Surviving in the exceedingly competitive $7 billion world market for drive-based industrial power controls and systems is no easy matter, especially when a company decides to take on such industrial giants as Siemens, ABB, Rockwell and ALSTOM. Nevertheless, when the company in question can tap into an enormously talented management pool that includes the likes of Chief Executive Officer Russell Shade (formerly of GE), Robicon and Americas President Gary Rauscher (formerly of Allen Bradley/Rockwell), Vice President and Director of Strategic Marketing Aaron Aleithe (formerly of Magnetek) and a number of experienced industry leaders from Ansaldo in Europe, the challenge becomes a much easier exercise to undertake.
High Voltage Engineering (HVE), headquartered in Wakefield, Mass., owns and operates a diversified group of middle-market, technology-based industrial manufacturing businesses including ASIRobicon, Phymetrics and Maxima Technologies. These subsidiaries focus on designing and manufacturing high-quality, application-specific products that serve a variety of industries including industrial power controls (ASIRobicon); surface analysis instruments, analytical services and particle-accelerator systems (Phymetrics); and vehicle-based instruments and monitoring and control systems (Maxima Technologies).
Through its ASIRobicon subsidiary, HVE is the world’s leading “independent” industrial power controls business. ASIRobicon’s three principal products are large electric motors for industrial use, power electronics devices known as drives and the electrical automation systems needed to control coordinated drive systems on an application-specific basis. The company’s broad range of motor products includes high-performance and general-purpose AC and DC motors. Its rotating machines are based on designs that offer the best in advanced power control technology. The company provides designs from standard, fixed-speed induction motors to the largest heavy-duty custom motors. ASIRobicon is a global leader in high-speed motor technology. Its motors have broad applications in many industries, including energy, oil and gas, metals, paper, marine and cement.
ASIRobicon offers a variety of low-voltage (less than 1,000 volts) and medium-voltage (more than 1,000 volts) drives that combine state-of-the-art power conversion technology and common control platforms. Along with maximum flexibility, its high-performance AC drive designs also provide power-factor and harmonic-control capabilities. “Our drives, including Perfect Harmony, are considered world class and we have the largest installed base of medium-voltage drives in the world,” notes Shade.Its electrical automation platform is based on the ARTICS architecture, a flexible and powerful VME-based open platform using standard Motorola power-PC microprocessors and a wide variety of programmable logic controllers. The advanced application software manages basic automation and process control functions, ensuring enhanced automation and the technological quality of the end product. ASIRobicon’s adaptive models have been calibrated in a number of complex applications primarily focused in flat- and long-product metals applications.
ASIRobicon was formed in January 2000 when HVE acquired Ansaldo Sistemi Industriali (ASI) of Italy from Finmeccanica. HVE combined the operations of its Robicon subsidiary, based in New Kensington, Pa., with ASI, headquartered in Milan, Italy. ASI has multiple facilities in Italy, plus wholly owned subsidiaries in France, Germany and England. Together, ASI and Robicon have joint-venture companies in Canada, Brazil, Russia and India. The rationale behind the purchase was to significantly strengthen HVE’s global position in industrial automation components and systems. Combined, ASIRobicon has annual revenues in excess of $300 million, more economies of scale to drive productivity improvements, more market reach, installed bases in 60 countries worldwide and expanded domain expertise in more industrial process applications.
ASI, with significant industrial automation market presence throughout Europe and the Middle East, complements Robicon’s high-power conversion market strength in North and South America, Japan and China. Shade says, “The combination of ASI’s applications expertise in energy, ferrous and non-ferrous metals, pulp and paper, marine and cable, combined with Robicon’s applications expertise in water and wastewater treatment systems, oil and gas, power generation, glass and cement will provide customers a global organization capable of meeting their industrial automation needs.”
Robicon was founded in 1964 as a manufacturer of specialty DC power converters in Pittsburgh. The company developed a power electronics focus and established a technical leadership role in power controllers and variable speed drives. Robicon experienced a high growth rate and became a dominant player in power electronics, particularly medium-voltage drives. Now merged with ASI, it is in an enviable position to achieve sustained growth given the market expansion and drive and automation systems bundling capabilities.
Ansaldo established the Italian philosophy of industrial culture in 1853 as a manufacturer of steam boilers, locomotives and electrical components in Genoa, Italy. Ansaldo Sistemi Industriali carries the history of Ansaldo’s industrial expertise throughout its power electronics, motors and generators businesses. Today, ASIRobicon is a world leader in the field of industrial process automation and electrical systems. With experience in many market sectors – such as power generation, steel, paper, cement, chemical, marine and offshore, railway transportation and research laboratories – ASIRobicon’s strength in power conversion is a direct result of its worldwide experience in diverse application solutions.
ASIRobicon has become a world-class products and systems solution provider focused on improving customer productivity and return on investment. “The future success of ASIRobicon depends upon our ability to meet or exceed our customers’ expectations for high-quality and performance products and solutions, and best-in-class life-cycle support,” says Shade.
In its first full year as an integrated company, ASIRobicon restructured the business, simplified and reduced the product portfolio, developed multigeneration product plans, integrated and coordinated channels to market and significantly improved financial performance. The company has defied recent market trends in the United States and Europe, and has realized double-digit growth in orders and revenues. Service-related initiatives are a major area of focus. Cooperation with and support by the Italian unions and minis-tries has been a necessary and positive factor in its business success to date.
The company’s biggest competitors are ABB, Siemens, Rockwell Automation and ALSTOM. Although small compared to these global conglomerates, ASIRobicon compares favorably in the industrial power-controls segment. ASIRobicon has the fourth largest global market share (6.8 percent) in the supply of high-power AC drive systems (including hardware, software and services). Revenues in 2001 for this entire sector were $2.5 billion, so the company does have a significant amount of room for growth. ASIRobicon also has the third largest market share (16.4 percent) in the supply of mega AC drive systems with outputs of more than 600 kilowatts. “ASIRobicon differs from its competitors, who are typically divisions of much larger industrial businesses, as it is entirely focused on its core business in global industrial power controls,” says Shade.
Systems for Growth
The global industrial systems market is characterized by diverse applications, long-term growth and measured volatility. Most of the industrial applications serve the basic infrastructure needs of both developing and developed countries (power, clean water, cement, steel, etc.). The value proposition for a company such as ASIRobicon is to reduce the total life-cycle cost of an end user’s industrial process. Total life-cycle cost depends on many factors including initial cost, efficiency, availability and reliability. Integrated electrical suppliers such as ASIRobicon want to provide a full range of products, systems integration and process automation that can maximize customer value added.
There are more specific factors driving the company’s market growth potential. First, there are the opportunities available in the retrofit of existing, constant speed motors to achieve process flexibility and improved efficiency. Second, there is the growth of global energy markets to consider, as well as power generation deregulation and restructuring. Third, companies such as ASIRobicon can take advantage of increased environmental protection awareness, infrastructure development and total water management. Fourth, there is the ongoing development of industrial capacity and low-cost production in emerging markets. Fifth, there is the burgeoning market for the conversion of non-electrical mechanical prime movers to electrical solutions.
With this in mind, ASIRobicon’s business strategy combines the following elements for success.
•Becoming an integrated electrical supplier with global reach and economies of scale. This provided the rationale for Robicon’s acquisition of ASI. ASI is now integrated with Robicon and ASIRobicon is undertaking an ambitious strategic marketing plan.
•Providing world-class, industrial power control products, systems integration and process automation. ASIRobicon is developing multigeneration product plans, common platforms and a sustaining leadership role in power electronics technology.
•Implementing and achieving process and operational excellence. The company has a world-class leadership team with the right incentives and a customer-focused multiyear business strategic planning process. It has undertaken organizational and facility rationalizations, information technology and e-business initiatives.
•Growing the service-related business to 20 percent of revenues. The company is leveraging its impressive installed base, developing wide-ranging commercial offerings and providing customer life-cycle support.
“We have many advantages working in our favor,” says Shade. “ASIRobicon is the leading independent industrial power-controls business worldwide. We have a strong management team with significant experience and expertise. We have a focused strategic plan well under way with excellent results to date – not to mention continued earnings growth and market share gains. We are also attracting new talent to our company, as many want to join a winning team.” With a list of qualities as impressive as this, the competition should start taking notice of ASIRobicon’s impressive plan for market share gain.