With acquisitions, Westborough co. enters new markets
Tom Sutter, global business development director, MicroChem.
As the consumer electronics market flattened out, Westborough-based MicroChem realized it would have to extend its capabilities in order to remain competitive. That’s what led to the acquisition of Attleboro-based Paratronix in June, and a September acquisition of New Hampshire-based Conductive Compounds. The company, a manufacturer of specialty chemicals, now has 90 employees.
Tom Sutter, global business development director, spoke about the acquisitions, workforce development tactics and operations at the company’s two-year-old, 76,000-square-foot Westborough manufacturing facility.
Tell me about the company.
MicroChem started off as a very small company, essentially in a garage. Its founder, Dr. Don Johnson -- not Miami Vice -- basically started with some small product lines for specialty chemicals used in the electronic industry. He was able to, through licensing acquire additional products, from IBM, or Shipley Co. With those products, he was able to grow the company.
Nippon Kayaku in Japan acquired MicroChem in 2008. The company continued to grow through organic growth, new product development. More recently, in 2013, we decided we weren’t going to reach our growth goals solely through organic growth. Find other ways to grow biz. Strategy included licensing and acquisition. For the past couple of years, we’ve been executing on that strategy, adding products and technologies through licensing and this year enable to make first two acquisition.
Why did you make the two acquisitions?
The electronic industry in a lot of ways is flattening. It takes many years to bring a new product to market. We had very aggressive growth targets from Nippon Kayaku. In order to meet our growth targets, we had to do something different. That doesn't mean we’ve given up on organic piece, but we needed to do something to get us there faster.
One of our goals in making acquisitions was to add new capabilities and to broaden our product line. If we broaden the product line and add new capabilities, we can add different markets.
Key areas include biomedical, and we wanted to get further into areas like military and aerospace. Up until this time most of our focus has been on the consumer electronics market.
How will each specific acquisition help you reach those goals?
Paratronix changes our business model somewhat, because it’s a service business, where they put up something called a parylene polymer coating onto devices. If you have medical devices that need a good biocompatible coating on them, that’s what parylene does. It allows us to diversify our business model, and it gets us into new market spaces, like biomedical.
The Conductive Compounds acquisition really helps to broaden our product line. It’s complementary to products we currently sell. It also increased our footprint, or access to the biomedical, military and aerospace end of things.
Talk about the move to Westborough.
We moved from Newton, two years ago. We went from a 25,000-square-foot facility to a 76,000-square-foot facility in Westborough. We’re on a 40-acre plot of land, whereas before we were in the center of a residential area. It was an existing building, and we gutted it and rebuilt it from the inside. As far as we’re concerned, it’s a brand new facility.
What employee development and recruitment programs do you have in place?
On the development side, we have a very progressive training program here. We feel that everyone in the organization needs to be engaged and aware of what’s going on in the company. There are no barriers to understanding what we’re doing and why we’re doing things. We’ve conducted a number of training programs, from the president of the company all the way to the operators on the floor that emphasize teamwork, leadership training and how-to-build strategies. Typically we have a couple of company-wide training programs per year, which can involve multiple days taking people off jobs just for training.
In terms of recruitment, it’s more conventional. When we have positions open we will go to Monster, or other Internet sites necessary to post. We want to make sure the candidates that we bring in will fit in with the culture and philosophy here. This is a very inclusive culture. As I said before, everyone here knows what our strategy is, and why we’re doing the things that we’re doing. Company results are shared in town meetings, which include everyone in the organization.
Anything else you would like to add?
The thing I’m most pleased about it is we created a strategy, we executed on that strategy and we were successful in implementing the strategy. We’re not looking at the slogan du jour, or the idea of the week -- we have a very sound strategy in place and are sticking to it.
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