The ‘irregular and irreverent’ JimPinto eNews has certainly been irregular over the last couple of months – I have been away, happily going off on bucket-list trips. You remember the movie ‘Bucket List’ where two friends dying of cancer decide to go to all the places they wanted before they ‘kick the bucket’. That is my model. Well, I am still in good health, so I keep going off on Bucket List trips . . .
In July we went on a 2-week Educator’s tour of China. I had visited China on sales-trips before, but this was purely for pleasure. We visited Beijing first – Forbidden Palace, Tiananmen Square, Great Wall, boat cruise in Dragon Valley, and many other wonderful places, along with good history-major tour guides who explained everything. After tours of the bustling old/new cities Suzhou and Hangzhou, we arrived in Shanghai for the world’s largest-ever Expo; every country had its own big building. We could only visit a few sites in the day we were there; with huge lines waiting to enter each exhibit. I had been to Shanghai some 15 years ago, and did not expect the glamour and grandeur I saw this time. Shanghai is now the largest city in China, growing 10% annually. Every evening at dusk the city lights up and the crowds gather at the Bund, the famous waterfront, in year-round celebrations. China has the largest population in the world and just this year has climbed to No. 2 on the GNP list, behind only the US, exceeding Japan and all other European countries. It is evident that the Chinese are moving fast towards prosperity and success.
Then, after just a week back home in San Diego, we went off on a British Heritage tour for another two weeks. I had lived in and around London for almost 10 years, and had made many sales-trips around the country. But I had never really seen Britain – so this was part of my bucket-list. On the first day, after a boat-trip along the Thames to Kew Gardens, and then Hampton Court, we returned to Piccadilly to see ‘Jersey Boys’, the musical, at a central London theatre. We then went off to see Stonehenge, Bristol, Bath and Chester. I had been to Chichester, Winchester, Colchester and Manchester – but never to Chester (earmarked for another visit). We went to the Lake District, and then Scotland where we took a boat ride along ‘the bonnie-bonnie banks of Loch Lomond’. Next were Glasgow and Edinburgh (with a brief stop at Rosslyn, the 15th-century medieval chapel of ‘Da Vinci code’ fame) and St. Andrews (the birthplace of Golf). On the way back, we stopped at Coventry and Shakespeare’s Stratford-upon-Avon. My word budget is fading fast so I cannot continue and wax eloquent on the pub-grub we sampled and the beautiful places we saw.
It is going to take me a while to get back to normal, but I know you will understand . . .
Small is better in industrial automation
The phrase ‘small is beautiful’ comes from the title of a 1973 collection of essays by British economist E.F. Schumacher. The book champions small ideas, in contrast with the ‘bigger is better’ syndrome. In an August 2010 article, I examined the question: Can large automation companies be innovative, or is smaller better for innovation and creativity?
How many engineers in a large company work 15 hours a day on a new idea? Where in a large organisation can you find the innovation and passion that typifies the start-up? This is the primary reason why big organisations are not as innovative as smaller ones. They crush innovation before it interferes with the status quo.
Especially in tough times, managers within large organisations push to stay within budget. Their survival instincts are to conserve, not to expand. Rather than risk disruptive change, their instincts are to push sustaining developments and incremental improvements. There is always fear of competing with existing products (which may currently be contributing to the top and bottom lines).
Many people just give up when facing this dilemma, especially when the company is still profitable. Some choose to downsize, allowing the recession to be an excuse. They cut new-product developments and curtail advertising to preserve budgets.
Others seek to stretch development money by moving offshore, where engineering per-head costs are significantly lower. But that simply cuts loose the innovators, who form start-ups to develop their new ideas without organisational inhibitors.
With no organic growth, most large automation companies are following the strategy of acquiring smaller companies, expecting to extend the smaller organisations success record through expanded sales channels and global coverage. But that does not work. The acquired company is usually forced to fit into the larger organisation, with its hierarchy, budgets, policies, procedures and petty politics.
The innovative leaders inevitably exit, leaving only second-level followers to fit into the larger corporate hierarchy. Acquisitions typically stagnate and simply get absorbed into the bowels of the larger organisation.
My conclusion: In industrial automation, smaller is better.
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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