Intending to farm out the components and do only the final assembly in Lyon, Hascoët spent a year compiling a global network of subcontractors. Several vendors were contracted with simultaneously to supply the same part at the same price. He then hired an American, Tim Hudson, to institute the system of quality assurance demanded by the FDA. Hudson had been with a division of Johnson & Johnson in Belgium and Paris, where, after three years, he had learned to speak flawless French. Coming to Technomed after that achievement proved "a disappointment," Hudson says; like everyone else in the company, he is required to use only English.
In that universal language of business, Hudson gives expression to the clash of manufacturing cultures. "We Americans tend to get impatient with the southern European influence. Most businesses here close between 12:00 and 2:00. There's an attitude you can push only so far, then you have to back off, or nothing gets done. They insist on four-week vacations, for instance, even though most countries we ship to don't close for a month. When an American gets down to the supervisory level, there's resistance to ideas. It would be a worse problem if the company's future belonged to France. But the future doesn't exist in France. They're looking to the United States and Japan. The people here know they have to support the overseas efforts; otherwise, they won't have jobs."
Eventually, the cost of labor and shipping will inspire Technomed to examine other manufacturing venues. But not yet: shipping a Sonolith from Lyon to Boston costs about $3,000 -- a pittance in relation to a million-dollar sale.
* * *
Cultural Variations
Human body parts may be conveniently universal, but, Hascoët found, human market sectors irksomely aren't. Technomed's Japanese subsidiary, for example, cannot sell directly to the end user, as do its other three, because Japanese business protocol dictates that foreign companies deal through native intermediaries. So Technomed has a local distributor making the sales, while the subsidiary provides engineering and support. "In the States," observes Jerome Lebon, vice-president of international sales, "once you staff your firm with Americans, there's no problem, even if the firm is a subsidiary of a European company. In Japan, however, it's a big problem. The perception of what is national is much stronger. The Japanese government and hospitals have to feel they are supported by Japanese people and Japanese firms, because they are far away from everything and feel we might withdraw someday."
In India, though, it's forbidden by law to deal with a distributor; only hospitals have import licenses. And in Germany a foreign product is not readily accepted from a distributorship; it does better if it comes from German speakers who directly represent the company. Even in Paris, Technomed faced conflict: when local customers sought local attention -- rush delivery of machines, for example -- Hascoët put them off. "I went the opposite way -- speed up delivery time to Japan. It wasn't easy to explain that our priority had to be where our market was, not where our culture was."
Technomed's two French managers in Japan speak Japanese. "Most Japanese have difficulty with English," Lebon notes, "so knowing Japanese is important. Even though a foreigner can never hope to speak perfect Japanese and will be a foreigner for life, if he wants to have friendly commercial relationships, he'd better speak Japanese."
And if language isn't a barrier, subtle restrictions may be. Technomed has had a hard go of it selling machines in Germany, because stringent standards for electrical wiring -- not for therapeutic efficacy -- protect native competitors Dornier and Siemens. "Regulations like those discourage small companies like ours from doing business in some countries," Hudson admits. "It would cost thousands of dollars to pass the safety standards of Denmark and Sweden, for instance, and it's not worth the manpower and expense." Nonetheless, this June, Hascoët threw some manpower and expense into setting up his own department of international regulatory affairs, specifically to control the technical aspects of every product in every country where it is or might be sold.
* * *
Hiring
While holding out for a professional management team, Technomed's tireless founder functioned as VP of just about everything for two years, as well as CEO. It was something of a conundrum: "If you have not yet established an image, you can't find bright managers; without bright managers, you can't establish an image." The first bright manager to cast his lot with Hascoët was Bernard Lacruche, an old buddy from Thomson. Equally disenchanted with anonymity in a large company, Lacruche fortunately proved an easy mark, even at the comfortable age of 53. "Gérard called and asked did I think we could build a commercial lithotripter in three months?" Lacruche relates. "I said, 'Probably not.' 'You can organize the factory, the personnel, and everything,' he proposed. I said, 'OK, then. I'll change my job tomorrow.' " Well, not exactly tomorrow: under French law, he had to give three months' notice.
Lacruche joined Technomed in January 1986 as vice-president for engineering and manufacturing. That he was a chemical engineer and only vaguely familiar with business didn't bother the similarly inclined Hascoët. It was more important to have probity than business skills, Hascoët rationalized, since "we were dealing with surgeons and institutions, who also are unfamiliar with business."
Every three weeks Hascoët would jet to the States to spend a week running the operation from a small office in Manhattan while searching for a U.S. president. He got lucky before he got exhausted. After General Electric acquired divisions of both Johnson & Johnson and Thomson, several veterans of the medical-equipment field were shaken out into the arms of headhunters. One was John Heinrich, who responded to Hascoët's six-month-long pursuit, "Sounds like the opportunity I've been looking for -- running an operation of my own in a small-company environment." On January 1, 1988, Heinrich became president of Technomed International Inc., United States. Now, Hascoët travels much less: to the States maybe seven times a year, Japan two or three times a year, Germany once a week. At the U.S. subsidiary, from which Heinrich goes to Paris once a month, travel now is the largest item in the budget. "They are coming here more than I am going there," says the rejuvenated CEO.
