Changing world market for water - the ITT approach

Strategy behind ITT's growing Asia-Pacific presence blends keen sensitivity to the geopolitical coordinates of each country with ambitious yet realistic business goals for the benefit of all players.

You've probably heard the statistic before: Asia is home to roughly 60 percent of the world's population, but it has less than 40 percent of the planet's usable water supply.

In particular, the vast nations of China and India, with 1.3 billion and 1.1 billion inhabitants, respectively, face unprecedented water management challenges as they attempt to integrate a burgeoning industrial base with daily human activity, much of it still tied to agriculture.

For ITT, the opportunities for leadership are legion, and indeed these emerging markets rank high on the corporate priority list, with approximately USD 50 million in spending on the agenda over the next three years.

These numbers supplement existing investment in new plant construction, which is about to dramatically raise the company's profile in the region.

The strategy behind ITT's growing Asia-Pacific presence blends keen sensitivity to the geopolitical coordinates of each country with ambitious yet realistic business goals for the benefit of all players.

For example, in China, where government recognition of the inter-relationship between development and public health is widespread, the company's water and wastewater pump systems already figure prominently in ongoing infrastructure initiatives, such as the Three Gorges Dam and the South-North water diversion project.

First-generation manufacturing plants that came on-line in the last century - many the result of joint ventures or acquisition, are ready for replacement in order to meet future standards for efficiency and competitiveness.

In India, by contrast, the large-scale building of roads, power grids, and wastewater treatment facilities is only now getting underway.

The government has projected roughly USD 300 billion worth of improvements through 2014.

In 2006, sales of ITT products to Indian customers, primarily HVAC pumps, wastewater pumps, and electronic connectors, hit the USD 10 million mark, highlighting the magnitude of opportunity ahead.

In 2007, ITT's Residential and Commercial Water business opened its first regional office in India, in New Delhi.

Attending the September inaugural ceremony were ITT China President Bill Taylor and corporate Senior Vice President and Chief Technology Officer Brenda Reichelderfer.

Pointing to the tenfold increase in business in the region over the last three years, Reichelderfer underlined how vital the country is to ITT's future in South Asia.

The company has taken advantage of its experience operating in both countries to plot a targeted growth trajectory.

The most promising markets for Fluid Technology in China focus on water supply and treatment for infrastructure projects, commercial buildings, and industrial applications like mining.

ITT has just cut the ribbons to two world-class manufacturing plants that will replace the existing Water and Wastewater site, producing submersible drainage and sewage pumps in Shenyang, in the Northeast; and the Residential and Commercial Water and Industrial Process site in Nanjing, half of whose output will be shipped to global customers from ports 200 miles to the east.

Both new facilities incorporate "green" practices, such as the use of water-based paints that reduce harmful emissions and ITT water treatment technologies that get as close as possible to total water re-use and zero wastewater discharge.

A new research and development center, also at the Nanjing location, will be the hub of aggressive efforts to tailor existing (and future) products to the country's exploding value market.

This approach reflects a broadened emphasis on localization, as the oft-repeated phrase "manufactured in China, for China" suggests.

The next generation footprint is complemented by the ITT headquarters, Industrial Process, and Water and Wastewater complex in Shanghai, the PRC's largest city (population: 18 million), with its booming economy and vibrant port.

ITT's relative newcomer status in India prompted a detailed study to identify a manufacturing site combining the requisite infrastructure capabilities with an optimal pool of human resources.

The choice was Vadodara (formerly Baroda), in India's western-most state, Gujarat, bordering the Arabian Ocean.

This city of more than 1.6 million is a pivotal junction for major roads and railway lines, the legacy of its role as an ancient gateway.

Its history of industrialization dates back to the 1960s.

Construction is wrapping up on the Vadodara assembly plant, which will manufacture products for two ITT value centers prime for growth: Residential and Commercial Water and Industrial Process.

As in China, the facility will operate in tandem with a new research and development center, also in progress.

This one will house teams of Motion and Flow and Fluid Technology engineers, often working with local partners, providing flexible engineering services for other ITT design centers around the world.

Commenting on these emerging markets in early 2007, ITT CEO Steve Loranger noted, "By the end of this year, our profile in both India and China will look much different than it does today".

When the next step arrives and product rolls off the assembly lines, the change will be visible to all.

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