One World. One Dream

In Shanghai for Advantech’s third World Partner Conference, Bob Gill finds an ambitious Asian company all set to take globalization to the next level.

This is the largest gathering of solution partners in the company’s history, announced Chaney Ho, General Manager, Greater China, as he launched the 2007 Advantech World Partner Conference (WPC). Indeed, some 400 people from 35 countries across the world had made the trek to Shanghai to witness and to be part of the three-day, biennial event.

On offer to the delegates: executive briefings, technology updates, product displays, business matchmaking sessions, specialized sectoral workshops, plus a plethora of opportunities to network and make valuable international contacts.

The theme this year: Global Integration, Mass Collaboration. “The world has become flat,” said Ho. “Information, money, talent – these can be moved around the world freely. And the Internet revolution, telecommunications, and transportation represent driving forces toward One World.”

But Ho also pointed out a number of “tough issues” – global warming; natural resource scarcity, water shortages, pollution, ageing population, terrorism – facing the 21st century world.

“These are challenges of humankind but there are opportunities behind the crisis,” he said, going on to describe a number of projects where Advantech solutions are already being harnessed: a wind power generation monitoring system in Germany; a continuous emissions monitoring system in China; and an airport security control system in Australia.

On the brighter side, Advantech is also gearing up to profit from the world’s generally increasing affluence, which is generating desire for comfort and convenience, for travel, for entertainment, and for high-level healthcare.

About Advantech

In just under 25 years, Advantech has expanded far beyond the confines of Taiwan, where it was first established by ex-HP engineer K C Liu. North America and Europe together contributed 50 percent of 2006 sales (US$452 million), Greater China 27 percent, and the balance almost evenly split between Japan/Korea, South Asia Pacific, Emerging Territory, and Others.

The company is now structured into three business units:

• Industrial Automation Group (IAG) – targets the factory automation, machine automation, building automation, energy & environment, and transportation sectors with a range of product offerings including controllers (PACs), industrial PCs, I/O modules, HMI panels, and industrial Ethernet switches.

• Embedded ePlatform (EPG) – encompasses embedded computing hardware such as PC/104 modules, single board computers (SBCs), industrial motherboards; industrial, network and blade computing platforms; plus Design to Order Services (DTOS) and Configure to Order Services (CTOS).

• eServices & Applied Computing (SAG) – focuses on selfservice kiosk, medical, and vehicle-mounted computing solutions, and also on the new growth areas of digital signage and real estate intelligence.

Advantech makes extensive use of partner companies to deliver solutions to end-users, and these are categorized into Channel Partners – providing product distribution and support; Solution Partners – companies that manufacture original equipment based on Advantech products; and Specialty Partners – technical specialists with strong domain knowledge in specific product lines and vertical markets.

Product manufacturing is concentrated in Asia at three centers: Taipei, Kunshan, and Dongguan. And the company operates four regional logistics centers – in California, Eindhoven, and Taipei and Kunshan.

Transformation time

From the man who started it all back in 1983, Advantech founder K C Liu, now President and CEO, the main message to his channel partners concerned not strategy, technology or products, but structure. Specifically, the transformation from a multinational corporation (MNC) to a globally integrated enterprise (GIE).

“Advantech’s present organization and operations are still based on the traditional MNC model. This model sets boundaries between product divisions and sales regions, which limits our potential growth in this ever changing and competitive global market.

“The more I study the situation, the more I believe we need to transform Advantech into a real GIE company to facilitate the next generation of growth. To be competitive, we need to change from the one-headquarter-multi-regions model to the GIE model,” announced Liu.

The main attribute of a globally integrated enterprise, a term first coined by IBM’s Sam Palmisano in 2006, is that state boundaries define less and less the boundaries of corporate thinking or practice. This means the traditional concepts of home country, foreign offices, geographical domains, transforming to a single globally integrated identity and domains of expertise with work flowing to where it is done best.

“In the GIE model, the key success factors are to establish direct command chain and end-to-end domain knowledge transfer within each vertical sector from the product divisions to the sales teams.

“Another key factor lies in serving the vertical markets from the customers’ point of view. Sales teams will no longer be limited to selling products from just their own product groups; they will also sell products from other groups, and even external alliance partners to deliver total solutions,” elaborated the Advantech chief.

Liu admits that as a typical, engineering-driven Taiwanese company, Advantech currently has “too many products”, hence the need to switch from a product-oriented organization to one based on customers and vertical markets.

Defining the GIE as the fourth stage of Advantech’s evolution from a local Taiwan company (1983-88), to an export company (1989-94), and then to today’s multinational company (1995-2007), Liu expects Advantech’s next transformation to be completed within three years.

“Then, hopefully by 2010, Advantech will be a fully-fledged GIE. I predict that these new changes will foster both the professional growth of our global business as well as the personal growth of all Advantechers.”

And asked by CE Asia why for the very first time Advantech had actively encouraged the global media to witness the WPC, K C Liu said, “Because we need to extend our brand recognition, since we are no longer such a product-oriented company. So please, go and tell your story to the world!”

K C Liu, Advantech President & CEO