The Business of Automation

BH: Welcome to Enabling Automation. The show where we explore how technology, strategy and people are shaping the next era of manufacturing. I’m your host, Ben Hope. Today we’re looking at the business side of automation, how systems get sold, how decisions get made, and how companies are adapting to new economic realities. The automation industry is full of moving parts, machine builders, integrators, manufacturers, end users and producers, each with their own pressures and priorities. It makes for a complex ecosystem, but also one full of opportunity for those who can navigate it the right way. In this episode, we’ll explore what’s really driving investment today, how companies can position themselves for growth, and what separates the successful from the struggling in a changing industrial landscape. Our guest today is Eugen

Goidenko. Hello, Eugen. Thank you for joining us.

EG: Hey, Ben. Thank you for having me.

BH: Yeah. Could you, introduce us? As you said, my name is Eugen Goidenko. I have been in the automation business for I tried to look this morning for almost 20 years.

BH: Really? Yeah.

EG: Majority of it I spend in the CapEx world. So I worked for a company who manufactured automation equipment for almost 15 years. And then about four years ago, I switched to SuperTrak Conveyance, where I am today. And the role of Director, Automation Products Global, where my main job is to bring linear motion technology to all machine builders and integrators worldwide. So I think I have seen it from both perspectives. More from the machine builder side, now, more from the product side, and have had exposure really worldwide to hundreds of machine builders at this point. Very good. Very excited to be here.

BH: So we’ll dig in. And I think looking at the market and the current state of the market, and I think we’ve seen in automation a lot of changes in the last few years. We’ve seen dips, we’ve seen highs. How would you describe the current mood in the automation market right now? Are companies building, pausing or simply being cautious?

EG: Yeah, I would say simply being cautious is probably the most accurate way to describe it. I think right now we are, and not to sound too dark here, but we are in a lull for sure. I’m spending quite a bit of time over in Europe as well as in North America, which is two of my main regions I am in. And yes, you see most companies are trying to survive. There are a few exceptions to it. So if the machine builders specifically are in a niche market, they’re doing quite well. Certain markets are always stable. So it’s a mix. It’s not everybody’s doing bad, but not everybody’s doing good either.

BH: Yeah. Really keeping an ear to the ground and kind of identifying where the trends could be coming from and then digging in.

EG: Yeah, so what I have seen is the companies that I’ve seen doing well even in the current economic conditions, are those who are serving a particular niche. If they have some special technology, if they have special process in their equipment that they’re serving, they’re doing well because there’s not that much competition. The ones that are struggling, that are machine builders, who are doing a lot of similar things, like many others, where it’s hard to differentiate yourself. Right? Because in most industries you have big machine builders, medium size, and the small ones, the one who struggled most of the little guys right now simply because the big companies

are now going after every project as well. Smaller projects than they normally would. Yeah. Where in the past they would maybe not even bid on it. Now they’re going after them. And so there’s fierce competition, particularly in a medical device field as well as in automotive. However, the ones that are doing well too, are the ones that are using that time right now to reinvent themselves, are using their time to look for new opportunities, look for new processes, new application, new products, new markets that they can serve. For example, we have seen a transition of automotive equipment builders now going into the medical device fields and at the rates that I have not seen before. So there’s for sure some interesting trends that are happening in this industry.

BH: And then the idea of diversification, if you can, if you can be functioning in multiple different industries, you can kind of balance exactly and kind of outlive some of the lulls.

EG: Yeah, yeah. And then there also depends. So you have industries in the automation world that have a very high barrier of entry. Again, maybe it’s because it’s my home. But the pharmaceutical industry, it takes years to build up the reputation that would make you stand out in that field. So when the pharmaceutical companies, the users of the automation, they start noticing you and they feel they’re not taking a risk by purchasing your equipment. But to get there takes years. The barrier between automotive and medical device seems to be a lot lower, because maybe the requirements are not as strict. And so the automotive companies thinking, well, we can assemble an automotive component. The same processes really apply in medical devices as well. So that’s why I think there is this big shift. Other industries like packaging also there that takes years to develop this type of technology. We don’t see much transition into those either. Right? So it really industry dependent what is happening. And that diversification is also happening because of that.

BH: Interesting. I think that takes us to the kind of investment and what really drives investment in automation equipment, is it cost pressure, labor shortages, or is it something deeper than that?

EG: That’s a it’s a this is a complex question. So we’re looking at it from the perspective of the manufacturer of components?

BH: Yeah. Where the real kind of need or the demand for equipment is coming from.

EG: Yeah I think it’s multiple. And this trend has been happening for a long time now. I think number one, there’s constant cost pressure on the OEMs (Original Equipment Manufacturers). So they have to constantly produce product at a lower and lower cost because of inflation, because of many different reasons. So they are pushing the automation companies to make equipment that A. is cheaper in the first place, but also produces the product at a lower cost. I think that’s a big one. The second big one that also has been happening for years is simply shortage of qualified labor. The trend is to automate literally everything. The more you can remove the human from automation, the better it is, and it’s really not to replace the human, so to say, but because there is not enough qualified people who can actually operate those machines, they’re hard to find. They’re hard to train. There’s a big turnover.

BH: The turnover, I think is the hardest part.

EG: Yeah, the turnover is always very high. And so when you invest into a big piece of automation, I have seen both ways. I have seen companies who have very strong technician and they just run these machines 24/7 and no problem, something happens, they adjust the fix and it just runs. And then you see other companies that buy this massive equipment but don’t invest enough into their people. And then they’re struggling. And it doesn’t really matter how good the machines are. It’s just not run. So the pressure on the automation companies keeps being make it bulletproof, make it so to say the human cannot mess it up. Right? Any anybody can know. Exactly. Yeah. That anybody can operate that and bring more and more processes into this piece of automation. So you reduce the just the need for labor. But the reason for it is not like a lot of people say, oh, automation companies want to replace people by robots. That’s not the reason why they’re desperate for people. But because there is not that many. They have to automate. Automation is the only solution. That’s the only solution at the moment. Yeah, I would say those are the two main reasons for what’s going on. Okay.

BH: I think we’ve seen in the last few years that capital budgets or CapEx has tightened across lots of different industries. Yes. What separates companies that continue to invest from those that pull back?

EG: Well also there there’s a lot of nuances. Let’s group them together. I would say number ones, those who had a long vision for their companies, who, when they had the good years, actually were saving money and have a cushion. They’re using that cushion right now to invest into their business and use this time right now, where there is not this crazy pressure of having to deliver machines to actually make sure, invent and develop new types of equipment. But that is not something that, say, small companies can have. They typically don’t have that cash flow buffer to do that. The luxury to do that. Yeah, they just don’t. And so those are the ones who are struggling the most at the moment. We’re seeing in Germany in particular. This is just one of the markets I spend a lot of time in. We’re seeing bankruptcies, we’re seeing part time work, we’re seeing consolidation, sales happening, etc., simply because they don’t have enough money to stay open. And that’s, of course, a very difficult time. So the best place to be right now, if you do have the cash, is to invest into new technology, because sooner or later this trend will start going upwards and you want to be ready for it as well. You want to hit the ground running and be competitive. Right. And we have seen similar things with the SuperTrak. When I started almost four years ago, we had a fairly small number of clients whom we served. And now as the economy started going down, our leadership was very wise to invest into developing customers. So we’re using the time right now to present our technology to machine builders worldwide, explain the benefits of it, explain how they can use it and how it addresses their pain points, so that when the trend goes up. Now we have hundreds of companies worldwide who are familiar with our product, know how to use it and most importantly, know how it helps them to be successful. And that’s what we’re doing right now.

BH: And they perceive the risk to be a lot lower because now they’ve spent the time to get familiar with it.

BH: Exactly. Yeah, because they also have time right now when there’s not as much pressure on them to deliver machinery. Right? Yeah. Yeah. I think now looking at the industry in general and the industry is obviously very generalized, but I think the automation world can be a complex network of machine builders, integrators and users. How does that structure influence how business actually gets done?

EG:

This was actually the probably the biggest lesson for me when I switched from CapEx into the products world. Up until then, I thought that products is a catalog sales, right? You just go to a machine builder, you show them a catalog of stuff and they buy it and there are components that are actually sold like that. SuperTrak is a very complex platform. Complex in a way. It takes time to understand and learn it how to use that. And so with that, actually, we have seen that the number of stakeholders in our sales process is huge. Within the machine builder, there’s always multiple groups of people who all need to agree that our platform is the best platform. Luckily, for the most part they do. We have the additional complexity of the user of this automation equipment. So what we’re doing in our field, we’re doing two things. We’re trying as much as possible. Also speak to the end user and we explain to them the benefits for them for the next 10, 20 years of choosing our platform so that they tell their machine builder, hey, you should use a SuperTrak, because SuperTrak invented this technology. We’ve been in this business for over 25 years. We have a crazy number of machines out there. But the other part, what we’re doing is we’re providing a lot of tools to the machine builder so they can sell, so to say, our technology to their end user. So that’s the tricky part, right? We often don’t get access to the end user. And we have to sell through the machine builder through another party to someone else that I found in CapEx world to be simpler because there I was talking directly to the end user.

 Right. And as we part of ATS, but for them it’s somewhat easier because they just talk to the person who needs this machine. They understand why they need it, and then they are providing them the offer. We don’t have the luxury to talk to ultimate end user, so to say, yeah, yeah.

BH: And you can get to the point where you think you have a really good deal, and then the end user decides to go a different route and then it falls apart.

EG: So diversification right now is just critical.

BH: Yeah. It’s critical right now. From your perspective, are we seeing more collaboration across the value chain or more fragmentation as companies specialize like partnerships or things like that? Is the ecosystem actually turning into a true ecosystem or is it really just a bunch of islands trying to operate independently?

EG: It’s actually very interesting because if you ask me that, a year or two ago I would have said, no, there’s really nothing changing its operate. But actually over the last year I am noticing more and more focus on partnerships. And I’m not speaking about the traditional distribution. Right?

For example, North America, US, in particularly it’s a very distribution friendly region. So a lot of machine builders buy components from distributors and not from the manufacturer. Very common. Yeah. But what we’re seeing, what we’re seeing right now, that line that separates the machine builder and the supplier of components, it starts to shift, it starts to become less. I am machine builder. You my supplier, I just want here’s what I need. You sell it to me. And then until we meet again, it turns more into a collaboration and co-development. Almost of solutions and ideas that the component supplier like SuperTrak of really supporting and helping the machine builder to think deeper and really reinvent their products, their machines. Right. So yes, there’s a lot more collaboration going on as for example, we have publicized as of last year, we have now major partnership with Siemens, but we’re doing a lot of work with them, and we’re now seeing a lot more trend towards building partners, technology partners, partners with whom we co-sell, partners who maybe distribute our products, all different versions of partnerships. But it’s a big trend for sure.

BH: But rather than trying to do everything yourself, it’s easier to partner and let people play the positions that they’re good at. And you can focus on what you’re good at.

EG: Exactly. It’s what we have learned. If you select the right partner, it can help you to get access to companies, to industries that you simply did not have access before. And no matter how big you are, you still have only your sales team. And whether it’s five, 10 or 100 people, whatever it is, it’s still not limited to that. If you have ten partners, of which each of them have 50 salespeople. Now all of a sudden you have hundreds of salespeople worldwide promoting directly and indirectly your product. And so I think and this is very,  reciprocal of both ends. So that’s why I think the partnerships are the future. If it’s done right.

BH: How are customer expectations changing and what they look for from automation partners today compared to a few years ago, is has there been a change in how an end user approaches a machine builder or an automation partner, whatever you want to call it? Or is it really just the status quo?

EG: Specifically today and maybe for the last 6-12 months, it is a buyer’s market, right?The answer is yes. Yes. And the OEMs are using that to their advantage majorly. So what happens is you as a OEM, you have whatever product you want to manufacture, where in the past you maybe go to 1 or 2 machine builders, maybe the one you prefer with whom you have worked in the past, because they know that their market is slow down there now, going to five, six, at times we’re seeing ten companies fighting over the same project. And the reason what they’re doing it for is the reduction of price that they’re getting from it. Right. And so particularly tricky if the processes that they need or the component in their one to assemble manufacturer is simple, the simpler, the more machine builders who can do it, the higher the competition. So right now it’s absolutely the buyer’s market. They’re using it. They’re driving the prices down. So perfect time to be an OEM and actually invest. Buy some equipment.  Yeah. If you have the money right now is the time to do it. Because the discounts that you can achieve today, this is not something you would have seen a year ago or two years ago.

BH:  And the availability, like I remember during the peak of Covid. (Sure, sure.) Like the delivery time on automation was like 36 months. If we move on to now kind of sales and strategy.

EG: Oh, my favorite subject.

BH: Your favorite topic. Yes. In my experience, selling automation is unlike selling almost anything else long sales cycle, technical validation, multiple decision makers. What actually works in this environment? What do what do you find is the secret recipe? Well, let’s me break it down in a couple categories here. So the one you’re talking about would be there’s the CapEx. So the guys who build the automation. And then when you take the products, which is where I’m at right now, and this is what I’ve learned over the last four years, there’s two types of product, the ones that are more of a commodity. Those are pretty straightforward. And the reason why is because if you’re selling a motor, a pneumatic cylinder, a bolt screw, things like that, it’s kind of simple. Everybody knows how to use them. Everybody understands them. It does not require a tremendous amount of selling, so to say. Right. Because prices the difference. It pretty much it is, yes. Think about the robots. There is five robots manufacture. They’re all plus/minus the same. It’s really about which color do you like or with whom you’ve done best experience. And so really there is who gives me the best price and a reasonable lead time. That’s it. And then you pick one.However, SuperTrak and SuperTrak like technology is very different. We have a product that requires a lot of explanation, a lot of support, and it’s funny to see cycles. I thought originally, well, product shouldn’t take more than a couple months to sell. And actually what we’re seeing is quite the opposite. Our average sales cycle, from the moment we meet a machine builder, until they consider a project or win a project where a SuperTrak makes sense at a minimum is a year in some cases we’re seeing 2 to 3 years, very, very long. So really no different to a CapEx. CapEx is exactly the same. It all starts with a handshake at some trade show, right? You start talking, you start developing and waiting for that time when the OEM wants to launch a new program (Pulls the trigger.) has a new something, and that can take years, literally years. And then it’s got to go very quick. Same thing for SuperTrak. So it’s a very long term game that we’re playing, which why for us every customer is extremely important to us. We’re not a commodity. I know majority of our customers, they’re directors of engineering, by first name, right. Because we spent so much time with them and really understanding how can SuperTrak make them successful. And that takes time. It takes time. We’re doing an introductory presentation and workshops and proof of principles and simulation and you name it, all of that. That does not happen in your commodity sales. You don’t do that. You didn’t do any of that. It’s not necessary. And so it’s very similar to CapEx world. Right. Exactly the same approach as the CapEx we do we do with SuperTrak and SuperTrak like products.

BH: Looking at maybe some mistakes that companies make when trying to grow or scale in the automation space. Any insight into mistakes.

EG: So it’s definitely a balance. And I already can predict to you right now. And so right now we have automation companies struggling, right. The ones that are going to survive who have not been through this phase before. They’re going to have a second challenge coming to them in about a year or two when the industry turns around. And I’ve seen it specifically in 2009 and 2010, where those companies that sort of say were hungry for projects. Once all of a sudden the industry turns around, they would take on so many orders that they would simply implode. As a matter of fact, I read statistics somewhere in Germany that a ton of particular machine builders in Germany declared bankruptcy the year following their best sales year, because they just take on so much and then they realize, well, we cannot scale that quickly because automation world is a very complex one to hire people. Everybody starting with sales to applications, to engineering, operations, down to assembly, programing, validation, all everybody who is involved, those are highly trained individual with the right background, with the right experience. And so when you sell all of a sudden a whole bunch of these machines, but you simply don’t have enough people, that’s when they implode. You get a lot of trouble. So that’s definitely a mistake that can be avoided. But you have to be extremely discipline, which is hard after struggling for a couple of years not getting orders. And you dangle these huge carrots. And all of a sudden they’re just all there. Yeah, right. And everybody gets overfilled. And so that would be the next thing we’re going to be going to see. And I would say the second mistake that I have seen happening and again, my favorite market, Germany, me being German myself, I’ve seen in many times, is when the companies take too long to try out new technologies. Germans particularly are very known for having probably some of the highest quality machinery out there. Right. It’s just the fact. Yeah. However, we also have seen some of them disappearing because they would just stick to something that has worked 30 years ago, not thinking about what the future can bring. And with a typical German attitude towards it. Well no no no no no, we’ve been doing this for 30 years. It’s worked for 30 years. Why should I change? And the problem is, when you do that, when you have the type of attitude you simply losing out. And that’s what we’re seeing with SuperTrak being a very different type of transport system. And so when you go to these machine builders who have been building chain conveyors or dials that are simple to operate, have done it for a long time, and now there’s this magnetic moving thing with a whole bunch of software and data that they say, well, no, let’s stay away from it. You do that too long, you’re going to you’re going to be left behind.

BH: The disruption happens.

EG: It just happens whether you like it or not. I saw it happening with robotics. I started in the pharma automation in 2007 as an intern. And or 2000. Yeah, 2007. And I went to a first trade show that I was INTERPHEX in New York City and back then I think it was one machine builder who had a piece of equipment that had a Staubli robot on it, and people were like, we’re not sure about robots. The kind of scary new thing. You go now to any of the pharma shows worldwide, almost every single machine has a robot on it, and in most cases a Staubli robot on it. It took about 15 years, and those who don’t do that anymore, they’re left behind because now that becomes the new standard, which is where we seeing SuperTrak. So those are the two things don’t implode and take on too much. And then still constantly think ahead. Now don’t run out after every trend. I’m not suggesting that at all, but you need to invest a certain amount of time and money evaluating. Some of them.

BH: Have a healthy, innovative mind set.

EG: Exactly, exactly. That’s a great way of putting it. Yes.

BH: Okay. And moving on and looking at people and the overall outlook. And I know that automation is obviously driven by technology, but it’s still sold by people. And what defines a great sales person or sales culture in the field of automation equipment?

EG: Well, now we’re going to another few hours on this podcast to talk about that subject. Actually, I’m writing- no I’m not writing a book right now, but I really should. Yeah. So what defines that? So number one, for me, as I have built the team that we currently selling SuperTrak basically from scratch in in sales. And the number one priority when adding on additional member. And by the way, our team is probably the best sales team in the world, at least the one I have ever worked with, some of the greatest people. And I’m very thankful every day I get to work with them. It’s their mindset. It’s absolutely their mindset with which they’re approaching things. They are not interested in selling SuperTrak. As silly as it maybe sounds, what they are interested in is to solve problems for their customers. Think of them almost as a as consultants. So when they go to a customer and they start and building that relationship with them, they don’t look at them as a quick sale. They look at them as a partner almost with whom they want to work the next 10, 20 years, they’d really deeply understand their problems, their pain points, and helping them genuinely to decide when SuperTrak makes sense and when it doesn’t. And my team is well trained to tell them, customer no, this is silly. Don’t do that. It makes no sense at all. So that’s one thing. The mindset of being a consultant rather than selling.

BH: And I think I think from a customer perspective, when the salesperson says “No.” selling you something, that gives them a lot of credibility, (It does.) and respect.

EG: It does. That is the genuine right. So that’s one the second part of it is we have reversed my team speaks 30% in meetings and listens 70%, which is the right attitude to have. And no matter where you go, you know right away bad salespeople because all they do is I call it feature dump, right? When they just come and they just, oh, here’s my amazing product and look at all the features that it does. And you fall asleep after, what, two minutes and you walk away saying I’m never buying this. Deal We have one month in two years. It’s. Yeah. So my team has been very well trained to listen and focus on discovery so that the machine builder themselves,

in all the different roles, actually understand themselves what the problem is. And then we can jointly find a solution. But before you understand what the problem is, there’s no point on telling them all the amazing features of a SuperTrak, because they don’t even understand how this applies to them. And I would say last one, and this is important one, of course, in our world, like is the top three criteria is a very strong technical understanding. We’re not selling simple things here. It takes typical onboarding time. If you don’t have much experience with SuperTrak, we are looking at about a year of somebody who has already technical background, but requires this additional SuperTrak background.

BH: Commercial training.

RG: Yeah, commercial training and technical. On top of it, we have a fantastic technical support that we, that that,  our team provides to us. So we have the salespeople who communicate to the customer, and we have a technical sales support team who then can answer, let’s say, the tricky question. So we almost have like a multiple layer of technical support that we provide. We have the salespeople, we have the technical sales, then we have the engineering and then we have the innovation center. So we have a lot of layers. But you need to have the technical understanding, because if you’re sitting in front of a machine builder and you are telling him, hey, I want you to change the design of your machine and put it on a SuperTrak, you better come back it up, because it’s also engineers you’re talking to. You’re talking to engineers (They want the details.) that have been doing it for a long time. Right. If you’re making that statement. Yeah, yeah, yeah. So they’ve been doing it for a long time. And you are now trying to tell them you’re going to have to back it up. And you cannot answer every question with I don’t know. I’ll get back to you. Yeah. That works once twice, but not. It’ll be your first and last call. Exactly, exactly. So those are, I would say, are the three most important criterias I’m looking for when hiring a new person.

BH: And then looking ahead, what excites you most about where automation, manufacturing and the production of things are heading over the course of the next few years?

EG: I keep thinking about what that is. Right? My prediction? Let’s say, what’s going to happen. First of all, I think there’s going to be a more and more trend of lowering the cost of these transport systems of this linear motion technology. So it’s going to be seen in many, many more industries and machine builders of all size. For years, it was sort of maybe because of wrong perception was reserved to these big machine builders, big machine build a premium product, high end equipment. And so in quote, the only one who can afford having a SuperTrak line that is changing drastically. And so I think just like now you see a robot on every single machine out there, you will start seeing SuperTrak all of a sudden pop up in food industry and maybe beverage industry and cosmetics and chip manufacturing. Right. We’re already in medical device, we’re already in automotive. So a lot, a lot more. The trend we’re seeing, it’s now also utilized by a lot of small companies who traditionally maybe rely on more simpler technologies. Now they feel comfortable to actually use a SuperTrak. Then the next trend I think we’re seeing in general with other technologies coming out, that there is a trend for more compact while higher performance. So that’s a trend where we’re seeing, right? Kind of like what happened with the phones. If you recall what it was a 90s and 2000, right? The phone were giant at first and they were smaller, smaller and smaller, but more and more performance up to a certain level where we are today. And at a lower cost. And at a lower cost, right. So that’s what started happening. We’re going similar curve right now, with our technology and driven also by so many more people using it. Right. So that’s that. And then yeah, I really don’t know where else it can go. But we’re disrupting the industry. That’s what we do. That’s our DNA. So to say. And I’m really looking forward what our R&D, we have a huge innovation center led by amazing people and some really, really smart people working there. Really. I cannot wait to see what is going to be the next SuperTrak then these people will invent. Technology that’s coming. Yeah. It’s technology. They’re just obsessed with technology. I know everybody uses the word obsessed these days, but they are obsessed with technology.

BH: Very cool. Today’s conversation highlighted something I think is very essential that automation isn’t just about machines or motion profiles. It’s about how companies translate innovation into value and how trust becomes the real differentiator in a crowded market. The best automation businesses aren’t just reacting to market forces, they’re shaping them. They understand the strategy isn’t just about what you sell, but how clearly you communicate why it matters. So whether you’re building systems, integrating technology, or leading a team, the challenge is the same. Connect performance to purpose. Because in automation, as in all industries, clarity creates confidence and confidence creates momentum. That’s all for this episode of Enabling Automation. Thank you very much to Eugen for your insight and your time. If you found the discussion valuable, follow the podcast and share it with someone who’s helping move the industry forward. I’m Ben Hope and this has been Enabling Automation. Thanks for listening and we’ll see

you next time.

EG: Thank you Ben.