Dr David Cartmell is executive chairman & CEO, BWA Water Additives. A PhD in Nuclear Chemistry from the University of Leeds, David joined the company in 1985 as a research scientist, and took over its reins in 1997. Since then, his strategic agenda for the business in terms of market-based focus on water treatment, continuous innovation, close connections with the customer base and strong emphasis on established BWA brand names has yielded rich dividends, with BWA establishing itself as the global technology leader water treatment chemicals.
In this exclusive interview, David holds forth on what makes BWA Water Additives tick and how his strategy for the company continues to endure and deliver.
It isn’t often that one comes across PhDs running businesses and highly successful ones at that. How did you end up at the helm of what is, unarguably, a highly successful and global water chemicals business?
My PhD thesis was on corrosion in nuclear power stations. So when I joined BWA in 1985, when it was still the water treatment business of Ciba Geigy, it was as a corrosion scientist in the research group. I worked there for two-three years, got a couple of patents and published some technical papers. I was often asked to help our sales guys with their customers’ technical problems, and I found myself engaged more and more with the commercial side of the company. I started to find that more interesting and exciting and if I may confess, far more energising than being in a laboratory because that was the real world out there. So in 1988, I moved into sales and in 1997, I was invited to head the business.
Having been at the helm for nearly 15 years now, I strongly feel that for any business to have a sustainable advantage, finding a differentiation or angle is crucial. For a business like ours, that angle has always been technology and technical leadership and approach has served us well.
We address mainly two key problem areas – scale control and bacteria. Companies are always developing or upgrading their plant equipment over time. When they change processes or techniques, they get different scale problems that need slightly different products or more data about how to use our products or new solutions. Scale control is a major focus area for us, where we are working with customers directly and also in our laboratories. On the bacteria side, which is a problem in Reverse Osmosis (RO) and also in industrial water, especially in processes requiring cooling water, having better control of bacteria in water treatment systems is a real need that we focus on as well.
How has BWA’s preferred business model of not owning manufacturing assets served the company through the highs and lows of the business and economic cycles? How has it helped the company innovate?
What differentiates us from many chemical companies is our single-minded focus on just one market, which is water treatment. Most chemical companies manufacture products and sell them into whatever market they can put them into, a strategy which makes sense if you have a large manufacturing base. If you don’t have that, it makes more sense to focus on only one market and source or develop products for that market. So how does that approach tie into technology and innovation? If you are focussed on one market, which in BWA’s case is water treatment, all your sales, marketing and technology people are essentially water treatment specialists. This, in turn, means that most of our new product ideas come from the market, not from our laboratory.
Our new product development is largely guided by the market. Our R&D people work on what we think we have heard from the market place and we take that back to our customer base. That gives us the confidence that there is a market for our products and that customers are going to be receptive. Also, we work closely with about two-dozen suppliers around the world. This means that our people enjoy giving customers the very best possible recommendations on how to solve their water treatment problems, without being influenced in any way by the need to recommend one particular product or another in order to ‘fill a plant’.
You chose to launch your new range of biodegradable antiscalants at a time when the emphasis seems to be lot more on managing costs, and global economy is unable to shake off the weight of uncertainty. So what kind of conversations are you having with your customers today, some of whom are large global corporations?
We always think long term, and for me, long term is nothing less than five to 10 years. There are three areas that we have identified as desires or needs of our customer base, be it desalination or general water treatment. One is discharge of chemicals into the environment. To compare, if you are making chemicals that go into the foam which goes into furniture, they might be lying for 20 years or more in somebody’s office. But in the water market, most of the time, they end up in water bodies in hours or days. I know that people are becoming more and more focussed on that.
The second thing we find our customers talking a lot about is their carbon footprint and environmental profile. Nowadays, large companies have people within their organisation who are serious about improving the organisation’s environmental profile over the long term. They tell us they want to have better control over the chemicals they use. So monitorability and ability to measure the chemicals in the system is becoming more important.
The third thing is safer handling of products. When people are handling chemicals, they want it be easier and safer to handle.
I feel that in the very short term, people will always be talking about cost control. But our product development takes years, so allowing short term financial situations to come in the way doesn’t make sense. Ultimately, those desires and needs will be there in two to three years time because people will always want a better environmental profile from the products they are using. That is a given, so our goal will always be to position our product range for the future not just for today’s market. Having said that, the products we currently sell are safe and environmentally acceptable, and regulated for drinking water. We would not, as a company, sell anything that wasn’t. So I would say the new products are simply improving on the profile we have.
Are there any gaps in the product portfolio that you are looking to fill?
We typically break down the application to the real problem – it can either be a scale problem, a corrosion issue or a microbicidal/biological fouling problem. And we are always scouting for new applications for our chemicals. A great example is oil fields where membranes are being used to remove sulphate from the seawater used for injection into the oil reservoirs. This gives rise to a distinct scaling problem, so we have developed a product purely for that market. I like these different uses because they all give slightly different challenges.
At the moment, we can address most of the problems occurring on the scale side but we always want to try and make things better if we can. As much as the focus is on controlling the problem, it is also about making total use of the product in the best way possible. That’s where aspects like handling, safety, biodegradability and environmental profile come into play. All these are part of the chemical because people buy and use the chemical and then it gets discharged into the environment. We have to think about the total usage of the product rather than limit ourselves to just the actual problem it is designed for. In fact, an unmet market need we have identified in water treatment is an online biocide for controlling bacteria in membrane plants. The product will actually allow you to control the bacteria on membrane while it is still being used. That’s a key research project for us.
To add, we initially launched our first biodegradable antiscalant for desalination under the Flocon family of products because the markets demanding such a solution, especially in Europe, in Scandinavia are mainly membrane markets. However, we will be launching one for thermal desalination, under our Belgard range, sometime in the next 18 months.
What is your vision for the future?
My vision is to continue to drive BWA towards global technical leadership in the water treatment chemicals business. We had a clear strategy for 15 years and it has worked. I am great believer in stability and innovation. If we can continue to combine business stability and very strong new product innovation, I think we have got a great success and a great future.
In any other business like mobiles or cars or laptops, markets come and go. But water is a basic need and requirement, so the demand will always be there. But this shouldn’t make us complacent either. I think we have to continually innovate and improve what we do. Every year, we have got to set ourselves new goals and new targets; so the biggest challenge for us would be to sustain our drive to innovate.