By Candace Stuart
Small Times Senior Writer

OXFORD, England, Sept. 4, 2001 – Companies that specialize in microsystems need to look beyond their technical strengths if they hope to survive in today’s global marketplace, analysts said Monday at an international conference on commercializing microsystems being held here.

They also said that companies must develop business expertise and an understanding of their customers.

“Most companies are technology driven,” said Henning Wicht, founder and general manager of Munich-based Wicht Technologie Consulting. “They don’t have experience in management or a marketing background.”

Wicht was one of 33 speakers to discuss the status and future of the microsystems industry at the sixth International Commercialization of Microsystems conference in Oxford. The three-and-a-half-day conference, which kicked off Monday, offered a global perspective from chief executives and analysts, and drew more than 100 attendees from as far away as Australia, Japan and the United States.

Increases in the number of MEMS suppliers, startups and acquisitions of MEMS companies, plus growing interest from corporations such as Intel, IBM, Philips and Samsung, indicate the industry is maturing, said Sean Neylon, chief executive of Colibrys SA in Neuchatel, Switzerland. But some companies risk falling behind in this competitive arena for lack of skilled business managers who can serve both the company and its clients.

“You need business management to succeed,” he said. “You need someone with competence to understand the competing forces in the marketplace.”

Neylon has been credited with giving Colibrys a strong business thrust, particularly since its spin-off from the university-industry partnership CSEM SA (Centre Suisse d’Electronique et de Microtechnique) on Jan. 1. The company raised $12 million in venture capital funding this summer to continue as a supplier of MEMS optical components and accelerometers.

In a study on MEMS startups in Germany, Wicht identified key criteria for success, starting with a clear product idea and means of production. Many companies founded by engineers and scientists meet those criteria, he said, but some then fail to analyze the competition and take steps to protect their intellectual property.

Like Neylon, Wicht found companies may succeed in developing a working technology but then struggle as they negotiate the business world. Both agreed that companies need to attract employees with some marketing and management experience to take them to the next level.

Neylon said a business leader must function both within and outside the company, understanding the company’s core competencies and fostering teamwork, but also scouring the industry for potential competitors and clients.

Most venture capitalists and other funding sources will require sound business leadership before investing in a company, Neylon said. “Investors will look at the team and if they don’t see someone to follow the business forces” then they will be hesitant to invest, he said.

Neylon recommends that companies with weak business operations use recruiting services or even contact investors and banking institutions for guidance.

Obtaining seed money or venture capital is another key to success, Wicht found, as well as a strategy for communicating about the company and its products, disciplined product management and a vision of how the company should grow.

“You can do a lot of things, but you have to focus on one, two, three products,” he cautioned.

Wicht has a background in industrial engineering and worked for a company promoting microsystems technologies before starting his own consulting company. For his doctoral dissertation in economics, he analyzed MEMS startups and continues to study the industry.

Microsystems and MEMS companies will need to serve their customers better as the industry matures and competition heats up, analysts said.

“Entrepreneurs tend to neglect their customers and recognize they are globally dispersed,” said researcher Ingrid Wakkee. “They tend to neglect the fact that cultural differences are still there.”

“But remember, you won’t be the only provider forever.”

She recommends learning something about the client’s business culture – is it informal, with parties using first names immediately, strictly formal or something in between – and perhaps making an attempt to speak in his or her language.

Wakkee is a Ph.D. candidate who studies marketing strategies at the University of Twente in the Netherlands. The university was founded in 1961 as an internationally oriented research institute that focuses on entrepreneurship.

“It’s an issue of perspective,” said J. Malcolm Wilkinson, managing director of Technology for Industry Ltd., a consulting company based in Wilburton, England. His company specializes in MEMS manufacturing and applications. “They’re looking for ways to exploit the technology, but not from the user’s point of view.”

Wilkinson singled out the medical market as a potential bonanza for the MEMS and microsystems companies that can offer everything from a $5 stent in a $1,000 catheter system to complex labs-on-a-chip for diagnosing cancer.

“You shouldn’t lose sight of the simple solutions that can be solved with microsystems,” he said, such as micropumps that can clear blood from video tools for surgeons. “Surgeons have trouble keeping these vision systems clear. … Can you make the device easier for the surgeon?”

The conference includes two more days of presentations on topics ranging from production methods to technology transfer initiatives, and ends Thursday with a special session on investment opportunities. Next year’s conference is scheduled to take place in the United States in Ypsilanti, Mich.


Candace Stuart at [email protected] or call 734-528-6290.


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