Delivering the X Factor

CEA: How is Honeywell Process Solutions (HPS) structured in Asia Pacific?

Teo: We are headquartered in Shanghai as part of the Automation & Control Solutions (ACS) group, one of the divisions within Honeywell along with Aerospace, Specialty Materials, and Transportation Systems, all of which are co-located at the HQ in China.

Together with the Americas and Europe, Middle East, Africa (EMEA), Asia Pacific (AP) is one of the three poles for HPS and all the regional VPs, including me, report in to president Jack Bolick, who is based in Phoenix, Arizona. We have close to 4,000 staff within the HPS business in Asia Pacific.

CEA: And your own career history with Honeywell?

Teo: An engineer by training, I have been with the company for 27 years now and involved in a number of different areas – operations, sales, marketing. Before heading up Asia Pacific for HPS, I was in charge of the ACS division for Southeast Asia.

After taking over HPS in Asia Pacific, I was based out of Japan before moving to Shanghai earlier this year, being tasked to rebuild the business over there after the end of a joint venture we had with Yamatake. Things are going well in Japan now and we’re up to around US$50 million in revenue.

CEA: What’s your assessment of the process automation business in the region?

Teo: Well, the biggest growth areas for us geographically are China and India, where there are major investments in new refineries and petrochemical plants taking place. In Southeast Asia, while we may not be seeing such levels of expansion, we are maintaining our momentum – Malaysia is a great market for us as we are major supplier to Petronas. Over in the Pacific, the business is driven largely by the metals, mining, minerals sector. Overall, because of the strong economies, the oil and gas boom, and Chinese demand for commodities, it is a very busy time for HPS in the region and I see it continuing this way up until at least 2010.

CEA: And what is HPS’ strategy to compete and win in the market?

Teo: Our approach can be summed up through the four quadrants of the Experion Process Knowledge System (PKS): unifying Assets, Process, People to improve Business agility. What this means is that in addition to controlling processes, we provide systems to optimize expensive plant assets, to take information from the field to help management to make business decisions, and to enhance the capabilities of plant personnel.

In terms of specific products within Experion PKS, these include the Experion R300 DCS, the Business.FLEX MES, and the UniSim plant simulator, along with many others. This UniSim offering delivers on the People aspect – for training new staff to replace the many operators set to retire over the next few years – given the demographics – and so enable plants to maintain skill levels needed to sustain operational efficiencies.

CEA: And Honeywell now offers flowmeters ..?

Teo: Yes, that’s right, as part of the efforts to broaden our offerings down at the field level, which was previously not a major focus for us. The flowmeters will be manufactured by Krohne and marketed and supplied by Honeywell under the new VersaFlow brand.

The recent acquisition ($260 million) of Enraf also enhances our field portfolio. The company is a major player in instrumentation systems for oil and gas transportation and storage facilities. And with more tank farms coming up and with the growth of the LNG carrier business in Korea, there should be huge opportunities for these products.

CEA: Wireless seems to be a major theme right now.

Teo: Yes it is, and our One Wireless solution is certainly a major initiative. Honeywell is one of the first companies to offer wireless products for process automation and I believe that we do possess an attractive, differentiated solution. Wireless is a strong enabling technology and one that could potentially change the whole shape of automation.

CEA: What do you hope to achieve from this Users Group event?

Teo: The Users Group is a cornerstone of how we want to stay engaged with our customers. It’s an opportunity to share technology and experiences with the companies that we are targeting.

This is the sixth time we are running it in Southeast Asia and it’s now a regular event every two years. We also have similar events for our users in China and in the Pacific, which are held every year. And over in the US, it has been running annually for 34 years now and is a really huge show.

We also invite partner companies to make presentations and display their products alongside ours. The ones here in KL – MTL Instruments, Pepperl+Fuchs, Turck, Vector Infotech – have been with us for several years. We select partners on a win-win basis; if we have common thinking processes and objectives then there is more to be gained and the partnership will be profitable.

CEA: Do you have a particular management approach to running the Honeywell Process Solutions business in Asia Pacific?

Teo: Our business is all about people – they are the key to our success once the right strategy is in place. So I place a lot of emphasis on staff recruitment, development, and retention.

The other aspect is management by objectives (MBO) – setting objectives early in the year on what needs to be done and then making assessments on progress and completion. As a US company, Honeywell is strongly financially driven. So every quarter we have to perform!

To grow the business we must take good care of our installed base first and then through word-of-mouth we can continue to grow from there. And we are growing – from $230 million in Asia Pacific back in 2003 to $600 million now.

Desmond Teo

X marks the spot for Experion PKS.