By Walt Boyes, Editor in ChiefAS WE
finalized the CONTROL Top 50, it gave me a chance to put the vendor portion of our industry under a microscope, and take a very close look. For the first time in a decade, almost every vendor is showing signs of growth, and the largest vendors are recovering nicely from the self-inflicted wounds of the 1990s and early 2000s. ABB, Siemens, ThermoElectron and all the other vendor companies, who didn’t know the value of all their acquired brands, are working diligently to rebuild brand awareness of some of the great old names now only found in the “Directory of Lost Companies
Granted, many of the vendors involved are moaning and complaining that there’s too much competition, but as end users, we know that there’s no such thing as too much competition. What this means is that competition is heating up between the vendors left on the field, and you, as end-users, can really take advantage of it. For Yokogawa to make good on its promise to become the world’s largest DCS vendor by 2010, for example, it must provide more value than its already entrenched competitors. More value means better stuff at lower prices.
The Big Boys are saying there just isn’t room for six major DCS manufacturers. Maybe they’re right. But you know what? It’s you end-users who get to decide by voting with your bucks. This is, as they say in New England, “wicked good.”
The Big Boys are prepared to buy your loyalty with all sorts of goodies, so keep your own “price” high. It is a buyer’s market for the first time in decades. If there’s something you want that is an expensive add-on to their system, understand that competition makes expensive add-ons become much less so—really quickly. Go to bid for it, and watch the price fall.
This is true everywhere in the world. In North America and Western Europe, traditional strongholds of the Top 50 companies, they’ve realized that it costs less to keep a customer than to go out and get a new one. So, to all you end-users in brown-field plants, remember that this buyer’s market applies to you, as well. And you end-users working on greenfield expansions in China, India, the Pacific Rim, Eastern Europe and South America can basically set your value meter on “extra high” for the remainder of the decade. Just keep pushing until the meter pegs to the right.
All the major controls manufacturers have figured out that the services business is a great money-maker, and they’re all just salivating over the idea of providing you with the best possible service, so they can extract money from you every month, instead of every upgrade. End-users can use this as a lever to extract the most value from the services wings of the major vendors, and you can really improve the level of service you’re receiving from your major automation suppliers.
As long as the worldwide economy continues to grow, and as long as the markets for the goods our fellow end-users produce keeps enlarging, it’s going to continue to be a fine time to be an automation end-user in the process industries.