In today's rapidly changing world, no company can afford to sit back on its laurels, even if they are as impressive as those of Endress+Hauser (E+H) are.
E+H is a world-leading instrumentation company that saw its turnover increase during financial 2000 to some 1,15 billion Swiss Francs, with record net income of almost 45 million. In addition, E+H continued its record of product innovation through registering some 81 patents during the year, more than twice its previous record. Innovation has of course been core to the business of the company for almost 50 years, since the launch of the first capacitive probe in 1953 to the first temperature sensor compliant with the HART protocol (2000) and the first ISFET sensor for pH measurement (2001). A glance at the E+H annual magazine, Changes, reveals that the company has had a first (or two) virtually every year since 1977, an enviable record.
E+H has traditionally been a supplier of instrumentation, and a recent independent local survey shows that they are number five overall in the instrumentation and control market. E+H believes it is number one, if DCS and PLCs are excluded, measuring instruments being the only parameter. In terms of instrumentation, E+H has not only demonstrated its innovation in terms of bringing new products to the market, but has differentiated itself through providing products that are second to none in terms of price/performance reliability, ruggedness and quality. With price becoming an issue internationally, E+H has become increasingly aggressive in terms of its pricing policy, as well as providing lower total cost of ownership and value added services to the end user.
With regard to the latter, E+H has formed a new internal group known as Process Solutions that is tasked with supplying total solutions to the customer, instead of only products. E+H experts will look at the application, assist with engineering, and finally offer a customised solution. Third party products could be included in specialist areas, such as intrinsically safe applications, while the latter would be largely based around the extensive E+H instrumentation range. E+H would also arrange for installation, calibration and commissioning of the plant under their overall guidance, through their own resources and established alliances with systems integrators and other contractors.
The instrumentation specialist has formed several international and local co-operation agreements. These agreements are in place with many of the major I&C players including Vega, and Pepperl+Fuchs. Another important strategic co-operation agreement has been signed with Finnish group Metso, the product range of the latter (valves, drive systems and systems engineering) ideally complementing the traditional E+H product line. E+H claims to have the widest range of Profibus, Hart and Foundation Fieldbus instruments on the market and in a recent development a strategic alliance has been formed with the Brazilian company SMAR, a world-leader in the promotion of open connectivity and an expert in Foundation Fieldbus. While Profibus is widely used in South Africa (E+H has more than 15 000 installed I/O) Foundation Fieldbus is an emerging technology and this new SMAR partnership will be of significant benefit to local industry and the automation solutions approach of E+H.
While the company is product based, E+H have made the decision to approach the market from an industry perspective. Global core areas of competence include petrochemical, mining, food and beverage, water and wastewater, power and pulp and paper. The company can call on specialists in each of these industrial areas from their worldwide staff of 6 200 employees. South Africa itself is a centre of excellence with regard to the mining industry and can provide international guidance and advice on this market.
Endress+Hauser, the fully owned South African subsidiary, has also seen many changes in the past twelve months. Not least of these was the replacement of its Managing Director, John Immelman, by Tony Jacobsen. John, notably, was transferred to Australia to start up a similar local subsidiary in that country. Tony, of course, is no stranger to the instrumentation and control industry, having spent fourteen years with Hartman & Braun, a short period at Honeywell and five years as MD of Burkert Contromatic, before being offered the opportunity to take up the reins at E+H. Tony is a qualified electrical engineer (Wits) and has a strong grounding in I&C project management, having been involved with the massive Mossgas project.
Customer loyalty programme
This was started in South Africa some two years ago and was intended for those identified customers for whom E+H wanted to offer exceptional levels of service. At present, the biggest participant in this programme is De Beers, with South African Breweries, Clover and Nestlé expected to follow. Building on its renowned service performance, E+H affords loyalty clients special attention with regard to product support, after sales service and - in some instances - pricing. A recent five-year service excellence award from non-loyalty customer E L Bateman underscores E+H's continued commitment to its entire customer base.
In addition to the customer loyalty programme, E+H has a worldwide network of key account clients that benefit from standard pricing agreements and minimum levels of service. Key account companies with a local presence include Dow Chemicals, Nestlé, Vivendi and Unilever.
Social responsibility
Dr Georg Endress, co-founder of Endress+Hauser, is no longer active in the day-to-day operations of the company, this being in the capable hands of his son Klaus, the present group CEO. Georg, however, plays an important role in seeing how the company can contribute in other ways to the economies in which it is active. In South Africa, the interest is to improve the level of education with specific emphasis on the instrumentation and control field. E+H has an existing agreement with the Witwatersrand Technikon with regard to experiential training of their students, the more talented often finding employment within the company. During the next year, the intention is to take this much further through the creation locally of an E+H University. The decision has still not been taken whether to establish an open school or enter into an alliance with an existing tertiary educational body. Klaus Endress himself was recently quoted as saying, "We are used to taking our share of responsibility for the community that we are working and living with".
Into the future
E+H is introducing many initiatives to ensure that its market share and turnover will continue to grow. At the lower level of technology we have seen the introduction in South Africa this year of the instrument express that offers a greatly simplified sales channel in the way of a short-form catalogue of the more popular simple instruments.
While paper catalogues will be with us for many years to come, E+H has also taken cognisance of the moves towards e-commerce. In fact, a significant part of the company's business lies in the petrochemical area and a recent article in Engineering News has predicted that this sector's e-business volume alone will increase to some $300 billion per year by 2004. E+H has already made a significant investment in the infrastructure required for e-business and has pilot systems operating in Germany and France. These systems provide clients access to the E+H database and orders can be placed directly, after which the physical product itself can be traced as to where it is in the manufacturing or delivery system. South Africa is ready to go online as soon as the local client base requires it.
A really innovative new support offering from E+H is W@M, or web enabled asset management. Many of the new products to be launched by the company during 2002 (such as the new range of ultrasonic products) have a self-diagnostic capability on board, and this can be interrogated remotely. W@M will allow E+H to carry out asset management for companies who have this requirement. Following an initial audit to ensure compatibility, all instruments could be interrogated remotely and the customer can be advised which are due for a service, repair or calibration. As W@M will operate with open protocol, it will in principle support all of a plant's instrumentation, not just that supplied by E+H.
The general philosophy of Endress+Hauser is to be in direct contact with customers rather than operating through agents. This is particularly true in South Africa and the company opened new branch offices in Rustenburg and Witbank during 2001, augmenting those existing in Cape Town, Durban, Klerksdorp and Port Elizabeth. Next year, the on-the-ground E+H team will be further expanded through the opening of offices in Richards Bay, Secunda and Kimberley. E+H South Africa is also responsible for the entire southern Africa region, where a lack of resources and a smaller market sees the use of local agents, widely distributed through the SADC countries.
Endress + Hauser
(011) 262 8000
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