Tek-Supply Blog

By Gregory Hale
With the ebb and flow of the world’s volatile economic environment, it comes as no surprise the economy was on people’s minds at ISA EXPO on Tuesday.

While no one has a crystal ball, it is clear the real winners are those companies and people that saw the economic disaster coming and made plans early so they did not have to react in a hasty manner.

Guillaume Coffinier from Dallas, Tex.-based Texas Instruments has felt the aftermath of the downturn.

“It has affected my company, but not my job. There were some layoffs that were big for some plants, but I don’t think it will affect me. It’s over—hopefully. I’m doing business development for semiconductors, selling to the automation market.”

It is easy to dwell on the negatives these days, but how about looking at the silver lining.

“With the economy slowing down, one of the good things is we are spending time teaching (users) how to use their technology,” said Rich Chmielewski, marketing manager Chemical and Biofuels Process Automation at Siemens.

“Before they would get it and put it in and operate right away. Now they have time.”

Even in a tight market, there are some companies that said they are doing well.

“We are up 10% for the year, but we are a small company around $20 million over last year,” said Kevin Finnan, vice president of marketing at Semaphore.

One of the advantages Finnan said his company enjoys is they are diversified. “No one vertical market is 25% of our company. We are working on emerging markets like solar, and it seems to be sticking.”

Finnan sees anything related to energy as a growth market for the future.

“People are wasting so much energy. It is all about getting organized. In the past year, people are seeing a pay back. People can save up to 25% with the right energy management plan. Green energy initiatives are not going away.”

But it all comes down to whether it is a profit or a loss. “Nobody is going to do much unless it affects the bottom line,” Finnan said.

“We haven’t seen the impact other companies have seen,” said Chris Martin, senior director of product management at security provider Industrial Defender. “At the end of the day, if companies have an incident that affects them, it is not an option.”

Martin said he has found if you can show you can generate a real return on investment that will always go in your favor. “Seven years ago when we started this, it was all evangelizing, but now it is a lot better as people have a lot more information available,” he said.

Even those companies that started the year off slow are starting to see some type of rebound.

“Up until the last three weeks, business has been down on a par with the other companies out there,” said Arun Sinha, director of business development at Opto 22, a networking and I/O provider. “In the last three weeks, though, business has been up to normal levels.” Sinha said earlier in the year business was down between 20% and 30%.

The same is true with Ron Seredian, vice president of marketing at Falcon Electric, a UPS provider.

“It has really slowed down, but we are just now starting to see more business pick up. We are actually starting to see business come in from university labs.”

By Ellen Fussell Policastro

John Hofmeister came to ISA EXPO to present a problem he does not believe anyone can solve with all the intelligence and know-how that we as individuals and companies have with respect to automation.

But it is a problem we can solve as U.S. citizens and voters. “Imagine the future 10-12 years from now without sustainable supplies of electrons. Imagine what will happen in the factories, labs, and processing that needs to be done automatically if the supply of electrons is short, unstable, and insufficient,” he said during his keynote address Tuesday morning at the Reliant Center.

The basic problem, as Hofmeister sees it, is by 2018-2020 the U.S. will enter a period of energy instability of liquid fuels. “The problem we all face in this country is 300 million people will be short on electricity and liquid fuel at the rate we’re going. It will take another decade to work our way out of what we’ve spent a decade working toward,” he said. And that is energy independence.

Hofmeister’s solution is a Federal energy reserve board, “which will only happen by a grassroots movement of Americans saying, ‘We’ve had enough,’ ” he said. Hofmeister is the founder and chief executive of Citizens for Affordable Energy and former president of Shell Oil Co.

He formed Citizens for Affordable Energy not to lobby, but to put the facts out there—to help people better understand what is at stake, what is required, what is possible, and how we have a 21st Century of national security to protect affordability and to save our lifestyle.

He wants to create a new independent regulatory agency called a federal energy resources board to take energy policy away from Congress, which has had 46 years, “and we’re worse off than we’ve ever been because every politically correct endeavor came for naught,” he said. “Our economy is suffering; our lifestyles are hurting; we need an independent regulatory agency.”

Energy problem

Hofmeister reminded ISA EXPO attendees that automation devices do not run on political aspirations, they run on electrons. “You need coal, uranium, gas molecules; you have to have reliable electrons. It affects you directly—your company and your personal well-being. We can’t let political talk determine what the future looks like,” he said.

In the last five years, this country has shelved or delayed or stopped the plans for 100 electricity pulverized coal generating facilities—to begin to replace an aging generation of 600 coal plants where the age is 35 years, Hofmeister said.

Seeing as how 93% of today’s energy comes from hydrocarbon and nuclear (50% from coal, 20% from nuclear, 17% from natural gas, and the rest from oil), it is amazing “we’re not investing in any one of those areas except natural gas,” Hofmeister said. He wondered why we cannot understand this 93% is so critical to our national security, lifestyles, and economy.

Partisan paralysis

The problem lies in the dichotomy between creating energy policy in political time. “We need to create energy policy in energy time,” he said. “Political time is defined as every two years because of who’s in office and who’s not. People are getting ready for an election—to be reinstated by voters. That’s what they focus on. Along comes an energy crisis or high-price crisis … then suddenly we have to do something about that.”

Problems can only be solved by citizens at the voting booth, Hofmeister said. To do that, we need to elect a government that looks at energy security in a pragmatic, coherent, short-, medium-, and long-term manner. “Companies are successful because they have a strategy and a plan to implement it. That plan positions resources, people, and technology to accomplish what this company is setting out to do. You set milestones and measure and fund progress. And you reap the results. What we do with our political system is, every two years, we throw it up in the air and say, ‘Try again.’ ”

In political time, we have evolved into a system of partisan paralysis endlessly going from one extreme to the other—right to left, “which produces a policy that doubles the amount of imports we require while we’re fighting for energy independence,” he said.

Hofmeister’s goal is to build a social network. “We’re not trying to promote individuals to take action themselves, but a network makes an impact,” he said. “We can control our future energy resources, infrastructure, what will be built, and when. I don’t expect the political system to activate. We need citizen involvement. We have the web site set up to build that social network (www.citizensforaffordableenergy.org). In the mean time, we’ll be educating and informing.”