1. Electronic Controls and Communications

2. The Global Challenge Of Strategic Standardization Management Alec McMillan Rockwell Automation Director, Global Standards & Trade March 23rd 1999

3. 2 Agenda Who is Rockwell Market Trends International Standards, and One-Standard-One-Test-One-Mark Components Of A Standards Strategy

4. 3 An electronic controls and communications company holding leadership positions in its global markets Industrial automation controls — #1 in North America Avionics & communications equipment — used by every major airline worldwide Leading supplier of customer call center systems Rockwell

5. 4 A Family of Brands More than 350,000 industrial control and system solutions Additional 150,000 motor- and control-based solutions Mechanical power transmission equipment Programming, man-machine interface, communication and component software solutions

6. 5 Power Generation Water/ Wastewater Packaging Applications Semiconductor/ Electronics Material Handling MetalsPharmaceuticals/ Health Care Transmission/ Distribution CementHVACTransitFood & BeverageMachine ToolEntertainmentMiningPackaged Goods AutomotiveOil & Gas/HPIFibersTires PrintingForest Products Wide Range of Industries

7. 6 Hierarchy of Rockwell Participation TC AG SC WG SC MGMT STANDARDS OVERSIGHTCommercialParticipation WRITING OF DRAFT STANDARDS Technical Participation WG TF WG First Priority Only when commercially justified

8. 7 Important Benefits Important benefits to Rockwell available only through participation in the standards and certification processes worldwide: Uninterrupted product flow Prevent product obsolesce Determine the content of the standard by influencing the definition of: Intended purpose Conformance criteria - Certification Early warning technology transfer & market cooperation Rate of standards development And, as described in to IEC/ISO Guide 2, determine the attributes of the standard by influencing standard content on subjects of – Variety control Interchangeability Compatibility Economic performance, Usability Mutual understanding Trade, removal of NTBT Protection of the environment, Health and Safety

9. 8 Public Standards Participation SCC ASTM NCMS ISO IEC EIA IEEE ISA ANSI NARM CANENA NEMA NFPA U.L. EEMAC CSA BSI VDE DIN CELELEC

10. 9 Resource Deployment

11. 10 Agenda Who is Rockwell Market Trends International Standards, and One-Standard-One-Test-One-Mark Components Of A Standards Strategy

12. 11 Some Key Trends & Forces Products & Technology –Open System and System Accessibility –Merging Technologies –Integrate control and information –Integrate communications - -LAN/WAN wire and wireless –Focus shifting from products to solutions Product Regulations & Market Needs –A standard is only as good as the market it protects –Intentional restriction of Conformity Marks availability –Trade Agreements and Customs Unions controlling product flow –“Worse regional case” will become global minimum –PAC-Rim and LA are maturing their regulatory systems

13. 12 Some Key Trends & Forces Regionalization of Trade is increasing (representative listing): –Mega-Regions: APEC, FTAA –Multi-National Regions: EU, MERCOSUR, ASEAN –Inter-regional Agreements: MERCOSUR and EU

14. 13 Some Key Trends & Forces Expanding Markets - Western Hemisphere & Pacific Rim –Opening of previously closed markets (e.g., Mexico, China) –Largest market growth potential Regionalization of Standards Activities is Increasing –Each regional trade group has at least one regional standards group –MERCOSURMERCOSUR Committees –EUCEN, CENELEC, ETSI... –NAFTANAFTA Committees, CANENA IEC Continues to be Perceived as Euro-Centric

15. 14 Some Key Trends & Forces Increasing Demand for Bilateral (trade) Agreements –Most common is the recognition of certification systems MRAs –Only in EU under regional control –Many use template (e.g., APEC) Proliferation of 3rd-party Certification –Proliferation of regional/international accreditors of certification schemes –Proliferation of national 3rd-party certification schemes –Proliferation of national product conformance marks

16. 15 Enhancing Market Share Opportunities What standards should the product comply with? What technology meets the standard? What standards should the process follow? What tests are required to self- certify per conformity rules? What regional marks are needed? What are the safety-related system standards? Are there region specific regulations? Prefers a safe, reliable, high-quality, cost- effective product that meets industry standards ! Marketing Design Engineering ManufacturingCommercial Services Quality Assurance System Integrators Regulatory Environment Customer

17. 16 Standardization Across the Supply Chain Safety, Environmental, and Quality Standards Material, Component, Design, Manufacturing, and Distribution Standards Electronic Commerce, Customs, Marking, and Other Regulatory Standards Product, System, Application, and Industry Standards Component & Equipment Suppliers to Automation Vendors Materials & equipment Components & Services Automation Vendor Products & Services Customer Products & Services Raw materials, fuels & equipment Raw materials & fuels Utilities, Equipment & Materials Suppliers Supplier of Automation Products Consumers Users of Industrial Automation Products

18. 17 Agenda Who is Rockwell Market Trends International Standards, and One-Standard-One-Test-One-Mark Components Of A Standards Strategy

19. 18 International Standards WTO definition by international trade –Definition by trade use –Not by source of standard, name of SDOs Single standard solutions do not reflect reality Need for regional and national ability to make deviations and common modifications (for health, safety, environment) Withdrawal of national conflicting standards Considering the actual commerce in world trade - - Why can’t the IEC adopt the de jure and de facto standards existing in other nations and regions of the world?

20. 19 One Test, Suppliers Declaration of Conformity and One Mark One “international accepted” standard One Test means executed once, accepted everywhere Supplier’s Declaration of Conformance includes choice of 3rd party test and certification –Objective to minimize government involvement –IECEE CB Scheme can be altered to facilitate the one-test-one- mark operating as a full, global Conformity Assessment scheme that is recognized and used in both none-regulated and regulated product verification. One Mark requires certification records be maintained in a public file, may also be on/with the product

21. 20 Agenda Who is Rockwell Market Trends International Standards, and One-Standard-One-Test-One-Mark Components Of A Standards Strategy

22. 21 Strategy Definition Key Customers, Markets, and Business drivers Objectives and Approach –By Industry –By Business –By Technology Assess current standards position –Business focus ( strategic, operational/tactical) –Success factor (critical, necessary, nominal) –Standards Participation (lead, influence, observe) –Standards Participation Investments ( time, expenses) Business Plan Integration –Impact areas- product, process, procedure –Key benefits and risks –Near term and long term plans