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Welcome to the Karl Storz board

cafead

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Staff member
  • cafead   Aug 28, 2004 at 04:37: PM
Welcome to the Karl Storz company board. Anyone is welcome to post here, whether they are an employee of the company or not. You may post anonymously without registering (registered users please logout before posting if you wish to do so), or with a registered username.

Managers and reps are encouraged to communicate with fellow employees here. If you are interested, we can also provide you with a private, password-protected board for district, etc. Just email webmaster@cafepharma.com for the details.
 








Re:Death of an German dream for China, India & Asia

Karl Storz: Death of an German dream for China, India & Asia
Karl Storz is the Great German Company. But by clinging to the attitudes that made it an icon, Storz drove itself to ruin.

©By Sudha Menon, (senior research analyst healthcare Industry)
NOVEMBER 22, 2008

Back in 2004, when it was still relatively flush, Director Karl Storz(India) invited me to a three-day "product seminar & road show." The idea was that writers like me would consume loads of free food and wine, pal around with executives, and develop favorable opinions about Storz.

After two decades of covering the healthcare industry, I've learned that Storz executives tend to be scrappers skilled at bare-knuckle office politics, while the top brass at office and marketing side are self proclaimed bravado and not set for smart, sincere, diligent - modern-day Eagle Scouts.

But in working for the largest company in the industry for so long, they became comfortable, insular, self-referential, and too wedded to the status quo of rigid and irrelevant policies drawn from head quarter- traits that persist even now, when Storz is on the precipice. They prefer conflict over stability, disorder over continuity, and only Storz's way over anybody else's. They believe that their vision and version will overcome adversity, and that tomorrow will be better than today - despite the evidence to the contrary.

In many ways the story of Storz since the 2004s is a tale of accelerating irrelevance in terms of market, management and customer relation. Customer loyalty and price preferences changed, competition tightened, technology made available much cheaper by local, European and Chinese companies in big leaps, and Storz was always driving a lap behind in terms of increase of market share. It became a red-state company, its Endoscope seldom seen in China and Europe now.

Storz has been losing market share in China and India since the 2005s, destroying capital on recruiting huge manpower like managers and product specialists for years, spending huge money on sponsorships and road shows without any significant result. The benefit of such awareness had been ripped by cost effective manufacturers.

I've had a chance to watch all this up close as a business journalist for the past many years. Over the years the company has tried to reform itself ample number of times in many countries without understanding the root cause, but it has been doomed by what once made it successful: doing it the only Storz way in consultation with wrong advisors. Ask one of the senior executive in India why Storz isn't flexible and market oriented and he'd tell you with pride, "We're playing our own game - taking advantage of our own unique history, heritage and product strengths."

I've visited Storz operation in Japan, China, Germany, Brazil, Middle east and U.S. I've attended Medical shows, product launches, technical background sessions, and news conferences, in addition to interviewing legions of many executives, dealers, analysts, and consultants. Looking back, three relatively recent events signaled the depth of the problems that have overwhelmed the company.

What I heard and learned from the incident were several things.
First, Storz always underestimate the ability of competitors to get it wrong.

Second, good manners, steady performance and business civility with acumen of their dealers are never reciprocated, encouraged or valued as an asset.

Third, a toxic mix to overreach the market and to increase profit, Storz started direct marketing in many countries eliminating long time dealers, compromises in manufacturing quality, and pound-foolish schemes had resulted in a endoscopy system that appealed to practically no surgeons.
Within weeks the customer would receive another ugliest schemes of all time. Creating systems that surgeons wants to buy and can be most cost effective must be the most fundamental mission of any company, and Storz had failed against their peers in Europe, China and India.

Aside from some stalling unresolved quality problems in most of the electronics units, Camera systems caused by software glitches and mechanical problem, the telescopes are out of vision in no time as promised gold standard, generating electricity leakage from the resectoscope and producing only water droplets. Still Storz is calling themselves a technology leader!!

Here is the nation's biggest endoscope maker, struggling mightily to meet tough economy standards of Asian countries, suddenly trying to change strategy without any meaning. What's remarkable about it is that it isn't surprising. Is it quality or brand or none? Look below the figures:

Telescopes with rod lens technology sold by most European manufacturers in range of $.900 and Chinese manufacturers at $.300. Storz sells at $.3200.

Basic camera system single chip technology sold by most European manufacturers in range of $.2500 and Chinese manufacturers at $.2000. Storz sells at $.5000.

Xenon light 180 watts sold by most European manufacturers in range of $.1800 and Chinese manufacturers at $.800. Storz sells at $.3500.

Fiber optic cable sold by most European manufacturers in range of $.150 and Chinese manufacturers at $.50. Storz sells at $.500.

MIS hand instruments sold by most European manufacturers in range of $.200 and Chinese manufacturers at $.100. Storz sells at $.500.

Storz is still growing - the number of employees worldwide reached an astonishing figure over 3500 in 2008 - but cracks were appearing that would widen into fissures. The company seemed to forget how to execute according to market conditions and it encountered all kinds of problems.

Though still a Storz dealer or employee, many seemed fearful, shrunken and insignificant without the corporate apparatus and cooperation behind them. Some of the champions, were nothing compared with the might of the company, have now lost interest and considering Storz association unprofitable.

Rancorous relations with dealers in many countries and periodic management problems remained a fact of life at Karl Storz.

In addition, German business confidence hit its lowest level in more than five years in October 08 as the deepening financial crisis started to have an effect on the outlook for economic growth.

On other hand, Asia is facing high inflation and heading towards Economic recession. The worst phase of economics-stagflation. It is the worst paradox.
For instance, Iceland, one of the richest countries, is bankrupt. A country that survives on imports has only one-day reserve for running the economy. This is global economics. We’re in deep trouble - we’re heading towards a massive depression, which will not be restricted to USA only - it will hurt and injure every country and every individual hard.

It's too bad nobody took the trouble to explain this to Karl Storz. If they had, maybe Storz wouldn't be looking so clueless.

This is also the message for Richard Wolf, Olympus, Stryker and many more to please step out of that boy's club of the masters of the universe who are orchestrating the endoscopy games and put yourself in the shoes of we the people, the consumer, the patients.
 








Boy, you need some serious English composition/writing lessons!

looks like somone from olympus management wrote this reply........ Storz still has the best products and isn't quite the boys club. Attend a National Sales Meeting with some other video vendors and you will see that the people wotj Storz are much more respectful!
 




What's the current status of Karl Storz in the US?

I'm curious about their reputation and strength of their product lines in the US market, particularly their ENT and powered instruments line.