Pictures of the Future    Fall 2007

The Buzz About Automation

According to the ARC Advisory Group, a consultancy specializing in manufacturing and supply chain solutions, globalization is the driving force behind this increase. Indeed, globalization demands that manufacturing companies live by the motto "faster, cheaper, better." In order to survive in such a competitive environment, manufacturers need to respond to market demands in an agile and flexible manner. They also have to cut their costs, boost their productivity and performance, and shorten product lifecycles. All of the above require standardized platforms and protocols. What’s more, production lines must not only be scalable and adaptable, they also need to be characterized by the lowest possible maintenance costs.

The automation industry’s key market segments are motor systems consisting of a drives, controllers and motors; numerical controllers; and programmable logic controls. According to ARC, global sales of motor systems added up to $5.2 billion in 2005, with an expected increase to $6.9 billion by 2010. Yaskawa is the leading company supplying motor systems, with a global market share of 13.9 %, followed by Mitsubishi Electric with 9.7 and Siemens with 9.3 %.

Computer numerical controllers (CNCs) control fast, high-precision working steps on machine tools. According to ARC, the global market volume for such controllers is around $4.5 billion, with Siemens holding a leading market share of 33.3 %, followed by Fanuc and Mitsubishi Electric with 32 and 12.4 % respectively. Thanks to their robust and reliable nature, programmable logic controllers (PLCs) play a key role in factory automation. These products undergo continuous improvement in terms of functionality, communications, diagnostic capabilities, scalability, and software.

ARC expects sales of programmable logic controllers to rise from $7.5 billion in 2005 to $10 billion by 2010. This area’s leading supplier of hardware, software, and services is Siemens, which holds a 28.7 % market share, followed by Rockwell with 21.8 % and Mitsubishi with 14.9 %.

Demand for information technology (IT) that not only synchronizes production processes, but also simplifies such processes and increases their flexibility is rising in parallel. Users plan to efficiently link all product-relevant IT solutions by means of PLM (product lifecycle management). According to a study by consulting company AMR Research, the worldwide market for PLM products amounted to around $11 billion in 2006 and is forecast to hit $16 billion by 2010.

With a market share of 13 %, Cadence, which specializes in CAD systems, was the number one company in the PLM market in 2005, followed by Dassault Systems and UGS—now part of Siemens—both with 11 %. The largest PLM market is the U.S., which accounts for 47 %, followed by Europe (36 %) and the Asia-Pacific region (15 %).

The objectives of PLM are product and process optimization, reduced time-to-market, lower costs, higher flexibility, and improved planning and process quality. The U.S. National Institute of Standards & Technology supports the Aberdeen Group’s conclusion that manufacturing companies have a lot to gain from PLM. Implementation can cut development time and boost productivity by at least 20 %. According to the Aberdeen Group’s study, companies that implemented PLM solutions, enjoyed a 19 % increase in sales, while their production and development costs fell by 16 %.
                                                                                                      Evdoxia Tsakiridou