Risk & Innovation Small Companies in Six Industries: Background Papers Prepared for the NAE Risk and Innovation Study (1996) / Chapter Skim
Currently Skimming:
5 Environmental Testing Laboratories and Instruments
5 Environmental Testing Laboratories and Instruments
Pages 83-108
The Chapter Skim interface presents what we've algorithmically identified as the most significant single chunk of text within every page in the chapter.
Select key terms on the right to highlight them within pages of the chapter.
From page 83... ...
Richard Lynch is a financial/market analyst with Wade Miller Associates. This paper was prepared for a March 21-22, 1994, workshop on small companies in environmental testing services and instrumentation held by the National Academy of Engineering at the Beckman Center in Irvine, CA.
|
From page 84... ...
Individual lab instruments have possessed computer control and data collection capabilities for some time, but the next step of integrating these instruments into laboratory de infonnation networks is only now beginning. The purpose of this background paper is to: provide an overview of the environmental testing laboratory industry; discuss likely future trends in testing technologies and methods; and provide a framework for discussing the implications of these technological trends for Be industry.
|
From page 85... ...
Industry growth accelerated with the introduction of the first two major pieces of environmental legislation that caged for extensive analytical testing: the Federal Water Pollution Control Act amendments of 1972 (now referred to as the Clean Water Act, or CWA) and the Safe Drinking Water Act of 1974 (SDWA)
|
From page 86... ...
and the Department of Energy (DOE - have developed slowly. Declining unit growth rates, in combination with an excess of analytical testing capacity' have tile erred prices and nrnfitahilitv in the laboratory industry over the past several vears As a result, technological advancements in instn~mentation have become increasingly focused on incremental improvements in operating efficiency and ease of use.
|
From page 87... ...
As will be discussed in greater detail below, this proposed merger may be the first In a series among the largest lab companies. The analytical instrument industry is much less fragmented than the laboratory industry, and it is also very much agiobal industry.
|
From page 88... ...
The sites that pose the most urgent threat to human health and the environment are placed on He National Pnor~ties List (NPL3 and are the responsibility of the EPA Superband program All other sites, referred to as non-NPL, are the responsibility of the Superfimd programs of He various states. Abandoned hazardous waste sites on federal property are handled by the agencies involved.
|
From page 89... ...
separate titles that significantly broadened air quality regulations. The four titles Mat wig have the greatest impact on demand for analytical testing services are: Able ~ (Nonanainmen0, which increases enforcement activities for AQCRs ~ are out of compliance with air quality standards; Tifie R7 (Air Tonics)
|
From page 90... ...
Medium-size lab companies, on the other hand, tend to specialize in regional, niche markets where pricing pressures are not so severe. Customers within these niche markets, which mainly consist of smaller manufacturing companies dealing with wastewater or hazardous waste regulations, tend to focus on customer service issues when deciding which lab to use.
|
From page 91... ...
such as Amp, sample preparation, and companion of - r customer data reports trom raw data These inefficiencies become more apparent as the size and complexity of lab operations grow and are, therefore, more noticeable in the large laboratories. Reducing costs and increasing the flexibility, speed, and responsiveness of analytical testing are perhaps the key immediate challenges facing environmental testing laboratories today.
|
From page 92... ...
and He role that the states would play in such a program. The laboratory industry is unlikely to support a national accreditation program unless the new system replaces the current hodgepodge of state certifications.
|
From page 93... ...
The biggest market for analytical testing services under RCRA is related to the Subtitle C "cradle-to-grave" regulations governing hazardous wastes. Subtitle C testing includes characterization of hazardous wastes at various stages of generation, transport, storage, and treatment.
|
From page 94... ...
However, new technologies and new applications for easing technologies have emerged and win continue to grow in importance. For example, as a greater number of complex, nonvolatile, and polar organic compounds are regulated, the limitations of GC and GCIMS methods for these analyses is requiring He increased TABLE 1 Major Types of Environmental Analytical Instrumentation Analyte Typical Instrumentation Used Level of Completed Water (for pH, turbidity, etc.)
|
From page 95... ...
The lethargy of the laboratory industry in adopting this technique can be traced ply to a lack of "approved" analytical methods for water and wastewater analyses that make use of the technology. SPE is starting to become widely accepted now only because the manufacturers of _ _ =, _ ~ .# .
|
From page 96... ...
In light ofthis, the three technology trends that are likely to have the biggest impact on the industry over the next several years are: improved information management systems; increased automation; and increased use of portable field-testing technologies. The significant expansion of air testing activities that USA eventually come about as part ofthe 1990 amendments to the Clean Air Act wiD also assist In accelerating the pace of innovation in environmental testing.
|
From page 97... ...
~ addition to sponsoring research projects, the EPA is currently developing a series of guidelines for laboratory automation called Good Automated Laboratory Practices (GALPs3. The GAL`Ps, which are now being finalized, should stimulate labs to increase the pace of automation by removing some of the uncertainty about what constitutes acceptable automated procedures.
|
From page 98... ...
As field testing technologies continue to improve, however, and as regulatory authorities continue to become more flexible in considering alternative technologies, the advantages in hex~bility and cost offered by field testing are likely to result In increasing maricet share for these systems. Several different types of field testing technologies are being developed.
|
From page 99... ...
Even when the reference methods are intended for guidance purposes, however, environmental laboratories are loathe to stray even in the tiniest details from the methodology because of fear that the data, if 99
|
From page 100... ...
As a result ofthese two factors, there is usually a lag of 5 years or more from when new analytical methods are developed to the point where they are implemented by environmental laboratories. The industry, therefore, is usually using methodology that is one to two generations behind the state of tile art.
|
From page 101... ...
MAJOR CHALLENGES FACING Tog; ENVIRONMENTAL TESTING INDUSTRY The environmental laboratolv ~ndust~v has been in a nenod of consolidation and intense ~ ~ ~ ~ -A r compe~at on since revenue growth rates began to plateau in 1988-1989. At the industries peakin the late 1980s, there were approximately 1,800 commercial environmental labs.
|
From page 102... ...
over the past few years. The laboratory industry, on the whole, appears to have a cost structure that is too high to maintain adequate profitability in the current pricing environment.
|
From page 103... ...
A critical paradox of the laboratory industry over the past several years is that customers and regulators have demanded ever-increasing quality from providers of analytical testing services (primarily because ofthe need for the data to be legally defensible) , but they have not been willing to pay higher rates to those labs with the most stringent QA/QC procedures.
|
From page 104... ...
Because industry revenue growth will probably continue to be relatively modest, the primary route for labs to become larger quicldy in coming years is likely to be through mergers and · · — acquisitions. It is somewhat Tore that computerization and automation wiD be playing such a pivotal role In the restructuring of the laboratory industry, because the advent of computer-controled instrumentation is pardy responsible for the glut of analytical testing capacity that currently plagues the industry.
|
From page 105... ...
This is a natural policy evolution. The most Vagrant problems that the major environmental laws were originally designed to correct-such as the release of raw sewage directly into waterways and the ~nappropuate disposal of hazardous wastes~are now largely under control.
|
From page 106... ...
All of these tasks will be made easier for labs as information management systems' automation, and field testing are further developed. Financial strength is a key issue for environmental laboratories.
|
From page 107... ...
As past of that agenda, the environmental lab business wild be forced to provide a higher quality product at a substantially lower price. The effective application of technology to improve productivity and increase flex~bilXy will be a key factor In reaching those objectives.
|
From page 108... ...
Table 2 represents one potential model for the laboratory of tomorrow. One thing is certain: The environmental laboratory industry win be undergoing continuous radical change in coming years as environmental markets continue to evolve.
|
Key Terms
This material may be derived from roughly machine-read images, and so is provided only to facilitate research.
More
information on Chapter Skim is available.