I first met Ray O’Connor during a visit he made to ABC Lasers in Brisbane. ABC Lasers is the Topcon distributor in Brisbane, and O’Connor is the chief executive of Topcon’s US subsidiary, Topcon Positioning Systems.
He is also a member of the executive committee of Topcon’s business unit in Japan, and therefore privy to strategic thinking in the company at the highest levels.
I looked forward to the meeting. It would be a chance to talk to the first senior Topcon executive to visit since the company announced its intention to merge with Sokkia earlier this year.
I was also interested in what Topcon publicity is calling ‘the mobile control market’ – essentially the application of its machine control and surveying technology to all forms of moving platform – including cars.
This latter development is significant, in particular because a large percentage of Topcon’s research and development in this field is happening in Australia.
Topcon Australia has 170 staff in Brisbane working on machine automation, in collaboration with 120 at the company’s Moscow Technology Centre. More people work on precision agriculture in Adelaide, and on the CivilCad software in Sydney.
The opening of the big, flash new office in Brisbane was symbolic of a lot that is going on in the industry. These are boom times for anyone with business in mining.
But there is more to it than just the mining boom – or even the performance of one company. Companies that supply survey equipment are, in general, reaping the rewards of a global shortage of labour, O’Connor says.
The price of surveying labour is rising dramatically. As a result, surveying companies everywhere are starting to weigh the investment in surveyors’ wages against the tools to make those surveyors more productive.
If Australian wages are rising faster than in other countries, it is because the two effects – rising demand and labour shortages – are reinforcing themselves.
Several things follow from this.
Suppliers to the industry are reaping a bonanza. Customers are prepared to pay a premium for new equipment, but only to the extent they can offer surveyors genuine productivity increases.
But the equipment suppliers face a dilemma. In order to offer such equipment, they need to invest in very expensive research and development – and charge appropriately. Moreover, the power of the new technology is not in new measurement equipment, but in mixing and matching all sorts of technology to suit a particular application. This requires a breadth of expertise that few, if any of them have developed. This, O’Connor says, is what fundamentally underpins the race for acquisitions that is sweeping the industry. Both suppliers and their customers need to be bigger so they can command the capital required to invest in equipment that makes them more productive.
It seems a done deal now that three supply companies have emerged from the ruck: Topcon, Trimble and Leica. Suppliers that are not in one of these three camps will find it increasingly difficult to remain viable.
This applies to both hardware and software. Traditionally, hardware manufacturers have been players in the survey software market. But all three of the majors have made major investments in imaging software recently. This ensures them a closer and closer fit between their imaging hardware and the imaging processors that make sense of the data.
To date, there has been less interest by the majors in the data itself, but this may be about to change. O’Connor says Topcon is in negotiation with data suppliers to aid its investment in Intelligent Transport Systems, although he declined to say which ones.
This emphasis on the productivity of surveyors is driving a profound change in the nature of surveying. ‘In any project of reasonable size, the surveyor is becoming a spatial data manager’, he said. It is not even clear that the typical site surveyor is employed to make measurements any more. For the most part, technology and cheaper field technicians can take care of that. The surveyor’s job is to decide what measurements need to be made.
However, one significant consequence of this is that external signs – such as stakes – no longer exist. It’s impossible for workers without access to this spatial data to detect an error. This means that the surveyor needs to be able to mastermind the presentation of data to other project team members. A dozer driver needs one kind of graphic and the site engineer needs another. It’s the surveyor’s job to know the difference.
The rewards can be remarkable. O’Connor notes that not that long ago, motor grader drivers required considerable expertise to keep the equipment on the correct line between two stakes. Now, an ordinary driver can move dirt with millimetre precision, given the right tools.
For the surveyor’s clients, the results can be exceptional. Better and more precise control of where things are means better control of the project itself. Projects move faster. Time means money, Contractors can earn millions of dollars by bringing in projects before time and under budget.
‘We are doing for the mining and construction industry what computer control has done for manufacturing. We make it possible to produce goods cheaper and faster. More importantly, we make it possible to do it better.
‘The only difference really is scale’, he said. ‘A manufacturer might use robots to build a device that is millimetres on a side. We are manufacturing devices such as roads that are measured in kilometres. The underlying philosophy in both cases is the same.’
Jon Fairall interviewed Ray O’Connor in Brisbane, 22 June.
