Sink or Swim the Internet Wave By : Jim Pinto, San Diego, CA. USA The change to a new century highlights the possible problems of moving over the threshold of the new millennium - overshadowing the tremendous changes that have already occurred and the enormous opportunities that are emerging. First published in InTech, June '99

The industrial automation business is now in a slow, or even recessionary, period. This belies the fact the U.S. economy is robust and the stock market continues to surge forward. Lack of growth in industrial automation is caused by over-capacity, which is now resulting in consolidation. Lack of Growth causing M&A Companies are merging, or making acquisitions, to generate growth and yielding profits by shedding duplicate capacity and sharing resources. In addition, in a fast-shrinking global business environment, only larger conglomerates with truly international presence will succeed. So, the mid-size niche-players are faced with an ultimatum: Merge or die. Few, if any, industry leaders have bucked this trend. ABB bought Elsag- Bailey, which had previously bought Fisher & Porter and Hartmann & Braun. Emerson bought Rosemount and then Fisher Controls and then Intellution to gain a presence in PC-based software, the modern equivalent of DCS and then, more recently, a Division of Westinghouse with complementary market presence. Siemens acquired the PLC business of Texas Instruments, to boost their presence in US markets. Modicon was first acquired by AEG and then a joint-venture by AEG Schenider and eventually just Groupe Schneider which already owned Square D and French PLC manufacturers April, Merlin Gerin and Telemechanique. Leeds & Northrup, unable to survive as a unit of General Signal, was sold to Honeywell. Rockwell (Allen-Bradley) acquired German PLC manufacturer Sprecher and Schuh as a means to gain a foothold in Europe. Siebe already owned Foxboro, Robertshaw and Barber-Colman and then acquired APV, Wonderware and Eurotherm and more recently completed a merger with BTR. The list goes on, and consolidations will continue. Recognize the change Of course, the hope is that consolidation will generate short-term growth and profit, with eventual return to organic growth as the industry itself expands. But, in a global market with few boundaries and instant communications, the industry continues to have excess capacity and this simply results in interminable rounds of competitive price-cutting, which helps no one. So, where will this lead? The problem is not recession, but simply a change in the way the world is doing business. For industrial instrumentation, the new way of doing business is the Internet and Moore's Law, which says device complexity doubles every 18 months. The wave of technology Don't think of the Internet as technology. Think of it as the future of your business. From almost nothing, the Internet has now connected more than 90 million businesses and individuals, representing a rate of growth about five times as fast as TV two generations ago. And the growth rate is gaining speed; expected beyond 250 million within the next two years. Let's take an example of a staple product in the instrumentation business: chart recorders, a business marketing studies report is declining steadily. These same studies tell us the only bright spot is "videographic" recorders, which are showing some growth. The only possible application for a chart-recorder with a geared-motor driving a limited length of chart-paper is in an old plant, which would need extensive re-wiring, operator re-training and logistics changes. Strange as it may seem, in some cases the chart-data is often manually transcribed into numbers, which are then entered into a spreadsheet for reporting. Merely duplicating the functionality in a videographic version of a recorder is a short-term palliative. Today, the functions of chart-recorders have been transcended by automatic data-acquisition systems, network I/O with memory. Recently, I visited a high-rise office building in Houston, Texas where an engineer showed me the real-time readings and trend-graphs for a boiler room in their plant in Hawaii, and similar displays for another plant in Australia. This "sensor to boardroom" linkup is not futuristic stuff. It is here and now. With Internet infrastructure growing, the choices become imperatives. Indeed, why would a plant engineer wish to walk to the other end of a plant to review a boiler-temperature chart, when she could review it at her desk? And then she could automatically convert the result to a spreadsheet, which she could then e-mail along with her encrypted and validated report. Go ahead - surf the Internet So, how are you changing the way you do business? Are you still moaning and groaning about the decline in business and the escalating cost of sales-calls and about steep price cuts? Or, are you leading by finding new ways to do business and service customers? As the wave of change moves inexorably forward, the difference between surfing (profiting from the changes) and drowning (getting buried in the undertow) is only a mouse click away. The Internet is not something that will happen in the future. It is the future - and it is happening now.

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