CEO Interview: Jonathan Flint, Oxford Instruments
PUBLISHED: 15:40 22 January 2013 | UPDATED: 22:38 20 February 2013
A British technology and innovation success story from the heart of Oxfordshire.
CEO Interview: Jonathan Flint, Oxford Instruments
A British technology and innovation success story from the heart of Oxfordshire
With turnover well in excess of 300 million, Abingdon-based Oxford Instruments is more successful now than at any time in its history.
In fact, the business is one of the most successful companies on the London Stock Exchange. Its share price has risen by a factor of seven in the last few years, in September 2011 it entered the FTSE250 and sales have grown by over 200 per cent.
This amazing company turns smart science into world-class products that address the greatest challenges of the 21st Century.
And what are these challenges? According to Jonathan Flint, CBE, who took over as CEO six years ago, they are that the worlds resources are finite: we must make more with less.
Everyone expects a better standard of living and Governments want GDP growth.The West expects luxuries; other places expect to be able to feed their children. There are no more atoms in the earth. Never going to be. How is that a sustainable model? The answer is you have to do more with those atoms: more value from one piece of material.
Oxford Instruments works at the absolute frontiers of science, providing the technology, the tools, to support the nano technology gold rush. Its an effective business model that works well.
The company is broadly split into three sectors: Nano Technology Tools, its most advanced science; Industrial Products for the non expert user, and service for customers who are buying sophisticated products and expect the support to match.
One of the toughest parts of Jonathans job is explaining to shareholders and the public what Oxford Instruments does. If shareholders dont understand what we do, and why should they when theyre not scientists and have another 500 listed companies to choose from, they wont invest.
Much of my time is taken up explaining why Oxford Instruments is one of the countrys most successful businesses.
Then there are our 1,900 staff, based at 33 sites across the world. We explain that having the best scientific idea is simply the beginning of the story. We are now much more effective at bringing ideas to market and applying really great technology. We have a big bank of patents, some of the best scientists and engineers, and we deploy that sheer intellectual horsepower on solving the big problems facing society. It took a few years for the engine to get going but its now really motoring.
The fact that Oxford Instruments is getting its message across effectively is not surprising. Jonathan Flint is a very good communicator. For this interviewer, who last sat in a science lesson when she was 16, knows nothing about nano technology or cryogenics and was frankly white with fright at the though of interviewing anyone so intelligent, he is as engaging a scientist as Brian Cox, with a much better haircut and less annoying accent.
You think Im being flippant? Im not. In this day and age, when never was so little understood by so many from so few (sorry Winston), its essential to be able to bring science to life for the wider public, of whom many of us have a very short attention span.
Luckily, sharing his vision with his staff doesnt present the same problems. I am very fortunate to run an exceptionally educated work force who understand concepts quickly. They are highly numerate and we love targets and objectives.
Thats good, because Oxford Instruments is part way through a strategy to grow by 14 per cent every year, ambitious when most companies are shrinking, and to produce a 14 per cent ratio of profit to sales by 2014.
To achieve this the company has boosted its force of highly trained salesmen who understand the complex products Oxford Instruments designs as well as the researchers and businesses that use them, and an R&D development programme linking back to the needs of the customer. When we see a scientific problem we talk to customers in the market, ask whether they would be interested in the technological solution and if the numbers add up we put together an R&D programme.
A good example of this is Oxford Instruments contribution to the success of Andre Geim and Konstantin Novoselov of Manchester University who jointly won the Nobel prize for Physics in 2010 after creating graphene a new wonder material 200 times stronger than steel. Jonathan describes it as two-dimensional diamonds.
The scientists were involved in pure research, much of their industry is driven by material science and they knew that the way of detecting this new material would be the identification of a specific property which could be seen only by using powerful magnets which they bought from us. Graphene is only tiny flakes at the moment but there is the possibility of much bigger structures that hold out the potential, say, of new electronic systems, very strong materials which have fantastic implications if we can get it scaled up. Lots of people are trying to invest in starting a graphene industry and most of them are buying tools from us.
A new National Institute of Graphene in Manchester has received a 50 million grant from the Government with the remit to take it from the research stage to commercialisation, though Jonathan says it will be a few years yet before graphene starts to be deployed as a widely used instrument.
This is the sexy side of innovation, but Oxford Instruments also makes tools for more down to earth applications, literally.
We work with the agricultural industries of developing nations. In some regions there is governmental concern as the growing middle class wants to replace their brown rice diet with white rice, which can cause nutritional problems. Industry must examine the micronutrients of the various strains of rice and identify what governments should recommend and what not. They use our nano technology analysers to do that.
There are all sorts of other things too. Oxford Instruments hand held analyser was used during construction of the 2012 Olympic Park. Traditional soil analysis takes days, severely slowing construction and adding significantly to costs. Not any more. Point the Oxford Instruments analyser to the ground and its operator, anyone in the construction team, instantly has an atomic level reading and a clear chemical analysis of what lies beneath.
Other Oxford Instruments innovations include a tool for analysing nano scale particles, unique to each discharge from a firearm and already in use by police forces across the world: Such analysis can link a certain weapon to a scene of crime, like a fingerprint for guns.
The company has many hundreds of product lines but its ones such as these that most of us can relate to.
Oxford Instruments is also involved in Cryogenics, the science of the very cold. Most people understand that there is a certain temperature below which mankind cannot go absolute zero. To put this in perspective, if absolute zero is 0, outer space is around 4 degrees and an office environment is likely to be around 270 degrees. Oxford Instruments has equipment that can go to a few thousandths of a degree. Jonathan continues: We are talking about constructing things from atoms. Atoms move faster when hot, and the colder they get, the less they move. When they are still you can start to manipulate them and strange things start happening. In the quantum world, properties of matter are completely different from the larger scale microscopic world, and for a lot of scientists and increasingly in engineering thats important. If you are manipulating matter, keeping it still is a good place to start. Cryogenics is a very exciting and rapidly growing field.
Theres a problem though. Cryogenics is usually achieved with liquid helium, the only thing that stays liquid down at those temperatures, everything else freezes solid. But of course helium is an element, a by-product of natural gas and its running out. We now have the ability to get down to these low temperatures without using liquid helium. Its called dry technology, we developed it here and now about half the magnets we sell use these dry techniques.
Such innovation, as Jonathan has already indicated, is achieved only thanks to a lot of very clever people, and Oxford Instruments draws its superbrains from across the world. Fewer than half its employees, 600, are in the UK and it employs around 200 people in its China facility, who are every bit as inventive and creative as those employed in the West.
The company sells very little in the UK just 5 per cent, and this should be a big a worry for UK Plc. Why? Because Oxford Instruments sells to where the most advanced research is going on and high tech factories are being built. Where we sell is where the wealth is going to be generated in a few years time, says Jonathan. Thats less and less in the UK but very large in Europe and the US and increasingly in Asia where governments are seeking to move away from being low-cost economies to high value added, and they see the key to that as having the most advanced technology and tools in their factories.
Its great for us because these are fantastic markets, but for the UK there is a lesson to be learned. We cant rely on the service industries while everyone else is into advanced manufacturing, many using our tools.
He gives an example: In Taiwan a school will have a tabletop electron microscope so students coming out are already nano-savvy. In the UK most dont know what nano technology is. We are a million miles away from that forward-looking attitude here.
However, the UK Government is making the right noises towards the high value, intellectual, added value companies, he says, including the 50 million graphene grant, its support of the international ITER programme to generate Carbon free energy, and new UK legislation coming out such as the Patent Box which will favour high tech companies. They recognise that such investment is the key to long-term prosperity. As Jonathan points out: Our society needs to value advanced science more. We led the world in the first industrial revolution, arguably nano technology is the second industrial revolution and I have to say its not being led from here.
But the UK has three universities in the top ten worldwide, including Oxford, and Oxford Instruments is determined to attract the best graduates who are enthusiastic and eager to rise to management level. We want people who can explain technology and lead teams. This country needs bright scientists for a sustainable long-term economy. Those in the financial industry are just moving someone elses money around.
Despite the huge uncertainties of the future, Jonathan is fundamentally an optimist. Get the right science, the right control and the right tools and you can make the world a better place. You can cure disease and make the environment safe.
So when hes not helping to make more with less, what does one of Britains most successful business leaders do?
I have a completely off grid house in the mountains of North Wales. No electricity, no anything. I go there four or five times a year with my family to get my thoughts straight.
And would he ever dream of decamping for one of the tiger economies of Asia?
No. Things are happening outside Britain, but this is a wonderful country and I wouldnt live anywhere else, however we do need to interact with the world to preserve what weve got and make sure we still have the wealth to be able to maintain it.
Hello, is that Didcot Power Station? Im just switching on
Oxford Instruments was founded in 1959 by Martin (now Sir Martin) Wood. It was the first spin-out company from Oxford University and is probably best known for playing a vital role in the development of magnetic resonance imaging (better known as MRI), after Martin Wood pioneered the use of superconducting materials to make the most powerful magnets the world had ever seen.
Before setting up the business Martin had worked in the physics department of Oxford University making magnets that used an extraordinarily large amount of electricity, so much so that he had to ring up Didcot Power Station every time he wanted to turn on his machine.
When he discovered superconducting materials that used no electricity at all, Martin made the worlds first super conducting magnet and was soon selling them to universities and other academic institutions around the world. Even today in almost every university physics department around the world there is the telltale blue of Oxford Instruments equipment.
Following delivery of the first MRI scanner to a London hospital in 1977, Oxford Instruments became the world leader in super conducting magnets. In 1983 the company listed on the London Stock Exchange.