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Emerson Brings 'Project Certainty' -- Does It Promise Growth?

Emerson Electric Co. 's EMR operating arm, Emerson Process Management, has introduced a breakthrough technology - Project Certainty - to facilitate transformational enhancement in capital projects' implementation. The company's main motive of launching this advanced engineering-based approach is to aid its clients in attaining Top Quartile project performance via eradicating costs and trimming complexities.

Major Problems

Owing to a huge amount of large projects, companies operating in process industries like hydrocarbon and gas processing and oil and gas exploration and production are subject to lose billions of dollars on an annual basis. As per industry reports, more than 65% of projects (having over $1 billion worth) of such companies does not succeed yearly.

Mostly, in such cases, the companies had already raised their overall budget by an extra 25% or have missed the schedules by over 50%. Moreover, this loss continues to result in operational issues for the process manufacturers in the next year too. Such weak project performance could severely restrain the arrival of new investments for these companies.

Emerson's Solution

Emerson found that a project's engineering and design studies stage is the most crucial one for process manufacturers and defines the future course of action. Hence, Project Certainty begins during this stage itself to delineate project goals and strategies to meet them.

Designed to tackle the utmost project susceptibilities, Emerson's Project Certainty can greatly boost the project schedule performance via application of ground-breaking technologies such as pervasive wireless field instrumentation and Electronic Marshalling with CHARMs, among others. Through this high-tech aid, Emerson is aiding its customers' project teams in incorporating unavoidable last-minute design changes, devoid of its effect on the schedule.

Conclusion

We are impressed with Emerson's new tool strategized at improving project performances across its clients' businesses. This will go a long way in boosting its client base and top-line growth.

Troubled by certain business issues, Emerson Electric currently carries a Zacks Rank #4 (Sell). Reduction of customer expenditure in the oil & gas market and appreciation of the U.S. currency had adversely affected the company's earnings and revenues in second-quarter fiscal 2015. Moreover, the company anticipates these issues to persist and continue affecting its financials in the upcoming quarters.

Nevertheless, investors interested in the Mechanical-Electrical industry may consider better-ranked stocks like CUI Global, Inc. CUI , Energous Corp. WATT and Powell Industries, Inc. POWL . All of these carry a Zacks Rank #2 (Buy).

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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