We had a chance to sit down with one of Stratasys’ key leaders to find out what’s happening at the 3D printing giant.
[This is part 2 of a two-part series. You may find part 1 here.]
Andy Middleton is Stratasys’ President EMEA at Stratasys & MakerBot. We posed several questions regarding their recent moves deeper into industrial space.
Fabbaloo: What you described is a rather detailed and extensive process that you would have an engagement with a client, you would be investigating their needs and requirements, figuring out materials and process, software etc. Does this mean that your target customers are only going to be the big guys?
Andy Middleton: Good question. We have thrashed this out. Initially it is not necessarily the size of the customer. It is how relevant are their requirements. How close are their requirements that we can do today. So just to pick up the top ten. We could have a list of project 2-3-4 years long, we wouldn’t earn any money. So we need ones with a minimum of customization in the work, whether it be the materials with high volume and the consultative role that we need to play. This is a conscious change in the company’s strategy.
It is to be able to identify within those customers do we have a relevant solution, for those needs today or within a very short term?
I was down in a large aerospace customer of ours and they said that if we can improve the repeatability from machine one to machine A to machine 10 to within the tolerances that we require, “you’ll go from 5 machines to 30”.
I was initially talking to Scott Crump about this. How do we move this forward? We need to improve our repeatability by low digit percentages. But it is all or nothing. 92% is not ok. 95% is a minimum threshold and we can not do it today. We can do it.
So what are we going to do? Do we outsource this development to a research centre or do we refocus our team, our R&D people internal? I am actually voicing for external to get a fresh look at it because our R&D guys they get tired of products. And I am saying no, it is not finished. They want to go to carbon fibre!
So to pay a third party to do it, then you are getting something.
Fabbaloo: One of the barriers to using 3D printing in industry has been the quality control. If I 3D print this part, for example, how do we know it meets all of the requirements, whatever they are?
Andy Middleton: Big issue with Airbus.
Fabbaloo: When I say the demonstrator, it wasn’t clear to me how you were going to do that.
Andy Middleton: I would have to get one of the technical guys to answer that. It is a concern with Airbus. They go through scanning of all of these parts that go into the planes. They certify the whole process from where is the fiber plated, how is it transferred, what are the build parameters, and it is all documented. How is it stored, what is the traceability of our materials, etc. How is it stored in Frankfurt? How is it transferred to Toulouse?
But if we don’t do that, they won’t even entertain us. The photograph I showed you of us shaking hands with Airbus, it was at the Farnborough airshow in the UK this year and we sat down and they said “hats off to you guys” for succeeding in becoming a supplier to Airbus, because of the quality control they have that on their own system. How we are doing it on ours?
Fabbaloo: With Airbus you integrated with their quality systems? With others, you may need to add on a new quality system.
Andy Middleton: Exactly. We are in discovery mode here. Do we need that are part of our portfolio? You can imagine the on one hand the amount of energy and thought, there are a lot of smart people outside of Stratasys. This requirement to collaborate with a partner is crucial for companies that ours to be successful. Those guys who think that they can go it alone with a 3D Printer, that is just not sustainable.
But in the board meeting actually it is a question of how many resources, highly smart people, to think this through – which applications, which industries, then take it to market, etc, This is time and people - now we are trying to judge this from a business planning perspective. That is the fun of business.
Fabbaloo: At the same time that all of this is happening you have to explain this to the Industry Analysts to make sure your stock price does not fall. Talk about challenging!
Andy Middleton: It is a challenge because at the same time we need to educate the customers who we think we have a solution for, to make them aware that we have this solution. Meeting with marketing, getting our narrative right to attract for our solutions. It is a pretty complex environment.
Fabbaloo: We are about 1/3 of our way through the show, and we have seen several occurrences of machines that appear to be explicitly targeted as a Fortus replacement. They may be cheaper to buy or they use cheaper material or they are slightly bigger. How are you competing against that? At this point do you care?
Andy Middleton: To say we don’t care is far too arrogant, it is not right. We are not being side tracked by it at all. I have seen equipment here and they will have inherent limitations if they are not using the smart extruders that we have.
The amount of brain power that Scott Crump had to put into our extruder technology, you just cannot replicate that over-night. So those are the facts. They won’t be capable of delivering the quality that we do today.
However, we should not ignore them. And this is about getting the story right. If I see a specification sheet for 20,000 products FDM. It may be similar material, the size may be bigger. We need to be very articulate in helping that customer to understand where that difference is. Why is he paying 80,000 more?
This is the challenge of our PR agency. We have to be really clever in the words we use otherwise that buyer may go with the cheaper version first before I realize “I thought it could do this but it can’t!” So one of our key challenges is articulating the message in a way to help remove the confusion in buyer’s minds.
Fabbaloo: For someone just printing prototypes, maybe a cheaper machine works but with your renewed focus on customers, that’s something nobody else has.
Andy Middleton: I love this document by the way <showing a new Stratasys brochure explaining these concepts>. It is something that we put together. It is understanding the drivers and what should a customer be thinking about if he is considering 3D printing as a technology. It is not about necessarily Stratasys focused – I think it is a tremendous document. What sectors are we talking, what about design. It is the first collateral that we would give a customer and then let’s have a discussion.
Fabbaloo: There is something your CEO said this morning: He said that it is all about the materials and I have long thought that. What is going on with materials? I think that Stratasys is a materials company at its core. How much effort is put into materials?
Andy Middleton: Materials takes by far the largest part of our R&D. In the boardroom, our CEO said that we are a materials company. Our job is to identify what characteristics does the customer need within the materials. The output device is not the easy part of it. But it is more simple than materials properties. How long does material need to maintain its characteristics? Does it need to be UV sensitive? What is the lifetime expectancy of that material? We have acquired over the last couple of years a company to help us, particularly on the FDM side.
On the PolyJet side, development is mostly in-house. It’s crucial. Materials will win the game. End of story!
And with Carbon Fiber, it’s a big step forward.
We have a medically certified material. I was at the largest customer in Switzerland, at the largest dental supplier for dental implants and surgical drill guides for implant surgery in the world.
I actually had it done in January. They put a gum shield in so the surgeon knew exactly where to drill in the bone. So I was happy because it was more accurate and hopefully have less post-operative care.
The material they required to print these drill guides during surgery has to be medically certified to be able to remain in the patients mouth for up to 24 hours. We developed that material only for guides within the dental world.
That is delivering a lot of value to the healthcare industry. We can charge for that. Instead of $200 a kilogram to $1000. It is a very small piece but a very high value piece for the patient, for the dental surgeon and so on. We were told by a major global dental customer that of all of the implant operations, only 3% world-wide are actually using a drill guide. The rest of done by X-rays, by looking, experience of the dentist. It is a great application. We have a lot of growth there. This is what I mean about being very specific so that “MED610” material is only for that.