NZ Business Magazine, December 1993
By Daniel Riordan
Auckland’s ritzy Pan Pacific Hotel is buzzing - literally. Fifteen model racing cars are tearing around helix-shaped tracks stretched over four large scaffolds. You’d think the optometrists attending the contact lens conference nearby would complain about the noise - if they weren’t so busy frantically working the remote controls of the miniature motors.
What do racing cars have to do with optometry? About as much as do gas torches, caricature artists, pizza boxes and frisbees - all of which have been used over the years to good effect by contact lens manufacturer Hirstlens NZ. The company’s motto could well be "expect the unexpected"; its secret weapon in the struggle for optometrists' order books is assuredly its sense of humour.
That’s how Hirstlens’ live-wire pairing of co-managing directors and owners Ian Handricks and John Shennan like to present their management strategy, and that’s generally how the industry perceives it.
The two head a company of solid pedigree dating back to 1942, renowned for its advanced technology, and with a new product under development - a bifocal contact lens of enormous world-wide market potential.
They also head a company which less than four years ago was on its deathbed - nearly bereft of products, its parent company in receivership, and its suppliers about to give up. That's when a sense of humour was needed most - as Handricks’ look alike Jerry Garcia might have said at that point, “What a long, strange trip it’s been."
That trip started back in 1942, when Hirstlens was founded by Eugene Hirst, a Czech Jew and dental technician who’d emigrated to New Zealand several years previously. Asked by an ophthalmologist to make a prosthetic eye shell for a woman with a complicated eye condition, he enjoyed the challenge, and decided to manufacture contact lenses full time.
“Gene was a patriarchal-type manager," remembers Handricks, who joined Hirstlens in 1974, six years after Shennan. “He'd come in and pat you on the back at nine o’clock in the morning, and enquired why you'd shifted an instrument l0 degrees on the bench. He fostered an interest in everybody’s personal career and engendered in us a culture that’s never been lost."
Doug Mortimer, an Auckland optometrist, bought a half share in the company in the early 1950s and things grew from there. Hirstlens became a world leader in developing the technology for the relatively new techniques of soft lens manufacture, without realising it at first.
“Because of isolation, I don’t think we knew what was truly happening around the world," explains Handricks. "We thought we were the poor cousins, but as it turned out we were miles ahead of anyone else."
But even so, Hirstlens still managed to lose its way. It succumbed to the nemesis of so many small technology-based companies: the corporate embrace.
That was in 1976, when Hirst and Mortimer sold their shareholdings to NZ Optical. As a division of NZ Optical - which was in turn owned by a larger Swiss conglomerate - Hirstlens struggled to adapt.
“The corporation had distant visions of hugeness for its division," recalls Handricks. “But Hirstlens was never designed to be a big company. “It was like being pulled through a wringer," he grimaces. “We used to account for every piece of material we used.
We became a company run by accountants."
And it got worse. In 1986 NZ Optical was gobbled up by Crown Corporation, which fell over two years later. Enter new owner Standard Optical of Australasia, which took all of six months to go into receivership itself.
“Poor old Hirstlens was by this stage sitting there looking pretty forlorn,” says Handricks.
At which point, Shennan and he said “enough is enough" and negotiated with the receivers to free the company once-and-for-all from its corporate shell. On June 1, 1990 the two became joint owners of the newly incorporated Hirstlens NZ, and set about restoring the operation’s reputation.
But first, they sat down and pondered how they were going to run the company. As befits a self-styled Laurel and Hardy act, they hit upon humour as the key to their approach.
“We decided that one thing lacking in New Zealand business at the time - not long after the crash - was humour. So that was going to be our secret weapon," says Handricks.
But there really wasn't much to laugh about at the time. The compar1y’s suppliers had been badly burned by the previous owners, and Sherman and Handricks had their work cut out convincing them to stick with the company.
"We called on every friendship we’d ever made in the industry," says Handricks. “And every single supplier came back to us, and took us on our word that we could make this thing work, ” including, he adds, suppliers who had expressed interest in buying the company themselves.
The climb back is likened by Handricks to scaling Everest wearing jandals and a T-shirt, but it’s a climb Hirstlens has made nevertheless.
In fact, points out Shennan, Hirstlens has made a profit every quarter since the two became its owners.
The off-beat approach was a big ingredient of that success. As Shennan describes it, it was the “something extra that was needed to grab the attention of suppliers and convince them that what they were dealing with was a company committed to the future."
The industry got an indication of what to expect at Hirstlens’ initial public appearance under Handricks’ and Shennan’s ownership - the 60th annual optometrists’ conference in Hamilton.
With just four products of any note, and a recent history of marketplace failure, the two decided to present the company to prospective customers with no products at all.
So they built a five metre high “time tunnel" and lined its walls with a history of optometry, featuring photos of just about everyone in the industry. “It was our way of giving something back to the optometrists in return for what they’d given us," says Handricks. The stand was packed throughout the conference.
“We talked more about our products than we’d ever talked before in our life. We were dry in the throat at the end of it, ” says Handricks. “But we’d proved we didn't need to take product to a conference - and since then we never have."
The next conference was in Christchurch. Although Handricks must have told the story countless times, it’s belied by his obvious relish in the yarn.
“Christchurch was our competitor’s territory, so we were allocated the far back booth. We decided to go quite minimalist, and took an empty booth with virtually nothing in it at all. But we hired a caricature artist and he drew about 300 caricatures of all the optometrists, with our logo. And of course they were stuck in a chair for l0 minutes and couldn’t move, so we could talk to them.
“We said they could have their caricatures - which were big ones, life size - so long as we could put them up on the wall for the duration of the show. And all of a sudden every square inch of wall, floor and ceiling was covered with these caricatures.
"Even our competitors wanted them done - we said sure, provided you stick them up in your booths. So the Hirstlens’ logo was everywhere.
“Then on the [final day] of the conference, when all the deals were about to be signed, we announced that everyone could come back to our booth and pick up their caricatures. That left all our competitors standing there with empty notepads in one single swoop we’d managed the biggest coup ever at a conference."
Now, several years on from that first conference where it could have presented no more than four products of any note, the Hirstlens’ catalogue contains over 300 product lines.
Handricks and Shennan say the response to the company at conferences has allowed it to jump to the next level, and also to broaden its scope from just contact lenses.
The diversification started at an early conference when Handricks took along a computer to play with behind the exhibit stand while the conference was in session. The interest shown in the computers by the many optometrists lacking in computer literacy led to Handricks initiating a profitable sideline for the company in computer sales and setting up an industry user group called “OUCH" - Optometrists Using Computers Help.
“We figured they were probably looking to have a bit more enjoyment than going ‘better, worse, better, worse’ in a dark room all day," jokes Handricks.
Today, Hirstlens has supplied hundreds of computers to the industry. The diversification has enabled the company to build a self-sustaining relationship with the industry - with optometrists confidently writing their own databases, Handricks points out it’s that much easier for them to jump to the next technology level when it becomes available, with Hirstlens as lens supplier.
More recently, Handricks [an engineer by training and something of a computer whizz] was asked to put together a total photo digital imaging system for the photographic industry, which, among other things, will enable the company to make a video of the fitting procedures for the bifocal lens, which can then be fed straight into a computer.
So long as these “sidelines" don’t stray too far from the company’s core business of contact lenses, Handricks and Shennan are confident they’ll contribute to rather than detract from Hirstlens’ positive growth path.
Having a dual command structure is definitely seen as a positive for the company. Two managing directors is not a recipe for continual infighting.
“If one of us doesn’t agree with the other’s suggestion, we say ‘fine - let’s not argue’ and we drop the idea," says Shennan. “There’s no defined position for either of us. We don’t say that one of us is marketing-oriented, or the other is product-oriented. We really don’t define our roles - to either our suppliers or our staff. And it works.
“We’re about as different as chalk and cheese as you can find," adds Handricks. “It really is a Laurel and Hardy approach to business."
Shennan says while he’s more reserved, Handricks is more of the gambler.
Explains Handricks: “I prefer using a phone to do business; John prefers using a pen. John’s a better public speaker than me because he’s probably more nervous about it than I am. I’ll get up and waffle - he gets up more organised, and the audience get more from it as a result."
But what of the racing cars whiz zing around in the Pan Pacific? They were all painted in Hirstlens’ colours of green, blue and black with logos, and the company’s advertising was displayed on the miniature hoardings that lined the race tracks. And next to the action, the company had a pile of “fast track courier systems" for sale - pizza boxes with order forms and pre-paid envelopes for Hirstlens’ products.
The two complemented each other superbly, says Shennan. “Optometrists were coming up to us and saying, ‘I’ll double my account with you if you can beat me around the track’. They had fun."
John Shennan and Ian Handricks say that while they didn’t find adapting to the corporate ownership easy, it never crossed their minds to leave Hirstlens.
"We had too much pride in what we were doing," explains Shennan. "And we could see the potential - the light at the end of the tunnel, and that helped us put up with the inconveniences." He says they realised management was new to the job of running a contact lens company and that Handricks and he worked long hours to ensure the corporate overlords saw the strength of Hirstlens.
Still, the take-over by Standard Optical of Australasia severely tested their patience. "It was an eerie feeling," reflects Shennan. "They’d always been competitors of NZ Optical, and the integration of their staff with ours was difficult. They were walking around talking about what they were going to do to this and that ... there was a lot of cynicism about it all."
Came the receivership, and it was almost with a sense of relief that the two took control of the company themselves. Facing a tremendous learning curve, the two were determined all along to do what Shennan calls "the right thing" by customers, employees and receivers. "And it had to be done in a gentlemanly manner, " he adds.
Loosening the chains
Hirstlens turnover has nearly doubled in the three years since Ian Handricks and John Shennan took over. They aim to repeat that growth again in the next three-year period. The company has minimal exports, though that should change if the bifocal lens project - funded 50/50 between the company and the government (the Technology for Business Growth Programme run by the Foundation for Research, Science & Technology) - realises its potential. “It’s quite a stimulus for a company to be involved with the foundation," says Shennan. "It is a chance to explore the potential developments that it has." The lens is expected to be released onto the market next year.
The core Hirstlens’ 14-strong staff have been with the company for over 10 years. Apart from one who left to go to university, no staff have been lost in the time Handricks and Shennan have been running the company. The loyalty factor is very high, says Shennan, which helped keep the company going through its various periods of corporate ownership.
“The staff had been used to autocratic-type management," says Shennan. "We’ve since loosened all the chains - now there’s no partitions between us and them. The first thing we did was take the time clock off the wall." Everyone pitches in when needed: “Ian and l will be in jeans one minute, loading the truck, packing boxes, then we’ll be out front again, talking to our customers."