JimPinto.com - Connections for Growth & Success™
No. 168 : 22 November 2004

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

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Emerson - strong leadership wins

With strong management, Emerson has come out of the recent recession with flying colors. The company now leads the market in motors, drives, compressors, tools, household appliances (Insinkerators, Instant Hot, HVAC etc.) and process measurement, valves, systems, solutions and controls.

With their own multifarious trials and tribulations, other process controls majors - ABB, Honeywell and Invensys - have been forced into also-ran positions. With John Berra as President, and fully imbued with the Emerson operating methodology, Emerson Process Management produces double digit operating profits, while growing substantially faster than their weaker competitors.

Emerson is driven by technology leadership. This is true for their Process Management products, systems and solutions as well. With the broadest product line, world leadership in quality, leading the way in systems & solutions, and domination in customer service, support and applications, Emerson seems well set to continue to lead the industry over the decade ahead.

For their 2004 Reader's Choice Awards, Chemical Processing magazine asked 20,000 of its readers to name the best technology providers in 41 categories covering equipment, software and engineering services. Emerson Process Management was voted the best technology provider in 7 categories, winning a total of 8 awards, versus Honeywell 3, Endress+Hauser 2, Siemens, Rockwell, Invensys and Yokogawa 1 each.

Click Emerson - strong management drives performance

Click Chemical Processing - Readers’ Choice Awards 2004

Click Provide your Emerson feedback on the Emerson weblog

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Invensys - Haythornthwaite waits

Apparently, I was premature when I reported (eNews 8 November 2004) that Rick Haythornthwaite had already stepped down from his CEO position at Invensys and handed the reins over to Ulf Henriksson.

The London Sunday Times issued a confusing story that led to my conclusion. It was apparently wrong. Rick Haythornthwaite has not stepped down as CEO - yet. Instead, "boardroom sources" suggested that "there was a clear understanding that Haythornthwaite would stand down once the company was seen to have overcome the worst of its problems." Now, since the problems appear to be worsening, how long will Haythornthwaite wait? And when will Ulf push to take the helm?

Haythornthwaite himself says he does not want to stay with Invensys. "I do not think I am the right guy to run this long term. Only when Invensys is seen to be turning, then it will be a natural time for a successor. The time is not right now. I am not looking for a job, I am not actively searching the market."

After the recent announcement of poor half-year results, poorly interpreted as "progress" it shouldn't take more than a few weeks for the Invensys board to make some moves. Perhaps that's enough time for Slick Rick to land himself another "strategic turnaround" job.

Meanwhile, Andrew Bond of the influential UK monthly "Industrial Automation Insider" newsletter reports:

    "Invensys' competitors continue to express surprise, both that it has thus far been able to maintain its independence, and that major users continue to place orders, despite the company's uncertain future.

    "Almost every major process automation vendor seems to have considered making an approach but has been unable to come up with a formula which would separate the most desirable plums in the Invensys pudding".

Here are some of the confusing news reports after the Nov. 11 2004 announcement of Invensys' half-year results:
  • Invensys 'turns corner' with Loss.
  • Departing boss Rick Haythornthwaite told investors that by meeting City operating earnings targets for two consecutive quarters the corner has been turned.
  • Operating profits in four remaining core industrial controls businesses slumped by a third to £63m in half-year end-Sept.2004. However, that was wiped out by £133m of asset write-downs and restructuring costs and £287m losses and write-offs on disposals.
  • Losses have hit £477m [$875 million] so far this year.
  • Hopes of a takeover have been dismissed by the City because of the group's twin 'poison pills' of £700m of debt, and pension fund liabilities now topping £600m.
  • Long suffering investors remain unmoved. Shares in the former FTSE 100 stock drifted down, not far from their all-time lows.
Stay tuned...

Click Reuters - Invensys chief says he's staying

Click Invensys 'turns corner' with loss

Click Provide your own feedback on the Invensys weblog

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Automation 'patent trolls' net millions from end-users

An interesting series of patent infringement lawsuits have been impacting the industrial automation business over the past several years. Solaia Technology, a company solely in the business of enforcing patents, has partnered with Schneider Automation to pursue patent infringements.

Schneider owns four patents, issued between Sept. 1998 and May 2000. Two were developed by Square D (acquired by Schneider), and two were bought in late 2000 from Ken Crater of Control Technology Corp. The patents relate to interface modules which translate Internet protocols - Ethernet, TCP/IP, and HTTP - into data recognizable to a PLC. Schneider began selling web-enabled PLCs in 1998.

Schneider opened with a lawsuit against Opto-22 which had been selling its Snap I/O Ethernet-based product since 1999. This was settled after more than 2 years and a ton of legal fees (estimated at about $2m for each side). It is not known whether Opto paid a big fee, or a nominal face-saver. But it ended with Opto buying a license for the "protected technology". But that still left the controversial patent unchallenged, awaiting the next defendant.

Solaia seems to be following a different tactic. Rather than suing large manufacturers like Rockwell and Siemens, they sued Rockwell's customers, including large end-users like Clorox, Boeing, Eastman Kodak, Eli Lilly, Shell Oil and others. Clearly end-users are more likely to avoid lengthy proceedings and settle out of court. And indeed, some seem to have settled, netting millions for the "patent trolls" (as companies like Solaia are called).

Of course, major automation suppliers like Rockwell would rather have the matter settled once and for all. It's interesting that Rockwell filed their countersuit, not against Schneider Automation and Solaia, but their lawyers - the firm Niro, Scavone, Haller & Niro - alleging that they "conspired to extract tens of millions of dollars in licensing fees" and for filing "baseless, sham" patent infringement suits.

Rockwell's suit is unusual because law firms are not typically sued, and also because the law firm Niro Scavone has a reputation as one of the country's leading patent enforcers.

The commentary on this continuing battle continues. Some weblinks are provided below (courtesy of Dick Caro).

Click Law.com - Latest on the Solaia/Rockwell lawsuits

Click Automation List exchange on the Opto22 issue

Click Law.com - Battling the Patent Trolls

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Extending the human life-span

When he became an octogenarian, a good friend told me, "I feel like a young man, with a lot of ailments". The problem is that the human body deteriorate with age. The risk of death increases exponentially, doubling every 8-10 years. Why do we fall apart? And what can we do about it?

The body is a failure-prone, defect-ridden machine, formed through the processes of biological evolution. But today, it can be improved through genetic engineering and can be better maintained through preventive, regenerative, and anti-aging medicine, and by repairing and replacing worn-out body parts. So, the rate at which the human body falls apart can be decreased, and maybe even eliminated.

Startling discoveries in the areas of genomics, biotechnology, and nanotechnology are occurring regularly and rapidly. Already it is possible to analyze our individual genetic makeup and evaluate our predisposition for almost any deadly diseases. Once the genes have been isolated, it will soon be possible to repress or enhance them through biotechnology.

Soon it will be feasible for 10% of our red blood cells to be replaced by artificial cells, radically extending our life expectancy and enhancing physical and mental abilities beyond what is humanly possible today.

Ray Kurzweil, one of the most influential living inventors, expects that rapidly accelerating progress in biotechnology, nanotechnology, and medical devices will systematically eradicate causes of death within the next 50 years. His latest book, "Fantastic Voyage: Live Long Enough to Live Forever", coauthored with an expert on human longevity, has just been published (Oct. 2004). It makes interesting reading - take a look.

ClickBoston Globe - The Futurist

Click IEEE Spectrum - Why We Fall Apart

Click MIT Tech Revoew - The Longevity Gene

Click Book: Fantastic Voyage - Live Long Enough to Live Forever

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Modern slavery is uncomfortably close

Here's a disquieting reality: There are more human slaves today than at the height of the transatlantic slave trade, and more than at any time in human history.

Although banned in every country, modern-day slavery has boomed over the past 50 years as the global population has exploded. Slaves are cheap these days, with prices lower than ever. And the world has a glut of slaves - 27 million by conservative estimates. And the "first-world" countries utilize the benefits - with cheap goods that flood our shopping-malls and super-markets.

Extreme poverty, combined with local government corruption and the global economy, has produced a surge in the number of slaves. Forced labor is used in many, many countries, with debt laborers whose pay can never meet the debt they owe. Workers often give their bodies as collateral for debts that never diminish over many years, or even generations. The practice is widespread and part of everyday life.

In 1850, a slave would cost about $40,000 in today's dollars. Today, you can acquire a "slave" for $30. So, the cheap availability of slave labor has converted them from being the equivalent of buying an automobile to buying cheap, disposable goods.

How many of us think of "slave labor" when we buy cheap Chinese goods from Wal-Mart? The fact that slavery is still thriving is mainly due to ignorance, and the lack of resources to eradicate it.

There is slavery in the developed world too. For example, some 15-20,000 people are trafficked into the US annually, most forced into the sex trade, domestic servitude, or agricultural labor. At any one time, between 50,000 to 100,000 people are in bondage in the US, mostly in plain view, in towns and cities across the country. People simply don't recognize slavery.

But, emancipation is not the complete answer. Freed slaves are often unable to cope outside their former existence. With one of the largest botched emancipations in human history, the US is a prime example of what happens when a country does no more than liberate its slaves. Four million people were dumped into the US economy without any tools, capital, education, political participation, rehabilitative care. Nothing. And the legacy persists.

Uncomfortable - but needs thinking and involvement. This problem won't disappear by itself.

Click Slavery is not dead, just less recognizable

Click Book - Disposable People: New Slavery in the Global Economy

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David Rapley [david@rapley.net] sent us his post-election ramblings:
    "Jim, we'll obviously have to agree to continue to disagree politically, but we might be closer than you think.

    "We were on Vancouver Island in British Columbia (Canada) during the election, where the event was watched with a high degree of interest and emotion. The high emotion was typically anti Bush. Of course when I watch their TV and read their newspapers, it's easier to understand why that is. So I agree with the eNews reader that commented about the lack of objectivity in the press. It's here in the US, in Canada and in the UK.

    "The eNews contributor from the UK who had gained the opinion that we Americans believe we have an obligation to change the world for the better, was flattering. If this war results in the establishment of democracy in the Middle East, then history will judge us as having effected a change for the better. However, does anyone believe that we would be fighting there if we and other Western nations didn't need the oil from that region?

    "I'm sure we all have different ideas of what, or who, is to blame for our terrorist problem. I still have a Cato Institute article published just after the fall of the Evil Empire. It suggested that now the threat from Russia had been diminished, the biggest threat to the US would come from terrorism. Therefore it advocated that we should adopt a low profile internationally. We should avoid setting ourselves up as a target. We would need a strong military to be used when we were threatened, but we should avoid inflammatory activities. Hindsight would suggest that this would have been a prudent course of action. Has any administration since, followed this advice?

    "So now we're in this war and I believe it's essential that we win it (however we define winning it). So I voted for Bush because I think he can do it, not because I agree with everything he's done or will do. There are many reasons why I couldn't vote for Kerry. I can't understand why the Democratic Party can't come up with better candidates.

    "What really worries and disappoints me is that neither party seems to be able to develop a vision for our country 10 or 20 years from now. If we keep on doing what we've always done, we're always going to get what we always got! So what's the grand plan that will ensure that 20 years from now we're not spending $80 billion/yr, or more, on fighting terrorism? Actually I think the terrorist plan is to slowly bankrupt us At the present rate of spending, it might not take 20 years.

    "Well certainly if we weren't so dependent on Arabian oil, that would help. To borrow a line from John Lennon, "Imagine" a federally lead program to encourage the use of alternate and renewable energies that would lead us to energy independence or at least in that direction. Imagine the effect it would have on the US economy!

    "But unfortunately, like Lennon I'm a dreamer and this imagining would take real LEADERSHIP in Washington ! I can't sing either."

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Kenneth Brant [k2brant@yahoo.com] presents an insightful analysis of US anti-terrorism policies:
    "I do hope the American electorate perceives enough cognitive dissonance (from the ideological scenario-building of the current administration to the empirical truth - told not just by its opponents in this election but by some of its very own deputies and acolytes) to decide something is very wrong at this juncture in US history.

    "It's simply not good enough policy to bash the evil-doers and/or those who harbor them abroad - including widespread 'collateral damage' to innocents and non-western culture. Islamist-inspired terrorism is fed by alienation and dislocation. As a nation we need to recognize that we continue to feed it (even if we don't agree on whether we cause it, intentionally or unintentionally).

    "Bush is right that there are "9/10" and "9/12" views of the world. But the important difference lies not in who possesses the most anger "post 9/11" and is doggedly committed to venting it. The important difference lies in strategy, tactics and willingness to embrace new thinking on how to respond to the threats.

    "It is Bush who has the "9/10" view of the world because he is prosecuting the "war on terrorism" with 20th century approaches to war that have been proven ineffective against insurgency, guerrilla war and terrorism: a/ traditional, pre-emptive military campaigns against nation-states (though updated with modern technologies to provide shock and awe'); b/ attempts at nation-building under the guise of promoting democracy; and c/ military occupation. In fact, insurgency, guerrilla war and terrorism were the responses to these forms of military action when overwhelming force could not be directly engaged on the battlefield.

    "It is Bush's 'pre-9/11' war that has created an engine for new terrorism that will plague current and future generations of Americans and others worldwide. They have produced a precarious, perverted and deeply flawed 'democracy' in Iraq in which 'indirect' violence and suffering may be as significant to the 'direct' suffering under an admittedly bad man - Saddam Hussein. And, they have resulted in our troops being bogged down in a single geography with no plausible scenario for fast redeployment to the distributed fronts in the 'war on terrorism' - while many nodes of terror continue to build across the world. It is also wise to remember any arithmetic in this war must include addition (new terrorists inspired and recruited) as well as subtraction - ostensibly 2/3 of al Qaeda's known leaders caught or killed. Osama Bin Laden himself did not crash into the WTC - we need to limit the recruitment of the real agents of terror not just damage its hierarchy which can and may be rebuilt in an even more covert organization.

    "Islamist-inspired terrorism has been clearly shown to be a networked phenomenon and its containment will require networked approaches. Cell-leader Mohammed Atta was an Egyptian national among mostly Saudi cohorts. He studied and developed terror plans while in Germany, entering the US through Canada. So, early detection and intervention to insure our citizens' 'homeland security' will require functional alliances and joint actions with entities like Saudi Arabia, Egypt, Germany and Canada (and, yes, even with France, which has a relatively large Muslim population, as well as with Pakistan which already has nukes and where the majority is increasingly hostile to the US and its own military leader) and increasingly with non-state actors. The need for stronger, more functional and more imaginative alliances is not a sign of weakness on our part. Putting aside the deeply divisive but equally necessary debates on ethics, fairness and justice, in this unconventional war success will be won with unconventional tactics. Alliances and imaginative new policies that help us prosecute an agile, surgical and interventionist war, while mitigating the alienation of the 'middle' in Islam and in Christendom, are a sign of strength 'post-9/11'.

    "The irony here is that Kerry needed to go further in the direction of foreign policy (imagination) change away from status quo as well as adopting new models of military engagement. He didn't go far enough - and perhaps taking that direction made him unelectable!"

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Terry Sheehan [sheehantl@comcast.net] praises Howard Bloom's books:
    "Thank you for suggesting to your readers they should read Howard Bloom's books. I have not read the "Global Brain" at this time, but have read "The Lucifer Principle". It's an excellent book and certainly does express what is going on in the world today.

    "I think this ought to be required reading for all our government officials. We need to get copies of both books into their hands. Maybe with your connections you could encourage an email campaign to the officials suggesting they read Bloom's books."

Click Read Amazon reviews on Howard Bloom's "Global Brain"

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