An industrial automation system typically includes various components that work together to automate machinery or processes. The question asks which component is responsible for directly converting physical parameters into electrical signals. Let’s analyze each component:

1. Sensor: A sensor is a device that detects and measures physical properties like temperature, pressure, light, sound, etc., and converts them into electrical signals for further processing. This conversion is essential for monitoring and controlling systems in automation.
2. Actuator: An actuator converts electrical signals into physical actions, such as opening a valve or moving a robotic arm. It performs the physical operation based on the instructions received from the controller.
3. Controller: A controller processes the signals received from the sensors and makes decisions based on set parameters, sending commands to the actuators. It serves as the 'brain' of the automation system.
4. Human Machine Interface (HMI): An HMI is a user interface or dashboard that connects a person to the machine, allowing them to monitor and interact with the automation process. It doesn’t directly convert physical parameters into electrical signals.

From the above explanations, it is clear that a Sensor is the component that directly converts physical parameters into electrical signals for processing. Hence, the correct answer is:

Correct Answer: Sensor