Main Automation Contractors: Transforming the Automation Supply Landscape?

Published: 19 Feb 2008

By Shweta Shanker, Research Analyst

Previously, the Engineering, Procurement and Construction (EPC) companies were delegated with the tasks of Front End Engineering and Design (FEED), detailed engineering design, procurement of systems and final construction. An EPC company generally procured the process control solutions from automation vendors. More recently, however, the Main Automation Contractor (MAC) is a term which is becoming increasingly common in the procurement of process control systems or automation systems to meet the increasing demand for services and solution-based offerings from the end-user companies.

Chart 1.1 depicts the various stages in a project execution process


















The MAC concept implies the early and greater involvement of the automation vendor in the project execution process. The automation vendor now assumes the responsibility of coordinating the activities among the small supplier, system integrators and the end-user company. As the MAC is more actively involved in the project, this results in greater co-operation between the MAC and the end-user company, thereby bridging various gaps that existed previously when EPC companies held greater responsibility in projects.

Influencing the supply process dynamics

  • Many end-user companies are now suffering from a lack of in-house expertise for automation arising from cost-cutting measures. This has resulted in an increasing importance being given to services provided by automation vendors. Automation vendors are now being called for to meet the requirements of services through the lifetime of the automation solution.
  • The MAC is also in charge of providing optimal integrated solutions which meet the specifications and satisfy the requirements of the end-user companies. This entails the procurement of products from third parties, in addition to in-house products, and requires robust partnerships with system integrators or strong internal integrating skills to provide this kind of a best-of-breed solution. The automation vendor thus transforms from being a system supplier to a solution provider.
  • The MAC trend is expected to push the automation industry into a stage of further consolidation besides increasing the number of strategic partnerships that are formed within the industry to enable automation vendors to meet the growing demand of solution-based offerings as opposed to commodity-based offerings.

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