You can see the full presentations from NCR and FMC attached, and the workshop output is also available as a powerpoint presentation, below are selected nuggets of information from the day.

NCR operate a Funnel system with a gate process. At any one time there can be between 50 to 100 ideas milling around in the funnel awaiting approval to get through gate 1 into the pipeline.

Once in the pipeline a project idea it is almost never cancelled.

The project selection criteria is driven by a number of considered business plans.

Firstly the corporation has a long range plan which attempts to position the company with respect to global market and technology trends. Add to this a sales and marketing business plan which includes much of the customer demand focus. They also have regular Portfolio Reviews which examine competitor activity and look outside of their current customer and application systems.

From this the company is working to polish the crystal ball and find the sweet-spot for product development. This includes the essential revenue stream maintenance, protection and growth of existing market shares and opportunities for growth.

The output of all of this work is the Line of Business Programme Plan which gives them a solid reason to accept or reject projects in the funnel.

One Fast-track way through the system is a Special Customer Engineering Request. These developments mostly come with an NRE charge and may still be rejected if they overlap with an existing NCR idea.

A surprising (to me) element of NCR’s development constraints is – to never change the software! We are used to endless streams of software updates for phones and PC’s etc. BUT NOT in the banking sector. Once a piece of software, which may include complex security systems, is proven to work and is fielded – it may not change for years. This makes a lot of sense to the customer and must be a real constraint to the engineers!

FMC operate a similar gate process system and also have more opportunities to look at than their pipeline has bandwidth to cope with. Gate 1 has three outcomes, GO, KILL and REVIEW. The latter is the maybe signal which requests more data.

The volume for new “Christmas Tree” oil pipeline manifolds is not large, coming in at 70 to 100 units per annum, manufactured at their Dunfermline base. However there is a significant increase in technology demand upon these systems. With operators now finding most “new” oil at much greater depth than the North sea, there is an increased demand for sea bed remote controlled technology. The demand for system metrics and sensors is driving new technology, such as optoelectronics, onto platforms which hitherto have mostly been mechanical. FMC’s new R&D group near Glasgow is the hub for these new designs.

What may be surprising to find is the gestation period for new technology adoption in the Oil and Gas markets. They are surprising conservative and cautious. It can take up to 8 to 10 years to bet a breakthrough for a new unproven technology. As well has the obvious health & safety and environmental aspects (as we see from the BP’s problems in the Mexican Gulf this week) the key driver is reliability and secondary costs.

The costs to put in place new equipment often hugely outstrip the cost of the equipment itself! With rigs costing $1.2M per day to rent it is not surprising that you can quickly rack up some huge bills. This is what lies behind the conservative approach. You must be absolutely sure of the functionality and reliability of equipment as the cost to replace or repair is enormous.

So one of the market specific constraints for FMC is that they need to prove to the nth degree that a new product is ready for deployment. This feeds back into the project selection criteria. For a “new” equipment to get the design go-ahead it must have a customer sponsor – i.e. a customer project who are willing to carry out field trials.

Often FMC will spend more testing and proving a product than they do on designing it!

With this input from FMC and NCR we then ran a workshop on just how to build a bullet proof business case. – See the attached powerpoint for the workshop notes.

GWW