Memry: The Virtues of Vertical Integration

You don’t hear many companies bragging about their vertically integrated operations. In fact, the concept has fallen out of favor, as evidenced by firms rushing to outsource all but their core business activities. Global supplier of nitinol-based products Memry begs to differ. Rallying under the slogan “from melt to market,” the company finds immense value in consolidating processes and controlling its technology. “Vertical integration is the core of our business model,” said Nicola Di Bartolomeo, CEO of Memry. Di Bartolomeo spoke with EMDT editor Norbert Sparrow at MD&M East in New York.

“Nickel titanium is not stainless steel. . . it is not a commodity material,” stressed Di Bartolomeo. “Nitinol is a unique material that is difficult to melt and to work. Having available the scientific knowledge and engineering expertise that allows us to process the material effectively is critical,” said Di Bartolomeo. “Vertical integration gives us control of the technology and allows us to effectively leverage nitinol as an enabling technology.” It also allows the company to devote appropriate resources to materials development and rapidly bring new products to market.

Materials benefit from Memry’s consolidation of expertise and “melt-to-market” oversight, added Di Bartolomeo. The search for cleaner materials is an important development project for SAES Getters, which acquired Memry in September 2008. Materials suppliers must be able to control the formation of inclusions during the production process, Di Bartolomeo said. “As devices continue to shrink in size, reducing inclusions becomes ever more critical. Impurities can lead to crack initiation and impact the overall fatigue life of devices,” he cautioned.

Italian advanced material company SAES Getters and sister company SAES Smart Materials have more than 25 years of experience melting, drawing, and forming nitinol. Vertical integration is key to building on that success, said Di Bartolomeo. “Vertical integration does not mean a closed system,” he stressed. “For example, we sell materials to companies that compete with us in manufacturing wires, tubes, and components. What we mean by vertical integration is maintaining control of the technology and continuing to create opportunities for innovation,” Di Bartolomeo said.