IA Insider: Automation and Control Automation Company Yokogawa Back On The Growth Track

Author / Editor: Nick Denbow / Dominik Stephan

The plan is ambitious: Yokogawa of Japan wants to become the global Number 1 in automation and control. The financial crisis stopped has put this undertaking to a grinding halt, but now the company is back on the growth track, says Nick Denbow of Automation Industry Insider.

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Yokogawa plans to become the global leading automation company. An ambitious goal - but the firm has a plan that is as ambitious ... (Picture: Yokogawa)
Yokogawa plans to become the global leading automation company. An ambitious goal - but the firm has a plan that is as ambitious ... (Picture: Yokogawa)

Industry Automation Insider is an UK independent subscription newsletter, providing industrial measurement and control systems users and suppliers with a monthly update on the continuing evolution and convergence of systems technologies. Now PROCESS Worldwide features interesting highlights from Nick Denbow, editor of IA Insider.

Shuzo Kaihori, president and ceo of Yokogawa Electric, has released a new business plan, detailing the Yokogawa aims and objectives through to the end of fiscal year 2015, and restating their long term vision and objective of becoming the global “Number 1 company in industrial automation and control”. This was a Yokogawa ambition that was first expressed as a ten year Yokogawa objective in the year 2000, but this was put on hold after their financial problems in 2008.

The plan presented by Kaihori is called “Evolution 2015”: he describes it as a ‘mid-term’ business plan, and with the parallel announcement of their financial results for the first half of 2011/12 it signals the emergence of Yokogawa from their period of “Consolidation and Structural Reform”, which followed the financial losses made during the years 2008/09 and 2009/10. This period has involved pruning and cut-backs in the Test and Measurement Division plus withdrawal from some T+M business areas, and a concentration of activities onto Industrial Automation and Control.

Financial History – The Day After The Crisis

Harry Hauptmeijer, president of Yokogawa Europe, explained much of this background at a user group meeting in Holland, which also launched their ISA100 wireless transmitters, back in June 2010. The 2009/ 10 results announced then had shown that total group sales had dropped 16% to 316Bn Yen (around US $ 3.4Bn). For the last full financial year, ie 2010/11, group sales recovered by 2.8% to reach 326Bn Yen (stronger exchange rates made this equivalent to US $ 3.9Bn), but the Yokogawa group had still made a nett loss, arising largely from some of the then remaining Test and Measurement business areas.

Current results – Back For Growth in Automation and Control

In the six months from April through to end September 2011, the first half of the financial year that Yokogawa refer to as FY2011, trading was at orders, sales and income levels above budget, and better than the equivalent period in 2010: they even achieved a positive nett income (US $ 9m) for the period, despite the strong Yen/Dollar exchange rate [Over the last five years the Yen has increased by 60% in value compared to the US Dollar].