When I attended the Materials Research Society’s 2008 Spring Meeting in San Francisco, I thought I would encounter a collection of companies that were winning by combining three of the core strategies available to small manufacturing companies in today’s highly competitive global economy: technology, niche marketing, and global reach.
I found what I was looking for, plus some very interesting contrarian advice about patents.
I should explain that the focus of the MRS is on very small things, like the molecular structure of disk drive surfaces or the ridges and troughs of semiconductors. Many of the exhibitors offered devices for imaging these surfaces – atomic force microscopes, for example, which utilize a pointed stylus whose tip can be as small as a single atom to “feel” the contours of a surface and then produce a digital “map.” These instruments are crucial to the development of nanotechnology, and innovations appear on a regular basis
It seems like there’s a market for any device that offers finer resolution, or the same resolution for a lower price, or will work a high temperatures, or room temperature, or doesn’t need to operate in a vacuum approximating outer space… the list goes on and on. The barriers to entry for this type of scientific instrumentation are surprisingly low. Four guys can go into business, quite literally in a garage. And I wouldn’t be surprised if one of these companies turns out to be the next, well, not quite Intel, but up there. They’ll win primarily with better technology, both in terms of what their products do and how they use technology to manufacture those products.
The imaging devices I saw, although they might appear similar to an outsider, were in fact highly specialized for particular niches. Some, for example, measured the strength of materials by hammering them with nano-scale plungers. Others measured “aspersion,” what we call roughness. And so on.
The market for these devices is clearly global, a fact that can be seen at MRS by wandering around and listening to the wide variety of accents with which English was being spoken. I also overheard conversations in Japanese and German.
I guess part of the message here is, get into nanotechnology if you can. Obviously, that message is not going to apply to the majority of readers here, but perhaps more than some would guess. Any company that can do aerospace precision could can become as a manufacturing source for a team of scientists who know what to make but not how to make it. Remember, not all of the equipment in the nanotechnology sector is high tech.
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And now, the story about patents. One of the most interesting discussions I had at the show was about intellectual property. A senior executive at a company I won’t name told me that her company typically doesn’t patent devices if they would be hard to reverse engineer. The reason? Once something is patented, it’s “out there” for anybody to imitate. And patent infringement laws aren’t really enforceable in many of the companies that participate in the global market place.
You can watch an video interview with Dr. Leroy Schwarz, Professor at the Krannert Graduate School of Management at Purdue University, as he talks about just this issue and how it affects his approach to patents: The Plusses and Minuses of Patenting Innovative Technology.
In the new global economy, patenting your invention has become a risk.