JimPinto.com - Connections for Growth & Success
No. 45 : May 31, 2001
Business, marketing & futures commentary.
New attitudes, no platitudes.
- Whither Rockwell Automation?
- Neo-Luddites - Bill Joy & the Unabomber
- Extropy-5 conference - shaping things to come
- Patterns of success & failure on the Internet
- Phil Cerasoli's Poems
- V-shaped Economic Recovery
- Stock market short or long-term
- Free online access to scientific information
Whither Rockwell Automation ?
Recent results for Rockwell: Sales $ 6b, market-cap $ 8.4b, recent stock
price $46.50, price to book 3.02, price to sales 1.42, price/earnings
18.91 - not bad !
For the six months ended March 31, 01, revenues fell 1% to $2.29 billion.
Net income from continuing operations fell 26% to $140 million, with
results reflecting "a slowdown in the economy, and increased interest
With the spin-off of Collins (the avionics business), Rockwell Automation
is essentially Allen-Bradley and Reliance and a few extra pieces. Revenues
will be $ 6b less $ 2.9b Collins = $3.1b. I asked some senior Rockwell
Automation insiders for their "deep throat" comments, and this is what I
Latest Rockwell financial profile
- With the spin-off of Collins, why does Rockwell need a corporate staff
that was given long term contracts when they moved from California to
Wisconsin? Meantime, our contacts at Collins report that rumors are flying
about a 10% layoff across the board.
- Don Davis likes "running" AB again, but he is so out of touch that he
is not even close to the same Don Davis he once was. At 61, some feel that
he is ready to make a move towards the exit pretty soon.
- Regarding the move to "Services”: Don has always said: "Show me a
service business that has predictable revenues and gross margins, and I'll
show you a service business I like." His heart (wallet) is still firmly
that of a hardware gross-margin man. But, the truth about the products
business is coming home to roost - declining margins and tough market
- Most Allen Bradley & Reliance customers - Systems Integrators,
Distributors - are scared to death about the competitive move on to their
- The emphasis on systems and services is driven by survival - and the
consultants. There is a fight going on internally amongst the 3 business
units as to who will be investing - or rather, cutting - less. So far, Ron
Wichter, Senior VP Software & Services Group (ex DEC) seems to be winning.
Several people report that he is "rattling lots of cages" right now. The
new service culture needs lots of time (which they don't have) to be
embedded in our core business method. It will need vision and
determination to see it through.
- The real market value of ROK = AB+REL will be known when Collins starts
trading (end of June ’01). That could cause an interesting price dip for
ROK and make an acquisition more realistic. Rockwell Automation is ripe for
acquisition by any global automation company which believes that the
installed base, plus distribution, would be an asset. Siemens seems to be
ready and waiting.
Rockwell Corporate website with press-releases
Rockwell Automation web site
Neo-Luddites - Bill Joy & The Unabomber
Many influential figures oppose the development of powerful new
technologies. In his by-now famous article "Why the Future doesn't need us"
Bill Joy, chief scientist, co-founder of Sun Microsystems, co-author of the
popular Java programming language, writes eloquently, "Our most powerful
21st-century technologies - robotics, genetic engineering, and nanotech -
are threatening to make humans an endangered species". Bill Joy is joined
by various "ethicists", including Prince Charles, in calling for a
Bill Joy's article was written after reading Ray Kurzweil's book "The Age
of the Spiritual Machine" (JimPinto.com eNews 1 Jan 2001 ) which posed "The
New Luddite Challenge". The term comes from 19th century Britain, where
imitators of Ned Ludd (who accidentally damaged a weaving machine) went
around intentionally causing damage to the machines which they felt would
destroy the local economy. The "Luddite" movement has lived on as a symbol
of opposition to technology.
In Ray Kurzweil's book, which provides some powerful arguments against
unrestrained development of technology, you recognize only after you've
read some of the text, that Kurzweil is actually quoting Theodore
Kaczynski - the Unabomber - whose bombs killed three people and wounded
many others during a 17-year terror campaign.
Kaczynski, a Harvard-educated engineer, is now in jail awaiting execution
for his murderous activities. But, that does not dismiss his arguments
against technology. The full text (some 250 paragraphs) of Kaczynski's
"The Unabomber Manifesto" was published in many US National Newspapers.
While it does ramble off on "anti-leftist" and other tangents, some
sections are eloquent, sensible and remarkably lucid. Read it - or at
least parts of it - for yourself.
The question remains: Where is technology leading? Artificial
intelligence, robotics, genetic engineering, nanotechnology and other
accelerating advances will change Life as we know it. Will those changes
cause our downfall? Or, will the improvements and advancements that have
already brought significant agricultural, medical, economic and
sociological improvements continue to benefit humanity?
Bill Joy's famous article in Wired - Why the Future doesn't need us
Full text of The Unabomber's Manifesto
Links to Ray Kurzweil's book - The Age of Spiritual Machines
EXTROPY-5 is near!
Powerful emerging technologies such as artificial intelligence,
bioengineering, super longevity and nanotechnology do have dangers as well
as enormous potential for good in transforming the human condition. The
Extropy Conference: Extro-5 - "Shaping Things to Come" - will take place in
San Jose, CA. June 15-17, 2001. This will bring together several
high-powered thinkers to examine the impact of advanced and accelerating
technology, to anticipate and proactively address potential problems, to
look at opportunities and to shape the future for the better.
There will be four major themes:
- Machine Super-Intelligence - Threat or Opportunity?
- Thriving in the Information Economy
- Mastering the Information Explosion
- Overcoming Resistance to Super longevity and Augmentation
Speakers at Extro-5 include inventor, entrepreneur and writer Ray Kurzweil,
who will discuss his latest book: The Singularity is Near. John Smart
will also be there - his website SingularityWatch.com helps people to
understand and better manage accelerating change. This will be an unmatched
networking opportunity for those seeking to understand and help shape the
For information & the Agenda, visit the Extropy Conference website
Read the précis of Ray Kurzweil's new book The Singularity is Near
Visit John Smart's website Singularity Watch
After the Goldrush :
One of the great speculative bubbles in history - the Internet Gold Rush of
the '90's - has come and gone. The financial markets have toppled
mercilessly and dot.com businesses, once the darlings, have become all but
a joke. Now, perhaps, it is time to make some sense of what happened, to
chart a new course.
Patterns of success & failure on the Internet
The Internet is inherently neither a disruptive nor a sustaining
technology; it is instead an infrastructure technology that can be used in
either a sustaining or disruptive way. For some companies, the Internet has
a powerful positive effect on the way that they already make money. Such
companies have a powerful advantage over new entrants as well as other
companies whose ways of earning a profit are disrupted by the Internet.
Highly recommended by the irrepressible George Gilder, the Innosight Report
"After the Goldrush" is written by Clayton Christensen, a professor at
Harvard Business School and the author of the best-selling book "The
Innovator's Dilemma". To read it on the web, you'll need to register
(free) before you access the complete report - includes an executive
summary and 6 chapters. After you register, you can join in an on-line
discussion on the subject. Worthwhile reading!
Read After the Goldrush
Phil Cerasoli's poems on the web
"Writer, poet, magazine publisher, movie and drama critic, photographer,
top level business manager, song writer, musician, cab driver, professional
poker player, entrepreneur…all rolled up into one world-weary traveler. "
That's how my friend Phil Cerasoli describes himself. I have known Phil for
half my life and have always admired his poetry and philosophy. Some of his
poems are simple dittys that will amuse you. Others are strong and powerful
stories, which make a point and carry a punch. I carry these poems around
in my Palm Pilot and have recited them countless times to delight and
challenge friends and relatives around the world.
I've put some of Phil Cerasoli's poems on the JimPinto.com website, as a
tribute to the man. And, because I'd like to share them with you. Before
you go off and do something else today, stop awhile and read just one -
pick one from the list , and click. You'll be back for more!
Index of Phil Cerasoli's poems
Charles Matheny [firstname.lastname@example.org] e-predicts about the economy:
"It occurs to me that while many are surprised at the speed of contraction
in the economy, no one should be. We have been working for years to apply
just-in-time deliveries to the factory, all the way back to digging it out
of the ground. This naturally implies that when a change (contraction in
this case) occurs at the consumption end, it is almost immediately
broadcast around the world. Clearly, the same effect should occur when the
consumption end turns up. I vote for a V shaped recovery.”
My old friend and colleague, Tony Bowker [TonyBowker@aol.com], now retired
to dream about virtual ASIC-chips, ride his Model T and tend his flock of antique
"Over the short term, the stock market does seem to be a popularity voting
medium. Over the long term, it is a weighing scale of profit. This makes
day traders the voters and we all know they are fickle, and really who
cares? Extrapolating this to industry, it makes nonsense of the quarterly
profit push and should make the successful CEO drive for long term growth.
Maybe that's why GE and Jack Welch are still successful. On the flip side,
our friends in Japan essentially follow the long-term approach, but the
market does not seem to be rewarding them. Perhaps the root cause there is
the banking industry and their tendency to skew the overall results."
Another old friend and colleague, Doug Bailey [email@example.com] wrote on
the subject of free online access to scientific journals:
"I submit that you are implying that the functions of scientific journals
is to, 1) enrich the publisher and 2) to restrict the flow of information.
I will concede point 1 but you are clearly failing to acknowledge the
primary and far more important role of the journals - that of peer review
prior to publication - all the respected journals submit articles to
extensive peer review prior to publication. Publication infers a certain
degree of trust that the research is well done and founded on sound
scientific methodology - irrespective of the conclusions.
"Since the advent of the personal computer there has been enormous increase
in the amounts of "junk science" as well as just plain bad science being
done. Just note all the "Latest Reports" quoted so avidly by newspapers
and radio. Much of information reported in the "Latest Studies" is not as
even as good as a high school science paper.
"When this un-reviewed information is thrown against the wall of the
internet it smears like a cowpie and is just about as useful. At best it
spreads silly information, biased conclusions (often for private social or
economic interests) and then serves as source information for still more
silly science. At worst it can be dangerous - for example the cancer cures
touted by herbal medicines in the guise of "The latest medical science
"I cannot advocate restriction to or censorship of the Internet but I do
see a problem here - maybe you or some of your readers have some thoughts."
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