Building on precision

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John Murphy discovers the history of Fisba Optik, a Swiss company celebrating 50 years in photonics

The story of the Swiss watch industry is fairly well known. A small, independent and mountainous country needed to make something to earn money. It needed to make things that were small and yet valuable enough to justify the difficulties of transporting them across mountains to its major markets. Watches were ideal and over the years the word ‘Swiss’ – when applied to a watch – meant quality, accuracy and precision engineering.

The great Swiss brands had some problems when the digital watch arrived on the scene, but today they are doing as well as ever and Swiss watches are still highly sought after, because they were able to innovate.

Fisba Optik is in a similar position. Switzerland is not a low-wage economy, so it can never compete on price with manufacturers in other countries. It has always been able to compete on the basis of its skill in producing precision optical components that can command the kind of

margins that make it economically viable to continue in one of Europe’s most expensive countries. But it can never rest on its laurels. There is always someone just behind and if it wants to enjoy the obvious quality of life its home country offers, it has to innovate. It has to take on the challenges that nobody else can meet and develop processes that can replicate and automate that precision to produce volumes that keep it competitive. Then do even better next year.

Fisba was founded in St Gallen in north-eastern Switzerland in 1957. There is, in fact, quite a cluster of optical companies in this area, because of the presence of Wild Heerbrugg, now known as Leica Geosystems. The story goes that a wealthy textile tycoon called Christian Fischbacher used to play tennis with a famous optical designer called Waldemar Strietzel. One day Strietzel told Fischbacher that he was going to move to the US to get a better job. Fischbacher did not want to lose his tennis partner so he offered to back him in setting up a company in Switzerland – and Fisba was born. Fischbacher was actively interested in the company as a director but he was never part of the management. He died about a year ago.

Werner Krüsi, CEO of Fisba, says that the major strength of the company has always been in optical design and its major business has always been customised sub-assemblies and advanced components for system integrators. He says: ‘The roots of the company are in medical optics, such as endoscopes, and that is still a strong business for our company. We are now active in a lot of other industries, such as the textile printing, biomedical and semiconductor industries, as well as astro and space systems. We are not making cameras, but we can do space-resistant optical systems that can withstand high temperatures, shock vibration and have long service-life.

‘Our strategy has not changed from the early days. The first part is still customised optical sub-systems; it may have a laser diode or camera chip inside, but it is always customised. We also make advanced optical components. We are not trying to compete with standard components from the low labour cost countries. Our components are made with specific manufacturing processes, which give better performance. We are particularly strong in micro optics for diode lasers, like fast access collimators.’

Assembly of micro optics for AFM (atomic force microscope) read out.

Krüsi says that most of the company’s manufacturing processes are proprietary rather than patented. He says that while it may be possible to patent its processes, it is extremely difficult to enforce such patents. At the same time, patents are published so they can actually help its competitors. He says: ‘In this industry you need to make a USP in the manufacturing process itself and, of course, the process must add value for the customer.’

The company is still active in endoscope optics, but it has a relationship with a single customer. The fourth part of the company deals with metrology and interferometry systems. One of the quirks of the business is that while Fisba uses its advanced components in its sub-systems, it also sells the same components to competitors. Krüsi says that this could present some difficulties, but Fisba is meticulous about protecting the intellectual property of its customers. He knows that if its customers did not trust the company it would have far reaching implications. He says: ‘This is not a big problem for us. What we are doing for our customers is very specific for each customer. We make use of our advanced optical components in our sub-systems, but we are buying in other components like sensor chips. Even if one of our customers gets a big advantage from our components, then they are likely to be adding a lot of their own value, so they are not really competing with us.

‘Our philosophy is ‘the spirit of partnership’. We do not want to get a quick sale and then be forgotten; we want to establish a long-lasting relationship with our customers. That means that we protect customers’ knowledge very strictly. We have a very large number of non-disclosure agreements and, even if we don’t have such an agreement, our policy is always to protect the knowledge of one customer from other customers.

‘There is a strict line between our core competence and the application-specific knowledge of the customers.’

Over the time that Fisba has been developing its own manufacturing, it obviously developed some expertise in measurement. About 10 years ago it released its own design of interferometer used for surface inspection, which is used in many fields of advanced manufacturing, including the optic and ophthalmic industries.

Krüsi says that the main driver for growth was the photonics market, where there was an increasing demand for micro components and for the integration of those micro components into small sub-systems. He says: ‘The smaller a system becomes, the more technology is needed to handle the whole integration process in a proper industrial manner. This is a core competence of Fisba to handle all the different technologies. We can start with the optical design and the superior coatings. We can do the assembly using semi-automatic processes with an accuracy of half a micron. We don’t just do that in the lab for one single item; we can do it in large quantities of maybe several hundred a month. The growth is in this area and we want to be more active in this area.

‘Manufacturing this kind of sub-system is not just the manual work of a highly-skilled individual. It’s about developing semi-automatic processes in order to have a very stable process with high predictability, otherwise it’s not economic. It’s like the Swiss watch makers, where they have switched to highly-automated production systems. It is the same for the high precision industry, which has to move to automation to build very small and highly integrated packages.

‘It’s always a walk along the edge for a company like ours. We have to stay innovative and have solutions for the most demanding customers, but we also have to make it economic for the customer and for ourselves, otherwise it does not make sense. It is often tricky to judge what is makeable and what is just too complex, and find the way between.’

Precision positioning and cementing micro optics onto CCD/CMOS chips in a clean room environment.

Krüsi says the relationship with the customers is more like a partnership than the classic supplier and buyer. People don’t come to Fisba if they can buy what they want on the open market. They come with a requirement and this is the start of a discussion as to whether it can be met, and if it can whether it is economic to do it, or whether it might be possible to get the same result another way.

He says: ‘The start of a new relationship is seldom between the purchasing department of a customer and our sales department. It is the R&D department of the customer, maybe with our sales department or maybe with our R&D department. It is a bit tricky, because customers do not like to open their book to just anybody and that is understandable, because they are making new developments. It is very important that customers can rely on your integrity and that Fisba will think about a solution and develop new ideas on the interfaces and the specification. We are the experts in optics and the customer is the expert in the application. If the customer is prepared to recognise our experience, then we can usually come up with something that is better for them. This means that we sit together and think about and discuss the specification, the optimisation and the interface. It’s an R&D to R&D process.’

He added that there are occasions where Fisba will take some of the commercial risk, but only when it knows something about the potential market and the likely volumes. If there is no transparency this can be difficult. He says that Fisba does not want to be seen as a contract R&D company. It wants to put components and sub-systems into serial production and make its profits on sales of those components and sub-systems. The R&D function is there to support the customer, rather than being a profit generator on its own.

The component and sub-assembly business does not do a lot of traditional marketing. It is present at most of the major exhibitions, but the marketing team really knows who is going to be interested in what it has to offer. In many markets it can cover 90 per cent of the volume in the market by working with just 10 or so companies, so the focus is on building deep and lasting relationships with those few customers rather than generating hundreds of sales leads a day.

The metrology business is quite different. Its products are sold and supported in many countries by distributors and, in the US, Fisba has set up its own subsidiary. It also has a subsidiary based in Berlin, responsible for the software development for the uPhase line, but German sales are handled from St Gallen. Krüsi says: ‘We were active with a software company that had been set up after the Berlin Wall came down. There were some changes at that company and, as a result, those who were working on our systems were formed into a separate company.’

In metrology, most of Europe is served direct, but the UK is served by Armstrong Optical and France by EO Tech. Krüsi says: ‘The system equipment business is very different from the project business. We consider project management to be part of our core competence. When we have to develop part of an overall system we know how to lock into the project management of the customer organisation and that is a completely different business, so we do it in a completely different way to the equipment business.’

Fisba’s engineers do a lot of travelling. Krüsi says that it was not unusual for its people to spend time working inside a customer organisation, with the customer’s own engineers, to gain their confidence and prove they can make the whole production process work. They then return to St Gallen to start the manufacturing process that will eventually fit in with the customer’s own manufacturing logistics.

But St Gallen has a few advantages of its own. Because of the cluster of optical companies in the region, there is a pool of well-educated people with precision manufacturing skills and many institutions where they can get advanced training in optical design and manufacturing. Another advantage is that the company has little difficulty recruiting and retaining people from all over the world who have come to work there. It has people from 25 different countries among its 350-strong workforce. Taxes are low and Switzerland offers them a clean and safe environment.

Krüsi is confident that Fisba can continue to grow in the next 50 years as it has in the past 50. He thinks the opportunities are out there and there will always be a demand for a company that can do something special. He says: ‘There will always be a market, but the products will not always be the same. Companies in middle Europe are forced to be innovative in their products, their solutions and their processes. When it comes to intelligent processes it is independent of location. We are forced to be innovative, but mankind is always advancing and producing new opportunities all the time, and being innovative in processes is a unique selling point. We will not stay with our present products, because they will become more standard and will move to low labour-cost countries. A company in the middle of Europe cannot sell on price, but on additional value, support, specific knowledge and solutions they cannot get elsewhere.’