Listen in: Companies continue DCS investments

Companies invested heavily in control systems in 2007. How about 2008 and beyond?


Despite global economic uncertainty, the market for process manufacturing and automation remains strong, so says a new study released by ARC Advisory Group . This is particularly evident in the global DCS market, which grew by almost 13% between 2006 and 2007. “ARC expects there to be continued growth in the global DCS market through 2012, with an overall CAGR of just under 10%. This may seem like an overzealous growth projection to some, but the process automation market remains poised for long-term growth on several fronts that we believe will be sustainable for the next several years,” according to ARC research director Larry O’Brien, the principal author of ARC’s “ Distributed Control Systems Worldwide Outlook .”. ( Listen in: Hear comments from study author, Larry O'Brien .)

Users demand more MAC capabilities

Both end users and engineering and procurement firms (EPCs) are increasingly looking to automation suppliers to provide them with automation project execution capabilities, combined with ongoing service after commissioning. Many factors are contributing to growth in project and engineering services for automation suppliers. As a result, suppliers are beginning to fill the role of a main automation contractor (MAC), overseeing all aspects of automation projects and providing a single point of responsibility for automation projects from design to startup and beyond. The result is that vendors are seeing a growing proportion of income from services.

The ability of the customer to influence project costs diminishes as the project nears its latter phases, but these latter phases are also where the bulk of project costs start to accrue. The ability to have a single point of responsibility in an automation supplier that acts as a primary automation contractor is essential to controlling project costs, especially when it comes to preparing expert proposals that portray a realistic and honest view of project costs.

Migration solution market heats up

By ARC’s reckoning, even just a couple of years ago only two automation suppliers had a sound competitive migration strategy. Now, the group says that just about everyone has one to varying degrees. Offerings include extensive migration service capabilities and tools for automated graphic conversion, control strategy and database conversion, and so on. This makes it a lot easier for suppliers to infiltrate their competitor’s control system installations.e time, many end users are reformulating their automation strategy for the next decade and are reevaluating their installed base suppliers.

Migration, evolution, modernization — whichever term you use to describe it, making the transition to a modern DCS is fraught with challenges for end users, from the increasingly difficult task of justifying an automation purchase, selecting a supplier, and implementing the solution, to providing a roadmap for the future. Most of the end users ARC deals with list migration as one of the key issues they are facing today. ARC estimates that there are $65 billion worth of installed process automation systems in the world today that are nearing the end of their useful lifecycle, which in many cases can exceed 25 years.

Asia is still the biggest growth driver

ARC concludes that the large amount of grassroots project activity in Asia remains the leading driver for growth in the global DCS market, particularly China. There continues to be significant growth in nearly all industry sectors there, from process to discrete manufacturing.

The Chinese pharmaceutical industry is growing at 30% per year, and the need for more advanced forms of automation to achieve regulatory compliance and enable China’s pharmaceutical companies to become true global players is huge. The basic process and discrete industries also continue to perform well. In the oil and gas industry, there continues to be a lot of focus on off-shore production to meet China’s ever increasing demand.

—Edited by Peter Welander, process industries editor, ,
Process & Advanced Control Monthly
Register here and scroll down to select your choice of free eNewsletters .

No comments
The Top Plant program honors outstanding manufacturing facilities in North America. View the 2013 Top Plant.
The Product of the Year program recognizes products newly released in the manufacturing industries.
The Engineering Leaders Under 40 program identifies and gives recognition to young engineers who...
A cool solution: Collaboration, chemistry leads to foundry coat product development; See the 2015 Product of the Year Finalists
Raising the standard: What's new with NFPA 70E; A global view of manufacturing; Maintenance data; Fit bearings properly
Sister act: Building on their father's legacy, a new generation moves Bales Metal Surface Solutions forward; Meet the 2015 Engineering Leaders Under 40
Cyber security cost-efficient for industrial control systems; Extracting full value from operational data; Managing cyber security risks
Drilling for Big Data: Managing the flow of information; Big data drilldown series: Challenge and opportunity; OT to IT: Creating a circle of improvement; Industry loses best workers, again
Pipeline vulnerabilities? Securing hydrocarbon transit; Predictive analytics hit the mainstream; Dirty pipelines decrease flow, production—pig your line; Ensuring pipeline physical and cyber security
Upgrading secondary control systems; Keeping enclosures conditioned; Diagnostics increase equipment uptime; Mechatronics simplifies machine design
Designing positive-energy buildings; Ensuring power quality; Complying with NFPA 110; Minimizing arc flash hazards
Building high availability into industrial computers; Of key metrics and myth busting; The truth about five common VFD myths

Annual Salary Survey

After almost a decade of uncertainty, the confidence of plant floor managers is soaring. Even with a number of challenges and while implementing new technologies, there is a renewed sense of optimism among plant managers about their business and their future.

The respondents to the 2014 Plant Engineering Salary Survey come from throughout the U.S. and serve a variety of industries, but they are uniform in their optimism about manufacturing. This year’s survey found 79% consider manufacturing a secure career. That’s up from 75% in 2013 and significantly higher than the 63% figure when Plant Engineering first started asking that question a decade ago.

Read more: 2014 Salary Survey: Confidence rises amid the challenges

Maintenance and reliability tips and best practices from the maintenance and reliability coaches at Allied Reliability Group.
The One Voice for Manufacturing blog reports on federal public policy issues impacting the manufacturing sector. One Voice is a joint effort by the National Tooling and Machining...
The Society for Maintenance and Reliability Professionals an organization devoted...
Join this ongoing discussion of machine guarding topics, including solutions assessments, regulatory compliance, gap analysis...
IMS Research, recently acquired by IHS Inc., is a leading independent supplier of market research and consultancy to the global electronics industry.
Maintenance is not optional in manufacturing. It’s a profit center, driving productivity and uptime while reducing overall repair costs.
The Lachance on CMMS blog is about current maintenance topics. Blogger Paul Lachance is president and chief technology officer for Smartware Group.