What does it mean to be Emerson?

Chuck Knight, former Chairman and CEO, and now Chairman Emeritus, has left his planning stamp on the Emerson culture. David Farr, the new CEO and Chairman, is continuing that focus. The transition from Knight to Farr was seamless. The processes continued, the basic strategies continued, and all the key managers stayed to contribute.

Results, not politics

Open Communications at all levels

Strong commitment to technology

Customer Commitments are "sacred"

Accessible Management

Legendary Emerson Planning Regimen

Emerson Division Board Reviews

Emerson Acquisition Record

People Ethos

Leadership development

John Berra, President of Emerson Process Management has been with Emerson since 1976; he was at Rosemount when it was acquired by Emerson. John provided some of these insights. He is passionate about Emerson:

"Jim, my comments may sound like an unabashed sales pitch, and I guess they are. This is not hype - we really live this way. I have worked at other companies and have seen hundreds of others. Emerson is the genuine article!"

Yokogawa targets the top-spot

Yokogawa's President and CEO, Isao Uchida, openly boasted (unusual for the Japanese) that Vigilant Plant systems will win a leading market-share for Yokogawa by the year 2010.

Walt Boyes, outspoken editor of CONTROL magazine wrote in his weblog:

We're coming to get you and we're coming on strong! That's the message Yokogawa CEO Isao Uchida delivered last night at the introduction of their new DCS concept, Vigilant Plant. Pointing out that this is Yokogawa's 90th year in the controls industry, Uchida-san claimed, "Yokogawa has generated 20% sales increases outside Japan annually since 2000, so we are gaining market share. Some of the competitors in this room are not happy, but competition is competition."

I had heard that Mr. Uchida has the vision of making Yokogawa the top process control supplier. So I asked him if that was true and how he would accomplish it. He gave a clear and articulate answer. I'm impressed. I wish other companies in the industry had such a compelling vision, instead of serving customers with mumbo-jumbo.

Pinto's Pointers

Yokogawa has always had problems managing itself as a global company. In the past, decisions have been kept in Japan without allowing much local autonomy. It remains to be seen whether that changes in the US.

I have met Uchida-san personally, and have a lot of respect for his leadership. When he was originally given the assignment to sell Yokogawa products in the US, there was no support structure and all literature was in Japanese. So he knows first hand what it's like to try to gain market share outside of the home base.

One has to be a little surprised about the latest bold projections. Previously Vision 21 / Action 21 were Yokogawa committments to achieve 500B yen in revenues and 50B yen in operating profit for FY05. Estimates for FY04 (3/31/05) are revenues of about 400B yen and profits of about 15B yen. This would mean growth of some 25% and 230% respectively - not impossible, but unlikely.

Mr. Uchida's public statements are clearly intended to send a message to his own troops about his expectations. It remains to be seen whether or not Yokogawa's organization can make it happen. Time will tell if this is just sales-campaign rhetoric.

Yokogawa is an excellent company and all their key competitors take them very seriously. Mr. Uchida's boasts won't be taken lightly. Watch out for the sparks!

Invensys (Foxboro) gets a new US President - ex-Honeywell

This past week, Invensys Process Systems (Foxboro) announced that Virginia Burnell has been appointed president of North American operations. Burnell was previously VP & GM of Honeywell Hi-Spec Solutions, global advanced software applications. More recently, she was VP & COO of PAS Inc. which manufactures process control alarm management software.

Mike Caliel, president of Invensys Process Systems, made the announcement:

"Ginny possesses the ideal combination of industry knowledge, management excellence, and personal drive needed to help lead Process Systems on its path toward industry leadership. We will lean heavily on her leadership qualities to help unlock the unmatched capabilities resident within Invensys' Foxboro, Triconex, SimSci-Esscor, Avantis, and Wonderware brands."

"Ginny started out as a sales person for Honeywell in Houston and worked her way up to Regional Mgr. She and her team were very successful selling Systems and Solutions. She ultimately made VP and was promoted to Phoenix where she headed up Honeywell's advanced software solutions group. She left Honeywell, apparently because she didn't get along with the GM, who was from the old Allied Signal gang (he didn't last long anyway). She married Ed Szkaradnik, another Honeywell VP, who has since retired.

"Ginny really understands the Industrial Process Control market, particularly Refinery, Chemical and Oil& Gas markets. She has a strong personality, is very energetic and very customer savvy. Strategic planning is probably not her long suit - she was primarily focused on tactical and short term planning as it related to her sales background. This new job will be a stretch; but then, it probably would be for anyone, considering Invensys' current status.

"Basically, Ginny is a good person. I have no idea what the culture is at Invensys and how they would accept a hard driving, system-and- solutions oriented woman. The products businesses will not get much of her attention. She really understands certain customer segments and what drives customer buying decisions. I have my doubts as to whether she's ready to put up with what appears to be an unrelenting drive to improve profitability. Her skills will certainly help Invensys on the growth side of the equation, provided she has the tools (systems) to compete."

The end of oil - resurgence of nuclear power

• Crude oil prices have doubled since 2001, but oil companies have barely increased their budgets for exploring new oil fields.
• US refineries are working close to capacity, yet no new refinery has been constructed since 1976.
• Oil tankers are fully booked, but outdated ships are being decommissioned faster than new ones are being built.

In 1969, the geologist M. King Hubbert showed that a graph of world oil production over time would looks like a bell curve, with a peak around the year 2000. Hubbert had a track record as a prophet: his 1956 forecast that US domestic oil production would peak in the early 1970s proved correct. Remember what happened to gas prices?

Most experts agree that by 2010, market pressures will grow so intense that they will stimulate the resolve necessary to develop new energy sources. By 2019, the year in which Hubbert's theories predict that global oil production will drop to 90% of current rates, hopefully the world will have found replacement energy sources. But that's just Hope - governments tend to remain hands-off until too late in the game.

Nuclear power plants will make a comeback. Ultimately, the US will simply switch to nuclear power, the ONLY energy-efficient fuel. Coal (and oil-shale) with ease the transition from oil. The US will switch to high-efficiency diesel and hybrid automobiles in order to ration our remaining oil reserves for as long as possible. The future will be based on renewable and energy-efficient (nuclear) resources.

Must-read book: The Bottomless Well

I must tell you, I couldn't put it down till I read the whole thing. And I'm now re-reading my favorite sections. Indeed, this book has radically changed my own views on energy. You know, I'd buy this book just for the clear charts and graphs.

No, this is NOT a book which says oil will run out. Rather it emphasizes that, as humanity advances, more and more energy will inevitably be found - from the "bottomless well" of ingenuity and progress.

This iconoclastic book explains why the demand for energy can only go up. Most of what we think of as "energy waste" is actually beneficial - it signals progress, with energy usage a cheap byproduct.

More efficient cars, engines, and light-bulbs will never lower demand - they'll increase it! Why? Because cheaper and better products stimulate demand, and increase total energy usage. As energy becomes more "ordered", waste is both necessary and desirable, and the price really doesn't matter very much.

In the automotive sector, gas prices matter less and less, and hybrid engines will most likely lead us to cars propelled by the coal-fired (and then nuclear-generated) grid. Expanding energy supplies mean higher productivity, more jobs, and a growing GDP. Across the board, energy isn't the problem; energy is the solution.

Wow! Get this book, and read it! My Pinto guarantee applies - if you don't like the book, mail me your copy, and I'll refund your money! (Heck, I don't know why I do this....)

eFeedback

"The oil dependence problem is glaring at us. It has raised its ugly head, shown its teeth and has taken bite after bite out of our national economy. Will we stand up and do something about it? Or will we allow our leaders to 'spin' the reason for the problem, and persuade us to be content with only trying to suppress the symptoms?

"Looking back on the history of America's growing oil dependency and comparing it to the present trend in outsourcing and importing, we have what can be considered a 'map' that revels where America is heading. If we continue down this path, our future will be one of increasing economic dependency.

"If the American people cannot agree that oil dependence is a problem, and what to do about it, then how will the USA solve these other problems that are leading us down the road to economic disaster?"

"Your article on 'The China Price' is accurate, but not the complete story. I am no economic genius but it appears to me we are locked in a economic war with China, they refuse to allow their currency to float like everyone else in the world, which allows them to remain artificially cheap, but they are paying a big price for this. The price of oil, and steel, drain away valuable hard currency from the Chinese economy.

"The Chinese are betting they can run out the competition before the impact of their economic policies hit home. American industry is trying to weather this economic tidal wave.

"As long as China continues to grow they must import vast quantities of raw materials, and they are paying extremely high prices for these materials. If you keep your currency artificially low to run out the competition from the rest of the world, but have to purchase materials at a high price, sooner or later this affects your bottom line. We saw this occur when all the other Asian nations were forced to allow their currency to float, those economies basically crashed. In my opinion China is headed in that same direction.

"Whether I am right or not time will tell."

"I know what you mean about disposing of computers. I build a new box about twice a year, moving my older unit up through my home network, first to my wife's "office" (which is where our bathtub used to be, in the master suite), then to the guest room, then to the garage as a backup (some day, that one will be used for the home automation system I've been devising since 1997) and finally out the door. It's that "door stop" computer that actually gives the most benefits.

"I work with the old (207 years) Mission San Luis Rey parish church (Oceanside), which is a mile from me, to refurb older PII and PIII computers, clean them, reformat the drive, load 98 SE and generally get them to work as well as possible. Then the group sends them to Mexico, for school kids and schools where these are considered leading edge systems. I'm sure there are similar groups everywhere, and others that send them to Africa and other developing areas where these systems are high tech. But there's always the cost to ship.

"Some are pushing for total destruction of CD and DVD disks, but only a few companies offered data destroyers for hard-drives. Software that supposedly totally blanks the drive makes sense for a large company that might be moving dozens or hundreds of systems a year - since many will have classified data on them. Like that FBI laptop that "disappeared" along with secret data.

"Whatever happened to those 'Mission Impossible' recorders that self-destruct? Now THAT would do it. Poof!"