JimPinto.com - Connections for Growth & Success™
No. 107 : December 30, 2002

Keeping an eye on technology futures.
Business commentary - no hidden agendas.
New attitudes, no platitudes.

  • 2003: Happy New Year! Transition to a very different future
  • Nanotech & Self-organizing systems - Crichton Novel: Prey
  • Cattle clones pave the way for human cloning
  • Automation update: Year-end 2002
    • Siemens, ABB, Invensys, Rockwell, Honeywell
    • Emerson, Schneider - starting new weblogs
  • eFeedback:
    • Leadership counts - Jack Welch & Lee Iacocca
    • Human cloning - can we change our moral foundations?
    • Comments on Chinacosm & Indiacosm

Happy New Year!
Transition to a very different future

The year 2003 will NOT be just any new year. The new millennium is 3 years old and the world faces an uncertain future as reality unfolds.

With a congressional majority in tow, the President seems to be promising a return to the "good old days": terrorists will be safely neutralized by the Homeland Security behemoth, greedy CEOs will be banished forever, business will be back in the hands of selfless leaders and the stock market will be booming again.

Things will right themselves - just as surely as Palestine and Israel settle together in peaceful coexistence; just as soon as Saddam proves that Iraq is indeed devoid of weapons of mass destruction; just as certainly as Al Qaeda terrorists sign a truce and deliver Osama to world justice; as fast as two million unemployed return to work in a revitalized economy.

The impending war with Iraq (and now N. Korea) clearly runs the risk of igniting far greater conflict. How many millions must die before the paradigm shifts? What is the catalyst that will signal the recognition that no one is right or wrong?

There is growing recognition that conventional hard solutions are completely inadequate - tanks and warplanes cannot stop a suicide bomber. The mass of humanity yearns to renew itself. The time for transition is near. The change will come when we care enough to ask each other, "What am I doing that makes you feel you must hurt me?" With understanding will come perhaps the beginnings of universal brotherhood of humanity. Can that social wisdom come without pain?

Ever the optimist, I predict - perhaps I just feel - that the solutions already lie within the problems themselves. Inventive, innovative, caring, charitable, far-sighted humans will indeed find a way. The future will be a better place.

I wish you a peaceful and prosperous New Year!

Click Pinto article: Transition to a very different future

Click Finding a softer approach for a new century

Nanotech & self-organizing systems
Michael Crichton's novel - PREY

At Caltech over 40 years ago (Dec, 1959) Richard Feynman gave a talk "There's Plenty of Room at the Bottom" - the challenge of manipulating and controlling things on a small scale. His talk started the ball rolling on the science of creating molecular devices that could compute, assemble and replicate themselves. This was the concept of Nanotechnology.

In 1986, K. Eric Drexler published "Engines of Creation", the groundbreaking Nanotechnology book. It described ways to stack atoms, assemble machines much smaller than living cells, make materials stronger and lighter than anything dreamed of today. Nanotech applications included better "skins" for aircraft and automobiles, tiny devices that can travel along capillaries to enter and repair living cells, the ability to heal disease, reverse the ravages of age, make the human body stronger. The idea was born that we could make machines the size of viruses. We could assemble these myriads of tiny parts into intelligent machines, perhaps based on the use of trillions of nanoscopic parallel-processing devices that would learn from previous experience.

Eric Drexler warned,

    "There are many people, including myself, who are quite queasy about the consequences of this technology for the future. We are talking about changing so many things that the risk of society handling it poorly through lack of preparation is very large."
Drexler's warning is included in the introduction to Michael Crichton's new techno-thriller PREY. The author of Andromeda Strain, Jurassic Park and other best sellers, weaves a story about the perils of Nanotechnology. This is combined with a technically realistic account of distributed intelligence, self-organizing systems and emergent behavior - the subjects Dick Morley has been discussing at his Santa Fe Chaos conferences for several years.

PREY brings to mind Bill Joy's well-known Wired article, "Why the Future Doesn't Need Us." He warned, "Our most powerful 21st-century technologies - robotics, genetic engineering and nanotech - are threatening to make humans an endangered species." Michael Crichton doesn't allow the reader to relax with the feeling that the danger is fictional - the book includes an introduction to emphasize the direct link to reality. Drexler's warning (above) is included, as well as an extract from a Santa Fe Institute paper by J. Doyne Farmer and Alletta dA. Belin, "Artificial Life: The Coming Evolution". Here is that quote:

    "Within fifty to a hundred years a new class of organisms is likely to emerge. These organisms will be artificial in the sense that humans will originally design them. However, they will reproduce, and will evolve into something other than their initial form; they will be "alive" under any reasonable definition of the word. The pace of evolutionary change will be extremely rapid. The advent of artificial life will be the most significant historical event since the emergence of human beings. The impact on humanity and the biosphere could be enormous, larger than the industrial revolution, nuclear weapons, or environmental pollution. We must take steps now to shape the emergence of artificial organisms; they have potential to be either the ugliest terrestrial disaster, or the most beautiful creation of humanity."
PREY is the story of a cloud of nanoparticles that has escaped from the lab - self-sustaining, self-reproducing micro-robots. The cloud is intelligent and learns from experience. It is "alive" and has been programmed as a predator. Humans are its prey. It defeats efforts to kill it - through self-organizing, emergent behavior and genetic algorithms, evolving swiftly and becoming more deadly with each passing hour. The story is fictitious, but the underlying technology is real.

This is a good book - read it!

Click PREY (A novel) - By: Michael Crichton (Pub. Nov. 25, 2002)

Click Santa Fe Institute abstract: Artificial Life - The Coming Evolution

Click Eric Drexler's groundbreaking Nanotech book - Engines of Creation

Cattle clones pave the way for human cloning

In the world of big-money cattle exhibitions, the bull Full-Flush is a celebrity. He has the wide rump, the meaty back and long neck that impress cattle judges and professional breeders. Many of his 35,000 calves have won state fairs and national stock shows.

Now Full-Flush has been cloned, with 5 genetic copies. This is the latest of 300 cloned cattle worldwide, an unmistakable sign that cloning is no longer a scientific oddity. It is poised to become a real business.

The FDA still bars the sale of meat, milk and other products from cloned animals. They are testing to see whether cloned foods are identical to non-cloned products and equally safe to eat. The agency could start to approve cloned products for sale within months, certainly in 2003.

As the year turns someone has already announced the birth of the first human clone. At least a couple of clones are expected to be born in January 2003. The New Year will bring several more, perhaps several hundreds.

Many people worry that human clones will have defects. But those fears will quickly fade as the practice continues and procedures are inevitably refined. Whatever your social, moral and ethical position on this major change in human society, human cloning is fast becoming a reality.

President Bush has come out strongly against human cloning, and will ask the Senate to approve a US ban. However, that will simply drive US research offshore, and will benefit medical research in other countries (notably China).

Stay aware as this important new revolution unfolds into the reality of the new century.

Click LA Times - Success Breeds Imitation

Click Bush: Human cloning 'morally wrong'

Click The Human Cloning Foundation

Automation update - year-end 2002

The industrial automation business is still "on hold" - a reflection of an economy with an uncertain future. Most companies are still doing incremental cutbacks to "meet budget". Their plan is to survive, with very little thought for future success.

Here we'll provide a few Pinto perspectives and prognostications on some of the automation majors that we have covered during the past couple of years.


Still the largest industrial automation company. German-based with good central management and a good financial position. To increase market share, primarily in the US, they are still looking to make acquisitions. They really don't know how to change their acquisition strategy, inevitably forcing new companies to meet the German mold. But, they are still looking at anyone who is available, which (in a declining market) is almost everyone.

Click Siemens - American Managers View

Click Siemens weblog


The second largest industrial automation company, though they may already have lost that rank. The company is ailing badly from the CE asbestos fiasco. But it is basically well managed and will survive to win another day.

ABB is still suffering from indigestion from the multitude of acquisition made in the past few years, and so probably won't do much more than recover during this coming year.

Click The ABB Blahs

Click ABB weblogs

Rockwell Automation

In a waiting mode to find the best acquirer. The next 30 days (Jan. 2003) will tell whether Eaton (Cutler Hammer) has acquired Rockwell Automation. If this does not happen soon, the future is anyone's guess.

Click Whither Rockwell Automation?

Click Rockwell weblogs


"Successfully" divested all their good companies at a reasonable price, to pay off debt. This would have been OK if the "core businesses" were doing well enough to justify the still-remaining debt-load - which they are not.

Invensys had a bad first-half, with CEO Rick Haythornthwaite under fire for bad cash flow. His poor excuse (quote from an interview published on the Invensys website):

    "The first thing we've done is we've changed quite a bit of the leadership. I have a senior team of 17 people. 14 of them are new. The next layer, the Chief Operating Officers, have actually already made 12 new appointments."
The UK financial markets will not allow Rick Haythornthwaite any more excuses by year-end. The banks have forced the divestitures, and they will force cash flow to fit, or he'll be gone and Invensys will be for sale. It is unlikely that anyone will be willing to buy the "group" that remains. So, there will be piecemeal scrambling.

Click Invensys in decline

Click Invensys weblog


The Honeywell group overall is doing reasonably well. Honeywell Industry Solutions (IS) has a new manager who seems to be trying to right the ship. The specter of an acquisition by Siemens remains, though GE may be coming back into the game. GE had made a lot of smaller industrial-automation acquisitions at a fairly high price; if they are interested, they'll win the bidding.

Look for some changes to occur within the first few months of the new year. Some people even think that Honeywell may buy Foxboro, with the pig+pig strategy. If nothing happens, I'm not sure how Honeywell IS can continue to soldier along. CEO David Cote has his "hard ass" reputation to protect.

Click Background - Honeywell for sale - GE buys then abandons

Click Honeywell weblog

Other majors: Emerson, Groupe Schneider, etc.

Emerson is very well managed. They recently sold Intellution (no growth and profit) to GE. Delta V remains a flagship product with good technology plus excellent worldwide sales & marketing. They'll continue to buy strategic pieces to strengthen their leadership position.

France-based Schneider is doing fairly well. They recently moved all Modicon (and others) manufacturing to Europe, leaving some Engineering, Sales & Marketing behind (a typical European NIH strategy). Schneider was stopped from buying Legrand, but has recently made some good acquisitions to strengthen its hand. They'll be a prominent bidder in any US sell offs.

In the past we have written items on most of the automation majors, with linked weblogs for open commentary. We currently have no weblogs on Emerson or Schneider. But, don't let that stop you. Send me (direct email) your comments and feedback on these (or other) companies, which will stimulate the start of a dedicated weblog.

If you don't comment, don't complain!

Click JimPinto.com weblog index


In the last issue of eNews, someone suggested that several well-known executives did not deserve their adulation (or their high pay) because dedicated employees made sacrifices and did much of the work. Bud Keyes [Bud.Keyes@EmersonProcess.com] disagreed:
    "I disagree relative to both Lee Iacocca and Jack Welch. Both have big egos but this is often part and parcel of a man with confidence and vision.

    "Chrysler was in incipient bankruptcy when Iacocca took over. The government made a loan (a sales job in itself for which he should be credited) and he paid the loan off and made Chrysler positive. I personally think he deserved every nickel he got and more. It was flat miraculous!

    "Similarly Jack Welch made GE into the company that it is today with his insightful, rigorous and demanding management style and detailed approach to business.

    "Yes there were many people who helped; but without those leaders, neither company would be where they are today. The failings of both Jack and Lee was not to bring a successor and strong leaders on behind them soon enough. We are now seeing problems at GE due to lack of control and detailed involvement from the top. Bad things are now happening that would not occur under Jack's watch. He is missed."

In the recent eNews item on human cloning, I suggested that every aspect of human life will need to adapt - theology, ethics, moral, legal, societal. Wayne Williams [TWW99@aol.com] responded:
    "The problem is that some things should not change. Societal mores are not necessarily the guiding light. Our legal system, based on the old English concept of natural law, maintains that there are "absolutes" and we must hold to them regardless of pressure from the masses, with changing times or geographical locations.

    "Regarding the concept of cloning humans. Although we are reaching a technological possibility, that does not mean we should change our moral and theological foundations. That would be like stating that since we have the capability to produce near-human likenesses on the screen, yet they are not actual human actors, then any level of perversity is legal.

    "I believe the real driving force behind human cloning is the 'affluent society' pushing for a nursery for body parts. Create the baby - then harvest the necessary parts from it to salvage the life and/or lifestyle of those who have enough money to afford the procedures. Notwithstanding my belief that Almighty God rules in the arena of the creation of life, this is yet another problem in the focus of money and technology on cloning.

    "We are moving at break-neck speed towards a world that is elitist-controlled, while leaving millions upon millions of people in poverty, disease, and famine."

Responding to recent eNews discussions, Albert P. McCauley, Jr. [cvcapm@core.com] wrote:
    "Chinascom and Indiacosm are inevitable. The problem is that US engineers are losing jobs because of the cost advantage provided by the lower living costs in these two countries. China and India will establish a cost level such that the US cannot compete. If we are more ingenious we can - but our companies are managed by accountants whose only skill is cooking the books.

    "I received an advertisement from an advisory service run by Daniel Ascani, typical in its hype. He makes a prediction that China will demolish every stock market in the world when it collapses. He states that an avalanche of failed state-run companies, and the resulting failure of banks with skyrocketing debits caused by the state run companies, will produce unemployment and civil unrest. If this were to happen I believe that China could revert to strict communism and the intelligent engineers and software people could wind up in re-education camps. Newsweek, October 28, 2002 presents a somewhat optimistic viewpoint.

    "We have exported our knowledge and skills and perhaps now our only hope now is to export our poor management."

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