The Blue Ocean Strategy is a great book by Kim and Mauborgne (Harvard Press) that looks at how exciting new  products can be created at the development stage by focusing on uncontested market space.

In the book the authors argue that instead of companies trying to be better than the competitors and fighting over market share they should instead focus on making the competition irrelevant by creating uncontested Blue Ocean market places where new demands of customers are satisfied.  Rather than trying to beat the competition at their own game businesses looking for uncontested space should answer four questions:

• Which of the factors that our industry takes for granted should be eliminated?
• Which factors should be reduced well below the industry’s standard?
• Which factors should be raised well above the industry’s standard?
• Which factors should be created that the industry never offered?

I found the book a good read and like anyone who learns about a new model or concept I wanted to try it out on one of our products at home.  I knew that no-one here had read the book before designing the MultiSmart Pump Station Manager over five years ago so it would be a good test. I am now sitting down and will do my best to answer the four questions:

• What did we eliminate that the industry took for granted?
That is easy. We took away the need to bring in a third party expert to set up, commission or make changes to the configuration of pump control in a lift station. It was all made so easy to use that any operator could be given simple training to do it and save themselves big dollars!

• What factor did we reduce below the industry standard? 
After thinking about that for a while it occurs to me that the MultiSmart reduces the number of moving parts found in any panel or station control box. The standard control panel is full of gear. A MultiSmart takes a lot of that away – up to 14 different devices are eliminated from one panel, maybe more. Again – big savings.

• Which factors did the MultiSmart raise well above the industry standard?
One of the biggest issues for the industry is getting enough data from lift stations and pump station. On average the industry is used to controllers providing less than 50 tags. We saw that as being the big picture for customers. The more information you have to hand the better your decision making. Asset managers are becoming more focused on network management, efficiency, energy and operating costs. Information and lots of it was going to be the key. We upped the ante with the MultiSmart and brought back 500 tags of data (and growing).  This allows greater level of control and monitoring than ever offered before in a controller.

• Which factor did we create that had not been offered before? 
Going back to the book for examples the authors showed how Cirque Du Soleil had solved this by being the first to offer a high level of theatre to their industry (Circus entertainment). That leads me to say that the MultiSmart was the first to offer an out-of –the-box solution for full pump station management. All the hard work has been done for you.  All the smarts come with the unit and we provide free upgrades as we develop them.

You might agree with me on those answers or you might not. My view is that they stand up to some scrutiny but I would love to hear if anyone has a different view. Read more…

General News, Industry MultiSmart, Pump Controller, Pump Station Management

When someone talks about the capital infrastructure of a water or waste water utility or authority they are referring to things like the pipe networks, the lift stations, water mains and treatment plants a utility owns and is responsible for. These are usually very large and costly investments by any standard and that is why most times the owner of the assets must levy fees in the form of taxes when other government funds cannot be found.

 

Asset management is the term used to describe the management of this infrastructure in a way that minimizes total costs. These costs are made up of the cost of investment, operating costs, maintenance costs and the eventual cost of replacing the assets at the end of their life cycle.

 

Asset management for our customers is all about the analysis of information in order to make informed decisions about their capital investments. The better the information – the better the decision they can make. There is a big incentive to use that information on decisions that will minimize costs.

 

All utilities and authorities are limited in their spending to how much they collect in water and wastewater rates. Therefore a critical goal for the city is to manage their assets in such a way that they can achieve the level of service desired by customers AND meet the legal requirements of the regulators WITHOUT going over the amount of money they are allocated to spend each year.

 

So asset management is all about the analysis of information to make better decisions about investments. The more data you have and the more of that data you get in real time – the better you are able to manage your assets.

 

According to the Water Investment Newsletter the application of information technologies to the water industry is destined to become a high-growth opportunity. As if we did not know that!

 

Combining a modern SCADA (Supervisory Control and Data Acquisition) system with the MultiSmart Pump Station Manager provides a sophisticated solution to asset management. This ensures not only continuous monitoring and control but a high level of predictive intelligence at the site where the assets are. Our enabling technology creates operational efficienies, and reduces maintenance and energy costs. This in turn helps the customer delay or reduces rate increases, helps bridge their funding gaps and optimizes their assets performance and reliability.

 

In the US much of the water infrastructure is approaching the end of its asset life cycle. This makes it a healthy candidate to get federal funding for capital renewal. We have already identified around $5billion in “shovel ready” projects that are eligible under the America Recovery and Reinvestment Act of 2009.

 

Multitrode designs its products with the needs of the customer in mind. In fact one of our core values is that the customer is “Boss”. Our view is that the MultiSmart is the best solution to a customer looking for a better way to manage assets.

 

Some examples of how the MultiSmart delivers better Asset Management

Capital Costs: The MultiSmart is great value for money. It allows for lower cost panels. in many cases it can pay for itself in the first 12 months. The one unit replaces up to 14 other devices.

Maintenance Costs: The MultiSmart provides large amounts of data from the remote site back to a central site to be analysed. It also has on site predictive intelligence that can tell when a pump will need servicing.

Operating Costs: We know that any network where MultiSmarts are fitted will reduce after hours call outs by up to 80%. That reduces emergency response costs and “on call” costs. We also know that energy costs can be reduced by up to 15%.

Recycling: The MultiSmart has a 5 Year warranty. The case is made of recyclable plastics and the boards can be returned and disposed of in the appropriate way.

Read more…

General News

The International Monetary Fund said this month that the world economy was on track to shrink for the first time in 60 years by as much as 1.0 percent. It said that recovery from the recession depends in part on stabilizing financial conditions through the injection of economic stimulus spending. But more telling was the view that the key to success was countries being prepared to work together on solutions.

 

Time is running out for the leaders of the Group of Twenty who are meeting in London this week. The message they might bring back home with them after the summit is of a deeper recession before things improve.

 

So what to do when faced with the very real chance of dealing with the worst downturn since the 1930”s depression?  That was a question we asked ourselves recently at MultiTrode. Just like in any other business involved with infrastructure, a slow down in the economic spending (despite money being made available for shovel-ready projects) will affect our customers and in turn “business as usual” revenue.

 

Our Chairman and company founder Craig Parkinson had the best answer. This is a man who has seen a few booms and busts in the twenty two years that MultiTrode has been around. So we always listen when he has advice.   Craig’s view was that we should do what we have always done in the past – go and talk to our customers.

 

He said it sounds simple but so few companies do it well because they are unable to stop thinking about themselves long enough to truly hear what the customer is saying. Now I am not going to give a lesson in Marketing 101 here. But the advice Craig gave was right on the money.

 

The folk at MultiTrode have always enjoyed a close relationship with the industry so it was not hard to start asking pointed questions about what things are keeping people awake at night. The response has been great. We are getting a lot of feedback and expect more as we continue to involve ourselves in the fresh issues.

 

The  biggest learning? Remember that we only focus on water and waste water pump station solutions so our questions can be quite targeted. From all our interviews with customers, experts and intermediaries we now know that the smart operations managers are focusing on three key areas. They realise that stimulus packages aside there will be an effect on operating and cap ex budgets so they are refining their operations, chasing station asset optimization and only investing in cost effective solutions.

 

They know that energy efficiencies of up to 15% are available at the pump station. They see that out-of-date lift stations can make up 60% of all emergency call outs and gobble up the bulk of “on call” penalty rates. They also know that the regulators will not be giving anyone a holiday.

 

Pump stations have long been overlooked by managers but today they see this area of their operation as a real mine of budget improvements. Our challenge is to keep listening like Craig did over twenty years ago to help them. Read more…

Industry

Like most other businesses faced with the challenges of today’s recessionary climate we recently brought our management team together to work through some scenario planning. I would recommend the exercise to anyone looking for strategic preparedness. In the course of the workshop we reviewed the overarching trends influencing the water and wastewater industry.

 

No matter what the economic situation the owners and managers of water infrastructure all face similar challenges. There are intersecting trends driving what happens in the market.  These trends are not going to change because of the current recessionary economic pressure on global markets. In fact it’s my view that we will now see them become more defined and more instructive .

 

Environment

The first trend is one of increased regulation. Around the world we see this trend gathering pace. This includes higher standards for drinking water quality and zero tolerance of waste water spills and strict monitoring requirements by the regulators.  Here is a truth: After every crisis the amount of regulation increases.  So after the dust settles on this global downturn expect a rush of regulator activity.

 

Security

The next is the post 9/11 concern over security of remote telemetry communications and control at water sources, treatment plants and pumping stations. This was once the domain of a few passionate souls who were almost being treated like Henny Penny, the character that claimed the sky was falling. Now it is an agenda item for most Homeland security agencies around the world. And people are beating a path to Henny Penny’s door.

 

Infrastructure

Thirdly our aging water infrastructure requires a steady investment. In most of the developed world water and sewerage infrastructure dates back to the years just after World War Two.  It has suffered from chronic underspend and a rapidly increasing population. There is a huge gap in what is presently allocated to be spent and the rate of spending needed. In the United States alone the estimate is a spending gap factor of ten to one.  No wonder that the rate of investment in water has been increasing in popularity.

 

Workforce

On top of this our workforce is changing. As people retire and exit the industry we are finding it harder to attract the number of good talent to the water business. Its not that we don’t have the talent in the new recruits – it’s that there are not enough of them.  This has focused the industry on seeking productivity outcomes. We now reward anything that lowers the capital costs and operational budgets and provides a knowledge foundation for replacement of technical staff. Even if we see an easing in the job market as a result of lay offs now that the greater part of the world is in recession the rate of growth potential for water infrastructure will soak it up quickly. Skills shortage is here to stay for some time.

 

Technology

The final trend that meets at the intersection point is the increasing use of low cost smart embedded devices that can be located remotely and linked using modern communication protocols.   This technology is small, full of application specific firmware, that can self-diagnose and are packed with high end communication capabilities. Plenty of multinationals like Schneider, Emerson, Siemens are putting big bets on this area but the water challenge is so great that there remains a huge opportunity for niche companies like ours to outperform the majors with highly targeted offerings.

 

My challenge now is to ensure I keep the company very close to the customer and these trends. I have set certain priorities for the business and one of the most important is a renewed focus on what keeps the customer awake at night. This blog is a company initiative designed to generate discussion and to share ideas. I will be keeping a close eye on the blog as it develops into a key source of communication with our customers and the community.

Read more…

Industry