Control News from Europe March 2008

Read Andrew Bond’s Industrial Automation Insider, a monthly newsletter covering the important industrial automation news and issues as seen from the U.K.

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Joy in heaven over Rockwell standards stance

A new white paper published by Rockwell Automation and downloadable from its literature site explores how companies can gain competitive advantage through their involvement in standard and regulation creation processes. “A Perspective on Standards: A Tool for Global Competitive Survival in an Increasingly Complex Regulatory World” includes contributions from leading standards, trade and conformity assessment organizations on why standards and regulations are important to global business and why industry should care.

Those with memories long enough to remember some of the fieldbus wars of the mid- ’90s, which featured a number of notable skirmishes between the Siemens-Profibus and Rockwell DeviceNet-cum-ControlNet camps may feel that there will be “more joy in heaven over one sinner that repenteth” when they read of Rockwell’s own chief technology officer Sujeet Chand arguing, “Never has it been more important that corporate leadership pays attention as standards have become critical to a business’ ability to compete and survive in an increasingly regulated and complex global marketplace. As manufacturing automation becomes more global and seeks consistent solutions in different geographies, standards become increasingly more important and can significantly impact a company’s profitability and competitiveness.”

Old formula won’t work

The paper is in part a plea for other suppliers and end users to identify and influence the development of standards to meet future industry and technology needs. It quotes ANSI president Joe Bhatia as saying that “The old formula for success—“engineer it, patent it and then sell it”—won’t work in today’s global marketplace. CEOs have two choices: Position your organization to take a seat at the table and be part of the standards-setting process, or let your competitors dictate the way you’ll be doing business . . . Market leaders and standards leaders are often one in [sic] the same.”

In a similar vein, IEC vice president Frank Kitzantides says, “The standards-savvy business leaders use standardization as a business opportunity. CEOs should care and need to care because standards have a big impact on their bottom line.” After recent events surrounding WirelessHART, however, he might reflect that some business leaders may have been a bit too savvy for their own good, and some CEOs may have cared a bit too much.

The paper argues the case for harmonization to create a single consistent set of applicable standards and regulations. Global reuse and interoperability requires industry-led voluntary action to achieve “one standard, one test, accepted anywhere.”

Global acceptance

“Regulation and related standards are increasingly compromising global companies’ ability to design anywhere, build anywhere and sell anywhere,” the paper concludes. “There are multiple paths to develop an effective international standard, but the key to success is to build support for a solution so that it is accepted and implemented globally.”

All of which sounds fine in theory. However, even in these enlightened times, vendors are not above pursuing involvement in the standards process in order to subvert it and, hence, protect what they perceive to be their own competitive advantage. Witness just in our own small corner of industry, recent events relating to FDT-DTM and EDDL. Today’s Rockwell may well be above playing such games, but it might still be edifying to speculate on how it would react, for example, to a suggestion to replace the current plethora of Industrial Ethernet protocols with a single standard, particularly if that single standard were, let us say, ProfiNet.

  • Rockwell’s competitors will no doubt be intrigued by a new white paper from ARC entitled “Rockwell Automation Builds a Business Value Proposition for the Oil and Gas Industry” which, not entirely surprisingly, can be downloaded from the Rockwell web site at http://www.rockwellautomation.com/industries/oilgas/. Not for the first time, the reader will be left wondering why ARC jeopardizes its reputation for objectivity by producing a document which fails to place the subject’s own capabilities in the context of its competitors. Indeed, it’s not until page 32 out of 35 and the section headed “Strengths and Challenges Moving Forward,” that there is a hint of anything other than total approval of Rockwell’s capabilities or strategy for oil and gas.

Even then the first paragraph of the section concludes with a restatement of an earlier observation by ARC that “The major process automation system players should consider Rockwell Automation as a formidable global competitor in the years ahead.” Only then do the authors concede that “Rockwell Automation does have some challenges. In the oil and gas automation system marketplace, the top tier of suppliers controls a significant portion of the market, with long-held installed bases of DCS systems and instrumentation. Rockwell Automation must continue to provide a superior business value proposition that gives oil and gas users a reason to migrate to their solutions outside of their traditional strong position in drives and MCCs.”

Whether such a superior proposition currently exists and, if it does, of what it is comprised are surely the key unanswered questions relating to Rockwell’s move into the mainstream process arena.

  • Rockwell Automation reported income from continuing operations of $156.6 million in the first quarter of fiscal 2008 compared to $130.9 million in the same period last year. Sales in the quarter were up 16% at $1,331.9 million. Architecture and Software saw first quarter sales increase 9% to $577.9 million while Control Products & Solutions sales were up 22% at $754 million. Chairman and CEO Keith Nosbusch said that half of the company’s revenue in the period came from outside the U.S. “While we acknowledge that there is significant uncertainty in the economic environment, particularly in the United States, we have not seen any fundamental change in customer demand for our products, services and solutions,” he added. “For the most part, customer capital spending and project activity appear firm at this time.”

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