The business of manufacturing anything isn’t easy. Within the orthopaedics segment, I often wonder how a company can not just survive but also thrive in this hostile economic environment. Is it luck or all about smart business practices and strategic thinking? In most circumstances I’d say that it’s a little bit of both. But times are difficult now; people who have lost their jobs aren’t going to pay for elective hip or knee surgeries that were previously affordable. Implant manufacturers are being hit especially hard; in 2011 alone, Stryker, Biomet, Zimmer, and Wright Medical have cut, or announced plans to cut jobs.

Manufacturers and suppliers must think and operate strategically at all times. We’re seeing a lot more partnerships and acquisitions that are generating new business. First, let’s look at a young company. OrthoSensor Inc. (Sunrise, FL) was founded four years ago, and CEO Jay Pierce is directing the company right where he sees orthopaedics headed—into an era of smart technology that integrates electronics and sensors into implants. He thinks his company’s technology will be a disruptive force in orthopaedics, and so far, this strategy is leading to success. Following a partnership announced with Stryker in August, Pierce told the South Florida Business Journal that OrthoSensor is planning to hire up to 40 people during the next year. Most of these jobs will be in sales, because the company outsources it manufacturing, which leads me to another part of the equation—the supplier.

Seasoned supplier Oberg Industries (Freeport, PA)has been around for more than 60 years. Its U.S. medical device business has recently exploded. During the last three years, the company has experienced a compounded annual growth rate of more than 20%, according to David Bonvenuto, executive vice president and general manager at Oberg. “Contrary to the unemployment rates and the focus on jobs [in] a stalling economy over the last several years, we’ve seen the opposite,” he says. Oberg wants to add more than 50 positions to its U.S. workforce, and the company recently held its first job fair to find candidates.

Oberg, too, is looking at where the industry is headed, but is doing so from the standpoint of what OEMs want. “[OEMs] are looking to consolidate their supply chains,” says Bonvenuto. “OEMs have maintained supplier bases that are unmanageable because they’re so large and diverse. As we talk to OEMs about what type of suppliers they want, they seek to improve quality, delivery, and pricing [while working] with fewer top tier-type suppliers.” Operating in harmony with what OEMs need has been the key to Oberg’s recent growth. Looking ahead to 2012 and 2013, the company is planning to continue its upward trajectory.

Sometimes it’s easier to get caught up in the negative news, but right now, I think we need to talk about the positive things that are happening in our industry. That being said, how are you turning challenges into success stories? Let me know what’s going on at your company.

—Maria Fontanazza

Maria.fontanazza@ubm.com