JimPinto.com - Connections for Growth & Success™
No. 211 : 8 June 2006

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

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Schneider buys Invensys Building Systems

Pursuing its strategy of selective targeted acquisitions, Schneider announced that it will acquire Invensys Building Systems (IBS) operations in North America and Asia. This follows the acquisition of Invensys Advanced Building Systems in July 2005, further consolidating Schneider's global position in building automation.

Invensys IBS generated revenues of $142 million for the fiscal year ended March 31, 2006, with operating profit of $20 million. IBS includes well-known brands such as Barber-Colman and ComTrol.

Schneider is paying a pretty good premium - $296M cash to acquire IBS on a cash-free debt-free basis, including a tax benefit of about $60M.

The acquisitions of TAC in June 2003, Andover Controls in July 2004, and Invensys Advanced Building Systems in July 2005 make Schneider a major player in US and European Building Automation and Control systems markets. It will significantly enlarge Schneider/TAC’s installed base and expand its distribution capability, though US distribution channel conflicts will not be easy to resolve. This now puts Schneider directly against Honeywell & Johnson Controls.

Click Schneider Electric to Acquire Invensys Building Systems

Click TAC & Schneider consolidate global position in building automation

Click Market Opportunities and Challenges in Building Automation

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Invensys makes good progress, refinancing expensive debt

Meanwhile, Invensys seems to be digging itself out of its debt burden, and the stock crept up to 26 on news that big-gorilla Siemens may buy the company, and slipped back to 23-ish (Wed. 7 June 06) with a market-cap of GBP 1.35B ($ 2.5B) when that prospect seemed to recede.

CEO Ulf Henriksson sent a memo to all Invensys employees. Titled "Financing for the future", it was a sort of performance review at year-end 2006, a key management performance bench-mark. A summary is included here - read the complete Ulf memorandum (weblink below).

  • Preliminary results for YE 31 March 2006 showed positive progress. Q4 orders up 10%, up 5% for the year at £2,637m (2005: £2,438). Q4 revenue up 5%, up 1% for the year. Growth at Process Systems, Rail Systems and APV, but decline at Controls and Eurotherm.
  • Positive operating cash inflow of £228M, compared with £188M last year. Free cash inflow of £100M, versus £39M last year. Operating profit up 16% at £191M (2005: £165M), with margin improvement to 7.8% versus 7.0% in 2005. Profit 22M, compared with £106M loss. Process Systems improved, Rail Systems steady, Controls weaker and APV break-even.
  • Sale of Invensys Building Systems to Schneider Electric SA for about £157 million.
  • Good Results: Improved operational performance, employee development, recruited talented people, cut corporate costs and simplified business structures. Invested in development of InFusion, the world’s first enterprise control system.
  • Major new re-financing planned; vote by shareholders June 14, 06. Previous refinancing (Haythornthwaite 2004) was when Invensys faced significant difficulties, reflected in expensive debt and burdensome restrictions. Improved performance brings better terms: Raise £340 million through shareholders rights issue; improved credit facilities from 6 blue chip banks, with interest savings of £45M per year - repairing the balance sheet.
Well, though most Invensys employees wouldn't recognize him if they saw him, Ulf seems to be making steady progress. After all the debilitating divestitures of once might Invensys (Siebe & BTR) Process Systems (Foxboro, Wonderware, Trioconex) appears to be the remaining jewel, with a trimmed-down £2.5B revenue (compared with some £14B before Yurko and Marshall precipitated the decline.

In my opinion these improvements, while creditable, won't allow Invensys to continue alone as the smallest of the majors. What it does mean is a better price when the company is inevitably acquired.

Who will acquire Invensys? Emerson and Honeywell - not likely. Key possibilities are Siemens or Schneider - to build their customer base in the process controls market segment.

Click Invensys Refinances Debt after 1st Profit in 5 Years

Click Invensys posts 11% profit gain; plans rights issue

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JimPinto.com new website design - feedback requested

Hey, do me a favor - please check out the newly re-designed JimPinto.com Homepage and give me your comments, nitpicks, suggestions.

Over the past few years, the JimPinto.com website has expanded to some 400-500 different webpages, writings, weblogs, podcasts and archives. The Index of Writings has become quite long. It's not easy to find something specific.

Aha! But it IS easy! The local Google site-search allows quick retrieval of any content: just type in any search word or phrase, leave the radio-button on "Search JimPinto.com" and click "Search" - it works like magic.

There are several new features in the new website:

  • New 800-pixel width
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Podcasts are popular - listen to recent eNews and InTech Pinto's Points via the "Podcast" button. You'll find the RSS link there, to submit to iTunes or your favorite aggregator website for automatic download to your computer or iPod.

Again, the JimPinto.com Homepage was designed by my son David Pinto's wife - the talented artist and web-designer, Surya Sajnani-Pinto. You'll find links to her own website and email in the address links at the bottom.

I'll appreciate your feedback, comments and suggestions for improvement.

Click Go visit the JimPinto.com Homepage now

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Tofflers' book: "Revolutionary Wealth"

Alvin Toffler's ground-breaking "Future Shock" was published in 1970, warning how accelerating technology would change society. It turns out that society coped fairly well in spite of the shock, though that doesn't minimize Toffler's remarkable prescience.

Then came "The Third Wave" in 1984, which described how humanity had fared through first the Agricultural and then the Industrial revolution, and was now in the midst of the Technological revolution. The Internet was not quite there yet, but the book was a benchmark of progress and harbinger of the new century.

In 1990, Toffler came out with "Power Shift: Knowledge, Wealth, and Power at the Edge of the 21st Century" another sweeping view a decade before the new century emerged with its cataclysmic economic and societal shifts. The co-author was Toffler's wife Heidi who (it turns out) was a strong contributor for all the previous books.

Last week, I caught an interesting interview on C-SPAN between the controversial Newt Gingrich (remember him?) and his good friend Alvin Toffler. The subject was the Tofflers' new book - "Revolutionary Wealth: How it will be created and how it will change our lives". While they were talking, I made my 1-click purchase on Amazon.com.

This latest (April 2006) futuristic forecast surveys the broad advances of technology, globalization, the rise of China, the decay of Europe, the rise of a new economic groups. The Tofflers think through the complexities with analytical depth that remains understandable. A primary theme is "prosumerism" - whereby the division between the producers and consumer of goods and services blurs.

It's worth the read - go review it on Amazon, or at your local bookstore.

Click Amazon link - Tofflers' Book "Revolutionary Wealth"

Click NY Time Review - The Future Is Now

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Colbert roast at Whitehouse dinner - wow!

I was clicking though C-Span a couple of weeks ago, and caught the Whitehouse Press Correspondents' dinner. The President and Laura Bush were there on the podium, with lots of major celebrities in the large audience - politicos, generals, TV personalities.

There was a lot of enthusiasm over the professional impersonator who was performing just a few feet away from the real George W Bush who took the mimicry in good humor. Then came the surprise.

I don't know if you've followed the comedian Stephen Colbert. His show is a spin-off of Jon Stewart's "Daily Show" on the Comedy channel, and follows with a segue immediately after. The "Colbert Report" (pronounced "Colbear Repor") is different; I've smiled at some of his dead-pan humor, but perhaps some of it is just an acquired taste.

Well anyway, Stephen Colbert was introduced at this Whitehouse Correspondents dinner. His "roast" of President Bush was as unforgettable as it was amazing. He posed as an ultra-conservative admirer, amazed that he could actually be speaking just a few feet away from his hero. One could see the President and Laura Bush squirm visibly. As the camera panned the audience, you could see their pain at the presumptuous parody. And it lasted 24 minutes!

Beyond the direct confrontation with "his hero", the roast included many hilarious clips and quips on famous personalities and current events, and ended with Colbert's audition tape for the (just filled by Tony Snow) job of Whitehouse Spokesman.

Understandably (I suppose) the Colbert Roast did not make too many headlines. An audio version rose to the rank of No. 1 album at Apple's iTunes. The video version was "pulled" off many website, but is still available on Google (link below).

Whether you are (still) a GW Bush supporter or not, you've just gotta see this video!

Click Colbert Roasts President Bush - 2006 White House Dinner

Click After-Dinner Speech Remains a Favorite Dish

Click Stephen Colbert at the White House Correspondents' Dinner

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Joanne Harris [punkinmark@mindspring.com] tells us why she won't vote for a woman president:
    "I know I'll take a lot of flack for writing this, but it must be said.

    "I'm a woman. I run my own consulting business, and do well with it. BUT - the majority of my clients are men, in companies that are male-dominated industries. Intentional? You bet!

    "I have a few women clients with whom I enjoy working, but overall, I prefer to work with men. Why? The men with whom I work are consistently respectful of my expertise and execution of their work. They don't tell me that they could do it better or that they had hoped to do a particular job and now I'm doing it instead. Conversely, I've had only a few women clients whom I believed displayed exemplary professional behavior, and who treated me as an asset, not a necessity or a threat.

    "In my own career experience, I have found that the majority of women in high places, however totally competent and intelligent to do the job, remain so intimidated by every other woman (not man) in the company that the cat fights and petty bickering never cease to get in the way of leadership. (Not to say that it doesn't happen between men as well, because we know that it does!) But it is consistently more prevalent with women.

    "I do hate the glass ceiling. It annoys the heck out of me, and keeps many deadwood men in positions of authority that could be much better run by anyone (man or woman). And, I encourage all capable women to break through that ridiculous ceiling and show the world that women can be amazing leaders. We do approach problems differently, and considering how many highly successful men in history have been supported by highly intelligent wives (including some former US Presidents), it is obvious that we bring an immense amount of savvy to the boardroom table.

    "But I never want to be the token female who has the job because of 'diversity' (I'm so sick of this word), EEOC, or any other propaganda. Give the woman the job because she is the best candidate (that goes for color as well). So many companies are struggling because they have hired a plethora of misfits, trying to keep up with EEOC cries for equality. Get over it. Get the job because you earn it, not because you are a woman, or a non-white or any other basis.

    "That said, I think the utopia company, in some cases, would hold a dual leadership of one male and one female, just because we do attack problems from a different perspective, and some of these companies do exist and excel.

    "The one obstacle that too many women build around themselves, though, is the inability to let go of insecurities that every other woman is out for their job, and thus must be kept in her place (as far down as possible).

    "Time and time again, I see women in high positions who, in trying to emulate the male leadership model, in essence simply become the queen 'B'. They treat their subordinates poorly, particularly any bright women who might work under their umbrella, terrified that someone is out to oust them!

    "Thus, I don't think that we are ready for a woman president, because the women in leadership (or who fantasize themselves as being leaders) are not ready. There is no woman in politics today that I would support. The reality is, as a woman, I am fine to have a male president. I just want one who stops trying to please every citizen, because in doing so, he is defeating the purpose of leadership."

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Bruce Fryer [brucefryer@fryergroup.com] provides some additional tips for finding a job:

    "When my robotics vision company failed, It took me 1 1/2 years to find a new job. It was hell. I have three major pieces of advice:

    1. If you find a job/company of interest, talk to your contacts to see who they know who knows someone in the company. In this industry, you are only about 2 contacts away from any company. Get a personal introduction and talk to them. Then discover the hiring manager and get introduced. Remember, HR's job is to cull applicants. Including you.
    2. Many jobs never make it to any web site. Now is a great time to contact everyone you know and see who they know. But (and there are books on this) you need to give more than you take. See if you can help everyone you talk to. Give advice, connect them with other people, etc. No one likes a moocher.
    3. Know yourself. In one sentence what do you like to do and are good at doing. This is hard. In my case (I'm high tech), I like to build things. I'm a new product person. Some people like to sell, some like to analyze, some like to run operations and make them smooth, etc. Let other people know who you are. I resumed blogging last year. It opened a ton of doors. When asked a question in my field, I would refer them to my blog. Then people felt they knew me, even though they had never met me.

    "By the way, if you are going to lose your job, you need to: a) get the highest home equity line of credit you can (it buys you time); and b) get an email address (Google, Yahoo, Hotmail) and get some free business cards to pass out."

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Andrew Bond [andrew@abpubs.demon.co.uk] from the well-respected British newsletter "Automation Insider" explains why Rockwell doesn't invite him to their conferences any more:

    "Jim, it may or may not be a comfort to know that you are not alone in your problems with Rockwell. I haven't been invited to a Rockwell press presentation here in the UK for more than three years nor been included on their fairly regular UK/European press trips to Rockwell Fair. More seriously, they haven't invited me to their annual Christmas press lunch for a number of years!

    "Speculation among my press colleagues, among whom this has become something of a running joke, is that I may have made the mistake some time ago of quoting a senior Rockwell executive verbatim when he agreed with the suggestion that they might compete with some of their integrators.

    "Pity we won't be hearing your thoughts about the Rockwell culture in the near future; but then again perhaps that tells us more about it than a formal interview would convey."

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