In an open letter to the Siemens employees, Shubert said: "I would say that we have achieved some critical milestones on the cost reduction side with the recently concluded VRS. For this I owe my sincere thanks and gratitude to all of you who have supported us during these difficult times. We depend on all of you who are remaining to contribute to the speedy turnaround of the company."

The successive retirment schemes have resulted in a hapazard staffing pattern in various departments. Admitting that post VRS and realigment of production processes there have been some gaps in the required skill levels, Schubert harped on cooperation and camaraderie to tide over the crisis. "While these will be bridged through re-training, I urge you to help out your colleagues... Ifyou see that a colleague has some difficulty, go out and help him if you can," he said.

In the new lean setup, the employees have been asked to keep on finding ways of reducing costs keeping a strict watch on the quality so that the price benefit can be passed on to the customers. Shubert said: "When we talk of costs we should not forget quality costs. Your aim should be to achieve your goal correctly in the first attempt. Each error that you make increases the cost which the customer is not willing to pay for."

According to Siemens employees' union general secretary Uday Mahale, employees costs are now kept under check through the four successful VRS of the company. "In fact, the company may fall short of employees as they have got a couple of attractive orders," he said.

Over the last three years, Siemens has undertaken a number of large-scale internal restructuring to put the company on a par with its competitors. The focus of the restructuring was to make an elaborate product rationalisationexercise aimed at controlling costs and measures including an extensive sales promotion programme at the operator, dealer and customer end and an overhaul of the entire sales structure, and amplified focus on human resource development.The objective of the elaborate internal restructuring was also to redefine the company's financial parameters to bring more clarity to its performance.