A lot of news of interest to the automation and manufacturing community has accumulated this week.
The Knowledge@Emory newsletter from the Goizueta Business School of Emory University is an excellent monthly resource for ideas. There are three articles especially interesting this month:
The American landscape has changed. Unemployment rates remain stubbornly high at close to 10%, companies and state governments are being forced to shed jobs, cut services and close schools, while the lack of capital continues to stifle small business and job creation. With daunting domestic problems from a growing deficit to gridlock in Congress, what’s the mindset of the American worker? Knowledge@Emory recently spoke to Rick Gilkey, professor in the practice of organization and management at Goizueta Business School and associate professor of psychiatry at Emory University’s School of Medicine, to gain insight into the tenor of Americans during this uncertain time.
The scandal resulting from Toyota Motor Corp.’s failure to adequately address life-threatening malfunctions in several of its car models has once more underscored the importance of ethics in corporate decision making. Though the market often rewards quick performance, Paul Root Wolpe, chaired professor of bioethics and director of the Emory Center for Ethics, says that “in the long term, it tends to punish companies that achieve those results improperly.” In a recent Q&A with Knowledge@Emory, Wolpe discusses the effect of ethics on a company’s bottom line, especially in an Internet-saturated culture where the fallout from unethical decisions can be uncontainable.
Christopher Klaus, founder & CEO of Kaneva, told an audience of BBA students that despite the gloom and doom they may hear, “It’s a pretty amazing time to be an entrepreneur.” Given ever-expanding Internet access to potential customers and business partners, he believes “there are thousands of opportunities if you have the right skill sets to pursue them.” The keynote speaker at Emory University’s Goizueta Business School’s 11th annual Undergraduate Business School Leadership Conference (UBSLC), Klaus predicts major paradigm shifts ahead, including the use of gaming technology to enhance education by taking a “boring subject and transforming it into a fun video game,” participatory marketing and branding in virtual worlds, and the rising demand for technologically savvy leaders with global perspectives.
New OPC Foundation Member
NextNine, a global provider of remote product service solutions, has joined the OPC Foundation as a corporate member.
“This membership will allow us to offer comprehensive OPC support to our growing list of manufacturing and automation customers,” said NextNine VP Marketing and Business Development, Nimrod Reichenberg. “We strive to make remote service easy. Out-of-the-box support for OPC will enable our automation customers to quickly design and deploy such services to their customers.”
NextNine Service Automation (NSA) allows automation vendors to remotely service a broad range of products, from simple drives to complex control systems. Using a single software platform, service organizations can remotely capture and analyze plant data, troubleshoot issues more effectively and offer premium services that increase the efficiency of the manufacturing process.
OPC UA Training
Unified Automation has partnered with leading OPC UA consulting companies to provide training to jumpstart OPC UA development. All trainers and presenters are members of the OPC UA core working group. Unified Automation, ascolab and DSInteroperability join together to provide a complete infrastructure to enable rapid deployment of OPC Unified Architecture in Europe and North America for Microsoft and non-Microsoft platforms. The complete list of webinars and training events. Register for the first OPC UA introduction webinar. This webinar will be held on Thursday, March 18, in 4 different time zones. The first Developer Training will be held April 20th-22nd in Houston, Texas.
The Manufacturing Recovery Has Begun But Is It Sustainable?
This report from ARC Advisory Group contains several nuggets of interesting information. It sees a modest recovery in 2010 for automation suppliers. It also sees controllers becoming increasing commoditized with falling prices driving suppliers to increase support and service offerings to drive growth. From the report:
Automation supplier revenues continued to fall throughout 2009 as compared to 2008. ARC expects that year-on-year comparisons between 2008 and 2009 will experience a decline, with modest growth in 2010. ARC sees signs that the manufacturing recovery has begun but its continued success depends on the ability of the financial markets to return to normal functioning. Small, medium, and large businesses have all been strained by the inability to access short-term capital. Moreover, many businesses have simply delayed capital equipment expansions, particularly if they manufactured components in the automotive supply chain.
Although the short-term forecast for the global automation expenditures for the process industries looks bleak, ARC expects moderate market growth to resume during the latter part of the five-year forecast period. Once the economic turmoil settles, the globalization environment will resume, which will once again cause manufacturing companies to invest in capital expenditures. “Manufacturers will continually face challenges to raise productivity, lower product costs, reduce plant operating expenses, and increase return on investment (ROI) to compete in the global market. Consequently, capital investments for automation should resume across many industries,” according to Senior Analyst David Clayton, the principle author of ARC’s “Automation Expenditures for Process Industries Worldwide Outlook”.
It is not often that price erosion becomes a major concern in the automation sector. However, industry veterans have experienced double-digit price decreases. There are several reasons for this, but the net effect is that the market will have difficulty growing even in the high single-digit range over the next five years. One element contributing to the price erosion is that controllers are rapidly becoming an automation commodity in some sectors. Differentiation between products, capabilities, and performance factors is rapidly diminishing. A large percentage of the suppliers in the market can compete very effectively from a performance criterion across many markets. This increases price competition.
With the commoditization of control equipment, many automation suppliers are differentiating themselves by broadening the scope of services offered to include front-end engineering and design, operations, outsourced maintenance, and performance improvement. Users and suppliers alike benefit from a more collaborative relationship. Users can leverage the expertise of suppliers to help manage plant assets across their entire lifecycle. Suppliers can go beyond being just automation providers, enhance their overall project revenues, and enjoy long term revenue streams through customer service relationships.
The change in leadership in America, dwindling oil and gas reserves, and environmental concerns are providing an environment ripe for alternative fuels. Revival of the nuclear industry and LNG liquefaction and gasification plants, commercialization of clean coal and cellulose ethanol are all possible. Suppliers should keep abreast of these markets by helping them solve measurement problems with industry specific solutions.
American Machine Tool Distributors Report
January U.S. manufacturing technology consumption totaled $130.96 million, according to AMTDA, the American Machine Tool Distributors’ Association, and AMT – The Association For Manufacturing Technology. This total, as reported by companies participating in the USMTC program, was down 40.3% from December but up 26.2% from the total of $103.77 million reported for January 2009.
These numbers and all data in this report are based on the totals of actual data reported by companies participating in the USMTC program.
“Many customers placed orders in December to take advantage of tax relief measures, pulling orders out of January 2010,” said Peter Borden, AMTDA president. “The good news is that January 2010 orders are still 26% ahead of January 2009. Fortunately, there are measures moving through Congress that will expand these benefits, incentivizing manufacturers to invest in capital equipment in 2010.”
Honeywell has signed a global five-year agreement to be a Main Automation Contractor (MAC) for Shell. The Global Framework Agreement (GFA) is part of Shell’s long-term MAC strategy to maximize production while lowering total operating costs by equipping its worldwide facilities with integrated process automation technology.
As a MAC, Honeywell will design automation and safety systems that will help Shell meet its customers’ energy demands in economically and environmentally responsible ways. For more than three decades, Honeywell has served as a MAC on hundreds of Shell projects. Currently, Honeywell is working on three of Shell’s largest projects: its new gas to liquids (GTL) plant in Qatar, the Athabasca Oil Sands Project (AOSP) designed to help Shell dramatically increase production in Western Canada’s oil sands, and the expansion of its Port Arthur Refinery.
Honeywell also announced it is providing virtualization technology for its Experion Process Knowledge System (PKS). This technology can help manufacturers streamline Experion system management and is said to lower the total cost of ownership by up to 30 percent.
Virtualization allows a single server to simultaneously run multiple operating systems and applications. It also improves reliability by insulating these operating systems from hardware changes. When process manufacturers use this technology with Experion, they can improve server utilization rates, reduce disruptive operating system and hardware changes and simplify overall system management.
Honeywell’s range of virtualized offerings include Experion off-line testing and development solution that can be used for training, simulation and engineering. It also includes Experion’s suite of Advanced Alarm Management solutions that improve process safety and operator efficiency, and eServer solutions that provide Web access to the system. All three products have been awarded VMware Ready status, which provides independent assurance that Honeywell has tested its software with VMware vSphere.