I have just returned to my home in San Diego, California after a very enjoyable 3-month trip that took me to a series of speaking engagements in England, South Africa and India.
I left San Diego when gasoline was over $4 per gallon, and returned at less than $2. I left America when the DOW stock index was just dropping below 10 000, saw it plummet to 7500 and then settle nervously above 8000 after infusions of billions and promises of trillions more.
Whither the automation business?
The industrial automation business seems to lag and has still shown some growth in the past quarter. But ARC Advisory Group, the premier automation analyst recently published 'A Series of Unfortunate Reports' by Larry O’Brien.
“Clearly, the global manufacturing environment is in the midst of a big contraction. Projects are still proceeding in many sectors, but others are being cancelled and/or postponed. We at ARC still feel that despite overall market contraction in North America, Western Europe, and other developed economies, there will still be growth in the Middle East and emerging markets, such as China and India, although this growth is probably less than half the levels we saw between 2007 and 2008. Nobody gets a free pass this year, and even the market leaders are going to find it a challenging business environment.”
The automation leaders are all undergoing shrinking pains, some worse than others. Large companies are all driven top-down, by organisational management and budgets based on ratios. There is very little real innovation, and minimal agility. When revenues shrink, the bean-counter ratios demand shrinkage to protect the bottom line. If that is not preserved, the companies’ stock declines and the dominoes begin to fall.
Top trends for 2009
Here are my views of the top-5 automation technology and market trends for the coming year.
Industrial wireless: Wired systems keep getting more expensive and difficult to install, while wireless monitoring keeps getting cheaper and easier. Wireless is shaping up to generate significant new automation markets, and stimulating visions of growth.
Machine-to-machine (M2M) communications: The convergence of smart devices with the Internet is creating a new inflection point. M2M is focused on the issues of how machines communicate, how they are managed, how the data and information within them can be utilised to add significant new value.
Security Services: Most of today’s automation and control systems use the same hardware, operating system and communications as widely deployed personal, office and administrative networks. Worms and Trojans can enter plants and factories via the Internet and through Intranets, plus deliberate intrusion through wired or wireless networks. Automation systems security has become an urgent issue and will be a major growth arena.
Complex adaptive systems: At the input/output level, most of today’s systems are clumps of I/O connected in deterministic, hierarchical systems, prone to failure when complexity increases. By contrast, programmable, intelligent, autonomous I/O systems with algorithmic (rule-based) response mechanisms have no theoretical complexity limit. During the next decade, this type of system will improve performance and robustness (failure-proof) at a fraction of the cost of conventional systems.
Disappearing software: Just as today’s firmware is not external and separate, software will become part of the product. The only external software needed will be in the browser. Everything else will be 'applets' and similar 'client-side' operations, triggered by 'objects' and 'agents' that reside within the system.
Jim Pinto is an industry analyst and commentator, writer, technology futurist and angel investor. His popular e-mail newsletter, JimPinto.com eNews, is widely read (with direct circulation of about 7000 and web-readership of two to three times that number). His areas of interest are technology futures, marketing and business strategies for a fast-changing environment, and industrial automation with a slant towards technology trends.
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