daratechPLANT 2007—Impressions from My Desktop, Part III

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Industry News

daratechPLANT 2007—Impressions from My Desktop, Part III

by Susan Smith

The following is Part III in a series of articles covering news announced at daratechPLANT 2007.

In an interview this week with Patrick Holcomb, Executive VP of Global Business Development, Process Power & Marine (PPM) Division of Intergraph, he outlined the direction Intergraph is taking in PPM presented at daratechPLANT 2007, January 29-31 2006 and discussed how Intergraph is doing since they were bought by Texas Pacific Group.

AECWeekly: What’s changed since Intergraph was bought by Texas Pacific Group?

Patrick Holcomb:
Very little – within PPM we haven’t had a change of a single person or single position at all. The only changes we’ve experienced are at lower levels. We’re hiring aggressively across the board but are constrained by the market. The market for talented people right now is very tight in this industry, it’s a real challenge to get the right people.

In reality, Texas Pacific bought Intergraph because they thought it was undervalued in the market since it was kind of a technical and complex asset, and I think they’ll probably do what they do with all the other acquisitions: hold it and sell it in five to seven years. They have been very supportive of the Intergraph management team across the board. We’ve had no changes in personnel to corporate level, either.

We have more push than ever before to be more aggressive. Many roadblocks have been removed as far as doing more and larger acquisitions.

What is Intergraph’s current market position?

Patrick Holcomb: We announced at the end of last year that we had 31% top line revenue growth for the PPM Division. One of the things that was most important to us was the take up of SmartPlant 3D. We’ve been working on the development of 3D for several years, SmartPlant 3D is the newest innovation to hit 3D modeling and design for a couple of decades. We think that’s going to be a pretty big innovation for the market. We saw a 200% growth rate in 2006 from 2005 in 3D purchases, including software maintenance and revenue. Most of what we’re doing is increasing our productivity of implementation rather than just hiring more heads to do it the same way.

AW: What is Intergraph’s stand on ISO 15926?

Patrick Holcomb: We’re a big believer of standards. Intergraph is on the board of POS Caesar, which manages the creation of ISO 15926. We support that standard and many others. We have long been a supporter of standard database technology so that people can get data from their systems for all the other ad hoc requirements that maybe we haven’t thought of in our product.

Interoperability is an opportunity for us. A number of doors are opening in the industry. SAP is trying to re-invent themselves by embracing this NETWeaver technology. That’s opened a lot of doors for us, so we can offer clients better product-supported integrations in to their ERP systems. We’ve made a couple of announcements recently with DCS vendors and they’ve joined our SmartPlant Alliance program so that we can improve integration with the DCS systems.

AW: Does the introduction of Autodesk into the plant market impact Intergraph in any way?

Patrick Holcomb: We don’t have a lot of low level CAD business, most of our business is intelligent 3D modeling. We do schematics, for instance, we have a pretty substantial marketshare and success in the instrumentation design business, but none of that is done with CAD anymore, at least on large scale projects, not where you need a lot of productivity. AutoCAD is a great tool for what it does. We don’t see basic CAD platforms as being a big competitor to intelligent automated rule driven systems.

AW: What products were you showcasing at daratechPLANT this year?

Patrick Holcomb: SmartPlant Enterprise for Owner Operators (SPO) has had very good take up. Intergraph has very deep penetration into the operations and maintenance arena in the instrumentation space. We’ve had tremendous success in managing instrumentation data in the Owner Operator space, particularly for operating plants. Instrumentation data changes more than any other asset data in the plant, and what we’ve realized from that is there is nobody that occupies the box of engineer or technical asset data management in the plant. If you just look at the IT stack, that box is missing. If I asked you who the ERP is, you could tell me if I asked you who the maintenance vendors are, you could tell me, etc. but no one knows who the vendor is who supports the technical asset information. It tends to break down into a conglomeration of file cabinets, random pieces of paper and information in different systems, none of which are well designed to support it.

Instrumentation is a unique type of asset information representing anywhere from 30 to 40% of the total cost of a plant. Our SmartPlant Instrumentation tool has been very successful, and we think we can expand that and manage all of the technical asset or engineering data of the plant, really creating the concept of having the engineering information system as one of the pieces in the IT architecture that the CIO thinks about for a plant.

We had a client who said they had a 0.3 % increase in up time by deploying SmartPlant Instrumentation. 0.3% uptime on a $1 billion asset on an investment that was $1 million is not bad. They may have a margin that is in the range of a $1 million a day. That’s a $1 million a year. If they can cover not only instrumentation but the rest of their asset information, that could be very attractive. Since BP had a couple of explosions, now all clients realize the need from a safety perspective to have good integrity of their engineered technical asset information and they know there’s a lot of liability if you don’t.

AW: What other trends are you seeing in the plant process marketplace?

Patrick Holcomb:
There are a couple of minor trends on the technology innovation side, in addition to 3D and interoperability. We recently purchased Alias, whose flagship product Isogen set the de facto standard for generating automated isometrics. They had a couple of other new neat technologies which we’re launching: one called Spoolgen which allows us to get into the supply chain deeper. It’s a tool that’s integrated with the isometric generation capabilities of our products and many others, and allows fabricators to automate a lot of the detailing work they used to do. They used to re-draft everything and then do the detailing, welds, contact points, etc. It also allows SmartPlant Enterprise to better integrate into the overall supply chain and doesn’t isolate us just to engineering.

We have another product called SmartPlant Process Safety that allows us to automate HAZOPs. It really reduces risk for owner operators, because they have a standard way of doing HAZOP analysis. They codify a lot of rules, which makes them less dependent on an individual person. It reduces risk and also helps to address the owner operator’s problems with the aging workforce, who have important safety knowledge that could walk out the door when this workforce retires.

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