Mr. Stef Wertheiner greeted us at the massive Iscar R&D facility. Iscar makes cutting tools for the Metal industry. They believe in the Motto “Where Innovation never stops!”. Iscar believes in improving productivity through innovation. They innovate by bench marking their products with their current products and competitors’ products. They follow the concept of Modularity which is to limit change in production & machine costs.
According to Mr. Stef Wertheiner, Iscar’s business model is like the razor blade model. Iscar is customer oriented business with the following principles:
- Cost Cutting
- Customer Relationship
- Improving productivity
One of the examples of customer oriented business is that Iscar demonstrates live action of the tools of the company at its R&D sites.
Mr. Wertheiner believes Mr. Warren Buffet who purchased the company for $4 billion was impressed by three aspects of Iscar:
- Level of innovation
- Human Factor
- Profit Margin