Thursday 29 September 2016

Concorde problem-solver's high-tech business is booming

David McMurtry's fast-growing €2.5bn high-tech manufacturing powerhouse Renishaw aims to be a leader in 3D printing

John Reynolds

Published 07/06/2015 | 02:30

David McMurtry by Paul Young
David McMurtry by Paul Young

Dubliner Sir David McMurtry, the 75-year-old co-founder and CEO of the €2.5bn precision manufacturing equipment maker Renishaw, is Ireland's greatest living inventor and our most successful engineer. He owns a 36pc stake worth €900m. He's a dollar billionaire.

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As a young boy, the Clontarf native made model planes and modified their engines. Now his company makes high-tech machines used to make real jet engines and parts.

At Rolls Royce in England, where he started out as an apprentice at the age of 18, his inventive genius notched up 47 patents and applications. A further 150 notched up at Renishaw in turn led to 300 more patents being granted, while the company has 1,500 patents in total.

Headquartered in a 16th Century mill beside a lake and nature reserve in a green Gloucestershire valley about 45 minutes' drive from Bristol city centre, the firm is a world leader whose employees are at the top of their game. Its products are used by the makers of essential components for Formula One cars, spaceships and planes.

More recently Renishaw is understood to have supplied the 'megafactories' in China and Korea to which Apple and Samsung contract out the manufacturing and assembly of their smartphones, sending its sales in Asia rocketing by 124pc. Its machines are instrumental in checking up to one million smartphones a day, and they also ensure that the machines that build them are operating correctly.

The company is also betting on 3D printing and niche areas of healthcare to drive its future growth, investing €68m in R&D over the past year, mostly in these divisions. Near Birmingham it is busy establishing one of the biggest 3D printing centres in the world.

In the lobby of the Renishaw HQ, I pass a proudly displayed prototype jet engine that the Irishman worked on at Rolls Royce. Our interview takes place in his modestly appointed office on the first floor, accompanied by the firm 's head of communications, Chris Pockett.

Renishaw was founded in the early 1970s after McMurtry invented a probe to measure small diameter fuel and oil pipes in Rolls Royce's Olympus engine for the legendary supersonic Concorde - a project on which he had been brought in as a problem-solver.

He realised there was a business opportunity in making other precision tools, so he and his colleague John Deer left and started their own company.

Did he ever get to travel on Concorde before its tragic demise in 2003?

"I had two flights back from the US on it - one took just under three hours from New York to Heathrow." There is a lasting connection with the plane on the outskirts of Bristol where he's supporting a new high-tech heritage museum - Bristol Aerospace Centre - where one of the remaining Concordes will be housed.

Compared to supersonic aviation, it seems trivial to talk about iPhones. I ask about his company's machines being used in their manufacture. Pockett interjects: "We've never named our customers and we absolutely respect commercial confidentiality with all manufacturers with which we work. Nor do we have a direct relationship with the companies you refer to. We sell equipment to companies that supply them. What we can say is that the majority of the world's manufacturers recognise us, the biggest names in a variety of industries."

Assistant CEO Ben Taylor had revealed earlier during my visit that committing to carry a large inventory of equipment had given Renishaw the edge over a rival in one of the supply deals in question. Another competitor struggled because it couldn't figure out how probing equipment would be used in the phone manufacturing process. The strategy is definitely paying off. Renishaw more than doubled half-year sales in China for the metrology division to €84m over the previous year; and quadrupled sales in South Korea to €33.5m.

One former Renishaw engineer now works in a senior manufacturing design role with Apple, and was part of a team that worked on the latest iPhone's curved casing designs - indicating how sought-after the firm's key employees are.

Using 3D printing, particularly of materials such as titanium and nickel alloys in niche areas of healthcare and precision manufacturing (including aerospace, defence and motorsport) is likely to be similarly lucrative, says McMurtry - who has some porcelain teeth made with one of its machines.

3D printing has already achieved significant results for aviation industry customers. One firm has halved its production cycle time, while another reduced the time to make an €85,000 part from 12.5 hours to 4.5 hours. In facial reconstruction work, 3D printing has reduced a particular process time from an hour to a minute and a half.

These areas are where its key strengths lie, McMurtry says, adding that while robots will increasingly take over high-volume low-cost manufacturing, this kind of high value work still needs people involved at most stages.

I wonder what he makes of Ireland's broader economic strategy? He's quick to answer. We need "loads of Kingspans... more Irish-owned businesses. Countries are at their best when they're manufacturing. Food and farming is doing well too," he argues, with a certainty of vision that brings to mind Michael O'Leary or Steve Jobs. He says he admires the stability and success of Germany's mittelstand and of their many export-focused SMEs.

When I ask about his thoughts on Ireland's tech-related FDI and our emerging start-ups, he name-checks Patrick and John Collison - founders of the multi-billion euro payment technology firm Stripe. "Move the clock 50 years and if I had the skills I might've had a go at a software or tech start-up," he says with a smile.

He keeps a chunk of cash in the bank, currently €105m, both as a safety net and to fund acquisitions. The most recent buy was a German company that had figured out a specific aspect of the 3D printing process.

The cash buffer was vital in keeping the business afloat during the 2008 economic crash.

"That was a scary time. We just didn't know when it was going to stop, and had to lay off 437 staff. Sales to our machine tool customers plummeted by 80pc as car makers cut production."

A solution he came up with - how to make a 3D-printed device that could deliver drugs directly to the brain for the treatment of cancer, Parkinson's and other brain diseases - gives some idea of the scope of his genius. (He was inspired by the bone-anchored hearing aid of someone he met in a pub.)

Problem-solving and R&D are the most enjoyable aspects of his work. "I enjoy interacting with people, asking them what they're working on. If they have a problem, I have a think about it and do some drawings, then show them with my ideas. My ongoing working relationship with them is essential for that."

A keen aptitude for maths and science ("I was hopeless at everything else") informed him from an early age. Model plane-making ("it was a major distraction to my education") helped to nurture his innate talent. Growing up in the 1940s and 1950s, he also played in his father's tinned foods factory in Fairview, beside the River Tolka. The clunking, whirring machines, which later produced boiled sweets fuelled his inventive curiosity. Seeing his father go out of business when the factory flooded also may have shaped his insistence on having a cash safety net and his dislike of borrowing.

He also enjoys visiting the world's biggest trade show for makers of manufacturing equipment in Beijing every year. "All the time I'm there I'm looking for opportunities, asking myself what they've missed," he enthuses.

Though he doesn't fly as a hobby, wouldn't a private jet be handy for such trips? "No, they're a bit ostentatious - like driving around in a Bentley. I wouldn't fly private. BA business class is great."

When he's not at home, with his family, or at work, his hobbies are table tennis and squash. He mentors a number of people with businesses "in areas where I have knowledge", preferring to keep these private.

What will happen to his stake in the company in the future? His children haven't followed him into Renishaw, but have their own businesses. "That's a problem that has to be addressed. Myself and John Deer are the eldest employees, after all," he says, declining to elaborate. His wealth may be channelled into philanthropic efforts - as with Concorde and Bristol Aerospace Centre. "You can't take it with you. More and more will go that way," he said in a previous interview.

Along with his knighthood and CBE, McMurtry's awards and honorary doctorates from universities and organisations in the US, Japan, Wales, Scotland and England are on a list one-and-a-half pages long. Not one is from any Irish institution.

It's about time someone changed that.

My boss said 'Go, fail, and then come back'

My greatest indulgence is...

"If you asked my wife, she'd say the business!" There's also his €36m futuristic eco-mansion Swinhay House, featured in the BBC's Sherlock last year. "We had a few meals with Martin Freeman and Benedict Cumberbatch - all the family enjoyed it." He's also a bit of a boy racer, owning a Ford Sierra Cosworth former track day car and a new Mini Cooper S-works - the fastest Mini ever made - that he's just bought.

The last gifts I gave and received were...

"The last gift I gave was something to one of the grandchildren, for their birthday. And as for gifts received, it was more than likely a pen - from the National Physics Laboratory, on whose board I sit."

The best business advice I've received was...

"When I left Rolls-Royce, my boss said to me: 'Leave, go and fail, and then come back.' 'Live within your means,' as my mother used to tell me, is another one."

The last film I saw was...

"I really enjoyed The Imitation Game and also The Theory of Everything."

The book I'm currently reading is...

"A thick annual of academic papers on manufacturing technology - a great thought-provoker."

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