A call for systems integrators

OEM component vendors must form closer relationships with systems integrators who add value by creating systems for end users in many markets.

by Andy Wilson
EDITOR
andyw@pennwell.com

It's a very sad but true analogy. The telecommunications/networking industry now resembles a critically ill patient who is not expected to recover any time soon. Although a once-booming industry based on the "World Wild Web," its promises of high-speed fiber-to-the-home information, numerous television channels, and get-rich-quick plans have evaporated.

No longer are communications companies shipping millions of boxes a year to dot.coms. Because fewer companies are ordering products, fewer products are being manufactured, and fewer products are being inspected and assembled. The ripple effect of this scenario for the automated machine-vision industry has been severe. Machine vision once held the promise of replacing expensive, unreliable, and ineffective human inspectors. But with the telecom industry suffering, the promise of installing more and more machine-vision systems has dimmed.

During the boom of the telecommunications industry, many managers at machine-vision companies sought to rapidly penetrate this market with manufacturing-automation products. At some companies, millions of dollars were invested in developing systems, showing them at telecommunications-related trade shows, and advertising them in various trade publications.

Unfortunately for these companies, the business boom-to-bust cycle was short. Products that were awaiting purchase orders were suddenly cancelled as the market plummeted. The old adage—"don't put all of your efforts in one market basket"—was overlooked. The result is that many of these companies are now in dire financial straights, looking for buyers, achieving notoriety through NASDAQ delistings, or close to filing for Chapter 11.

Another old adage says diversification is the key to success. Stocks, cash, bonds, and mutual funds should be held in proportion by investors. If one segment rises, another will most likely decline. Fortunately, many OEM suppliers in the machine-vision/image-processing industry followed this model rather than chase elusive telecommunications butterflies. By diversifying into industrial, medical, automotive, packaging, semiconductor, scientific, electronics, and other markets, these companies—although still markedly affected by the economic downturn—are still in business.

Unfortunately, deciding on how to proportion the market pieces of the imaging pie proves a difficult task. Companies who invest too heavily in one area, such as semiconductor inspection, may do better in boom years, but stumble when such markets decline.

To maintain profitability, OEM component vendors must form closer relationships with systems integrators who add value by creating systems for end users in a number of different markets. Simply having sales representatives scattered all over the world is no longer a guarantee of success. By developing such relationships, systems integrators provide a pull-though effect with which a number of different products—cameras, frame grabbers, software, process-control systems, networking components, and computers—are bundled into a completed system. What's good for a camera vendor, therefore, may also be good for a software vendor.

Global directory needed

However, finding skilled systems integrators is a complicated process. What is needed is a global systems-integrator directory—one that lists companies by countries, regions, or states, lists their accomplishments, and describes their capabilities.

This directory would be useful for both OEM vendors and end users who want to commission a systems integrator to develop a networked, computer-based, automated, machine-vision-inspection system. The result would stimulate the machine-vision industry.

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