Electrical Business

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ABB repositions Power Systems division to drive higher returns


December 14, 2012
By Anthony Capkun

December 14, 2012 – Following its strategic review of the Power Systems division, ABB says it is repositioning the business “to secure higher and more consistent profitability”.

“We’ve made substantial investments recently to increase Power Systems’ potential for value creation,” said Joe Hogan, ABB’s CEO (photo). “However, Power Systems has not generated consistent returns. This is not acceptable; therefore, we are recalibrating the growth, profitability and cash return ambitions for this division.”

The division is shifting its focus to higher-margin products, systems, services and software activities, says ABB, and closing low value-added EPC (engineering, procurement and construction) operations in more than 10 countries “where project returns do not reflect the execution risks involved”. To implement this new strategic focus, the division has made leadership and organizational changes.