Extract JimPinto.com eNews Dec. 30 2002
Automation update - year-end 2002 - Honeywell
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.
Thursday, December 19, 2002
Do you have any stats on the layoffs at Honeywell International Engine & Systems, Torrance, CA. This would include layoffs in the past year and future predictions including closing the facility?
Tuesday, December 17, 2002 - from a Honeywell ex-employee:
What Honeywell really needs to do is stop hiring over paid CEOs that follow
the GE model and mentality of executive compensation.
AUTOMATION AND CONTROL PRODUCTS ANNOUNCES WORK FORCE PLANS IN NORTH AMERICA
From : Roger Fradin, President Automation and Control Products
To : To all North America Automation and Control Products Employees
Yesterday Honeywell Automation & Control Products (ACP) began announcing a
series of steps that we believe are critical to maintaining our competitiveness and funding our
future growth. We are proposing several restructuring projects throughout our global businesses, including North
America; they include productivity improvements, outsourcing, work transfers and census reductions that will
result in a net reduction of approximately 275 positions in North America during 2003. Employees who are affected will be
personally contacted. Employee severance benefits are specified in the Honeywell Severance Pay Plan.
While difficult, these actions are necessary for us to remain competitive
and grow. All of our discussions with the affected employees will be handled respectfully,
ethically and in the best interests of employees, customer and shareholders.
Tuesday, December 17, 2002
What have you heard about Honeywell selling it's Nylon/Specialty Materials Division to BASF. I work at Honeywell and the rumors are all over the site. Management is not verifing or denying it.
Tuesday, December 3, 2002 - from an ex-employee:
I spent 6 years at IS (14 yrs at Honeywell total) before leaving 1 1/2 years ago. Some observations/opinions:
I see Honeywell as not knowing what they have, not knowing what they want and not knowing who to sell to. Honeywell was great when they invented/created in-house with their own engineers. Now everything’s a commodity. A Company with the technology they want can be bought, mined, and dumped.
As a corporation Honeywell was all set to be an aerospace company but now that that's in the tank they are trying to get industrial back on board without ever investing in new products. They continue to gut the customer service groups of knowledge, experience and reliability by moving the groups around, not valuing experience and knowledge. Upper Management doesn't know and doesn't care what customers want and need. They're just trying to get their next bonus. If a customer jumps through enough hoops Honeywell will sell to them.
Thanks to Michael Bonsignore, Marcos Tabakaras (sp?) and the other "bunge-bosses".
Monday, November 18, 2002 - from a Honeywell employee.
1) I'm only a grunt, so I don't see the day to day activities of top
management. In regards to Dave Cote I'm impressed by what I've heard, now
if he can walk the talk. Which doesn't appear to be happening. As an
example he said we were not going to pull everything we could into 4th qtr
and thus bleed dry 1st qtr next year. However, I see us doing the same
thing we do every year and continue to be pressured by management to get
everything into 4th qtr.
In regards to Kevin Gilligan, my impression isn't very positive. He puts a
travel ban on, no travel except where customers are involved and hopefully
it's revenue producing. We had a customer with a problem and it took 2 VPs
to finally approve someone going to site to work on the problem. Yet, we
can bring in a bunch of people from the East coast to Phoenix for Green Belt
training. Also, middle management doesn't seem to have any restrictions on
traveling for staff meetings.
Jack Bolick, all I have is a first impression which is positive.
In general my impression is that Honeywell is managed for the benefit of
it's top management first, share holders second, and customers third. Dave
and Jack haven't been here long enough to really know what is going on,
we'll have to wait and see if they change things. Kevin just doesn't know
what's going on, in his defense I'm hearing from management types that you
don't tell upper management what is really happening, you tell them what
they want to hear. This doesn't speak well for our leadership team. We
continue to play games and kid ourselves about cost savings were achieving.
As an example, we saved $x millions by getting rid of the travel group. We
now have expensive engineers, PMs, etc making their own travel arrangements.
That cost gets pushed into the project, and is thus hidden so we have a
great savings to boast about. In reality, there may be a little savings but
not the claimed amount.
2) Reductions continue, what I see is 2 worker bees get cut for every
overhead person. Our group is understaffed, and we continue to lose people,
voluntary leaves as opposed to layoffs, due to poor management. Poor
management includes micro management, work load, support, etc. Moral is
very low obviously, we can't decide if these actions are intentional just to
get people to leave (note that most of those leaving are the skilled
experienced workers) or just stupidity.
3) We seem to have two schools in leadership, one
is looking towards the future and trying to build a base from which to grow
and expand, while a second school can't see beyond next week. Right now I
think the second school is winning, but just barely. How fast we grow and
how dominate we become in the market place is a function of how much the
first school can set the agenda. The market right now is ripe for someone
to take a leadership role, that can be us if we get our act together, which
requires a course change. I'm hoping Jack can implement the necessary
changes. What I believe will happen is that rather than a radical course
change, we alter course slightly and slowly grow. We'll probably miss the
opportunity to kill off the competition while their in a weakened state.
Monday, November 18, 2002
I work with Honeywell and we're fed up with the constant layoffs. Morale sucks. Is there any end to this???
Thursday, November 14, 2002
Honeywell laid another 2 bombs in their latest 10Q.
Honeywell stock is down 11% today. The reason appears to be first that
they will have to fund their pension with an additional $900million on top
of the $100million that they had planned. They also announced that their
asbestos liability appears to be larger than the value of the current
reserves. They also plan to cut an additional 4-5 thousand people this
year, with an possible 4th quarter charge of $1billion.
Thursday, November 7, 2002
A-B (Rockwell) and Honeywell have divorced - ProcessLogix will not follow the (Honeywell owned) controller updates in the future. Neither PL nor PlantScape has a secure future because of this.
Thursday, November 7, 2002 - from Europe:
Honeywell Organization:
Centralization meant that each and every customer was categorized in a specific market and assigned the level of service they could expect from Honeywell Sales/Service. Each market has its own sales and projects group which reports direct to headquarters in Phoenix, AZ. (Every local sales person had to report direct to HQ in Phoenix, AZ.!) Executive management have realized this not manageable, so they have started to introduce regional coordination again. The Hispec organisation has been integrated fully into the traditional Honeywell organisation. This means that DCS/Instruments sales people are now also responsible for selling advanced process control applications. The morale in the organization is still very low, but there are no big changes (=reductions). The quality of engineering is low (a lot of bulk work is coming from India). All DCS projects in The Netherlands are making a loss. Therefore new project managers are being hired.
Major Accounts:
DSM has been lost as one of the Major Accounts. The International Account Mgr. has been fired. The situation of losing Major Account ChevronTexaco to Yokogawa has not been made public in Honeywell. Honeywell feels they are losing BP/Amoco as a corporate account, the International Area Mgr. has been asked to identify other activities in which he could be useful. The remaining Major Accounts (Shell, DuPont, ExxonMobil, Proctor&Gamble, Conoco) are managed direct from the US.
ExperionPKS/PlantScape:
The relationship between A-B (Rockwell) and Honeywell has been terminated. This means A-B will not get new releases for the ProcessLogix controller, but Honeywell can continue to use AB I/O for ExperionPKS/PlantScape. This I/O can not be redundant due to the back plane design of the A-B PLC which is used for PlantScape. Honeywell will announce a new network (proprietary protocol, fast ethernet, redundant TCP/IP) which replaces ControlNet. The HPM I/O modules can then be connected to the Experion controller, giving a migration path from TDC3000/TPS. There is no further development on HPM controller. The new release Experion, which is scheduled for January 2003, will include an enhanced controller with full HPM capability as well as software for this new TCP/IP network which allows redundancy via switches and routers.
Monday, November 04, 2002 - from a Honeywell insider.
Here is my feedback on the Jack Bolick message :
- Honeywell Mgmt. were encouraged that, in spite of the low morale, there had not been a masss exodus. What they haven't taken into consideration is the fact that this is because not many are hiring. Honeywell will be in real trouble if that changes in the near future. My source for this is with Account Managers and Team Leaders in the field.
- The comments on goal-alignment really speak to the vastness of Honeywell. Yet "good old boy" networks have dominated career advancements and left many to their own devices, without sponsorship or understanding of how to chart a career path which doesn't really exis outside of the networks. It's like insider trading, you're either in or you're out. Therefore how employees understand their place in the overall scheme of things and how their contributions match up with the IS goals, etc. is lost because they never quite get there.
- Perceptions of leadership is hilarious. The new joke is that Honeywell upper management is an oxymoron. The written comments suggest that the lack of confidence in leadership is due to the numerous changes in upper management. Well yes duh, that is part of it. But I can tell you that there has not been a high level of confidence in IS upper management for 10 years. We promote people who not leaders. What we need are leaders!
- IS reputation: In short our largest Customers are losing confidence in us while we figure out who we are. Confidence is waning in the employee ranks, regarding our ability to pull this out in time, to have a choice of being sold or not.
Bolick has only accomplished pissing people off thus far. He needs to realize that he is currently working from a position of weakness, and must first earn respect. I don't think he gets it. The message is a lot of blah, blah, blah, a sort of verbal masturbation.
Received by weblog - Sunday 3 November
Addressing your feedback
TO: Industry Solutions Employees Worldwide
FROM: Jack Bolick, IS President
Earlier this summer, the company asked you to voice your opinion about Industry Solutions. As promised in the Phoenix town halls, I am sharing the results of your feedback. It probably comes as no surprise to you that our satisfaction levels are low.
Reviewing the feedback you've provided is part of the Leadership Team's effort to get clarity on our direction as a business. More than half of the IS employee base responded to the survey, with about 3,280 surveys completed. That's the good news. The concerning news is that only about 55 percent of you are satisfied with working at Industry Solutions.
Our job now is to understand why people responded this way and develop action plans to address the issues. In addition to a low employee satisfaction rating, three other areas are clearly identified as in need of action: goal alignment, perceptions of leadership and IS reputation. (Reputation is defined as the ability to attract and retain talent, stable and well-managed, socially and environmentally responsible, responsive to customer needs, and providing the best products and services.)
In the executive summary report that was provided to me by Wirthlin Worldwide, they drew the following conclusions from the survey data. (Wirthlin is the independent international research organization that conducted the survey for Honeywell.)
1. Goal alignment -- "This benchmark wave of employee data reveals a considerable gap between how important employees feel Honeywell IS’ business goals are versus their perceptions of Honeywell IS performance on these goals. Much of this may be attributed to employees’ low awareness of Honeywell IS’ efforts towards these goals, and/or a lack of understanding on how, as an individual, they contribute to each goal."
2. Perceptions of leadership -- "Employees exhibit stronger relationship with immediate managers and departmental goals than with executive leadership. Frequent change in senior leadership identified as a key challenge…. Immediate managers score highest on trustworthiness, caring and reliability."
3. IS reputation -- "Low ratings in reputation attributed to issues with performance on key organizational leadership attributes as well as frequent change in senior management positions."
I can tell you from my viewpoint that we're already taking actions. A plan to refocus our customer service is in place, and actions are already being taken such as the launch of PKSconnect. (PKSconnect is a global web-based customer feedback system.) The sales effectiveness initiative is under way, including a team reviewing the alignment of customer needs with incentive compensation for the sales force. In addition, the Leadership Team will review the IS five-year strategic plan (STRAP) in December to bring clarity by creating a simple five-year vision statement (strategic intent) and by identifying five to eight overarching customer Big Ys for us all to focus on in 2003. I will be reporting this out to you early in the first quarter next year.
Next steps will be to develop a more comprehensive action plan, share the plan and discuss it to ensure global understanding, which will result in ownership and clear action by all.
To get more detailed information about the survey results, please contact your manager, who has been provided with a toolkit about the survey. I encourage you to discuss the results and potential actions together.
I look forward to working with you to continuously improve our business.
On Sunday October 27, 2002 - Jim Pinto wrote :
The Honeywell weblog traffic is at an all-time high, with several thousand hits per month. I'm a little uncomfortable that comments are always negative. To maintain a balance, I hereby request ANY Honeywell IS people who are POSITIVE about their company to e-step forward and provide some of your positive thoughts and ideas about your company.
I had invited Jack Bolick to be on the the ISA panel session last week (Dick Morley's Last Retort - Wed 23 Oct). Unfortunately, he didn't respond, and the Honeywell people told ISA that they would not participate. I hoped that whoever represented Honeywell would give us a positive slant on the company.
Anyone reading this, please forward to Jack Bolick, or at the very least, a Honeywell person. Surely it would help them to read what Honeywell employees are thinking and saying.
Sunday, October 27, 2002
The fan who commented on Oct. 17 must be applying for Jack Bolick's job - after Bolick leaves in 6 to 8 months ??
Friday, October 18, 2002 - from a knowledgeable Honeywell-Phoenix insider :
Cote's most recent town Hall meeting (17 Oct.) was the standard
"we must suffer now to make us stronger in the future" type of drivel.
He emphasized the importance of setting up shop in China (which was
perceived by many as to mean "continued outsourcing"). And then he bragged
about the "world-class" capabilities of India and that they have
ranked on a scale from 1-5 as a strong "5" for the last 4-years in the
software arena...again viewed as more outsourcing. In fact, the remaining
UCN continuing engineering responsibility is scheduled to complete
transition to India by Nov. 1st.
On the subject of Gilligan, me thinks he doth protest too much.
Constant denials about claims of being "for sale"; very much troubled
by Sir Pinto's prognostications - to the point of having access to your
web-site terminated and issuing an e-mail which warns that any
reproduction/republication of internal company news is now deemed
by the "lawyers" as a violation of company policy which may include
termination of such offenders.
Question: Just how many employees can view internal news articles before it is legally
considered as "public domain"? We might just have to test that theory.
During Cote's song and dance session, Jack Bolick chose to sit right in the
midst of the "factory worker" section - and they loved him for it! Playing the
"I am just like one of you" role and coupled with his good 'ol boy North
Carolina accent appears to be sucking in many new supporters.
He has not been there long enough for anybody to gage his intentions and
direction for the business. As they have all done prior to him,
he too will soon be off on the Grand World Tour to meet with location
heads around the world. One can only hope that he spends as much time listening
to customer as he will to those who will tell him exactly what he wants to hear.
One of the latest victims from the recent round of layoffs was the head of
the Guest Service Center in Phoenix. This individual was unceremoniously
escorted out the door with only a moments notice. "She", and her department
have been responsible for all of the shows and user conferences for over the
last 25+ years. The upcoming ISA show in Chicago will go on without her
since the activity has been planned long in advance of her departure.
There is no indication currently from the remaining members of her staff as
to what and how their roles are to change within GCS.
The overall business remains stagnant as does the market. News about any big
wins are few and far between. The consolidation effort continues with both people and properties.
Saturday, October 19, 2002 - a Honeywell insider from Honeywell mid-east commented:
1. Senior Management appear to be too far away and divorced to what
is really happening. As far as relationships with our clients it is
embarrassing trying to explain why our Senior Management is being changed every year!
2. Employee reduction is not really affecting us because we are
growing. 15% on revenue last year and about 20% this year. Next year will
be a challenge as we are going for 30%. Our problem is in getting
experienced engineers to work for us. (By the way Honeywell has been in
this country for about 25 years - only recently have a few of us arrived
here and are willing to act on what we believe in)
3. If Senior Management don't get their act together from a perspective
of understanding our business, investing in R&D for future products and
having some consistency then we are f$%^ed. (Sorry about that) They do not
appear to be on the same agenda as those who take pride in their job and
Honeywell and want to see us as a great company again.
Some of us out there, Senior Managers in our own locations, who have
been with Honeywell for many years, really believe in the company, for what
it once was and for what it could be again. However we are being held back
by the perceived stupidity and risk aversion of Senior Management. They
seem to forget that business is a risk. Unfortunately we are too influenced
by our American Management. Globalisation to them is taking the American
way and imposing it on the rest of the world. They haven't realised yet
that that does not always work. Leave it to the people in the field to
provide the results. As I said previously we ARE providing the results.
This is, I believe, because we are in aposition to be able to ignore Senior
Management except for those things we agree with.
Friday, October 18, 2002
The Honeywell loyalist who posted on Oct. 17 has obviously not been exposed to products outside his own company's offerings. Honeywell has no technical advantage over any of it's competitors, and will never 'run away' from better products.
Thursday, October 17, 2002
A Honeyweller commented :
- I met Jack Bolick and I like him. He was obviously on information overload but, I took note he did
not sit in the "crony" section at the last town hall meeting. Dave Cote and Kevin Gilligan both seem to be
classic executive management, who consider the needs of Wall Street and their own compensation
before the needs of our real customers.
- I knew a few people who were hit in the recent RIF. It's getting harder to get internal support & there are no young
people in my group.
- I think if leadership spent less time with consultants and more time with customers we would
quickly recapture the glory days. I often meet people in the industry who like Honeywell & would
like to see us back on top. I believe Honeywell has everything it needs to run away from the
competition. We are battling in areas today because of a lack of customer focus/understanding at
the executive level.
Wednesday, October 09, 2002
Honeywell has dropped from largest to 3rd largest employer in Arizona
according to this list:
http://www.azcentral.com/business/rep100/index.php
Thursday, October 03, 2002
Monday 9/30 was another BLACK MONDAY. (Unconfirmed, but a large number) 187 more Industrial employees laid off worldwide. More good friends without jobs. More saddness. It seems Honeywell is trying hard to become the second or third largest employer in the city of Phoenix (ummm, they're first now, I think...)
Welcome Jack (layoff) Bolick. Good bonus is guaranteed, I bet.
Tuesday, October 1, 2002
Jack Bolick emphasizes customer focus as he introduces himself to IS employees
Posted By: ACS Administrator (Tue, October 1) (Extracts only here)
"My personal beliefs are customer, customer, customer," Jack Bolick explains. Why I'm here is to help this organization determine how to create that value."
Jack introduced himself to IS employees and answered their questions during meetings at two Phoenix facilities. During the meetings, Jack said he recognizes how frequent leadership turnover can be difficult for employees and the business. Reiterating what ACS President and CEO Kevin Gilligan told IS employees in August, Jack said, "This business is not for sale. I would not be here if it were."
Jack told employees that "I'm a builder. I do not like tearing things down," he said. "That doesn't mean we won't have to back up and do zero-budgets and other actions. But I'm here to grow this business."
"I see the great potential of this business. I'm excited and look forward to being here. Besides," he adds with a chuckle, "I love to play golf. That's another good reason to come to Phoenix."
On Wednesday 25 Sept.02 Jack Bolick, the new President of Honeywell IS, sent a voice mail
message to all US employees (extracts only here):
"This is Jack Bolick, your new global leader for IS.
I'm glad to be on board. I'm excited to be here.
"I was with Honeywell's Electronic Materials business for
approximately 12 years. I leave that business in good shape
and I'm joining to do the same here - to grow it and position
it for the future in the control market.
"I've been in industry over 20 years - as a process engineer
doing controls, up through laying out and designing MES systems.
I'm certified in production and inventory control, quality
engineering in several different disciplines. I really look
forward to joining our global team and driving it forward.
"I do firmly believe that everything begins with the customer.
Our image with the customer is strong. With new products such as
Experion PKS I know that we have a winning formula moving forward.
"I'm glad to be here and look forward to seeing all of you.
I join formally on October 1 and from that point we will drive
forward together as one global team."
Tuesday, September 24, 2002 4:43 PM - from a Honeywell IS insider:
Today Jack Bolick, from Honeywell Specialty Materials, is named Industry Solutions president at an all employee meeting. Mr. Bolick ensured employees that Industrial Solutions, IS, is not for sale. Mr. Bolick asked employees to stay the course. Will Jack Bolick last long than a year and out last Terry Sutter?
On Tuesday, September 24, 2002 - a knowledgeable industry observer wrote:
Very confidential - but this may generate some confirmation from the Honeywell-Siemens rumor mill.
An ex-Honeywell manager confirmed that when the United Technology buyout of Honeywell was announced internally (on a Friday) they were also told that concurrent with that deal, IAC was being sold to Siemens. All this fell through on Saturday when GE made their counter-offer. GE at the time wanted to keep IAC (IS), so the Siemens deal was off.
We have to wonder why someone hasn't jumped on the $23 a share price of Honeywell and buy the whole thing. Or, why Siemens hasn't completed the original IAC deal. Is there some regulatory reason Honeywell might want to wait until 2003 before agreeing to a buyout?
Another reason why Siemens may be hedging on the deal might be that they realize that any announcement of IS being sold will again force the Honeywell installed base to stop spending. Forcing another 6-12 month wait to find out if the deal gets approved plus another year to find out the new product direction would likely give the Honeywell installed base enough reasons to finally give up on Honeywell IS altogether.
But this assumes Siemens is smart enough to figure that out... (The same Siemens that was surprised when Moore sales dropped off significantly in 2000 - forgetting the impact of Y2K spending in 1999 and the impact of any takeover).
Tuesday, September 24, 2002 - the Honeywell supplier who sent us the 5% rebate request from Honeywell UK (see below) commented:
Honeywell must really be desperate to ask for a 5% 'rebate' from all of their suppliers in order to be considered as a future 'strategic supplier'. The request seems to be trying to generate cash specifically for the end of this year - I guess they are still having trouble making the numbers. The real joke is that paying the 5% doesn't even guarantee the supplier will be chosen as a strategic supplier once Honeywell "significantly reduces its supplier base".
What's the next step? Will Honeywell request a 10% reduction on all 2003 invoices once their 'productivity improving e-business tools' are in place?
Received 24 Sept. 2002
On 12 Sept. 2002, Honeywell UK (Bracknell, Berks.) recently sent out this letter to suppliers (extracts here):
Honeywell ACS Service Europe is introducing a program in 2002 & 2003, aimed at a significant reduction in our supplier base.
Each of Honeywell's current suppliers are requested to contribute a rebate to Honeywell of 5% of the yearly spend. You will be required to make a payment to Honeywell ACS Service in the fourth quarter of the current calendar year, that consists of a rebate of 5% of total sales to Honeywell, applied to all completed transactions.
Signed: Bill Jarret, Regional Supply Mgr.
Monday, September 23, 2002 7:21 PM
All Honeywell Industrial Solution (IS) employee will be meeting tomorrow to announce some exciting news. Could this be the announcment of Sutter's replacement? Or is this to announce the Siemens deal?
On Saturday, September 21, 2002, Edward L. Higdon [ehigdon@onemain.com] a Honeywell supplier wrote :
A little background on how a Honeywell supplier gets treated.
We supplied a set of custom modifications both fixtures and solder
systems to Honeywell - this was their Freeport #4 Plant. While the cost savings were both obvious and
substantial I have never been so under supported by engineering staffs. Assigned engineers were
too busy to become actively involved.
At Honeywell, the machine was originally miswired and nearly blew the
controls to kingdom come. One modification after another was made after sample parts were run
successfully and a three days set-up turned into a three trip fifteen day marathon.(Less than 8 total
hours with the engineer at their plant with the machine) The machine is working well and in
continuous production but the buyer put a hold on the final four thousand dollar payment(what
profit?) Basically saying we ain’t paying "Whatcha goin' to do?" sucker. I've seen engineers dodge
questions, but you can just imagine.
I could never trust Honeywell again to meet their commitments to payment or to follow through on their word.
Gross "impunity" is my only possible description of their behavior. Forget the contract. Payments
so late they didn't matter anymore, e-mail cut-offs(obvious filtering), absolute refusal to reply
to requests for explanation, refusal to return merchandise unpaid for etc.etc. What gives?
I realize plants are going through downsizing but pervasive attitudes of the vendor as the enemy
aren't going to take us anywhere. Not surprisingly, this Honeywell plant (Freeport #4) has had a lot of layoffs.
I've bought or designed in far more dollars from Honeywell's products than they
have ever purchased from me. That's at an end. Is the customer always right?
Edward Higdon
Soldering Technology Labs
On Thursday, September 19, 2002, John Okolowicz of Honeywell [john.okolowicz@honeywell.com] wrote:
Here is a good one for you:
Your web site has been blocked from internal viewing on all computers from
within Honeywell International. It has been deemed a "Porno" site as per the
"red screen of shame" and the warning message that pops up:
http://it.iac.honeywell.com/lras/warning.htm?URL=www.jimpinto.com/home.html&IP=164.145.53.127&CAT=PORN
You can check the facts by just contacting any one of your friends that
still work at Honeywell. I have been trying for a week to get an explanation
for this censorship but have not been able to get anyone's attention.
Hmmmmm. Could this have something to do with your inside scoops on the
possible Siemens acquisition?
Wednesday, September 18, 2002
I heard that some managers at Honeywell IS, former IAC, have been asked to apply for their current positions. I know when GE was in the process of buying Honeywell they were doing the same process. Could the Siemens deal be closer than we think?
Wednesday, September 18, 2002 - from a Honeywell insider:
I noticed that Kevin Gilligan announced a new VP of Six Sigma Plus. What was interesting is that Tracy Glende who holds that position was not mentioned in the announcement. Could Tracy Glende be the heir apparent to the position recently vacated by Sutter?
Sunday, September 15, 2002
Rumor of more layoffs at Honeywell IS (part of the old IAC). Given
the practice of dropping the axe at the end of a quarter, I'd would
guess next week.
On Saturday, September 14, 2002 "one untermensch" blogged:
Siemens had better be really careful about the price they pay, as the company is losing value every day ! The Glorious Leadership of Kevin Gilligan and his team is sinking the ship. We hear nothing useful from these guys, only instructions to kowtow in front of the six sigma plus paper idol, and by the way, do use the toilet paper on both sides. I guess that they are too busy negotiating their golden parachutes.
The new organisation, 'vertical', is producing some unexpected effects : on the same product, R&D, Marketing, Sales, Production, Quality are all reporting to different organisations (with different agendas) and the real work is gradually halting, replaced by endless negotiations among these organisations. And don't forget multiple reporting.
Thursday, September 12, 2002
I'Ve been with the company (Honeywell "Industry Solutions) for over 10 years.
I've been through one to many mergers (Measurex, Honeywell, Allied and the failed GE)I've seen a lot of changes from within and it has not been a "wonderfull life".
To whom ever they sell us can't be any worse than Honeywell.
I just wish they get it over with and stop preteding that we all have blind folds.
Wednesday, September 11, 2002 - from an industry observer:
Heard from a former Siemens employee who heard from
his contacts within Siemens that Don Bogle is on
retainer at Siemens and working on the Honeywell IS
acquisition. Don and Ed Hurd were at the helm of Moore
Products at the time of the Siemens acquisition.
Coincidence?
It also appears that they are now just haggling over
the price ...
A Honeywell observer wrote on Wednesday, September 11, 2002
Heard from an Emerson ex-Honeyweller who had heard
from his Honeywell contacts that Ed Hurd was spotted
in Honeywell IS Phoenix offices recently. Ed was
apparently wearing a Siemens contractor badge - part
of a Siemens due diligence team no doubt ...
On Friday, September 06, 2002, this was blogged by "Micro Watcher":
Honeywell's purchase of Invensys Sensor Systems is a great move and strengthens the Sensing and Control business which is the strongest that Gilligan has. Alan Wright, their VP/GM, knows this business better than anyone and will drive Growth and Profitability - unless, as rumoured, he is poached by GE.
On Wednesday, September 04, 2002, another Honeywell insider wrote:
"I also work for Honeywell Industry Solution, and the Jim Pinto website is indeed blocked at our facility (and I suspect at other facilities connected to the mother-ship)
"The censorship method ... is that of handing the job over to some frail and erring mortal man, and making him omnipotent on the assumption that his official status will make him infallible and omniscient.
ATTRIBUTION: George Bernard Shaw (1856-1950)"
On Wednesday, September 04, 2002 - after seeing the weblog (below) that access to the JimPinto.com website has been blocked within Honeywell, a current Honeyweller wrote :
"I'm with Honeywell IS and have had no problem accessing your site either at work or home. I've been by your site to check on the blog once every couple of days @ the office since B4 the GE merger. Maybe the 'alleged' Honeywell IT barred access to this site is local to the other Honeywell insider?"
On Sunday, August 25, 2002, someone logged this:
Terry Sutter's replacement has been identified. He is a Honeywell insider from another division.
Honeywell will wait until after the end of the quarter to avoid disturbing the new IS leader's division.
On Sunday, August 25, 2002, a Honeywell insider wrote:
FYI, Honeywell IT has blocked the JimPinto.com website from internal access. I can no longer log on from work, only from home.
On Thursday, August 22, 2002 - *EXPERIENCED* wrote :
It's a sad state of affairs to see Sensor Systems being run by a bunch of young, arrogant, inexperienced yuppies without a compass - but it’s an equally scary thought of Honeywell’s toxic management style!!
On Tuesday, August 20, 2002 an industry analyst wrote about the Honeywell purchase of Sensor Systems from Invensys:
This supports the theory that Invensys is forced to sell profitable businesses to get needed cash in the probably vain hope of taking the dogs that are left and magically transforming them into gold! Other key buyers looked at this and declined.
IMHO, Honeywell drew the short stick on this one. My belief is that: a) the roughly 15% operating profit is over stated and, b) that Honeywell will destroy this profitability within 24 months (witness Measurex and almost every other acquisition Honeywell has made).
Invensys sells sensor group to Honeywell for $394m
Continuing to cut costs and pare debt, British industrial engineering company Invensys plc agreed Monday, Aug. 19, to sell its sensor systems unit to Honeywell International Inc. for $394 million, plus $21 million in liabilities and transaction costs.
The deal follows the $425 million sale of Invensys' battery business to EnerSys Inc., a Reading, Pa.-based competitor owned by a Morgan Stanley Private Equity fund, and the $505 million sale of its flow-control business to Irving, Texas-based Flowserve Corp.
Read news story : Invensys sensors sold to Honeywell
On Tuesday, August 20, 2002 , a knowledgeable industry observer wrote about Kevin Gilligan's Town Hall meeting :
"This is reminiscent of similar bologna before the announcement of the GE acquisition!"
On Monday, August 19, 2002, someone sent this:
Kevin Gilligan tells Town Hall participants that IS is on the right track. (extracts here)
Although IS will soon have another new president, ACS President and CEO Kevin Gilligan said that employees should not be overly concerned about major changes ahead. The current structure and direction are the right ones for the business and IS will "stay the course," Kevin told employees Thursday (August 15 02) during a Town Hall in Phoenix.
Kevin said there are three facts all IS employees should understand:
"This business in not for sale -- period." IS is a good business with great potential. Honeywell has increased its investment in IS this year to reestablish our leadership position in the marketplace. While every company continually reassesses its portfolio, there are no plans to sell IS. That is not part of Honeywell's strategy.
"This business is on the right track." The fundamental strategic direction that has been set will not change. After much deliberation, IS has developed a sound strategy that is fully supported at the ACS and Corporate levels. Our challenge now is executing the strategy. In addition, the basic structure of the organization will not change. IS will not be combined with ACS Service.
"This business is making great progress." We have delivered on our profit commitment for the past four quarters. We have launched Experion PKS and the market has reacted favorably. For the most part, we have reassured customers that we are stable and dependable. The best way to ensure our continued success is to keep meeting our financial commitments so Honeywell will continue investing in our business.
Kevin thanked outgoing IS President Terry Sutter for the "terrific job" he did over the past year in regrouping the organization, creating a strategic focus for the business, setting a direction, motivating employees to support the direction, and reassuring customers that they can count on Honeywell. Terry said it was a "tough decision" to leave and he has a lot of mixed emotions. Although he was not looking to leave Honeywell, he decided to accept a "unique opportunity" offered to him by a company he knows in the part of New Jersey where he's originally from. Noting that "my 8-year-old has lived in four different states," Terry said the decision met both family and career needs.
In selecting Terry's successor, Kevin said he is looking for someone who has strong leadership skills, a strong customer orientation, and is very good at implementing strategy. "My job is to find you a great leader who will execute and build on the strategy we have. Your job is to keep the momentum going," he said.
On Thursday, August 15, 2002 an industry observer sent this:
The continuing saga of Honeywell continues from here. A good friend who worked in a non IS group here in Minneapolis was laid off after 21 years of service.. He did get 36 hours to get out, and some severence. Also had an accountant friend who left a local mortgage company here to go to work for Honeywell return to his old job after only ONE DAY at Honeywell.
The mood inside that company must be terrible.
On Wednesday, August 14, 2002, a Honeywell insider sent this :
Axe Wednesday strikes again!
Supervisors please post for those employees who don't have access to e-mail.
Special Posting - August 13, 2002
Announcement of Job Losses - Embedded Controls
Alan T Wright, Vice President & General Manager
Laura Ulz, Vice President North American Operations
Tim Erickson, Director Global Enabling Technology
As a result of the ongoing business situation, we are announcing a headcount
reduction within the Embedded Controls organisation. We are taking these
actions across all functions to better align our costs with our level of
business. We know this is a very difficult situation for the people directly
impacted and for the colleagues who see friends losing their jobs.
Unfortunately, at this time we see no other alternatives.
The last 12 months have been very difficult, especially for Embedded
Controls where revenue this year is significantly down against plan. We had
expected that the business would have recovered by now, however, this has
not materialised. As a result we have been forced to take additional actions
to reduce our costs. We have already significantly reduced the level and
amount of discretionary expenditures, curtailed outside hiring and
implemented restrictions on travel. The decision to further reduce headcount
was taken to align our staffing with current levels of business activity as
we strive to improve our financial results.
Although we are facing a difficult year and still have many challenges in
front of us, the businesses within Embedded Controls are fundamentally sound
with excellent long-term prospects. To secure these prospects we need to
continue to reduce costs, ensure projects are completed on time, drive sales
activity, and focus on meeting customer requirements. We must continue to
improve productivity and identify ways of maximising the return on our
investments to help make us more competitive.
On Wednesday, August 07, 2002, a Honeywell observer wrote:
Jim, your latest eNews said : "In my opinion, the Siemens/Honeywell deal is still open, bogged down in
price negotiations."
The departure of Terry Sutter would seem to support your conclusion. Kevin
Gilligan has lost 3 out of 4 of his Business leaders in recent months. Something is up.
On Wednesday, August 07, 2002 - after seeing the memo from "Gilligan's island" a Honeywell insider wrote:
Some possible scenarios:
- There is something going on with Siemens and Sutter doesn't fit into the
plan - somewhat like Tambakeras and Allied.
- The performance of Sutter's group is shaky and Gilligan is using Sutter
to save his own ass. Gilligan recently fired the Service President as well.
- Jim Pinto scared off Sutter with his challenge to duel at the OK Corral.
On Wednesday, August 07, 2002, this memo was published by Kevin Gilligan of Honeywell.
Message from Kevin Gilligan
To All Industry Solutions employees worldwide:
Terry Sutter has decided to leave Honeywell to join another publicly
traded company. The company Terry is joining will announce his new position
soon, which is why we are not providing additional information about Terry's
future plans.
Terry has provided outstanding leadership for the business, and all of
you have played an important role in IS' success by consistently delivering
results. You have many reasons to be confident about IS' future.
Industry Solutions has accomplished a lot in the last year for which
everyone should be proud. Not only has it met its financial commitments,
but also has developed a clear strategy for the future, is regaining the
confidence of its customers and has successfully launched Experion PKS.
While the leadership may change, the IS strategy and direction will not.
We remain committed to Industry Solutions as a core ACS business that has
outstanding opportunities for future growth.
I know that you've seen many changes in the leadership of this business
over the past few years, which has created uncertainty and anxiety. We
expect to fill this position from within Honeywell by the end of August, which is
when Terry will leave. In the meantime, stay focused on meeting your
commitments and achieving results.
You have all helped Industry Solutions make a comeback in the market
this year, and I am confident that you will continue to deliver outstanding
performance.
Thanks for your support as we make this transition.
Kevin Gilligan
President and CEO
Automation and Control Solutions
On Wednesday, August 07 2002, a Honeyweller wrote:
Jim, I just heard that Terry Sutter is leaving Honeywell Industrial
Solutions. Is this place a mess or what?
On Friday, July 26, a Honeywell observer wrote:
"A friend of mine that works for Honeywell told me about your website. We had lunch today, and it is horrible what is going on at Honeywell. I used to sell PlantScape, and, Scan 3000, along with working with all the Honeywell applications people. It is a tragedy. I forwarded your website to another former Honeywell application engineer, and he really enjoyed the article on Bonsignore. We lived through that! In fact, I was in a meeting the other day, with a fellow who has a doctorate in physics, and he made the statement he wanted "customer delight", I burst out laughing, and he was quite offended. I explained, that was the mantra at Honeywell about four years ago, and what a joke that was.
"It has been my desire for several years to have Rockwell (AB) and Honeywell's IAC group merge, that would be good. Both companies have or had, real talent in their employees, and it would be a powerhouse. Probably will never happen, but one can dream."
On Tuesday, July 23, an industry observer wrote:
I look forward to your email newsletter every week and have been especially intrigued by the ongoing saga of the possible Honeywell/Siemens acquisition.
I worked at Honeywell for over 15 years and watched the top brass take that company from a world-class organization to the current wreck that it is with disbelief and dismay.
I find the current situation amazing and depressing. The Siemens mentality, as described by a number of your readers seems right-on. I have always heard that Siemens can't believe that the mention of their name in North America doesn't clinch the sale, much as Honeywell could never believe that the same wasn't true for them in Europe. Both have had large ego problems that have prevented a logical and profitable market strategy. It's sadder still that Moore ended up "road-kill" in the Siemens move into the measurement & control market in the U.S.
I have just heard that the infamous purple Procidia is being revived sans purple and will be pushed by Siemens. It has been in the doldrums since the initial launch was interrupted by the Siemens acquisition. I remain unimpressed, unless some major redesigns are done. There are too many inherent design problems to mention here, but I would be extremely surprised if they came up with a unit capable of displacing the entrenched competition.
The Moore 353 controller seems to be off the radar screen for any changes, even though it is extremely long in the tooth and over priced. Who actually buys a $2000+ controller for a couple loops of control (sometimes a single loop…), when ethernet and RTD inputs are a very expensive option that adds to that already outrageous price?
On Wednesday, July 17 2002, a Honeywell insider wrote:
"It is indeed interesting that Terry Sutter does not respond to your comments, either directly or indirectly.
"And, if there is clearly no basis for the Siemens deal, why have David Cote or Kevin Gilligan not issued a denial that supports Terry Sutter's memo?"
On Tuesday, July 16, 2002, a Honeywell observer wrote:
It's usually more important, what people don't say, than what they say:
Der Spiegel (German magazine like "Time/Newsweek" and famous for its interrogative interviews) yesterday had
an interview with Mr. Pierer (Siemens CEO) about Siemens, mostly about Siemens in the US, CEO income,
mergers. Not a word about Honeywell......
Did they not want to ask? Were they asked not to ask?
Pinto response:
The Honeywell affair is still under NDA (non-disclosure) - so, if Der Spiegel is aware of it, they were asked NOT to ask.
On Monday, July 15, 2002, a Honeywell insider sent this :
It looks like Honeywell is trying to clean up before a bigger deal with Siemens.
Japan's Yamatake ends equity tie with Honeywell
TOKYO, July 16 (Reuters)
Japan's Yamatake Corp said on Tuesday it had bought back 12.99 percent of its shares from its largest shareholder Honeywell International, ending the capital tie with a former joint venture partner.
The deal, under which the Japanese manufacturer of automation systems purchased 10.99 million of its own shares for 10.65 billion yen ($91.64 million), was conducted at the request of the diversified U.S. manufacturer on Monday, Yamatake said.
Discontinuing the equity relationship with Honeywell after half a century will open up opportunities for Yamatake to enter new fields through new partnerships or joint ventures, it said.
"If Yamatake had not bought back those shares, Honeywell might have chosen to sell them to a third party with whom a conflict of interest might arise, which might have prevented Yamatake from securing autonomy in management," the company said in a statement.
On Monday, July 15, 2002, a Honeywell observer wrote:
"Ginny Burnell was announced as departing Hon IAC last Friday. Another good person leaves the ship! How many management leaders can they lose before some of their industrial customers realize they do not know this company any more?"
On Friday July 12 '02 - a Honeywell insider sent this:
Sent: Friday, July 12, 2002 12:32 PM
Subject: Energy and Industrial Automation VP/GMs
TO: Industry Solutions Employees Worldwide
FROM: Terry Sutter, IS President
Ginny Burnell, vice president and general manager of the IS Energy SBE, will
be leaving her position effective July 12. Ginny is currently considering
other opportunities within Honeywell. Throughout her more than 24 years with
the company, Ginny has served in varied sales roles in the industrial
business. We wish her all the best.
With Ginny's transition, I am pleased to announce the following change to
the Senior Leadership Team, effective immediately.
Brian Strauss, currently vice president and general manager of the
Industrial Automation SBE, will succeed Ginny in leading Energy. Brian has
been with Honeywell since 1995 and joined Industry Solutions last October.
Previously, he was business director for Metglas Solutions, a Honeywell
business in Morristown, New Jersey.
On 12 July '02, a prominent industry observer and analyst wrote:
"I think it is critically important to understand that many of Honeywell’s customers have observed a gradual but steady drop-off in terms of sales and service support. My impression is that Honeywell's historical legions of fiercely loyal customers really aren't all that loyal any longer.
"Instead of a lot of happy customers, I suspect Siemens (or anyone else who might end-up with Industry Solutions) will actually find a significant percent of existing customers who are distant and even angry. End-users are not stupid and they have seen Foxboro, Bailey, Moore, and others suffer through acquisitions. They have learned that customers usually do not come out better from the merger/acquisition activities of their vendors.
"It is my opinion that, because of the dissatisfaction-issue, the value of Honeywell’s installed base has been over estimated. When one couples the growing resentment of Honeywell customers with the over-hype of Experion, because of its inherent technical restrictions and slow roll-out schedule, I think that if Siemens picks up Honeywell’s process control business, they will be in for a bad surprise.
"Of course Siemens, being Siemens, will be supremely confident that they can remedy any Honeywell short-comings. They will be able to turn-around Honeywell better than anyone else on this planet."
On 10 July '02, a Honeywell insider wrote:
"When I visited with the engineering leaders recently, I picked up a sense of optimism on their parts. Even though they seemed almost embarrassed by Experion they were also pleased to be working on the improvements that will soon be coming in the form of PlantScape R500. They definitely see themselves as on the road to recovery with the planned enhancements of PlantScape, increased focus on and funding for Fieldbus, plus there was even mention that they might do an acquisition in the field instrument/transmitter area."
On 8 July 2002, an end-user who attended the recent Experion Users Conference reported:
"If something was about to happen between Siemens and Honeywell, then the technology leaders at the Users Conference, seemed blissfully unaware."
On 7 July '02, a Honeywell employee (name expressly withheld) researched an article
on the JimPinto.com website to compare the recent denial from Terry
Sutter (current IS President) with the one made previously by John
Weber (former President of IAC) when it was suggested (two years ago)
that IAC was being sold to Siemens:
> Tuesday 17 Oct. 2000
> Message from John Weber (President, IAC)
> To : Industrial Control employees worldwide
>
> Some of you may have heard a recent rumor that Siemens
> and Honeywell are contemplating a possible transaction
> involving IAC. While it is Honeywell's general policy
> not to comment on rumors, I can tell you unequivocally
> that IAC is not for sale. We continue to be part of the core
> business that Honeywell is counting on for future growth.
Compare this with the message from Terry Sutter:
> 27 June 2002
> To: Industry Solutions Employees Worldwide
> From: Terry Sutter, President, Industry Solutions
>
> It is Honeywell's policy not to respond to rumors of acquisitions
> or mergers. However, I can tell you unequivocally that Honeywell
> is not in discussions with Siemens about the Industry Solutions
> business. Industry Solutions remains an important ACS business
> and Honeywell is counting on us for future growth.
He asks: "One wonders if Terry Sutter simply used a standard denial
form...."
On 5 July, 2002, a knowledgeable Honeywell observer commented:
"We need to remember that, after the GE-deal fell apart last year, Honeywell made a lot of noise about how they were NOT going to sell-off IAC (now IS). David Cote, Kevin Gilligan and Terry Sutter have all continued to tell the IS leadership team and the troops that they will remain as a Strategic Business Unit within Honeywell, and as we know this has just been reiterated.
"On the flip-side, two years ago I personally heard the President of IAC state - nay, proclaim - that they were not for sale - and that was precisely at a time when you and I and everyone else knew knew that was damned well not true!"
On 3 July '02, a Honeywell insider came up with this:
"A rumor has been floating within Honeywell, that Siemens is interested in buying the whole thing - all of Honeywell.
"This sounds goofy to me. Sure, Siemens is big - but they are not GE, plus they are having problems now anyway. Also, if the EU wouldn’t approve the deal with GE then why should the DOJ approve anything for Siemens? The only message here at Honeywell is that we now understands full-well just how interested Siemens really is in our process control pieces."
On June 28, a Honeywell insider reported:
We at Honeywell have a clear and harsh understanding of the mess that Siemens has made of their other acquisitions, especially Moore. What would happen to us under Siemens would be even worse than what happened to Measurex after we bought them. We’d have to learn to do the goose-step and salute with a stiff right arm!".
Pinto's Comments on Terry Sutter memorandum:
It is interesting that this "official denial"
came at all. As the memo says, this is normally NEVER done.
We guess they had to say something and do it fast.
There are 2 possibilities: a/ If there is anything afoot with
Siemens, Terry Sutter does not know. Or b/ After careful consideration
by Gilligan and Cote, Sutter was told to make this denial.
It is interesting to note that 2 years ago, John Weber, President
of IS (then IAC) proclaimed loudly that IAC was NOT for sale
- just a few days before the United Technologies deal was announced.
But, Weber's discomfort was short-lived - he was gone before too long.
With hindsight, Weber was correct (but not the way he intended)
- IAC was not being sold. ALL of Honeywell was!
I invite (challenge) Terry Sutter top contact me directly to discuss
this 'rumor'. I commit that his comments and feedback will be
published without editing of any kind.
On 27 June '02, this memo was circulated by Honeywell Industry Solutions.
It is highly unusual for management to comment on rumors, particularly in writing.
Apparently, Terry Sutter wanted this email to make its way to
JimPinto.com for publication. It is included here - exactly
as received.
Date: 02-06-27 14:48:13 EDT
To: Industry Solutions Employees Worldwide
From: Terry Sutter, President, Industry Solutions
It is Honeywell's policy not to respond to rumors of acquisitions
or mergers. However, I must address an unfounded story currently
circulating outside Honeywell that's connected to Monday's
announcement of the ACS realignment.
I can tell you unequivocally that Honeywell is not in discussions with
Siemens about the Industry Solutions business. The rumor is not true
and we do not know its source. Industry Solutions remains an important
ACS business and Honeywell is counting on us for future growth.
Rumors are needlessly distracting. We have made a lot of progress on
Experion PKS with customers and employees. Let's stay focused on
meeting our customer commitments and achieving results. Keep working
to grow our business, increase productivity, reduce our cost to serve,
improve employee satisfaction, and drive Six Sigma and digitization.
Thank you for all your efforts as we work to successfully close the
second quarter.
Signed: Terry Sutter
On Thursday, June 27, 2002 someone (name witheld, evidently from Siemens) weblogged:
Don't anyone think that Siemens needs Honeywell technology. The PCS7 system is now capable of running anything from a FCCU to an LNG plant. Their problem is no supervising control engineer in the end-users or any requisitioning engineer in the EPC contractors is willing to put his career on the line by selecting it. Chicken before the egg, I think. What Siemens needs is the Honeywell position, through which they can market a Honeywell system improved by the Siemens engineers and their own PCS7.
On Wednesday, June 26, 2002, a Honeywell insider logged this interesting tidbit:
Further corroboration that this is indeed happening is that a headhunter
that had been retained by Honeywell a couple of weeks ago in order to
find a candidate to replace Ginny Burnell (President & GM of Honeywell
Industrial's Energy division) has just been let go.
With the entire division going over to Siemens, I guess they have an
alternate way to get rid of Ginny!
On Tuesday, June 25, 2002, someone who knew Bill Ketelhut from his GE days wrote this about his separation from Honeywell:
"Bill Ketelhut was at Foxboro, ex GE Fanuc and GE-Microswitch (the JV between GE and Honeywell Microswitch). Ketelhut is well thought-of by GE and they planned to bring him in to run Control Products (Microsiwtch plus) if the GE acquisition of Honeywell had gone through.
"Bill has a signed contract and left Foxboro with a severance package. He then was employed by GE to run Honeywell Control Products. When the GE deal went south, Honeywell picked him up to finish out the take-or-pay contract he was signed on. He was not that active - he took the money and ran so to speak. Mutual separations. He did not want to stay without GE in charge."
On Monday, 24 June 2002, the following memo was sent to all ACS (Honeywell "red") employees - first portion summarized here.
A MESSAGE FROM KEVIN GILLIGAN REGARDING ACS ORGANIZATIONAL CHANGES
To all ACS employees:
ACS recently completed a strategic planning review to define the direction of ACS and an organizational assessment.
Our recent strategic planning review and organizational assessment revealed several areas where we still have
opportunity for improvement. Today we are announcing a realignment of certain parts of our organization to address the areas that most need improvement. These actions will drive business growth and ensure ACS' success in the future.
This realignment includes:
Combining the Control Products and Security & Fire Solutions business
units into a single SBU called Automation & Control Products. Roger Fradin,
who currently leads S&FS, will lead this new organization. Bill Ketelhut
will leave the company. We thank Bill for his contributions during the last
year and wish him well in his future endeavors. This change puts our
products businesses into one organization.
Pinto Point:
Gilligan's memo does not give any direct clues to the Siemens
deal. However, separating industry solutions - putting Control Products under
Roger Fradin - seems like an an interim step, and still poses the possibility.
Please recognize that, at this stage only a few, very senior
corporate people would be privy to a transaction of this nature.
You simply can not expect any 'announcements' at this stage.
On Monday, June 24, 2002, the following comment was logged:
With respect to the Siemens and Honeywell trade - I work for Siemens Building Technologies, though not high enough up to know the people who would know we were on the block.
I'm sceptical about the report for two reasons. First, those aren't the right names for the Siemens organizations. Second, I would think it's more likely that Siemens would just pay cash. They paid cash for us when they bought us (Landis & Staefa) from Electrowatt.
On Friday, June 21, 2002, this message was picked up on the Honeywell chat/message-boards:
Some one is shaking the trees!
by: noallhere 06/21/02 01:54 pm
Msg: 34760 of 34762
Rumor has it that Honeywell's Control Products and Security & Fire Solutions
are being combined. Bill Ketelhut is out and Roger Fradin is in. It was
hinted that Ketelhut was asked to leave and will be gone as of today.
Anyone else hearing anything? What does this mean for the company?
Pinto note: If you have any comments or insights, please weblog.
On Friday, June 21 we heard noises of some big news brewing:
Siemens and Honeywell will trade - the Siemens fire protection and building management business
for the Honeywell process automation business, plus some cash.
This despite new Honeywell CEO David Cote's insistence that industrial process automation is important to Honeywell.
A knowledgeable industry observer commented:
"Siemens has coveted Honeywell's industrial automation business for quite some time, and have made more than one approach.
Siemens is off balance just now, given the business fall off and various re-structuring activities so I wonder if they have the balls for a big play like this."
Another industry insider agreed:
"The move would makes a lot of sense for both parties. Siemens needs Honeywell more than any other potential player. Both have lousy systems and both need a redo badly.
"Ed Hurd is now back working as a consultant in Phoenix. If they would employ both Hurd and Don Bogle (previously CEO of Moore Products when it was acquired by Siemens) they might get something for their money. But it would still take a good three years. However, I doubt that the remaining people and value of Honeywell would survive a German onslaught!"
On Wednesday, June 19, 2002, this weblog was received :
On the topic of the $100 million dollars in Experion Sales since its announcement: Technically that is true, but what they are doing is chalking up ANY Plantscape / TPS sale as an Experion sale.
Also, ExxonMobil has made a major commitment in Experion and that sales figure may reflect commitments from ExxonMobil on upgrading its aging systems.
On Friday, June 14, 2002, a Honeywell competitor responded to the weblog (below) regarding Honeywell's announcement that it had generated more than $ 100m in orders for Experion.
"We feel the '$100M in less than 2 months' is just the total of all their system related sales. If $100M is a two month sales report, then it is a significant reduction in sales. We put that portion of Honeywell around $900M/yr.
It will be interesting in how the User's Conference attendee's react to this marketing ploy. I remember these same attendee's came out with a positive attitude last year, even though GE walked out half way through the conference. For a lot of users, this has to work."
On Wednesday, June 12, 2002, John McBride [john.mcbride@honeywell.com] logged this from Phoenix, Arizona:
The Industry Solutions business of Honeywell [NYSE:HON] announced that it has generated more than $100 million in orders since announcing its new system, Experion PKS™, less than two months ago.
For more information visit: http://www.experionpks.com
On Tuesday, June 04, 2002, an end-user customer for DCS equipment wrote:
"Took a look at Experion over the last 2 weeks. Between that and the "buzz" on the street from
Honeywell, Invensys, and Emerson folks, the consensus seems to be that
Experion is nothing to write home about. I think there are some morale issues involved as well.
It seems like once a company gets put in play, it never leaves the game.
The question is who will buy Honeywell??
On May 29, 2002, Tom Ramey [tramey@ramey.com] wrote:
Look at this 6-month chart, HON vs GE
Looks like Honeywell should thank their lucky stars the GE acquisition fell through. In the last 6 months Honeywell has even gained 20% while GE has lost 20% of it's value, a minus-40% delta.
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