The industrial automation business around the world seems to lag behind the rest of the industry as it is still showing some growth (in the past quarter) compared to other markets plummetting. But a report just released from a head analyst group may prove otherwise.
Whither automation?
US-based ARC Advisory Group, the premier automation analyst, published ‘A Series of Unfortunate Reports’ by Larry O’Brien at the end of January. According to the report, the year ahead will cause doom and gloom for developed economies — with no exceptions.
“Clearly, the global manufacturing environment is in the midst of a big contraction. Projects are still proceeding in many sectors, but many are being cancelled and/or postponed,” said the report.
“We at ARC still feel that despite overall market contraction in North America, Western Europe, and other developed economies, there will still be growth in the Middle East and emerging markets, such as China and India, although this growth is probably less then half the levels we saw between 2007 and 2008. Nobody gets a free pass this year, and even the market leaders are going to find it a challenging business environment.”
The automation leaders are all undergoing shrinking pains, some worse than others. Large companies are all driven top-down, by organisational management and budgets based on ratios. There’s very little real innovation, and minimal agility. When revenues shrink, the bean-counter ratios demand shrinkage to protect the bottom line. If that’s not preserved, the companies’ stock declines and the dominoes begin to fall.
Become an entrepreneur
As reduced budgets begin to bite, employee stress and uncertainty shoots up. Consider what happens: The bean-counters’ cutback formulas result from simple spread-sheet calculations. Managers are told, “Your budget must be cut by X per cent”. Few eliminate themselves, and so the next level in the hierarchy reviews the cuts.
Most often, the lowest-level workers are laid off, and the best higher level people quit. So management becomes more remote, closeted in endless meetings, and more work is expected from the remaining few. It’s a downward slide that cannot be stopped.
If you’ve been fired – laid-off, made redundant, reduction-in-force, restructure – it should NOT come as a surprise. Surely you saw it coming. The web is filled with sad stories, many accepting that they are probably the next to go from cost-cutting and offshoring. More and more head counts will shrink as they scramble to meet shrinking budgets. This is a signal that serious change is here.
This is a wake-up call from illusions of ‘the good old days’. If you’re one of the growing number of people who have lost their jobs, or can clearly see the writing on the wall, what are you going to do? Where will you look for another job?
The old question, “How much experience do you have?” does NOT apply anymore. If I was at Emerson, I would avoid hiring someone who’s just been laid-off from Rockwell, Honeywell or Invensys. Indeed ‘experience’ in any large company is a liability in the new economy.
If you’re out of a job, count yourself lucky to get an early signal that CHANGE has come. Being out of work destroys your self-respect and makes you cynical. Instead of just looking for work and finally accepting some stupid low-paid job to make ends meet – think of something different.
Why wait? Why not just use this opportunity to be your own boss, start your own company? Become a self-motivated entrepreneur. Make your move.
Look for good chemistry with others who are in similar positions, with complementary skills, and START something. Necessity is the mother of invention. Find good, growing needs – and fill them.
Think outside the old box. Look at the kid who wrote software that shows beer slopping inside the Apple iPhone – they’re selling millions at $1 each. Now, why can’t YOU think of something?
You do NOT need big capital to start – the money goes primarily for big salaries. Pay yourself and the founders drastically cutback living expenses, and share the ownership – stock in your new startup. Be your own boss. Work hard to build something for yourself. You’ll be happy you did!
*Jim Pinto is an industry analyst and commentator
jim@jimpinto.com
www.jimpinto.com