JimPinto.com - Connections for Growth & Success™
No. 222 : 7 December 2006

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

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Automation wireless growth paradigms

The industrial automation environment holds the potential for installation of wireless products throughout a factory or plant to yield vast arrays of information that can improve operations and profitability.

Already widely deployed in commercial and business applications, industrial wireless adoption has been stalled, purportedly because process control users are slow to change and are paranoid about security. The real reasons for slow introduction are a combination of old-paradigm thinking, compounded by paralysis analysis through standards committees.

Honeywell Process Solutions and Emerson Process Management have made recent major wireless announcements focused on the process industries. ABB is involved on a broader front, across factory automation, process and power industries, with a considerable portfolio of wireless products. Invensys is active with the Wireless Industrial Networking Alliance (WINA), but does not yet have a broad offering. The other majors are not pushing anything yet.

I see 2 marketing problems concerning industry leaders' wireless offerings. While focusing on resolving FUD (fear-uncertainty-doubt) regarding adoption of the new technology, many are missing the FABs (features-advantages-benefits) that completely new and different wireless capabilities bring.

The spread of new wireless technology in the industrial environment will generate the ability to do things that were inconceivable before. This will cause changed work processes and new skill sets that may not simply extend from old habit-patterns. The future values of wireless in the factory and process plant are yet to be imagined.

Then there is pricing. Industrial automation companies typically look for 50% gross profit margins, based on relatively low product volumes and high overheads. New products are usually introduced with all the conventional layers of overhead. Too few marketing managers have the guts to propose revolutionary pricing formulas. So, applications that can justify a completely different pricing structure by generating much higher sales volumes are overlooked, or inhibited. Of course, this presents opportunities for new, agile and innovative leaders to emerge.

Pinto's Pointer to the leaders: If you're looking for growth, don't get paralyzed by perpetuating past pricing paradigms.

Click Automation World (Nov. 2006) - Wireless Growth Paradigms

Click Andrew Bond's analysis of recent industrial wireless announcements

Click Industrial automation Wireless at the "tipping point"

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Micro-solutions to macro problems

I've had a LOT of feedback from my eNews coverage of Nobel prize winner Yunus and the micro-loans he pioneered with Grameen Bank in Bangladesh, one of the poorest countries in the world. Today, many countries, including America, are utilizing micro-loans with great effectiveness for the poor and disadvantaged.

I saw Yunus on TV again the other day. The aggressive interviewer was asking whether micro-loans was a "good business", a new and hitherto untapped profit opportunity. Yunus responded that they were NOT doing it to maximize profit, but at low interest rates to help poor people by stimulating their entrepreneurial spirit and allowing them to develop their own independence. The reporter was puzzled, "Huh?" He simply didn't understand the response; the idea was completely outside his "logic box".

Already the concept is becoming distorted. There are many websites that will help to find micro-loans, defined as $ 35,000 and under. Gosh, that's a long way from "micro" for the average poor person. And they caution that banks "require some type of collateral and the personal guarantee of the business owner." They completely miss the point. Poor people have no collateral - micro-loans operate on the basis of trust and personal judgment. Tell that to bankers, and they go blank.

There are cynics, of course. Some suggest that "micro-loans cannot make a macro-difference" and the concept is just another form of "neo-liberalism". It makes me mad to read some of this stuff from well-fed, arm-chair critics, stuck in their ivory-towers of wealth and privilege.

America itself has a poverty and hunger epidemic. During the Christmas and Thanksgiving holidays, as we indulge in an excess of turkeys and ham and cakes and booze and holiday cheer, 35 million people in America don't have enough food, 12 million of them children.

Anna Quindlen of Newsweek expresses her frustration: "The problem is intractable and profoundly serious; the public doesn't know, corporations don't care, and there's no creative thinking".

In this new century, the Achilles-heels of Democracy and Capitalism are exposed. Poor people don't vote. Capitalism has no mechanisms to cope with Poverty, except obscure "trickle-down" theories. Indeed, Poverty breeds Terrorism. Capitalistic tools such as machine guns and tanks can't contain militant terrorists who threaten our society. Meanwhile, America preaches Democracy, and yet doesn't know how to cope with those who win a fair democratic election - in Palestine, the democratic winners were termed "terrorists".

We need to come up with innovative new ideas to solve the seemingly intractable problems of Poverty and Terrorism. We need more ideas like micro-loans - self-replicating, exponentially multiplying mechanisms that solve real problems at the lowest levels of society.

We need new "soft" solutions to the "hard" problems of this new century. Read my 3-year old article (weblink below). And thinkaboutit.

Click Micro-Loans, Macro-Impact

Click Business Week - Micro Loans, Solid Returns

Click Soft Solutions for Hard Problems - Jim Pinto Dec. 2001

Click Soft Solutions Weblog - provide your own comments & feedback

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The re-shaping of America

Global forces are taking control of the US economy. In 2007, for the first time ever, the cost of imported goods and services will exceed federal revenues. In other words, Americans will be paying more to foreigners than they do to their own government. Today, the key influences that affect the US economy are not in Washington but in Beijing, London, and overseas.

Since 1995 US imports have risen from 12% of GDP to 17%. Foreign money finances about 32% of US domestic investment, up from 7% in 1995. In the global economy, where companies move factories and facilities around the world like pieces in a chess-game, US workers are getting seriously short-changed.

The stock market is rising, and household wealth is higher than it was at the peak of the 1990s boom, even after adjusting for inflation. But this is thanks to the global economy, which has been fueling the US expansion with cheap goods and cheap money. Yet real wages are down over the past 5 years, the trade deficit is enormous, and there are widespread worries about America's continued ability to compete.

In the past I never quite agreed with Lou Dobbs when he preached that Outsourcing hurts American jobs. But I appreciate his recent preaching on the plight of middle-class America.

In the US over the last 2 decades economic gains have been shifting to an ever smaller portion of the population. Consider this: From 1999 to 2004, the income of the bottom 90% of all US households grew by 2%, compared with about 60% for the richest 10%. Incomes jumped by almost 90% for households annually making $1 million, and more than doubled for those make $20 million a year. And the gap keeps widening.

Globalization and automation have not only hurt manufacturing workers but also mid-level managers, engineers and software programmers. In job-loss shifts, most of those who lost their jobs had high school diplomas, community college and four-year degrees. The American middle class has lost purchasing power, especially in big cities where the super-rich have driven up housing prices and the cost of living.

In a recent LA Times article, Joel Kotkin and David Friedman suggest that we should forget tax cuts and minimum-wage hikes; it's time for massive infrastructure projects that put millions to work in well-paying jobs. Their practical suggestions: rebuild highways and bridges, upgrade ports, construct new energy systems, and expand public transportation.

China, Japan, Singapore, South Korea and Taiwan have poured billions of dollars into upgrading airports, transit systems, schools and roads, and their economies have benefited. The US did it before - during the 1930s people were put to work on huge infrastructure improvements; in the 1950s, we built highways under the Eisenhower administration, which generated dynamic American leadership.

America needs leaders - now!

Click Business Week (Nov. 20 2006) - Can Anyone Steer This Economy?

Click Joel Kotkin - Rebuilding the middle class

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America's oil addiction

In an airport the other day, I overheard a man talking on his cellphone with someone in his family, "I've left you money for food and gas." Strange, I thought - the two "necessities"....

People's memories are short-lived when it comes to oil. Prices shoot up from $50 a barrel to $ 70, and the media generates a panic. Then a month later, they are celebrating "cheap oil" and the stock market jumps when prices "plummet" to $ 60. When prices at the pump jump from $ 2.00 a gallon to $3.50 there's talk of a coming depression; and then they talk of "cheap gas" when the price drops to $ 2.50.

Behind all of this, sooner or later Americans will pay for this oil addiction through a steady decline of middle-class purchasing power. Our increasing reliance on oil and gas poses economic, geopolitical and environmental dangers to the country.

Clearly oil money funds anti-American regimes and even terrorism. Beyond that fact, a dramatic price rise could quickly put this country into recession. The status quo energy policy promoted by the current administration is simply not enough. But who cares?

Again, America needs leaders - now!

Click Visit American Energy Independence website

Click Washington Post - Feeding the oil addiction

Click Energy Independence Now

Click Good jobs, clean energy

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Blimericks contest winners

You may recall that we ran a Blimericks contest about 3 months ago - for original limericks on GW Bush: Blimericks.com.

There were 125 good entries and the contest is now over. Now the winners have been announced and the cash-prizes are being awarded.

The objective panel of judges stressed rhythm instead of rhyme, and they eliminated some good Blimericks that didn't quite follow the limerick cadence.

Here are the top-2 winners for your enjoyment:

    First prize: Charles Brody (Chompy), Billericay, UK

      For his birthday George Bush got a pair
      Of fatigues with a blood-spattered tear
      A gift from the dad
      Of a guy in Baghdad
      With a postcard signed, "Wish you were there."

    Second prize: Richard Harrison, Venice, Florida, USA

      This reminder for each Democrat
      Our party will give tit-for-tat
      "R" is how we began
      And we end with "I CAN"
      While the end of your party spells "RAT"

While almost all of the Blimericks posted were negative on GW Bush, you'll note that the second prize award demonstrates some fairness. (smile)

Click Read all 16 Blimericks winners

Click Visit Blimericks.com and submit your own Blimerick

Click If you like to write limericks, join another limerick contest

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Erik Rasmussen [Erik.Rasmussen@honeywell.com] of Honeywell corrects my comment previous that Honeywell did not yet have any wireless products to announce:
    "Since 2002, Honeywell's XYR 5000 wireless transmitters, Experion Mobile Station, and IntelaTrac PKS field operator solutions have been installed in over 300 customer locations delivering real economic value, far beyond just avoiding the wire cost. Customers are deploying Honeywell wireless transmitters to monitor tank levels, meet regulatory compliance for safety showers, monitor offshore well heads in fragile environments, and prevent leaks and fugitive emissions.

    "Although some of our products are 'buyouts', Honeywell is responsible for the implementation, services and customer satisfaction of all our wireless installations. Each of these projects has given us great insight into how end-users want to use wireless technology and what exactly their critical needs are.

    "Building upon this experience, Honeywell's second-generation multi-functional wireless mesh network is already in beta testing and will be shipping the second quarter of 2007. Our self-healing and self-organizing mesh network supports wireless-enabled applications within a single wireless network to optimize plant productivity and reliability, improve safety and security, and ensure regulatory compliance.

    "Consistent with Honeywell's philosophy, we will protect our customers' current investments by integrating Honeywell and other third-party products into the new network. In addition, these second-generation solutions are guaranteed to migrate to emerging wireless standards."

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James Lamb [jim@think-local.com] wonders how micro-loans can apply to the poor people in his own neighborhood, and comes up with some good ideas:

    "While with a former employer, I met a guy who works for the Grameen Bank. He told me that one of the things they discovered was that it was better to loan to women than men, because the men would be more likely spend on drink or squander the money.

    "Not sure if it could work with the destitute in my neighborhood, though I've considered giving them a broom, showing them how to use it and ask the shopkeepers if they can sweep in front of their shops.

    "Also, not sure if I agree that the "creative spirit" of people on welfare is killed. They are amazingly creative on finding ways to work the system, and they also have some pretty elaborate underground-economy schemes (also, Freakonomics talks about the intricacies of drug dealing among ghetto dwellers). The problem is because they can't read or write very well, they are shut out of most legitimate employment, or the jobs they can do are managed by only slightly more intelligent people who are horrible managers with terrible people-skills, so those on welfare would rather deal with the welfare bureaucracy than low-level bad managers (or horrible working conditions).

    "We need some of the best people to deal with the worst, rather than the 'slightly better than worst' dealing with the worst - maybe not permanently, but to get systems in place so they're more idiot-proof."

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Dan Wojcik [danwojcik@comcast.net] wrote to me after reading an eNews item I wrote 2 years after 9/11, on September 11, 2003:

    "Jim, I blinked when I saw the following cached page below - written over three years ago, and 10 times more pertinent and trenchant today.

    "Hats off for having the courage to say what you said back then."

Thank you, Dan! Good feedback is always appreciated.

Here's the link for you to review, to see what Dan "blinked" about.
I'll appreciate YOUR comments.

Click 9/11 anniversary thoughts - For what it's worth

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