Design the Key to Transformation

Overseas award gives Taranaki manufacturer confidence to expand into European market.

Expand Bruce Moller says user feedback helped guide Howard Wright's design process. Photo / SuppliedInvesting in design is paying dividends for a Taranaki company operating in a very specialised niche.

Howard Wright Ltd is in the business of making the specialised beds used by hospitals, and faces tough competition from global operators. To help meet the competition, Howard Wright embarked on a two-pronged transformation process that completely rewired its approach to product design. The first change was a Better-by-Design (BBD) programme; the other was adopting the Japanese Kaizen 5S system to improve its manufacturing operations.

The hard yards paid off. Last month the company won the 2010 Australian International Design Award for its M8 intensive care bed - praised for its "outstanding design, attention to detail and innovation". Last October the M8 won the Best Design Awards run by the Designers Institute of New Zealand. And earlier this year it added a prestigious Germany-based iF design award, competing against 1016 contestants from 39 countries.

Chief executive Bruce Moller, who bought out the Wright family's business with other investors, says the organisational transformation was crucial as the company had been customising beds based on what customers wanted, which resulted in the range soaring to over 70 beds. "Even though we were doing a lot of work we were not getting volume from it," he says. "We were having to customise beds for clients. Around 2005, we had started to reduce the variations and rationalise."

In 2005 the company signed up for the BBD programme - run by NZ Trade & Enterprise - which completely overhauled the way in which it approached design. "We developed knowledge of our customers by reaching out to patients, clinicians, orderlies - users who understand how they were using the product." Having assessed all the user feedback, Howard Wright began to turn from being a follower to a leader, producing a highly functional bed that also looks good. The first result of all the study - after 10 prototypes - was the M8 intensive care bed.

Like all companies pushing to lead product development, Howard Wright has to ensure the investment in design translates into real business growth. "When you are doing product development and pushing to be best-in-class level, the cost of development is increasing all the time," says Moller. "We need to be winning more big businesses, developing more channels to market." His immediate goal is to have the company strengthen its hold on the Australian market, where it has just over 20 per cent market share.

Doing business in Australia is all about "stickability", says Moller. "The thing we learned about Australia is geographically, it is very widely spread out. We decided to go right across, we did the national approach." The company has a large sales team in Australia: six people spread across New South Wales, Queensland, Victoria and in Perth.

Moller himself spends about three months in a year in Australia, something he says is really important to stay close to customers. To win more business in Australia, the company will need to make inroads into competitors' market share.

The iF design win has given the company confidence in its move to expand into Europe, where it will use Germany as its beachhead. "We are working on opportunities in Europe but want to ensure we have everything correct so that when we do [make] our entry, it is not going to be a shotgun approach - that we have taken out all the risks by knowing what we are going to do."

The company has come a long way since founder and motor mechanic Howard Wright began an engineering business underneath his house, building his first hospital bed when a nurse asked if he could make something similar to one manufactured overseas.

In the 1960s he opened a bed-making factory, and won international sales in the mid-70s with a bed that could be raised with hydraulics. Sales have been steady since Moller took over in the early 1990s but he wants to see faster growth, and is aiming for a compound growth rate of 10 per cent per year over the next three years. He is aware that splicing the design gene into the company's DNA without complementing it with tight manufacturing processes could be a real pitfall.

Moller has a lot of faith in lean manufacturing consultant Clinton Yeats who mentors him, but warns of the risks that come with adopting lean manufacturing. "This elimination of waste process, people reducing stock - that carries certain risks as well. You have no safety in stock as you are driving your inventory down. We have made some mistakes too and have learned to mitigate our risks." The constant challenge of lean manufacturing he says, is that of focusing on removing waste at the non-value-added end of the manufacturing chain.

Operating out of Bell Block, just north of New Plymouth in the shadow of Mt Taranaki, Howard Wright employees have a new sense of self-belief that they can do great things and rattle the giants in the industry who may not be as nimble on their toes.

By Yoke Har Lee