Swiss quality: Interview with Maxon Motor's CEO Eugen Elmiger
An emphasis on highly-specialised, high-quality product is the key to maxon motor's future, as Paul Fanning finds out when he talks to the company's CEO.
Maxon Motor is no ordinary industrial company. This much is obvious from its stunning location in Ewil, Switzerland on the shores of Lake Sarnen and surrounded by snowy-peaked mountains, which is almost a cliché of a Swiss pastoral scene.
However, the company's special nature is far from skin deep. As a manufacturer of highly-specialised motors, it occupies a position at the cutting edge of industrial innovation and far from the commodity supply of standard motors.
Eugen Elmiger, the company's chief executive officer, says of this position: "Maintaining our quality is at the heart of what we do because it is the key means we have of differentiating ourselves from our competition. Without that quality and the advantages it gives us, we couldn't compete in the markets we do."
And it is the markets in which maxon concentrates its efforts that give some clues as to the quality of its products. According to Elmiger, the areas where it is seeing most growth are all at the cutting edge. He says: "Medical has great potential for growth and so do aerospace, energy harvesting, biotech, green-tech. We're moving away from classic industrial automation because it's becoming increasingly commoditised – they increasingly don't need the sophistication in the motor as that sophistication is now in the controller."
According to Elmiger, much of the impetus behind the company's innovation comes from the customers. "80% of innovation is coming from the market, customers and applications and 20% from R&D," he says. "The customers are the most important guys for the company. We have to stay on top of the technology, but it's ultimately the customers who guide us there."
Besides quality, the key factors guiding product development according to Elmiger, are: "Cost, lead time, miniaturisation, increasing power and increasing the software intelligence into the products."
This latter, he believes, has posed significant problems, since it requires different ways of thinking and less traditional skill-sets than was once the case. He says: "30 years ago we just made motors and then we made gearheads and then we got into electronics and mechatronics. It's moving more and more away from mechanical and towards electronics, which is a difficult shift because it is easier to understand mechanical principles because you can see and hear and touch them. Software is more difficult."
Again, however, quality is the key to growing the business and keeping customers happy. This, in turn, means a careful choice of suppliers. Says Elmiger: "Zero-failure strategy is the only way to succeed in our market. Particularly because of the applications we are in – aerospace; space; medical implants – we can't afford not to have the right suppliers because we can't be responsible for the failure of an aeroplane, a spacecraft or – worst of all – a vital medical system. So, when someone says we can save a few dollars by changing a supplier – however good that supplier may be – we cannot take the risk of changing and thereby risking failure."
This concentration on quality does pay off, however. Offering an example, Elmiger says: "Our quality gives us an ability to break into markets that we couldn't previously touch. The fact is that the requirements of the medical industry are such that they bring quality standards up to the levels of the aerospace industry. This means that we're now able to supply to applications such as aerospace that would previously have been the preserve of specialist suppliers – often only with a slightly modified standard product rather than a piece of equipment developed from scratch."
However, the fact of keeping customers happy and the innate conservatism of some industries do pose their own problems in terms of innovation. "More conservative industries do represent a big hurdle for us," says Elmiger. "We want to constantly improve and change our products, but it's often our customers who say no because the products they've had have never failed, so they don't want to take the risk of changing. And yet every year they ask for a cost reduction or a weight reduction."
Other industries, however do offer opportunities to innovate. One of these, says Elmiger, is the oil and gas exploration markets, where rising fuel prices are making on-the-hoof innovation commercially viable. "80% of our markets are conservative and 20% highly innovative. Oil and gas, for instance, gives us an opportunity to deploy technologies we wouldn't dare put into a spacecraft," he says.
In terms of the future, Elmiger sees increased configurability as the key. Already maxon gives its customers the opportunity to configure and order their own DCX motors online for delivery in 11 days, which he believes will free up sales engineers to work on larger projects while giving the customer a fast and efficient service.
However, he believes this is just the beginning. "Things like the DCX platform will change our business, but it will take a few years. However," he adds, "DCX is just an evolution. The revolution will come soon."
Eugen Elmiger has worked at maxon since 1991. He was a significant driving force in the establishment and expansion of the sales network in Asia at the end of the 1990s. He has been a member of the Executive Board since 2006 in charge of International Sales & Marketing and has been Speaker of the Board since January 2010. He qualified as an electrical engineer and studied further at the University of St. Gallen and Stanford Business School. He has more than 20 years' international sales experience.
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