IN this week's SME Focus the story of two entrepreneurs who have successfully commercialised some of the results of the research in Scotland's world- class universities shows how much big and small firms can gain from working together.
Names: Gordon Hayward (chairman) and Vic Murray (MD)
Ages: Old enough to know better!
What is the business called?
Alba Ultrasound Limited
Where is it based?
West of Scotland Science Park in Glasgow
What does it produce?
Alba Ultrasound is a specialist technology company engaged in the design and manufacture of ultrasonic transducers and arrays.
These are the devices which generate and detect ultrasound – which is basically sound with a pitch beyond the hearing range of the human ear.
An array comprises many individual transducer elements, sometimes thousands, arranged so that the sound beam can be moved around under control of the electronics in the sonar unit. Moving the sonar head this way enables images of the underwater scene to be developed in real time – almost instantaneously.
What services does it offer? Alba offers a bespoke manufacturing service to its client base and will work very closely with clients to tailor products for their specific requirements.
We operate primarily at the high end of the market.
To whom does it sell?
The main market area for the company is in underwater sonar, with secondary markets in non-destructive evaluation (NDE) and biomedical ultrasound. Alba's clients are from all over the world and range from underwater sonar companies engaged in passive defence such as minehunting and subsea security, through to organisations involved in underwater surveying in the offshore oil and gas industry.
In almost every case, Alba supplies the front-end transducer system to the client, who in turn creates the electronics and data-processing components of the actual sonar system, thereby providing high-quality images of the underwater environment.
What is its turnover? £3 million
How many employees? 40
When was it formed? 2000
Why did you take the plunge?
Vic Murray – frustration at what felt to me to be the slow pace of technology development in my previous company and the desire to be in control of my own future.
Gordon Hayward – while working in acedemia, the wish to create a world-leading company based in Scotland and the opportunity to offer high-level employment opportunities to high-calibre engineers and scientists. The majority of my graduate PhD students went overseas, particularly to the US.
What were you doing before you took the plunge?
Vic Murray – I was a senior acoustics design engineer with a sonar company in Aberdeen.
Gordon Hayward – I was Director of the Centre for Ultrasonic Engineering at the University of Strathclyde, which I founded in 1998. The origins of Alba's technology go back to the PhD I did at Strathclyde and the subsequent work of a number of postgaduate students there under my supervision. Vic and I started working together in 1987, with some funding from the UK Ministry of Defence.
His role was to focus on practical application of the technology, while I ran with the fundamental research aspects.
How did you raise the start-up funding?
The directors provided some initial input funding in tandem with a loan from the Small Firms Loan Guarantee Scheme.
What was your biggest break?
We got an early break when we won the contract to design and manufacture the array suite for the upgrade of the UK minehunting fleet. This was a subcontract to Thales Underwater Systems Limited and they took an enormous risk in going with such a small and unproven company.
However, they kept a close eye on us and we delivered the first array system in 2004. Since then we have delivered 15 sets and they are all operational.
Thales openly marketed this system as "the best sonar of its type in the world" and it was the first-ever practical demonstration of a wideband imaging and classification sonar.
Working so closely with Thales enabled Alba to develop both the corporate governance discipline and technology capability to work successfully in extremely demanding environments and this has paid dividends down the line.
What was your worst moment?
Vic Murray – We experienced a reliability problem with a product several years ago.
We couldn't find the root cause which could have impaired the company's reputation. Eventually it turned out not to be our fault.
Gordon Hayward – The period leading up to Christmas in 2008. We had invested heavily in new premises and the impending credit crunch led to some clients delaying payment. The resultant cash flow issues were, to say the least, problematic.
What do you most enjoy about running the business?
Vic Murray – the sense of pride that the whole company feels when we have developed what we believe to be a world-leading system.
Gordon Hayward – the common sense of purpose and unity. It is a refreshing change to see everyone working towards the achievement of a common goal.
What do you least enjoy?
Vic Murray – it's difficult to get everything perfect. Failing to achieve targets at the first attempt can be disappointing. Gordon Hayward – nothing in particular but if I had to commit to one aspect, it would be in matters relating to staffing and indiscipline.
What are your ambitions for the firm?
To be the undisputed world leader in what we do.
What are your top priorities?
To double turnover by 2015; to increase the number of production cells supplying different clients; to develop and expand our export business while sustaining quality of output; to develop and expand into other market areas, such as NDE.
We are part of the Centre for NDE, a consortium of six UK universities and 19 leading companies, so we are already well linked into the international market for NDE transducers and arrays; to obtain full ISO accreditation by 2013 – this is an important quality benchmark for the company.
What could the Westminister/Scottish Governments do that would help?
We get a lot of support from Scottish Enterprise – Alba is one of their account-managed companies and we have a very good and extremely pro-active account manager.
On a UK basis, more needs to be done about training to ensure companies like Alba have ready access to the quality of workforce that is needed to compete internationally. Although we do have good people, this has been an ongoing issue since the start of the business. We have been working with schools to promote engineering (as part of the Scottish Government's Science and Engineering Action Plan) and have been struck by the enthusiasm of both teachers and young people when they get the chance to learn more about engineering. It amazes us to observe that many people see engineering as only part of the country's past – engineering as a mainstay of our future is really exciting.
What was the most valuable lesson you have learned?
Vic Murray – trust your own instincts.
Gordon Hayward – it is very difficult to stay in academia and run a business properly.
How do you relax?
Vic Murray – I find the best way to relax is to take a long holiday. A few days are just not long enough to forget the day-to-day problems.
Gordon Hayward – I have been known to cast the odd fly or two - but often it does not seem like relaxation!
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