The Swiss factor

Cosimo Bizzarri (CB): Your three companies come from very different sectors: home appliances, sanitary ware, knives and accessories. What brings you here together today?

Martin Baumüller (MB): Looking at our three companies, the first thing one notices is they are all iconic brands from Switzerland, with a strong legacy. V-ZUG is 112 years old. Victorinox is 141. Geberit has just turned 150. So we have a long history in common.

Yvonne Fischer (YF): Also, our three companies focus on quality, precision and a mix of heritage and innovation. So I see a lot of common threads, even if the industries are very different.

Nathalie Noël (NN): Innovation is also something that defines our three companies. What keeps us motivated is the fact that we are constantly in the search for customer-relevant innovation. Swiss people like things straightforward and clear, so another aspect that all our products have in common is that they are always very intuitive.

CB: What is special about the company you work for?

NN: I joined V-ZUG because of its sustainability agenda, which is not driven by laws or regulations, but rather by the company’s ethos. They’ve engaged in visionary projects such as building a multi-energy hub and a vertical factory at their headquarters, and making sure that spare parts for their appliances would be available for at least 15 years. I fell in love with their mission.

MB: I think what makes Geberit special is a strong dedication shared by the 11,000 people that work for the company. It’s a passion for innovation, continuous improvement, making products and customers’ lives better. There’s a very genuine drive within the company, coupled with experience and know how.

YF: This is very similar to how I feel at Victorinox. What surprised me the most since joining the company is that people are truly at its core: employees, suppliers, customers. You feel and breathe the values, day in and day out.

CB: And what about products? Is there a specific product that you think represents your company?

YF: Well, it’s still the classic… There is no way around it: the Swiss Army Knife™. Our founder was a knife maker and a visionary. He built the product so that it could be multi-functional and high-quality. He did a lot of prototyping and feedback sessions from people, asking them how the knife felt, how it sounded and so on, a sort of user-centric process that is super relevant today. In the past, the Swiss Army Knife™ was a portable tool for soldiers, who used it to open cans or cut something apart. Today, most of our customers look very different from those soldiers, but we still pay close attention to them to innovate the product. What is their day like? What are their challenges? Could we add a function to help them?

NN: For V-ZUG, the most iconic product is the CombiSteamer, which combines an oven and a steamer. We worked extremely close with Switzerland’s best chefs to really nail a perfect product that could redefine new cooking habits in the kitchen. I think that the CombiSteamer helped to define the company’s innovation path and a technology that can now be applied to other successful products such as washing machines or dishwashers.

MB: Ours is the cistern, which is basically the tank for the toilet flush. It is the first product that the company brought to market in the early 20th century. Back then, it was a wooden box mounted on the wall. Our founder invented it to improve sanitary hygiene, since his three daughters had died of diphtheria. Later, the cistern was concealed inside the wall—the visible part is the push plate with the two buttons that people use to flush the toilet. Today, in combination with a ceramic toilet bowl, the concealed cistern is still Geberit’s blockbuster product. It’s funny: people send me pictures of it from around the world. It’s a piece of Swissness that people recognise.

CB: Talking about Swissness, your companies have another aspect in common. A strong link with your local territory, and ongoing investment in it. Why is that? And does it come at a cost?

NN: Most of our industry has moved production abroad. V-ZUG made the choice of retaining its production not only in Switzerland, but in Zug—the heart of the company’s history. And it’s not just production. Most key functions within the company are at our Zug headquarters, situated just metres from each other, instead of being spread around the world.

YF: Victorinox has a similar mindset. Everything has to be as near as possible, so logistics can be efficient and the quality can be controlled throughout the manufacturing process. In the past few years, we have built a brand-new Distribution Center in Seewen, near our headquarters.

NN: Producing high quality products in such a location positions us in a segment where customers are willing to pay for premium. But it also allows us to have highly skilled people performing amazing work inside our factories. Take the PowerSteam. Because of its technological complexity, you would probably think its production is highly automated. But in reality, it’s a product that requires a lot of craftsmanship. Today, we have only twelve hands in the company that can put that product together. It’s like making a Swiss watch.

CB: Wow, that’s pretty special. Do you guys have any other examples of this sort of high-detail, artisanal work carried out in your companies?

YF: We have Swiss Army Knives whose production is completely automated, but others that are assembled almost completely by hand. Knives with big blades—like kitchen knives—are sharpened manually. We have an apprenticeship program for knife-making, during which young people learn to forge. Ours are very tangible products that you feel in your hands. A human needs to test them to really see if they will work for our customers. There’s a lot of expertise within the company and employees actively share their knowledge with the next generation, primarily through hands-on experience in the workplace.

MB: Making ceramics is still largely a craftsman’s work, but when you want to mass-produce, that can become a challenge. There are so many parameters which are difficult to control when you make a ceramic toilet. So, we are looking at how we can industrialise that process, driving automation for ceramic manufacturing, while also increasing the quality. Of course, you will always need human skills to develop tools and keep the factory organised and efficient, but it’s a shift in terms of what people do and where you need the know-how. We like to give people the responsibility and freedom to reinvent themselves and their daily work.

NN: At V-ZUG we involved the apprenticeship team in the design of the new equipment for our vertical factory. They are young and digital natives, so automation is a topic that speaks to them. We have integrated them in the project team from the beginning so that they could feel like they own this new process and way of doing things. It is about finding the right balance between becoming more efficient as a manufacturer but at the same time applying our unique human skills to create additional value. Embracing a circular business model, for instance, will require much more human intervention than just making products, selling them and forgetting about them.

CB: Nowadays, everyone talks about circularity, but how it is done varies greatly from industry to industry, and from company to company. Can you please expand a little bit on what you mean by that?

NN: In Switzerland, we are very connected to the nature around us: as soon as we have free time, we go running in the mountains or sit by a lake. So, I believe that as a country, we pay great attention to both Swissness and our natural resources. That’s why circularity has such a strong case here. For V-ZUG, the circular factory is more than just a project. It is a manufacturing vision, that can be implemented only through extremely close collaboration with our suppliers.

YF: So true. We are lucky because most of our products are modular and therefore adapt very well to a circular approach. Again, take the Swiss Army Knife™. If customers have an issue, they can ship it to us and we will fix it, sharpen it, clean it and send it back to them. Over the decades, we’ve never added materials or processes that could destroy this modular concept. Also, as a company that started when Switzerland was one of the poorest countries in Europe and that has withstood two World Wars, Victorinox has continued to prioritise efficiency and responsible usage of resources by tailoring its operations, and it’s never an afterthought. This is also a very Swiss quality. The usage of resources and materials is always carefully considered.

MB: For us, circularity has a lot to do with durability and reliability. Most of our products are installed into the wall and remain there for fifty to seventy years. It’s not so easy to predict what will happen to them on the day in which they will be dismantled. This gives a very special connotation to the topic of circularity when it comes to our products. It has to do with materials, which must be durable and reliable. It has to do with supplying spare parts: for example, if you have a Geberit system from fifty years ago in the wall, you can still upgrade your push plate with a new one of the same proportions. It also has to do with reducing waste in the production process. In our factory, virtually every bit of plastic that could be considered waste gets reused. We also look for opportunities to sell waste to other industries. For example, ceramics waste gets used as filling material for road construction.

NN: I’m thinking about what you two have just said. Today people are used to reason in the short term: “How much am I spending for this product right now?” But I’ve had my Swiss Army knife since I was 18, and it’s in perfect shape. And now I know I can send it to Victorinox to get it sharpened (thank you for the tip, Yvonne). So we should get used to thinking about total cost of ownership. In the long run, owning one of our premium products will result in exceptional cost-benefit ratio, simply because it’s going to last.

CB: It looks like there is a conversation going on right now between three Swiss companies, about how to approach circularity, and how to share best practices. Does this happen often? Do you think this sort of collaborative model could be implemented at a broader level, as well?

NN: Switzerland has powerful companies, but in the end, we are a small community. We interact a lot with each other and there’s a lot of openness to best practice sharing.

YF: There are informal conversations going on, especially about target setting. Why start from scratch when someone has already tested an approach that seems to work and could be adapted? There’s a lot to learn from each other, also on the topic of circularity.

MB: You become circular when you focus a lot on design thinking. Switzerland has been the number one innovative country in the world for 14 years in a row, and I believe the country is on the verge of discovering its full design potential. Circularity today is still understated and linked to a value system, rather than to a business one. There haven’t been enough conversations on how profitable it could be once it is scaled up. I think it is obviously profitable. Speaking about Geberit, we can charge premium price for our products. Why is that? Because we make reliable products, that are durable and built to last. So, circularity and sustainability are not just a matter of social responsibility, they also translate into an economic benefit.

CB: What are the major challenges that you, as Swiss manufacturers, are facing right now, and how are you trying to overcome them?

MB: There are market fluctuations, of course. In the past few years our industry went through some rough times, but we mastered this period with strategic stability and operational flexibility. For example, we made sure to find work for our employees in other departments or even in another industry in Switzerland. This helps us to secure important know-how and skills that we need once the demand picks up again. There you go: an example of collaboration between Swiss companies.

YF: Yes, that’s a great model: we also shifted people to other companies for short periods so that they wouldn’t have to be out of work. Another challenge we must face is the strong Swiss Franc: if a significant part of your sales is in other currencies, that is an issue. And also the quick development in the digital environment, that needs to be governed.

MB: Digitalisation and artificial intelligence are the buzzwords of the moment. We must make sure that we integrate them in a smart way, in order to take advantage of the opportunities they present. I think Switzerland is doing quite well. We have great infrastructure and great talent.

CB: Nathalie, at the beginning of this conversation you mentioned that you chose to work with V-ZUG because of the company’s sustainability agenda. Right now, we are seeing companies and regulators backtracking on this topic compared to a few years ago. How do you feel about this?

NN: Yvonne mentioned that Victorinox still follows a no-waste mentality that has been there since its foundation. Martin said that Geberit products are designed to last for at least fifty years. So, I think that in times like these we need to think sustainability as a long-term commitment. Our three companies have it ingrained in their mission. Switzerland has it woven into the nation’s social fabric. I think we’re playing the long game.

The people behind the conversation

Cosimo Bizzarri - One of the managing editors for Inspirations, Cosimo Bizzarri teaches Design Management at the University of San Marino and writes about design, culture and creativity for a wide array of publications.

Nathalie Noël - Born and raised in São Paulo, Brazil, Nathalie Noël is Chief Marketing Officer and member of the Executive Committee of V-ZUG, a company rooted in Switzerland since 1913, committed to building a sustainable future through the manufacturing of long-lasting home appliances.

Martin Baumüller - After joining the firm in 2011, today Martin Baumüller is Chief Marketing Officer and member of the Group’s Executive Board at Geberit, a Swiss company with around 11,000 employees in more than 50 countries, and the European market leader for sanitary technology and bathroom ceramics.

Yvonne Fischer - Yvonne Fischer is the Chief Product Officer at Victorinox, a fourth-generation, family-run Swiss company operating in over 120 countries. The company produces premium household and professional knives, watches, travel gear, and the iconic Swiss Army Knife™.