Arc user survey plc supplier preferences


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Arc user survey plc supplier preferences

  1. 1. BY ARC ADVISORY GROUP NOVEMBER 2001 ARC User Survey: PLC Supplier PreferencesExecutive Overview ................................................................................ 3Primary and Secondary PLC Suppliers – How Important Is Brand? ............ 4How Do Users Select PLCs?.................................................................... 9Why Do Users Switch PLC Suppliers? .................................................... 10Which PLC? The User/OEM Struggle ................................................... 12Converting Controls: Who Pays the Bill? .............................................. 15Recommendations ............................................................................... 17Enterprise & Automation Strategies for Industry Executives
  2. 2. ARC Strategies • November 2001 20 18 16 OEMs End-users No. of Respondents 14 12 10 8 6 4 2 0 better local faster PLC larger PLC better tech support price/performance programming reduced # of better/easier smaller/cheaper (capacity) more innovative presence suppli ers products PLC better Top Reasons Why End Users and OEMs Switched PLC Suppliers Commercial Issues Technical Issues 1. Quality of products 1. Quality of tech support 2. Quality of pre-sales service 2. Reusable programming code 3. Local presence 3. Integration with 3rd party devices 4. Wide range of products 4. Uses IEC 61131-3 languages 5. Supplier’s reputation 5. Supplier’s reputation 6. Discount price 6. Supports open networking standards 7. Willingness to customize products 7. CPU scan time 8. List price 8. Wide range of related products Criteria for Selecting a New PLC Supplier from a Recent ARC User Survey2 • • Copyright © ARC Advisory Group
  3. 3. ARC Strategies • November 2001Executive OverviewARC’s recent PLC brand preference survey posed questions about PLC selec-tion behavior to nearly one hundred users of PLCs worldwide. Theresponses were split nearly 50/50 between OEMs and end users. The resultsprovide some new insight as to how and why users choose their brand ofPLCs, why users switch suppliers, and how end users and OEMs react whenforced to consider using a different PLC.On the demand side of the automation market equation, concepts like brandawareness and brand loyalty take on new dimensions. Controls supplier se-lection is closely tied to the huge investments necessary for everything fromspare parts inventories to the training of engineering, maintenance and op-erations personnel. The lack of industrial standards forces users to commit tosuppliers’ proprietary technologies and programming languages, makingswitching costs high. As a result, end users make multi-year commitments -ideally to one or two suppliers - to minimize costs. Despite this, over a thirdof users surveyed have switched suppliers in the past five years for reasonsranging from better price/performance to local presence in target markets. Other 11% North Europe America 31% 58% Major Geographic Regions Represented in ARCs User SurveyHow do end users and OEMs choose their PLC suppliers? The survey resultsindicate that performance is still the most important selection criterion forusers. For complex applications like packaging machines, OEMs are migrat-ing to specific solutions, such as combined PLC and motion controllers, andlimiting the number of alternate solutions they offer. Other OEMs, especiallythose that serve the automotive industry, still bow to the wishes of their cus-tomers and implement whatever PLC is specified. OEMs tell ARC thatcustomers today are less willing to disrupt a complex, carefully tuned auto-mation solution by specifying their own PLC. Copyright © ARC Advisory Group • • 3
  4. 4. ARC Strategies • November 2001 Two-thirds of end users surveyed stated that they dictate the type and brand of PLC to be used on OEM machines. If an OEM didn’t offer the desired PLC brand, most end users would insist on a controls conversion to their brand – or look for another OEM. Half of those would share at least some of the con- version costs. Most OEMs would implement a different PLC if required, but would expect the customer to share the extra costs. In general, the balance of power between customer and OEM hasn’t changed – it’s just been stirred up in light of the increased complexity of some PLC applications. Other Food & Beverage 35% 16% Pharmaceutical 11% Petrochemical 7% Fine Chemical Automotive 5% Electronics/ Consumer 6% Pulp & Packaging Semiconductors Paper 5% Products 5% 5% (non-food) 5% Respondents to ARCs User Survey Represent a Wide Variety of Industries Primary and Secondary PLC Suppliers – How Important Is Brand? Consolidation in the industrial controls industry has reduced the number of suppliers in the market to a handful of vendors offering increasingly broader and more complete solutions. While this trend gives users less choice, the remaining suppliers now offer extensive product lines of well-integrated components extending far beyond just PLC hardware and software. The first part of ARC’s survey takes a look at the importance of PLC brand, why automation users buy PLCs from certain suppliers, and what pressures they face in making supplier selection decisions. Geography is by far the most influential factor in deciding which PLC to use among end users and OEMs. Each of the top three PLC suppliers in the4 • • Copyright © ARC Advisory Group
  5. 5. ARC Strategies • November 2001world – Siemens, Rockwell and Mitsubishi – dominates its own respectivehome market – Europe, North America and Asia. For this reason, discussionof the results is broken down by region.North AmericaOf 48 North American users surveyed, 63 percent use Rockwell Automation(Allen-Bradley) as their primary supplier (68 percent of OEMs, 58 percent ofend users) and 13 percent named Rockwell as their secondary supplier. Sie-mens is the primary supplier for 13 percent of the surveyed North Americanusers (5 percent of OEMs, 19 percent of end users), while a full 23 percentlisted Siemens as their secondary supplier. While these results confirmRockwell’s dominance in its home market, they also confirm that Siemens ismaking inroads as a viable alternative in this coveted market. Primary PLC Supplier - North America Primary PLC Supplier – North America 68% 70% 58% % of N. American respondents 60% 50% 40% 30% 23% 19% 19% 20% 10% 5% 5% 4% 0% OEMs End-users Rockw ell Automation Siemens Schneider Other Respondents from North America Clearly Favor RockwellMeanwhile, Siemens’ High Growth Is Threatening Schneiders Number Two PositionOnly two North American respondents listed Schneider Electric, fourth inmarket share worldwide and second in North America, as primary supplier(5 percent), while a full 13 percent named Schneider as their number twosupplier. However, ARC’s North American market share data shows thatSiemens, Schneider, and GE Fanuc have all gained market share over recentyears while Rockwell’s share has declined steadily. The real threat is comingfrom Siemens’ massive push to gain market share at the cost of local suppli-ers which has driven their double-digit growth in the North American Copyright © ARC Advisory Group • • 5
  6. 6. ARC Strategies • November 2001 market. In fact, last year Siemens nearly caught up to Schneider and GE Fanuc in the North American market with the three suppliers each owning about 13 percent share. Machine OEMs in North America have a stronger preference While the survey results confirm for locally made automation products than end users. In Rockwell’s dominance in its home ARC’s survey, 68 percent of OEM respondents listed Rockwell market, they also confirm that as primary supplier while only 5 percent named Siemens. Siemens is making rapid inroads as a OEMs tend to use local products like Schneider or Rockwell viable alternative in the coveted North American region. and are as reluctant as their European counterparts to imple- ment controls of another brand unless pushed by their customer. However, nearly 23 percent of North American OEMs named Siemens as their secondary supplier, versus just 13 percent for Schneider. This is a strong confirmation of Siemens’ number one position worldwide and of the trend for OEMs to cover the majority of customers’ wishes by reducing the number of PLC suppliers supported to just a few so- lutions. Of the North American end users surveyed, 58 percent identified Rockwell as primary suppler versus 19 percent for Siemens. This gap in the preferences of OEMs and end users is explained by end users’ taste for machinery im- ported from Europe and other parts of the world. The United States, for example, typically imports twice as many textile machines as it exports. If an end user does not specify the specific brand of controls to be used on ma- chines, most European OEMs will simply use their own house brand – which is most often Siemens. As secondary supplier, North American end users named Siemens and Rockwell equally (14 and 16 percent) while 9 percent indicated Schneider, and 17 percent said they didn’t have a secondary supplier. While these are “snapshot” data and do not reflect historical trends, they do suggest a trend towards end users supporting fewer PLC types. Europe European automation users accounted for 31 percent of the responses. Of these users, an average of 46 percent named Siemens (31 percent of OEMs, 70 percent of end users) while Rockwell Automation averaged 27 percent as their primary supplier (31 percent of OEMs, 20 percent of end users). Sie- mens was identified by 19 percent of all users as secondary supplier while 23 percent named Rockwell.6 • • Copyright © ARC Advisory Group
  7. 7. ARC Strategies • November 2001 Primary PLC Supplier - – Europe Primary PLC Supplier Europe 70% 70% % of total European respondents 60% 50% 38% 40% 31% 31% 30% 20% 20% 10% 10% 0% OEMs End-users Rockw ell Automation Siemens Other Siemens Dominance in Europe Faces Only Minor Threats from Other CompetitorsSiemens, with a European market share of 47 percent according to ARC’sPLC Worldwide Outlook 2000, clearly dominates its home market. Theseemingly inflated result for Rockwell is due to at least two reasons. Firstly,large American-based producers and several large European global accounts- especially those in the food & beverage and consumer packaged goods in-dustries – have plants all over Europe. These global manufacturers oftenhave a worldwide controls strategy employing a single architecture from asingle supplier, regardless of location, and often use Rockwell products. Sec-ondly, many European OEMs, eager to sell machines in the North Americanmarket, offer Rockwell controls as a second standard.Schneider Electric fared worse in ARC’s survey, despite a pan-Atlantic pres-ence with both the Modicon and Telemecanique brands. Of 85 respondents,only two reported Schneider as their primary supplier, and both were inNorth America. However, ARC received no survey responses from users inFrance - Schneider’s home market. In Europe, Schneider is the second largestsupplier behind Siemens and is particularly strong in the auto industry.Schneider scored high marks as a secondary supplier, where results averaged13 percent in the North American and European markets. Copyright © ARC Advisory Group • • 7
  8. 8. ARC Strategies • November 2001 Secondary PLC Supplier - NA and Europe 70% Secondary PLC Supplier – NA and Europe 60% 52% 46% % of respondents 50% 40% 30% 23% 23% 19% 20% 13% 13% 12% 10% 0% North America Europe Rockw ell Automation Siemens Schneider Other As a Secondary Supplier, Siemens Enjoys a Comfortable Position Among All Users While Rockwell Still Dominates the North American Market European OEMs were split equally between Siemens and Rockwell, but the sample size of this group (16) is inadequate for a fair statistical comparison. Interesting in the results from these machine builders is presence of many second tier suppliers not belonging to the Top Three, such as GE Fanuc, Ber- necker & Rainer, Robert Bosch, Moeller and Indramat. However, more significant is Siemens’ high overall ranking (31 percent average) as secondary supplier to OEMs. Even in markets where Siemens doesn’t dominate, OEMs still see the need to offer the products of the world’s market leader to meet the needs of demanding global customers. Asia/Pacific While the results from users in the Asia/Pacific region were too few to be statistically interesting, it is important to acknowledge Mitsubishi’s 51 per- cent market share in Japan and its advancement to the global Number Three position, according to ARC’s latest PLC Worldwide Outlook study. In fact, Mitsubishi’s dominance in its home market is much great than that of its ri- vals Siemens and Rockwell in their respective markets. Also noteworthy is Mitsubishi’s global Number Two position in the smallest sized (nano) PLC category and Number Three position in the large categories.8 • • Copyright © ARC Advisory Group
  9. 9. ARC Strategies • November 2001How Do Users Select PLCs?Brand Loyalty – A Question of InvestmentBrand awareness in industrial automation is quite different from brandawareness in other industries. Consumers may switch soft drink brandsweekly or drive a different make of car every few years. But industrialautomation requires huge secondary investments in everything from spareparts inventories to the training of maintenance and operations personnel.Furthermore, a lack of industrial standards forces users to commit to certainproprietary technologies such as controller programming environments andnetwork protocols. As a result, end users must make a multi-year commit-ment - ideally to a single supplier - to minimize costs.Good documentation Ease of configuring/using HMIEase of coding Integration with plant network32 bit processing, integration of servo mo- Reliability and supporttion into PLC (real closed loop)Development software pricing Local presence at OEM siteTraining availability for our end users Safety related products, certificationsPre-sales support with servo application Speed of deliveryknowledge & sizingIndustry standards New versions compatible with old onesSmall product range to cover most applica- Good servicetionsThe availability of integrators and engineers Long product lifecycleswith experience with the PLCEnd user acceptance Temporary loan of equipmentPersonnel at supplier Software! Software! Software! Secondary Reasons Given by Respondents for Selecting a PLC SupplierBut the reality of automation is not that simple. Despite supplier consolida-tion and the trend towards more comprehensive product offerings, manymanufacturers still rely on a variety of suppliers for everything from sensorsand contactors to middleware for application integration. Often, special ap-plication needs can only be met by specific solutions from smaller, innovativecompanies, especially in areas like motion control or machine vision. Mostautomation users address this problem by specifying a “house brand” to beused wherever possible, and third party products for specific tasks. The au- Copyright © ARC Advisory Group • • 9
  10. 10. ARC Strategies • November 2001 thorization of third party products is often dependent upon connectivity and compatibility with the house brand. How Important Is Brand Loyalty? To better understand how and why users make their PLC supplier selection, the survey asked users to rank the importance of using a certain brand of PLC on their machines. Eighty-seven percent of all respondents ranked PLC brand as either “very important” or “important”. Less important Somew hat important 2% 11% Very important Important 45% 42% How Important Is the Brand of PLC Used on Your Machines? Why Do Users Switch PLC Suppliers? Switching PLC brands is expensive. Besides the software that has to be re- written, employees in departments from engineering to maintenance to purchasing have to be retrained. PLC suppliers like to build in switching costs. For decades, suppliers have only paid lip service to industrial stan- dards affecting programming languages and field bus protocols – all in the interest of keeping switching costs high to protect their customer base. However, in the survey, 35 percent of all automation users have switched their brand of PLC in the past five years. If the costs of switching are so high, then why have over one third of all users switched? Innovation and Price/Performance Are Most Important Users who have switched brands were asked to give their reasons for switch- ing (multiple answers were allowed). The responses were surprisingly similar between OEMs and end users. The most popular reason for switch-10 • • Copyright © ARC Advisory Group
  11. 11. ARC Strategies • November 2001ing was because the new supplier offered more innovative products (21 per-cent) or better price/performance (18 percent). This confirms that despite thehigh cost of switching, customers still place high value on both performanceand price and are willing to change suppliers if they find a better deal. 45% % of responses (multiple answers possible) 40% 35% OEMs End-users 30% 25% 20% 15% 10% 5% 0% better local faster PLC larger PLC better tech support price/performance programming reduced # of better/easier smaller/cheaper more innovative (capacity) presence suppliers products PLC better Top Reasons Why End Users and OEMs Switched PLC Suppliers“Better local presence in our markets” was the third most named reason forswitching suppliers. This is good news for the top three suppliers – and badnews for the rest of the pack. The effects of globalization are forcing manyOEMs to look beyond their own borders to increase sales and smooth out thedips due to economic fluctuation in some markets. As OEMs sell more ma-chines abroad, local service and support become more important. Localpresence is also important for global conglomerates in the food & beverageand consumer goods industries, many of whom have unified controls archi-tectures around the world and only use the products of suppliers with a trueglobal presence.Other significant reasons given for switching PLC suppliers were better oreasier programming (12 percent), faster PLC execution time (11 percent), andbetter technical support (9 percent). Copyright © ARC Advisory Group • • 11
  12. 12. ARC Strategies • November 2001 Which PLC? The User/OEM Struggle Who Determines Which PLC — The End User or the OEM? Both OEMs and end users were asked who they feel has the greater relative power in deciding which brand of PLC is used. Sixty-eight percent of re- spondents from all industries feel the power lies with end users to decide, while only 12 percent say that OEMs have this power. Finally, 16 percent think that balance of power is about equal. It s about the N ot s ure s am e 4% 16% OEM 12% E nd-us er 68% Who Has the Greater Relative Power in Determining Which Brand of PLC Is Used – The End User or the OEM? End users were asked which criteria determine the brand of PLC to be im- plemented in newly purchased machinery. Sixty-seven percent of end users indicated that they specify the brand of PLC to the OEM. Twenty-six percent stated that they use the most suitable PLC for the job, suggesting an empha- sis on the task at hand as well as some flexibility regarding brand. Finally, just 3 percent allow the OEM to specify the PLC. Machine OEMs are constantly faced with the following situation: What hap- pens when an OEM’s controls solution doesn’t match the customer’s house brand? How willing are end users and OEMs to accept or implement a dif- ferent PLC brand and accept the related consequences? What exactly are the consequences and costs of switching PLC brands? ARC asked both end users and OEMs how they would react in this situation. The results are interesting. A full 58 percent of end users would insist that the OEM implement the user’s specified PLC system. Just under half of these would strong-arm the OEM into converting the controls for free – the other12 • • Copyright © ARC Advisory Group
  13. 13. ARC Strategies • November 2001half would be willing to share some of the costs. Twenty-two percent areindifferent enough that they would accept the machine with whichever PLCthe OEM normally uses. The remaining 13 percent would look for anotherOEM with a similar machine that uses the desired PLC. 5% [4] 5% [5] 10% [3] 14% [2] 66% [1] Implement a different PLC but charge extra for the conversion [1] Not implement any other PLC regardless of the future business potential [2] Implement a different PLC for no extra cost, but ONLY if the business potential is high [3] Implement a different PLC at no extra cost even for one machine [4] Other [5] How OEMs React When an End User Prefers a PLC Different from the OEM’s SolutionOEMs are more flexible when it comes to implementing a different PLC tosatisfy a customer’s wish. A whopping 81 percent of OEMs surveyed wouldimplement another PLC. However, 83 percent of those willing to convertcontrols would expect the customer to share at least some of the conversioncosts. Ten percent would convert at no charge, but only if the future businesspotential were high enough. The remaining 6 percent would implement adifferent PLC regardless of how many machines they might sell. Finally, 14percent of all OEMs queried would stick to their guns and refuse an orderspecifying a different controls brand. Copyright © ARC Advisory Group • • 13
  14. 14. ARC Strategies • November 2001 4% [5] 13% [4] 32% [1] 24% [3] 27% [2] Insist that the OEM convert to my brand of PLC at some cost [1] Insist that the OEM convert the controls to my brand of PLC at no extra cost [2] Accept the machine with a different PLC [3] Buy the machine from another OEM that uses my preferred PLC supplier [4] Other [5] How End Users React When an OEM Does Not Offer Their Preferred PLC Solution How Many Different PLCs Should a User Support? Surveyed users were asked to indicate how many different brands of PLC they support. While the average is 3.3 brands, 23 percent of end users and a full 34 percent of OEMs support five or more different PLCs. However, users in some industries see this number diminishing. Pester Pac Automation, a packaging machine OEM, used to offer as many as 32 different PLC types to accommodate customer wishes. However, that number has diminished greatly in recent years. According to Stephan Remer, Technical Manager at Pester, “Specialized solutions combining mo- tion control with soft PLC logic, like PacDrive from Elau, have become the standard in the packaging industry. Even if it’s not their usual PLC, most customers accept this solution because they know it gives us the control we need to handle service problems in the future. If the customer requests, we can also install a PLC from Siemens or Allen-Bradley, but by using our spe- cialized solution, we’ve greatly reduced the number of PLCs we have to support.”14 • • Copyright © ARC Advisory Group
  15. 15. ARC Strategies • November 2001The situation is different in other industries, however. Automakers tend tobe loyal PLC customers, often working together with suppliers on newproduct development. Transfer machines, presses and other machines in thisindustry put fewer demands on PLC performance than the technology of thepackaging industry. five brands or one brand more 8% 29% two brands 23% four brands 15% three brands 25% How Many Different Brands of PLCs Does Your Company Use or Support? (End-Users and OEMs)Automotive OEMs are used to implementing whichever PLC is prescribedby the end user. “We’ve never had a customer ask us to recommend a con-trols solution,” commented Franz Melder, Manager of Controls Engineeringat Grob, a German machine tools OEM. “We implement whichever PLC thecustomer uses in his factory and charge extra for any additional developmentwork necessary”.Converting Controls: Who Pays the Bill?How Much Does a Controls Conversion Cost?OEMs with whom ARC spoke estimate that a controls conversion typicallycosts an extra 20 to 80 percent of the total controls labor budget, dependingon the extent of necessary hardware changes and software reprogramming.Many OEMs minimize their hardware changes in a conversion by using uni-versal remote I/O devices capable of communicating over different field rdbusses with nearly any PLC. Interbus-S was a popular 3 party system in the1990s, but many OEMs have now standardized on DeviceNet or Profibus. Copyright © ARC Advisory Group • • 15
  16. 16. ARC Strategies • November 2001 And as Ethernet-based field busses become more popular, many are looking at Industrial Ethernet or Profinet as future standards. While IEC 61131-3 compliance suggests that programs can be ported from the PLC of one supplier to another, OEMs tell ARC that this is still a dream and that software normally has to be completely rewritten. According to Hans Beckhoff, President of Beckhoff Industrie Elektronik, “Control software written on one platform has been optimized to work with that particular con- troller. Adapting software for another controller may compromise the quality and stability of that software. OEMs often lose money on such pro- jects because they underestimate the effort to convert, tune and optimize software”. 35% 32% % of responses (multiple answers possible) 30% 25% 23% Relay ladder logic Function block diagram 20% Sequential function chart Instruction list 15% 11% Structured text 10% 10% C or C++ 10% 7% Visual Basic 6% 5% 0% IEC 61131-3 Programming Languages Are Used by 87% of Respondents, But Users Complain that Program Portability Between Vendors Is Still a Dream Converting a complete controls system from the products of one supplier to another is expensive. PLC code must be rewritten and often in a different language. In addition, tag databases have to be either imported or newly created. For the most part, tag names have not yet been “extracted” from the hardware level, so hardware knowledge and careful coordination with ma- chine designers is still necessary. Inter-PLC communication is unique to the protocols of each supplier and must be completely reprogrammed when switching suppliers.16 • • Copyright © ARC Advisory Group
  17. 17. ARC Strategies • November 2001In engineering, new CAD drawings have to be created for the new supplier’scomponents. Technical personnel need to be trained in the specifics of every-thing from allowable cable lengths to heat dissipation requirements. Evenpeople in the purchasing department need to be made aware of the specificsof the new vendor. Finally, commissioning engineers need technical trainingto start up and troubleshoot the new automation systems. 25% Expected "fair share" of conversion costs 20% 22% 20% 15% 17% 10% 5% 0% All respondents OEMs End-users How Much of the Conversion Costs Should Be Shared by the Customer? Not Surprisingly, OEMs and End-Users Don’t Completely AgreeWhen conversion costs are to be shared, end users and OEMs differ slightlyin the fair share of costs to be assumed by the customer. The average fromboth end user and OEM respondents is 20 percent of the total conversioncosts. Not surprisingly, OEMs expect the customer to pay more (22 percent),while end users only expect to contribute 17 percent.Recommendations• For end users, standardizing on one supplier can cut costs, but careful consideration must be given to supplier selection. Users must consider the trade-offs between using the most technically suitable product for the application, minimizing the costs of supporting multiple suppliers, and the importance of local support and service. Copyright © ARC Advisory Group • • 17
  18. 18. ARC Strategies • November 2001 • Despite industry consolidation, OEMs are faced with the problem of hav- ing to support multiple PLCs to fulfill customers’ requirements. As a rule, the more complex the machine, the more likely a customer will ac- cept the OEM’s own controls solution. OEMs can ease their dilemma by rd using as many universal or 3 party components and limiting the cus- tomer’s choice to PLC hardware.18 • • Copyright © ARC Advisory Group
  19. 19. ARC Strategies • November 2001Analyst: David HumphreyEditors: Dick Hill, Chantal PolsonettiDistribution: All MAS ClientsAcronym Reference: For a complete list of industry acronyms, refer to our web Reference:page at Artificial Intelligence EPM Enterprise Production ManagementANSI American National Standards Institute ERP Enterprise Resource PlanningAPI Application Program Interface HMI Human Machine InterfaceAPS Advanced Planning & Scheduling IEC International ElectrotechnicalB2B Business-to-Business CommissionB2C Business-to-Consumer IT Information TechnologyBPR Business Process Reengineering LAN Local Area NetworkCAD Computer Aided Design MRP Materials Resource PlanningCAGR Compound Annual Growth Rate OEM Original Equipment ManufacturerCAN Controller Area Network OLE Object Linking & EmbeddingCEMS Continuous Emissions Monitoring OPC OLE for Process Control System PAS Process Automation SystemCMMS Computerized Maintenance PID Proportional Integral Derivative Management System PIMS Process Information ManagementCNC Computer Numeric Control SystemCPG Consumer Packaged Goods PLC Programmable Logic ControllerCPU Central Processing Unit ROI Return on InvestmentCRM Customer Relationship Management SCE Supply Chain ExecutionEAI Enterprise Application Integration SPC Statistical Process ControlEAM Enterprise Asset Management TMS Transportation Management SystemEC Electronic Commerce WMS Warehouse Management SystemFounded in 1986, ARC Advisory Group is the leader in providing strategic plan-ning and technology assessment services to leading manufacturing companies,utilities, and global logistics providers, as well as to software and solution suppli-ers worldwide. From Global 1000 companies to small start-up firms, ARCprovides the strategic knowledge needed to succeed in today’s technology driveneconomy.ARC Strategies is published monthly by ARC. All information in this report is pro-prietary to and copyrighted by ARC. No part of it may be reproduced withoutprior permission from ARC.You can take advantage of ARCs extensive ongoing research plus experience ofour staff members through our Advisory Services. ARC’s Advisory Services arespecifically designed for executives responsible for developing strategies and di-rections for their organizations. For subscription information, please call, fax, orwrite to: ARC Advisory Group, Three Allied Drive, Dedham, MA 02026 USA Tel: 781-471-1000, Fax: 781-471-1100, Email: Visit our web page at Copyright © ARC Advisory Group • • 19
  20. 20. Cambridge, U.K. Düsseldorf, Germany Munich, Germany Hamburg, Germany Tokyo, Japan Bangalore, India Boston, MA Pittsburgh, PA San Francisco, CA Visit for complete contact informationThree Allied Drive • Dedham, MA 02026 USA • 781-471-1000 • Fax 781-471-1100