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Emerson helping companies radically improve project and operational effectiveness

At IHS CERAWeek 2016, Emerson announced Top Quartile Performance, a commitment to partner with energy industry executives to help them achieve operations and capital performance in the top 25 per cent of their peers, while continuing to drive benchmark performance expectations higher.  

Research from Solomon Associates and Independent Project Analysis (IPA), Inc., demonstrates the staggering differences between Top Quartile Performers and those operating in the lower quartiles in areas like project performance, reliability and energy efficiency.  For example:

The cost of a typical $USD1 billion scope project is more than $USD1.6 billion for operators in the fourth quartile of project performance, while Top Quartile Performers will complete the same scope for $USD750 million.
Maintenance costs are more than tripled for fourth-quartile performers in reliability when compared to Top Quartile Performers.

In energy efficiency, fourth quartile companies see both fuel costs and emissions that are double those of Top Quartile Performers.

“The energy industry has reached a crisis in terms of capital, operational and financial performance, and efforts to simply tweak traditional approaches and ‘run lean’ aren’t delivering results in the current business environment,” said Emerson Chairman and Chief Executive Officer David N. Farr.  

“Emerson partners with industry leaders to look beyond outdated standards and deliver the radical improvements needed to get the most out of every capital investment.  Focusing on Top Quartile Performance strategies will help executives across the globe achieve better return on assets and deliver shareholder value.”

Based on the Solomon, IPA and other research and data, Emerson estimates that process industries could save upwards of $USD50 billion in wasted maintenance costs alone, plus more than $USD10 billion in energy costs, even at today’s prices.  At the same time, the industry is wasting staggering sums – an estimated $USD430 billion – in poorly executed [capital] projects. 

Emerson’s Top Quartile Performance initiative comes at a time when automation technology, real-time diagnostics and the Industrial Internet of Things are all advancing at a pace that renders decades-old project and operational practices obsolete.  While best practices are often touted as the solution to poor performance, it is time for transformational thinking and action.

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