From the ISA Meeting: Invensys merges units to form software division
Invensys creates $2 billion software division from Wonderware, Baan, APV Systems, Triconex, Simulation Sciences, Esscor, and Foxboro's software operations.
By Alan S. Brown
Managing Editor, Chemical Online
Table of Contents
Modules
Seamless solutions
Manufacturing critical
Innovative approaches
Modular
Invensys plc has combined its diverse software operations into one large software division. Based in Herndon, VA, the newly formed Invensys Software Systems Div. (ISS) starts life as one of the world's largest industrial software concerns with sales of more than $2 billion.
The group offers software that ranges from manufacturing automation through enterprise resource planning (ERP) and enterprise asset management software. It has strengths (though they are not uniform) in the process, discrete, and hybrid industries.
Invensys has already begun integrating the group's products and technologies.
Modules
The division will consist of four business units:
- APV Systems. APV Systems (Crawley, UK) offers turnkey processing systems, automation, and services to the food, beverage, and health care industries. Donald Sorterup will head the operation.
- Baan. Baan (Barneveld, The Netherlands) provides e-business, supply chain management (SCM), customer relationship management (CRM), and ERP software and consulting. Laurens van der Tang will head the unit.
- Invensys Process Automation. Invensys Process Automation (Foxboro, MA) will combine Triconex, Simulation Sciences, and Esscor with Foxboro's systems and measurement and instrumentation businesses. The company, which started out developing software for digital control systems (DCS), has increasingly moved towards process optimization. It seeks to serve process and hybrid industries with integrated sensor-to-boardroom automation. William Ketehut is the unit's president.
- Wonderware. Wonderware (Irvine, CA) is a flexible system that provides factory automation, manufacturing execution systems, and enterprise asset management to discrete and process manufacturers. The product has excellent links to ERP software. Joe Cowan heads the operation.
"While these product groups will operate with complete responsibility for their respective markets, programs will begin immediately to integrate their products and technologies," says the division's new chief executive, Bruce Henderson.
The combined business shows excellent balance. Geographically, 40% of the business is in North America, 35% in Europe, 15% in Asia, and 10% in the rest of the world.
The new division will derive 60% of its revenue from software integration and customer services, 20% from software and licenses, and 20% from hardware and electronics.
Seamless solutions
"The division will have the unique competitive advantage as the first to offer integrated e-business/automation solutions to its customers," says its new chief executive, Bruce Henderson. "Our object will be to provide seamless, mission-critical solutions that optimize customers internal operations and link them transparently with their customers and supply chains."
Such seamless integration does not exist yet, says Henderson. Yet the industry has made enormous progress in the past five years. In 1995, companies used dozens of discrete programs to handle functions ranging from device configuration to order entry to accounting.
"In 1995," Henderson told a news conference at ISA, "there was no interface between these programs. Now, we have clumps of allegedly integrated e-business, ERP, supply chain management, and integrated automation software.
"What the customer wants," he says, "is a smooth and seamless way to view and analyze information." By 2005, he expects the industry to produce a truly integrated software suite that handles e-business, ERP, and integrated automation.
Manufacturing critical
Customers see such seamless software as a way to keep pace with fast-moving e-commerce and the growing demand for rapid product delivery.
"The problem today," says Henderson, "is that you can take an order fast, but try to get it into the factory fast. Today, the order sits around for days until it can be batched into the next planning cycle. It might take days or weeks to execute.
"The software to solve that problem doesn't exist today. Companies like us want to come up from industrial solutions and link to the boardroom. Companies that are traditionally in ERP, such as SAP and Oracle, want to come down to the plant," Henderson concludes.
Innovative approaches
Invensys is taking some innovative approaches in its attempt to put everything together.
Invensys Process Automation, for example, has become "more than just a traditional DCS or box-selling company," says its president Bill Ketelhut. "We've become more of a systems integrator.
"We're less reliant on internally-developed Foxboro software. We want to grow our scope beyond our traditional product base." Ketelhut says the company is interested in using products not created by Foxboro or Invensys.
The company also sees its Wonderware software as a way to address two discrete markets. "High-end refining is the traditional DCS market," says Henderson. "Most refineries have a single vendor, tightly integrated products, mostly analog devices, and very tight control.
"Other markets, such as hybrid and batch, embrace multivendor solutions, more intelligent devices, and more discrete and batch control.
"By continuing Wonderware into IA series system, we're creating an architecture optimized for both sides of the market. It is the only real control system that is optimized for both markets."
Modular
At the division level, Invensys seeks to get under the hood of its latest acquisition, Baan. The giant ERP firm is primarily noted for supporting discrete and hybrid manufacturing.
"Other companies that applied discrete and hybrid systems to the process industry have not been successful," says Henderson. In the future, we plan to get under the ERP level and look at modules. We think they're equally applicable to other industries, and we're going to continue to modularize the software.
The fruits of some of those integration efforts have already reached market. One year ago, the company introduced its I/A Series Batch Suite, which combines elements of Foxboro and Wonderware software.
It followed with the I/A Information Suite, which combines modules from Foxboro, Wonderware, and Simsci.
It also hopes to integrate the process-oriented enterprise asset management and ERP modules from its Marcam acquisition with Wonderware.