What he didn’t see were the multiple hurdles his company, General Data Co. Inc., would have to clear to introduce its technology to the labs. If he had, he says, General Data might not be on the verge of cracking this potentially huge market.
“Sometimes you do it in spite of yourself because you don’t fully understand all of the obstacles, and if you did, you would have pulled the plug two years earlier,” says Wenzel, founder, president and CEO of the nearly 200-employee company.
Wenzel launched General Data in Pittsburgh in the 1980s, then bought a Cincinnati company involved in barcode technology and moved his business here. It’s found its niche in hard-to-barcode applications.
One client, for example, wanted to apply labels to oily parts without having to clean them first, and General Data came up with a solution. Another innovation: A hospital patient identification wristband that includes a photo of the patient and other data to avoid mix-ups in medications or testing.
Wenzel talked with Smart Business about penetrating a fragmented and unfamiliar market at the right level, sustaining a spirit of innovation and choosing the right opportunities to pursue.
How does General Data stand out from other companies in the barcode industry?
Our forte is the difficult-to-barcode or the difficult-to-apply automatic identification. Typically, from a consumer standpoint, if they think of barcodes, they think of the UPC code on the side of a cereal box.
That is not our business at all. We specialize in on-demand labeling, typically in a manufacturing or distribution environment where variable data needs to be applied online or during the process, i.e., either a serial number needs to be created, a lot number, a weight, some variable data that cannot be predetermined, and so the basis of the business in the early days was to come up with the hardware/software and the media to print variable data in nasty environments.
Where is the largest concentration of your business?
Manufacturing in general, although in the last four years, we’ve made a huge commitment to health care. The other application that is huge we believe that General Data is the world leader in the segment of laboratory automation. We have come up with a patent-pending process where we can apply a label to a pathology slide, where we can encode patient identification on each slide from a computer-generated database, which sounds real simple, and according to manufacturing best practices, had been in place for 15 or 20 years.
That’s not the case in health care. Two years ago, I didn’t know much about laboratories, but the protocols, the testing procedures that a slide has to go through and is subjected to <\m> some of them require 26 steps. No one up to this point had developed a label material that could be applied and would withstand the protocols of these tests.
How have you overcome the obstacles to entering the medical lab market?
It’s interesting when you enter a new market because once we came up with the label that actually survived this, well, it’s a good news, bad news situation when you go into a new business segment where it’s never been done before. That’s good if you capture that business segment, but you are also asking your customers to change their existing business practices, which is not only a huge challenge in any industry, but particularly so in the medical industry.
It’s a new way of doing it, especially in the labs, because they use all the equipment from the lab automation companies, the ones that make the testers and the processing equipment they use. The lab may want to adopt our technology but the software to be able to deliver the patient information to a printer at the right place in the sequence of events didn’t exist. So we’ve had to work, in essence, with the OEM suppliers of equipment to labs, and to their systems and to their databases. We’ve said ‘Look, guys, we’ve come up with this wonderful invention and we can automate this process, but we need your help to either open up your software or make software changes so that we can get at the data.’
It’s not that they don’t want to do it and they want to see more errors, but they already have 10,000 requests from their customers and they only have ‘X’ that they can accomplish. So we had to develop a groundswell with early adopters to prove the technology and prove the increase in effectiveness in the lab and prove the decrease in errors so that now it’s getting legs, and our customers in the labs are now in a position where they can put pressure on the third-party equipment suppliers to work with us.
We finally had some major successes just within the past six months where we’ve had some of these large companies say they understand.
How is the health care industry different from other industries?
It’s the best in the world because it’s entrepreneurial and it’s fragmented. It’s also very slow to adopt industrywide standards because it’s entrepreneurial and fragmented. The government has been hesitant, but in the past couple of years they’re starting to put more pressure on the industry because there’s been a huge lack of uniformity in standards.
What’s interesting is they’ll all come up with the same answer at the end; it’s a different way of getting there and, unfortunately, there are hundreds of different ways of getting there.
How did you persuade medical lab companies to work with you?
The technology is so compelling, if you can just get all the parts and pieces and people involved to buy in and make it work. A, it’s compelling from a cost justification standpoint and, B, it’s not like tracking steering wheels that are going to Honda. You’re actually going to potentially save someone’s life.
So the business case for it is so compelling that we just needed to be able to show that we had a product that actually worked. It had been tried several times in the past and there were several failures out there, so that actually made it more difficult. Even some of the early adopters were very skeptical.
How do you keep the innovation coming?
We try to stay energized at the top. Some of it comes from our hiring attitude. I’d love to always have somebody smarter than me, but give me positive attitude over perceived brilliance any day and we’ll get there.
I think we have an excellent reputation as innovators. We tend to attract people who want to do things outside of the box. We don’t say no enough, perhaps, to our customer base, and that’s part of it. On just the labeling side and the industrial and the strange applications, 70 percent of that part of the business is sold to resellers, so we probably have a thousand-plus resellers across the country who are selling into labeling environments, and they come to us daily with, ‘Can you do this?’
How do you decide which products or ideas to develop?
It’s a combination of a specified process with a heaping mixture of gut feel. Some of it is anecdotal. We try to keep track of the application and try to get feedback from the dealers, keeping tabs on if we make this product, how many can they sell.
And, of course, every one of them could sell millions if only we could make them. We give the problem to our alchemists, who turn paper and film into gold and stir the secret sauce and come up with a product.
What challenge must General Data meet going forward?
One challenge is to look at how we manufacture and whether we can make a quantum leap and manufacture more of the base materials rather than purchasing them. It’s that classic make-or-buy decision, and it’s megamillions of dollars.
And it’s not just a cost consideration. When we’re doing such innovative things, if we had the volume of the product that we were manufacturing, then we could dedicate some of that manufacturing expertise to tweak and fine-tune a component we may need for a developmental project. Whereas right now, if you’re not making the next level in the supply chain, you have to rely on outsiders and beg and plead and say, ‘I only need half a drum of this to test my theories.’ And if you don’t make that half a drum it can be tough.
Another, again on the medical side, is to broaden the product to additional pieces of equipment and to be able to roll that out on a worldwide basis. We are getting requests from literally all over the globe, and putting together an international marketing force is a challenge. How to you find out who’s the best laboratory automation company in Singapore? And when you’re trying to sell something that’s brand new, it just doubles the challenge.
How to reach: General Data Co. Inc., http://www.general-data.com