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Transcript of “Using the Downturn as Downtime to Prepare for Long Term Growth Opportunities” CEO 360 Degree...
“Using the Downturn as Downtime to Prepare for Long Term Growth Opportunities”
CEO 360 Degree Perspective:Measurement & Instrumentation
(M&I)
GIL 2009: North AmericaGrowth, Innovation and Leadership
A Frost & Sullivan Global Congress on Corporate Growth
September 13-16, 2009Scottsdale , Arizona
2
Global Perspective – Measurement & Instrumentation
Test & Measurement Semiconductors
2007 - ~ $50B
CAGR – 7.1 %
2007 - ~ $265B
CAGR – 5.6 %
2007 - ~ $41B
CAGR – 9.1 %
Sensors
M&I
2007
M&I
Test & Measurement
2007 - ~ $44.3B
CAGR – 5%
Semiconductors
2007 - ~ $200B
CAGR – (24)%
2007 - ~ $44B
CAGR – 9.2%
Sensors
2008
3
Global PerspectiveThe Complex Business Universe
Environmental Concerns Drive Demand
Wireless Standards Set Tone for New Products
BRIC & Other Emerging Economies
Struggling Economies
Measurement & Instrumentation Industry Global Environment
Measurement & Instrumentation Industry Global Environment
Source: Frost & Sullivan
4
Focus on Core Competencies
Innovative Approach
Standard Wireless Sensors
Superior Product Performance
Cost Efficient Solutions
Extending into the Critical Markets
Innovative Wireless Systems Newer Applications Areas
Complimentary Products and Accessories
Dissemination of Education to End-Users
Developing Common Acceptable Standards
Experience Spread over next 5 years (2008-2013)
TIME
MA
RK
ET
PE
NE
TR
AT
ION
Global PerspectiveWireless Standards Impacts New Product Development
2008 - 20092008 - 2009 20132013
Seamlessly Wireless World (?)
2008 - 2013
5
Economic PerspectiveThe Complex Business Universe
Current Slow-down of Economies leading to Budget Cuts
Growth in Rental/Leasing Market
Continued Industry Consolidation
News of Economies Getting over the Slump
Measurement & Instrumentation
Industry Economic Environment
Measurement & Instrumentation
Industry Economic Environment
Source: Frost & Sullivan
6
Economic PerspectiveStimulus Package Totals – World (2009)
China - $580BUS -
$850B
Europe - $280B
Japan - $110B
UK - $45B
India - $9B
7
Economic PerspectivePlanned US Federal Government Stimulus Spending (2009)
Planned Government Stimulus Spending
Defense and Security $16.448 billion
Federal and State Government
$45.472 billion
Commerce, Justice and Science
$17.842 billion
Transportation, Housing and Urban Development
$57.07 billion
Energy & Environment, $98.234 billion Agriculture and Rural
Development $15.986 billion
Labor, Health and Education
$66.15 billion
Source: CNN
8
GDP of key countries/regions in Europe – 2008 to 2013 indicates tough times ahead for economy pan Europe
Spain
France
Germany
Economic PerspectiveAnalysis across Europe
Britain
Italy
0.9%
-1.2%
0.4%
1.9%
2.1%
1.4%
1.4%
-0.7%
0.4%
2.0%
2.2%
0.2%
0.7%
-3.6%
-1.1%
1.5%
1.8%
0.7%
1.3%
-1.7%
0.2%
2.3%
2.5%
1.7%
0.3%
0.4%
1.2%
1.4%
1.5%
Eastern Europe
3.1%
2.2%
3.1%
2013 2012 2011 2010 2009 2008
Britain and Ireland in UK is likely to go into deep contraction in 2009 and 2010
Source: Economist
Germany is set for contraction in 2009 and is expected to bounce back in 2010
Eastern Europe is not growing at the rates since joining EU. The fall in growth rate have been rather dramatic in few counties
9
Integrated Industry Perspective Zooming In on End-user Industries
Source: Frost & Sullivan
General Purpose
Test
Communications Test Sensors
Aerospace Aerospace & Defense& Defense
Automotive & Automotive & TransportationTransportation
ElectronicsElectronics
Life SciencesLife Sciences
Aerospace Aerospace & Defense& Defense
Service Service ProvidersProviders
Equipment Equipment ManufacturersManufacturers
Automotive & Automotive & TransportationTransportation
Automotive & Automotive & TransportationTransportation
ElectronicsElectronics
Life SciencesLife Sciences
EnvironmentEnvironment
Life Sciences Life Sciences
Semiconductors
ResearchResearch
CommunicationsCommunications EnvironmentEnvironment
Chemicals & Chemicals & PetrochemicalsPetrochemicals
Aerospace Aerospace & Defense& Defense
Aerospace Aerospace & Defense& Defense
ResearchResearch
Process ControlProcess Control
CommunicationsCommunications
ElectronicsElectronics
10
Segment
Parameter
Analytical Instrumenta
tion
Manufacturing Test &
ATE
Communications Test
Dimensional Metrology
Mechanical Test
General Purpose test
Market Size 2007
$18.8billion
$7.6 billion $7.98 billion $6.4 billion $4.2 billion $3.7 billion
CAGR (2007-2010)
5.5% 7.2% 12.6% 6.1% 5.4% 4.8%
Leading Market Participants
Thermo FisherWaters CorpVarianHoriba Instruments
AdvantestAgilentCredenceTeradyneNational Instruments
Agilent AnritsuJDSURohde & Schwarz SpirentIxia
HBMMitutoyoCarl ZiessHexagon MetrologyVishay
Emerson ProcessGE InspectionB+KRockwell Automation
AgilentAnritsuRohde & SchwarzTektronix
Competitive Perspective Test & Measurement Industry
11
Competitive Perspective Semiconductors Industry
World Power-over-
Ethernet Chipsets
World LED Driver ICs
World LCD and OLED Driver ICs
North American
Digital VLSI Design
Services
World Battery
Management ICs
World DC-DC Converter
ICs
Market Size (2008) $91 million $1.04 billion $5.3 billion $727.9 million $1.4 billion $2.98 billion
CAGR (2008-2012)4.8% 10.4% 1.8%
8.8%14.6% 16.5%
Leading Market Participants
Maxim Integrated ProductsLinear
TechnologyTexas
InstrumentsMicrosemi
National Semiconduc
torMaxim
Integrated Products Texas
Instruments
SAMSUNGNovatek
Microelectronics Corp
NEC Electronics
IBMeSiliconQThinkFaraday
Technology Corporation
Texas Instruments
Intersil Corporation
Maxim Integrated Products
National Semiconduc
torLinear
Technology Maxim
Integrated Products
Segment
Parameter
12
Competitive Perspective Sensors 2008-2013
High
Growth Sensor Markets
Distance Sensor
Torque
Sensors
Humidity
Sensors
Scavenging Sensors
Acoustic Sensors
pH
Sensors
Rain
Sensors
Other Emerging Sensors
CAGR
2008-2013 19.2% 25.4% 20.5% 19.2% 19.2% 16.2% 16.3% 16.3%
Trend
Low Growth Sensor Markets
Load Cells
Sensor
Speed
Sensors
Motion Sensors
(Auto)
Level Sensors for Solids
Knock Sensor
CAGR
2008-2013 3.5% 3.4% 3.6% 3.8% 2.5%
Trend
High
Growth
Sensor
Technology
Wireless Semiconductor-Based
Sensors
CAGR
2008-201348.5% 16.7%
Trend
Note: All figures are rounded; the base year is 2008. Source: Frost & Sullivan’Note: All figures are rounded; the base year is 2008. Source: Frost & Sullivan’
13
Technology PerspectiveThe Complex Business Universe
Wireless & MEMS gaining ground
Test Automation
Embedded Instrumentation
Integration of Technologies
Zero-defect Manufacturing
Green Technologies
M&I Industry: The Focal Point of an Industry at a Crossroads
M&I Industry: The Focal Point of an Industry at a Crossroads
Source: Frost & Sullivan
14
Technology Perspective Communications Test & Measurement (2008 – 2013)
Dri
vers
High
Med
Low
10 GbELTE/WIMAX
QoE/Service
Assurance
3G MobileDataServices Security
DOCSIS
3.0
15
Technology Perspective – SemiconductorsMarket Impact of Key Trends
ProjectedImpact on the
SemiconductorIndustry
High Impact
Low Impact
Certainty
Low High
Increasing Chip Complexities
Co-existence of analog & digital logic on chip
MEMS Technology
Low Power Consumption
High Level of Integration
Shift to 3-D Packaging
High Growth Impact
LowGrowthImpact
MediumGrowthImpact
Source: Frost & Sullivan.
16
Technology Perspective Sensors
Dev
elo
pm
ent
Su
cces
s 2
008
2009 2010 2011 2012 2013
Embedded Piezoresistive Microantiliver Sensors – Using Gas Detection
Direct Monitoring & Control – Transformer Temperature
Wireless Sensor Use – Multi-Traffic Control
Solid State Sensor - Humidity Detection
Novel Overlap Functions – Wireless Sensing
Intelligent Sensing – Inverter-fed Induction Motors
Smart Sensor – Self Adaptive Sensor System
Imp
lem
enta
tio
n S
ucc
ess
2009
-201
3
17
Customer PerspectiveThe Complex Business Universe
Challenges Challenges
Impacting Impacting
Customer Customer
Relationship Relationship
ManagementManagement
Need for region/pr
oduct specific
distribution
channel strategy
Need for region/pr
oduct specific
distribution
channel strategy
Increasing Need of Global
Technical Support
Increasing Need of Global
Technical Support
Strong Demand
Growth in Emerging Markets
Strong Demand
Growth in Emerging Markets
Source: Frost & Sullivan
18
New Business Can Come from Non-traditional & Alternative Sources
• Security Security MarketMarket
• Alternative Power Alternative Power & Battery Needs& Battery Needs
Measurement & Measurement & InstrumentationInstrumentation
• Oil & Gas MarketOil & Gas Market
• Alternative Alternative Fuels MarketFuels Market
• Environmental Environmental MonitoringMonitoring
End-user / Customer Perspective – Market Opportunity Window for M&I Vendors
Increasing Security Concerns
Generation Shortfalls and Increasing Demand for Power in all Segments
Green House Effect and Impact of Environmental Degradations
Need to Enhance Yields and Ensure Pipeline Integrity
• Medical Medical MarketsMarkets
The Preferential Sector For Investment Opens New Untapped Opportunities
Need for Improved Healthcare
• Food & Food & Agriculture Agriculture
Soil Monitoring for Increased Yield
19
Best Practices PerspectiveThe Complex Business Universe
Source: Frost & Sullivan
Product Innovation and Differentiation
Product/Region Specific Distribution Strategy
Effective Customer Service Strategy
Customer Diversification & New End-users
Technological innovation leadership
New Markets for established products
Ability to establish brand awareness
Strategic mergers,
acquisitions, or joint ventures
Reorganization structured around growth strategy
Product Innovation and Differentiation
Product/Region Specific Distribution Strategy
Effective Customer Service Strategy
Customer Diversification & New End-users
Technological innovation leadership
New Markets for established products
Ability to establish brand awareness
Strategic mergers,
acquisitions, or joint ventures
Reorganization structured around growth strategy
Best Practices in M&I
20
Going ForwardFuture Scenarios
Global Diversification and
Product Specialization
Sustainable Technology &
Product Innovation
Market Facing Solution Providers
Downstream Vertical Integration
or Consolidation
M&I Industries:Effective Growth
Strategies
SustainablSustainable Growthe Growth
SustainablSustainable Growthe Growth
Source: Frost & Sullivan
Questions and Answers
Growth Success Story 1
Christine KingPresident & CEO
SMSC
GIL 2009: North AmericaGrowth, Innovation and Leadership
A Frost & Sullivan Global Congress on Corporate Growth
September 13-16, 2009Scottsdale , Arizona
Meeting of the Minds: The CEO 360 Degree Competitive Perspective Think Tank
Speakers
- Jason Urso, CTO & VP Technology, Honeywell Process Solutions - Atul Bhatnagar, President & CEO, Ixia - Calvin Harrison, VP Marketing & BD, Inneoquest Technologies, Inc. - Richard McDonell, Sr Group Manager, Product Marketing
GIL 2009: North AmericaGrowth, Innovation and LeadershipA Frost & Sullivan Global Congress on Corporate Growth
September 13-16, 2009Scottsdale , Arizona
Growth Success Story 2
Atul BhatnagarPresident & CEO
Ixia
GIL 2009: North AmericaGrowth, Innovation and Leadership
A Frost & Sullivan Global Congress on Corporate Growth
September 13-16, 2009Scottsdale , Arizona