Being able to reproduce a photograph has always been desirable and this is shown by the demand for the Calotype. Bearing in mind that digital imaging technology has helped progress the ease, convenience and technical, it has done this in a way that has divided the two forms of photography causing great debates among both practitioners and observers of both. Mark Amerika, digital artist and writer, in an interview draws attention to and discusses the differences between digital and analogue photography. Amerika claims that images and how they are read is influenced by the way they are captured, suggesting that as technology changes so does our interpretation of photographs (JACUPS, Karen, 2006). Because photography is much more easily manipulated with digital photography it can be argued that the objectivity of the photograph is lost and it is futile to pursue objectivity (JACUPS, Karen, 2006). It would seem true that manipulation is more common since the advent of digital photography, which could argue that the making of an image is only a small portion of the final product like in the aforementioned case of Rejalnder. Both Mitchell and Savedoff claim that digital photography and the manipulation of it cannot be compared to analogue photography because it is a new medium (MITCHELL, WILLIAM J, 1992) (SAVEDOFF, BARBARA E, 1997). Both continue to argue that because with digital photographs the image is created with a digital sensor digital capture is a separate process to analogue capture. Digital photographs receive their authority because they are almost identical to analogue photographs and this authority is passed to the digital photograph. However, if this authority is diminished, digital photography may be criticised for its lack of authority. News reporting currently accomplished by digital photography may Siemans: Micro Environment and BCG Analysis Siemans: Micro Environment and BCG Analysis SIEMENS COMPANY REVIEW BACK GROUND TO THE STRATEGIC DECISION Siemens is a worldwide leading organization in electronics and electrical engineering industry which is operating in the sector of energy, communication and healthcare sector. There are few industries working in the global market of small and large business which have maintained their successful history of quality products and customer satisfaction. Siemens is also one of those well known and established organizations, having proud to be the leading business. Siemens was founded by Werner Von Siemens and Johann Georg Halske in 1847. The Production Electrical Telegraphs are the remarkable source of Siemens for the past many decades to achieve the large amount of its overall sales. For more than one and a half century, Siemens is still popular in competitive industries for its innovative achievements, technical supports, quality, reliability, and globalization. Being the environmental friendly is one of many other positive aspects of Siemens to feel proud of. Almost one third of their revenue is generated by environmental friendly green products and solutions. â€Å"In fiscal 2009, ended on September 30, 2009, Siemens had revenue of â‚ ¬76.7 billion and net income of â‚ ¬2.5 billion. At the end of September 2009, the company had around 405,000 employees worldwide.† (www.siemens.com) To acquire the long run and effective advantages, generally most of the organizations utilize Strategic decisions. Strategic Decisions help the businesses maintain their quality on the long term directions. Strategic decisions are comprised by considering the organizations activities and analysis to decide the working areas of any organizations. Siemens strategic decisions are quiet clear so far. Siemens basic strategy is to focus particularly on innovation and technology driven growth markets and until the substantive time they have been quiet successful in setting up the trend of new technology and capturing leading positions maintaining their strength of local existence and creating local values on the global level. Siemens believed in diversification and innovation since the establishment which make outstanding business sector. They started identifying market particulars upcoming trends and drawing the strategic results early on. Some years past, Siemens improved their portfolio to four megatrends including demographic change, urbanization, climate change and globalization which are already influencing our daily life today, and the impact of these trends is increasing substantially in the decades. The activities into the sectors of Industry, Energy and healthcare have been the main points of consideration for business. They also set the stage to achieve leading positions and customer satisfaction in attractive continuous growth markets. MICRO ENVIRONMENT ANALYSIS Organizations have adopted the internal analysis as a key feature with the frequently changed environment nowadays. To face the environmental change in the ongoing time it has been more useful for the businesses developing strategies utilizing their own resources and capabilities. Siemens has already made it the prior concern for its organization believing their internal resources and strategies as the main strength to achieve their goals. Financial Resources: The group recorded revenues of E77,327 million (approximately $116,294.4 million) during the financial year ended September 2008 (FY2008), an increase of 6.7% over the financial year ended September 2007 (FY2007). The operating profit of the group was E2,492 million (approximately$3,747.8 million) during FY2008, a decrease of 50.2% compared with FY2007. The net profit was E5,725 million (approximately $8,610 million) in FY2008, an increase of 50.4% over FY2007.(Data Monitor Siemens AG). Physical Resources: Siemens are very diversified in geographical presence. They operate in 190 countries spread over the Americas, Europe, CIS, Africa, Asia, Australia, and Middle East. During FY2008, the group generated 26.1% of its revenue from Americas, 52.7% from Europe, CIS, Africa, and 21.2% from Asia, Australian, and Middle East. (Data Monitor Siemens AG) Human Resources: It is in the concern of Siemens that outstanding, competitive and innovative employees are their strength and valuable assets. All of their employees are highly trained, focused and innovative. This belief in their staff plays an important role for Siemens to sustain in the world market. Reputational Resources: Siemens is operating in over 190 countries and for over 160 years. It had created a good and remarkable reputation around the world. They have made them very diversified and manufactured their own brands. Their brands include generators, electrical products, healthcare equipments and many others are some of the outstanding and famous worldwide. MACRO ENVIRONMENT ANALYSIS There are some factors that keep changing time to time. These factors are called External factors. No organization can depend on it because of their constant change. Organizations are facing many economic and global problems to sustain. Due to the present dynamic environment; internal strength has been the key part for organizations rely on in order to face any of these challenges. As far as Siemens is concerned, they have been well prepared and have completed their homework keeping these challenges in front. They introduced remarkable measures that will not only help them surviving these crisis without being highly affected but also they will emerge much stronger with the passage of time. Because they began research, identified market specific and started to draw the strategic consequences quite early on to prevent their strength getting weak. Their integrated homework made them able to precisely consider the upcoming opportunities and threats. This homework helped them identify the nature of advantages, opportunities and threats before the time which are: Opportunities: Siemens had bought quite a few businesses in recent years because they think that these businesses have potential to drive its business growth. â€Å"In January 2007, the group acquired US based UGS, one of the leading providers of product lifecycle management (PLM) software and services for manufacturers. In the same month, Siemens Water Technologies strengthened its service and product business in the US with acquisitions of four companies: Envirotrol, CEC, Pure Water Solutions, and Sunlight Systems. In November 2007, the group acquired Dade Behring Holdings, a manufacturer and distributor of diagnostic products and services to clinical laboratories.† (Some information is taken from www.siemens.com) Threats: Siemens had done all their homework but still threats lie in front of them. Siemens faces intense competition across its market segments. As Siemens is a huge industry with different sectors their competition is much higher than other industries. Their main competitors in the industry sectors are ABB, Alstom, Bombardier, Emerson Electric, General Electric Company, Honeywell International, Johnson Control, Philips, Schneider Electric, and Tyco International. (Information is gathered from www.datamonitor.com). Likewise in energy sector as well its main competitors are General Electric, Alstom Powers, Mitsuibishi, Abbott and lots more. As it is quite clear that, such competition could adversely affect the revenues and profit margins of the group. DIRECTIONS FOR GROWTH It very important for organizations to be vigilant when choosing the strategic direction, it is a useful method for organizations to launch their products in the market and in order to gain competitive and desired advantages. As it is pointed out by Johnson, Scholes and Whittington that: organizations should be aware of 3 types of motives or pressures that may shape their choice which are: Environment Based Motives: As Siemens is concerned they already had pointed out the growth of economies in the different continents. â€Å"The group operates in about 190 countries Spread over the Americas, Europe, CIS, Africa, Asia, Australia, and Middle East. During FY2008, the group generated 26.1% of its revenue from Americas, 52.7% from Europe, CIS, Africa, and 21.2% from Asia, Australian, and Middle East†. (www.datamonitor.com) Resource Based Motives: As being one of the most diversified groups Siemens have very strong resource capabilities. Due to their high revenues Siemens can afford to spend lucrative amount on their RD. In 2008 Siemens increased its research and development investment to (approximately $5,690.9 million). Igor Ansoff has developed a well known matrix system to analyze the directions of strategies and mix between the products which a company sells and the market is to be sold. Siemens has set the task for capturing leading positions in attractive growth markets. In order to maintain their position Siemens targeted their business activities to some sectors including Industry, Energy and Healthcare. Siemens direction of its strategy lies in all 4 stages of Ansoff matrix. Market Penetration: With the help of its targeted business activities in leading growth market Siemens is constantly penetrating the market. They also have a much diversified customer based group. This group has industrial, infrastructural and diversified customers. The group can be classified in markets like as transport and logistics (such as transport authorities), construction, communication, real estate, metals and mining, machinery, utilities, automotive and many others. Market Development: Siemens is operating in over 190 countries and for over 160 years and generating high revenues which is increasing with the passage of time. Its because they had identified their opportunities and threats. Their prior homework of seeking new markets made them able to achieve the targeted financial market. Product Development: Product development is a very effective and attractive way to counteract a new entrant in market. Product development is to introduce new product to the market or the same product with enhanced and added new services. Siemens has been successful maintaining their vast market, product quality and customer satisfaction around the globe. The basic sectors Health, Industry and Energy are the ones providing them a remarkable deal of opportunities to develop their products. Some of the products and services in energy sector spectrum such as LED energy saving lighting and building control system are up-gradation to their products for their present markets. Diversification: Diversification is one of the key parts for organizations to gain competitive advantage over their competitors. On the other side it includes a great deal of risk for organizations because a huge amount money is required to invest lucrative amount in RD. As The Siemens is a market business leader in the growing sectors, so it deals with the risk to diversify with upper hand. Siemens had always believed in innovation and the technology as said by the founder of the Siemens Werner Von Siemens â€Å"If you are not moving forward you are moving backwards.† Siemens diversify its business by two different ways. Related Diversification: Siemens operates in various sectors of the business market. It provides so many opportunities to diversify beyond the substantive product market within the broad confines of the ongoing industry. Siemens always tried the best in their value chain to gain new products market and customer satisfaction. In industry sector Siemens offers different products such as services like building, communication, lighting, mobile solutions and in energy sector they are providing distribution of power, conversion, extraction and lot more. Unrelated Diversification: Siemens has also diversified its business sector activities beyond its current scope or industry sector. Because of dealing with three business sector activities, Siemens always believed in technology and innovation in their products and services. It requires a great deal of investment in RD. Siemens has a very powerful RD. Recently Siemens had increased their research and development investment to E 3,784 million. Siemens invested with Fujitsu in laptops, which is a very good example of unrelated diversification. PORTFOLIO ANALYSIS The strategy of Siemens portfolio is quite clear for the past many years which set the target to capture and maintain the Number 1 or Number 2 in the future profitable and competitive markets. By doing that Siemens believe they can survive and get through in the difficult constantly changed environment. Siemens is concentrating deeply on renewable energy and organic growth of various products and services. In the past five years they had invested 20 billion Euros in the acquisition of growth business. Siemens has established its leading position in the attractive growth market working out with its three business sectors Healthcare, energy, and industry. As a part of DESERTEC a Solar Thermal Power in Sahara and Wind Farm in Europe are being constructed. They have also being producing Smart Grid Solutions based Technologies such as Electric Cars and lot more. The best and precise portfolio Analysis of Siemens is comprised by Boston matrix. BCG Matrix Siemens AG METHOD OF DEVELOPMENT Siemens have varieties of methods and strategies to develop their SBUs (Strategic Business Unit). It is because they had a diversified business culture worldwide and they operate in 3 major sectors Healthcare, Energy and Industry. Siemens is constantly operating with their strong partners and developing their services to beat their competitors, therefore they are gearing the value chain to efficiency. They believe that for outperforming their competitors they have to consistently work out and improve their services better than they are. Following the belief of always being better than they are, Siemens is successfully developing their services to sustain in the market and improve customer satisfaction. As a diversified business Siemens believe in utilizing different methods of development. Strong RD department is one of their strenghts. They are able to afford the Organic development. They also intend to continue the assurance of strict resource allocation in the future; they are ver y keen on the Organic growth. In the past five years Siemens have invested Twenty billion Euros in the organic development. There was a significant increase in RD budget and it got its RD location in more than 30 countries worldwide. Siemens is also keen to acquire growing businesses. They had recently invested more than 20 billion Euros in order to acquire businesses. Siemens is constantly optimizing its portfolio of Products. Every year numerous acquisitions and divestitures are completed by Siemens. â€Å"In 2005 alone, Siemens invested around EUR 2.5 billion in new businesses and the 2006 figure will be substantially higher. On the divestment side, the carve-outs of BenQ, Product Related Services and Logistics Assembly have caused a stir. Regarding recent prominent acquisitions, such as Flender AG (Germany), CTI (USA), Bonus (Denmark), US Filter (USA) or VA Tech (Austria), Siemens Management Consulting were primarily involved in the pre- and post-merger integration (PMI) work†. (Information is gathered from www.smc.siemens.de) It is Siemens belief that acquisitions helped them come closer to achieve their goal of growing a fast global market. Siemens is also running many joint ventures with one of their SBUs for obtaining growth. Such as Siemens and Nokia have announced their intention to merge the network business of Nokia and the carrier related operations of Siemens into a new company which they will call Nokia Siemens networks. Its a 50-50 joint venture. In which both parties will invest half and half share. Both parties are looking forward to stand as a Global Leader with strong position in current important growth segments of fixed and mobile network infrastructure and services.