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Emerson's Green Mission Gains Momentum
China Daily, Dec 16 2008, Wan Zhihong
Emerson, the US-based industrial conglomerate, is the world leader in providing engineering services and innovative solutions for industrial, commercial and consumer markets.
With over 142,000 employees worldwide, Emerson operates from 263 manufacturing locations and markets its products in 150 countries and regions. The company's sales in fiscal 2008 amounted to $24.8 billion.
Emerson has eight business platforms: network power, process management, industrial automation, climate technologies, storage solutions, professional tools, motor technologies and appliance solutions.
China is among the fastest-developing regions for Emerson's business. Since 2002, China has been the second largest market for the company after the US. In November, the company opened its new Asia Flow Technology Center in Nanjing, capital of Jiangsu province. The center will significantly strengthen its presence in Asia-Pacific and enhance the capabilities to provide effective process automation solutions in the region.
Emerson Chairman, CEO and President David Farr spoke with China Daily reporter Wan Zhihong recently on the importance of the Chinese market and the company's measures amid the global financial crisis.
Q: Why did you build the new technology center in Nanjing and how do you expect your business to perform here?
A: Our new Asia Flow Technology Center will further expand our production capacity and services for leading flow metering and measurement technologies. Our products cater largely to the oil and gas, refining, petrochemicals, marine, life sciences, food and beverage, metals and mining, and pulp and paper industries.
The continuing infrastructure development and underlying growth rate has made Nanjing ideally suited for expanding our global network of manufacturing and support facilities in Asia-Pacific.
Jiangsu has become an important and strategic investment location for Emerson in China and we employ more than 1,300 locally. Apart from this we also recruit people from the local Nanjing universities for our other China businesses.
Q: How does the global financial crisis affect your business?
A: Today 70 percent of Emerson's sales come from the mature markets, which are the North American and European countries. The global financial crisis will cause a decline in sales and profits in some markets. However, we are still in a strong cash position, enabling us to make our own investments and decide our future.
We have gone through many such economic cycles in the last 100 years and have always been quick to readjust our strategy according to the situation. We will make all efforts to take advantage of the recent economic downturn for further growth.
Q: What measures have you taken to face the financial crisis?
A: We have made a full analysis of our new products, technologies and markets and focusing on ideas that can generate the maximum profit.
We are also eyeing some mergers and acquisitions, and in the coming few years we will work on it aggressively.
Q: How do you gauge the importance of the Chinese market, and do you have any other expansion plans here?
A: Emerson has more than 40 legal entities in China. We have 30 manufacturing facilities spread across 15 cities. The company has also established more than 10 engineering centers at various locations. In addition, Emerson has also been expanding and strengthening its Asian procurement presence.
China has become our second largest region of operations behind North America, with more than 38,000 employees in total. China has also become very important to us for many reasons: sales, innovation, manufacturing, and logistics.
We are optimistic about China's economic growth prospects, as well as its ability to take advantage of the latest technologies and the strong pool of local, well-educated talent. Together Emerson and China will continue to innovate, and this will continue to be a winning combination for both.
Q: China is now putting an increasing focus on energy efficiency and environmental protection. What is Emerson's contribution in this regard?
A: We are working closely with the Chinese government in this area. We are working with the government to develop new air-conditioning and heating systems that are more energy-efficient.
Our process management products are also utilized for environmental protection to minimize emissions of large projects in the country.
Q: Have you ever cooperated with the Chinese local government or central government on energy efficiency? Do you have any suggestions on this issue?
A: Emerson is actively involved in energy efficiency. We seek to employ innovative thinking and new technologies to help customers and our world use energy resources in more efficient, cost-effective, and environmentally sound ways.
We have also been working closely with the Chinese government and our local partners by sharing our best practices and making suggestions.
China is certain to benefit from technologies that can help reduce energy consumption. In December 2004, Emerson signed a memorandum of cooperation with the Standardization Administration of China (SAC) to cooperate on research, formulation and revision of energy efficiency standards and regulations, holding symposiums, as well as introducing key energy-efficiency standards. We also helped in localization of the regulations and best practices followed by other countries.
Emerson is also collaborating with the Chinese government to promote energy efficiency and conservation. Emerson Climate Technologies assisted the SAC and Chinese National Institution of Standardization to promote energy efficiency and public awareness of energy labels.
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