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SPIE Professional January 2009

People First

Jan Melles says people and people skills are essential for entrepreneurial success.

By Jan Melles

Jan Melles, co-founder of Melles Griot

When I was asked to write this article, I wondered what I could possibly add to the many informative articles by successful entrepreneurs in previous issues of SPIE Professional magazine. The one thing that makes me possibly different from other entrepreneurs is my longevity in the industry. My 43 years in the optics and laser industry go back to 1965 when I was a young and inexperienced sales engineer and include my role today as president and CEO of Photonics Investments BV.

I have now reached the ripe old age of 68 and can say that it has been a fantastic experience.

My career has included 40 years as an optics and laser entrepreneur, having founded or co-founded 12 companies. I have served on more than 20 boards of directors and brokered the sale and acquisition of more than 50 companies varying in size from $5 million to $200 million.

Having experienced multiple ups and downs over that many years, you’d think I would have seen it all. But nothing is further from the facts. Not a day passes when things happen in business that don’t add valuable information to my mental database.

The following comments are based on my experience as an entrepreneur and are my opinions about the core values and principles which are essential for successful entrepreneurship.

Starting Out

Thinking of starting a business? Be honest with yourself about why. This is essential if you aspire to be successful.

Many people are driven by negative circumstances to create a business for themselves. These can include an employer going out of business, being laid off or fired, having a tough time with your boss and/or colleagues, not feeling properly appreciated for the kind of work you do, having the feeling of being underpaid, not getting the promotion you counted on, etc.

If these are the only circumstances motivating you to start your own business, you may want to think twice.

While it is not impossible to achieve success driven by these situations, it will be more difficult than when positive factors play a role as well. Positive reasons for starting a business include a strong desire to have your own business and be independent of anyone and the ability to create something you are convinced cannot be achieved by working for someone else.

Value of Partners

Starting a company by yourself is the ultimate form of entrepreneurship, but it can be lonely. Many who do it alone miss the human interaction needed to stay on course. As such, there is much in favor of having a partner.

There are plenty of examples of partnerships that became successful companies. HP, Bausch & Lomb, EG&G (Edgerton, Germeshausen, and Grier, Inc., acquired in 2002 by URS Corp.), Apple, and Google are prime examples.

Many of my ventures have been with a partner. Growing a business together can be immensely beneficial, especially if the partners are complementary in character and add different values to the business. For example, someone with a strong technical background might complement someone more competent in sales and marketing.

A key benefit of a partner is having a sounding board on which to test your ideas. Many of the ideas I came up with, (often after waking up in the middle of the night) looked like great winners—until I discussed them with my partner. Reality set in when he responded: “But have you thought about this?” or “Do you realize what the consequences could be if …?”

Good ingredients for a successful business are loyal partners who are team players.

Other Relationships

Nothing is more important than the people on your payroll and nothing is more essential to achieving success for your business than building a strong team of competent and ambitious people. It is an ongoing and proactive process, so you should always maintain a reservoir of potential, talented employees.

For years I stayed in touch with professors at various universities. Building good relationships with these universities was important because in many cases they were also customers. It also generated leads on talented students with ambition to be involved in business.

Customer Relations

Customers are not companies. They are people of flesh and blood who have the same problems living in a complex society as anyone else.

Building good personal relationships with current and potential customers is one of the best ways to get and keep their business and to minimize the risk of competitors getting into “your” territory.

Some years ago, I tried to get orders from a large medical instrument company that was buying a large volume of optical components from a major competitor. The company’s buyer indicated that he was happy with his current supplier and had no reason to switch.

I could not even get in the door to talk to him until one day he actually allowed me in his office. Then he turned his desk clock to face me, saying, “You have five minutes to make your pitch.”

During this meeting, he actually talked more than 30 minutes, at one point showing me a box full of military medals, mainly from World War 2, which he pulled from his desk drawer. He mentioned that he was a serious collector but was missing a German “Iron Cross, 3rd Class.”

I left his office without any orders but made a mental note of this. A few months later, my wife and I were visiting a small antique fair in London where an old fellow had a small booth selling all kinds of junkie stuff–and a bunch of medals. When I saw these, my conversation with that buyer flashed back to me. The dealer had two Iron Cross, 3rd-Class medals and said they were rare. I bought one.

When I returned from my trip, I called the buyer, who also remembered our friendly conversation. I made arrangements to see him, and when I put the medal on his desk, he almost had tears in his eyes as he thanked me for something he had been yearning after for years.

About a week later, a fat envelope full of drawings arrived at our office with a request to submit a quotation. We were successful in securing that business. For an investment of less than $25, we got orders worth hundreds of thousands of dollars.

Selling Is Listening

I hear too many times these days that selling by sales people is becoming less important because of the Internet. Customers only need to check your Web site for all the information they need to place their order. All you have to do is promote your Web site and orders start rolling in.


For other people, selling is the process of convincing a customer to accept your arguments that your product is the best there is. My experience indicates that this is not the essence of the selling process.

The key factor in selling should be listening to the customer and motivating him or her to want to buy your product or service.

Making sure your sales people are properly trained in the details of your products is essential to gain a customer’s confidence. But by focusing on the merits of the product, sales people tend to talk too much when they should be listening to understand the customer’s needs.

By giving you the purchase order, the customer is sticking out his neck on behalf of his company.

Make sure you don’t let him down.

Whenever sales people call on me, I know it’s time to end the visit when I hear comments like, “Well, sir, I need to get back to my office to get an answer to your question.”

Product Development

Product development is another essential, ongoing activity for the survival of any business, big or small, and any company in our industry spending less than 5% of sales on product development is not taking this seriously. The norm has been between 5% and 15%, with the majority investing 5% to 10% of sales.

At the start of any new business, the product line will consist of those items that the founders brought into the business. Once those products have been designed and brought to market, the question is what to do next.

New ideas for products will come mostly from active interaction with customers. Unfortunately there are too many companies relying on their sales force to bring back ideas after talking with customers. In practice, this does not work. Sales people are not always the best listeners and their salary and incentive package are mostly based on orders they get, not talking to customers about possible new products.

I have had more success by using a tech-heavy engineer/scientist with good listening skills whose only function was to interact with customers, in particular design engineers, and to learn (=listening) what their plans for new products were without any pressure to get sales.

Business in China

Nowadays, the magic solution to increasing sales and/or lowering costs is to become active in the Chinese market. There is no doubt that this market offers excellent opportunities for growth, but it is also important to be aware of potential pitfalls when there are language and cultural differences and risks involving protection of intellectual property.

There are ways to minimize the risks. I highly recommend consulting a Chinese law firm to come up with a policy that makes sense for your business and to use a reliable interpreter if you are not a native Chinese speaker.

Chinese people are hard workers and can be instrumental in building your successful business. To succeed in the Chinese domestic market, find a Chinese partner who has the necessary skills, the required permits, and the infrastructure to support your entry in this huge market.

The influence of family on business affairs is another aspect of doing business in China that merits special attention if you are a foreigner.

Most Chinese companies are started and managed by families. Family interests are paramount in Chinese culture. This is a great benefit since the people in charge are highly motivated, have moderate income demands, and are very loyal to the business. The drawback is that there are many talented engineers and scientists who have little or no chance of being promoted to management since they are not family members. This is a serious handicap for growing the business.

Cash Objectives

When asking business owners what they consider to be the hallmark of a successful business I often hear arguments such as “to be the most innovative company in the industry,” “to be the market leader,” “to be the most profitable company,” etc. These are wonderful objectives but not the real raison d’etre for any business.

The real purpose of any commercial enterprise is to generate cash, the funny stuff you can put in your bank account or use to buy all these wonderful goodies you would like to have. Your company may indeed be the most innovative, have the largest market share, is the fastest growing, etc., but if it does not generate the level of cash needed to make and keep shareholders happy and to reinvest in your business to sustain its ongoing growth, you are wasting your time.

Keeping track of cash therefore is one of the most basic elements in the financial management of a company. Adequate liquidity, even more so during turmoil in the global capital markets, is essential for the survival of your business.

Tech Entrepreneur

Most people starting a business in our industry either have a strong technical background or unique skills and knowledge that are the foundation of generating the products the company will develop for the market place.

They are rightfully proud of their achievements. They play a key role as CEOs and usually principal shareholders. Without them, there would be no business. The first years of any new business are commonly the toughest. If you look back at these early years at some later time, they are—without exception—seen as the most interesting and exciting period of the company’s development.

When the company grows, the demands on the CEO change with it. The stronger a CEO is focused on technology, the more difficult it is to provide effective management for growing the business. Over the years, I have seen too many examples of tech CEOs becoming less effective as managers and an obstacle in the company’s growth. For the sake of the company, these CEOs are well advised to realize their limitations and step back as CEO to let a more experienced general manager take over. This lets the founder concentrate on developing new products and technology.

Despite all the difficulties that come with owning your own business, few things in life are more fulfilling. The opportunity to decide your own future and what you want to do with your own life is just not possible working for someone else.

Cornerstones Of Success

Jan Melles offers these tips for a successful entrepreneurship.

• Have a clear focus on where you want to go
• Be a good team player
• Trust your employees
• Realize that mistakes will take place, and ups and downs are an unavoidable feature of any business.

Company Profile

Photonics Investments, headquartered in Duiven, The Netherlands, has started or invested in many new ventures in the United States, Europe, and Asia, all active in optics, lasers or optical instrumentation.

Founded in 1992, it specializes in mergers and acquisitions and assists top management with defining corporate strategy and developing, expanding, or reorganizing international business.


Jan Melles Talks About Competition

We live in a highly competitive world, with competitors always trying to get our business. Many entrepreneurs see competitors as a threat or at least a nuisance, and competitors can become an obsession for some.

It is smart business policy to keep track of what your competitors are doing. In the end, however, you will need to build your business on its own strength.

I have always looked at competitors in a more positive way. They keep me on my toes, and they can be a good source of information to help strengthen my own product line.

Competition, indeed, becomes a threat if you fail to deliver your products to specification and on time.

Jan Melles

Jan Melles has been founder, president, and CEO of Photonics Investments, BV, since 1992. After obtaining his BSEE and serving in the Dutch armed forces, Melles immigrated to the United States in 1965 and began work as a sales engineer at Rolyn Optics. He and Dick Griot founded Melles Griot, a distributor of lasers and optical equipment, in 1969. MG was sold in 1988 and is now CVI Melles Griot.

Have a question or comment about this article? Write to us at SPIEprofessional@spie.org. 

DOI: 10.1117/2.4200901.02

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