Leading Questions

Vision Monday posed these two questions to a diverse group of 10 company leaders throughout the optical business.

Question 1: What does ‘leadership’ mean today in the optical industry’s ultra-competitive climate?

Question 2: What is one specific initiative your company is taking to propel your business forward for the next five to 10 years?

Rod Larson
President, Gerber Coburn

Answer 1: Consolidation within the industry creates an environment of more targeted, fo­cused competition.I think the hallmarks of leadership are similar among Gerber Co­burn’s competitors and our customers’ competitors.Our customers are increasingly demanding and are looking for multi-dimensional leadership from their suppliers.It’s not enough to be the technology leader, nor enough to be the leader in service support.True industry leadership must be exhibited through excellence in multiple areas: product innovation, customer service, technical support, integration of products and services, real value-for-money, and global reach.”

Answer 2: “One of management’s toughest challenges is choosing and prioritizing from among the initiatives to drive and grow one’s business.There’s a very challenging balance to be struck in driving improvement and change along multiple priorities while not diminishing the success of those efforts by trying to do too much at the same time.One of the priorities for Gerber Coburn is to create innovative product and process platforms.These platforms will better enable attractive return-on-investment for our customers and give us better ability to leverage our technical resources, gain efficiencies from our supply chain, and simplify product and process support.Such platforms have the added challenge of needing to have global relevance and appeal.”

Lance Snarr
CEO, Thoma & Sutton Eye Care Professionals

Answer 1: “In today’s highly competitive eyewear/eyecare environment, a leader needs a brave face and a lot of creative innovation. The changes in all facets of this industry are so dynamic today that to keep pace with the altered business landscape one must lead with boldness and courage.

“A good leader needs to adapt to those ongoing changes and innovate to keep his or her business on the right track for success. That means doing the proper research into current business conditions, then taking risks, experimenting with new ideas and merchandising trends, and keeping up with the times--to try to lead in the times.”

Answer  2: “We are really focusing on hiring, training and retaining an excellent staff and store personnel.

“Over the next 10 years, we believe eyecare practitioners and optical retailers will find it more and more difficult to hire talent and keep talent, so we’re planning now for five or 10 years out. When we hire new people, we think about our store environment and how we plan to grow our business--that means we try to manage our people so they will be happy employees and want to stay. It’s not just a matter of pay--it’s how we treat employees to encourage them to be part of a team and contribute. There will always be bigger companies that may offer more money, but we work to offer a better environment so our employees feel good about what they do all day--I really believe that’s important.

“Our stores are in two licensed states, Ohio and Kentucky, and there are only so many licensed opticians in the pool of potential employees. Other companies may offer them more money; we offer them a happier workplace.”

Liz DiGiandomenico
Senior Vice President/General Manager, EyeMed Vision Care

Answer 1: “All vision companies are striving to understand and balance the needs of eyecare providers and consumers. For vision-benefits organizations this is particularly tricky, as our customers include multiple consti­tuents--brokers, clients, members and eyecare pro­viders. Leaders are defining new ways to anticipate and satisfy their expectations by infusing quality at every customer touchpoint through technology, proactive communication and research. These are really the attributes that set leaders apart from the rest.

Leadership also involves anticipating the overall direction of health care and interpreting it for the vision-care sector. For instance, consumer-driven health plans have pushed savings and member choice into the forefront. Likewise, wellness initiatives focused on preventative care have impacted clients’ views of vision benefits. Vision companies must navigate this environment successfully by understanding where their services fit into overall health-care packages.”

Answer 2: “EyeMed is embarking on several programs to make sure we stay in tune with our constituents’ needs. Perhaps the biggest, and certainly the widest-reaching, is the integration of our eye health and wellness plans into core health-care programs. Vision benefits are about a lot more than eyeglasses: comprehensive eye exams are the foundation of good visual and overall health. While we certainly want people to correct their vision if necessary, we are more concerned with members receiving eye exams annually or at the frequency directed by their eyecare practitioner. After all, eye exams include more than just refraction; they can identify all sorts of chronic conditions, including diabetes and high blood pressure.

 “To address this, EyeMed will continue to work with our clients to promote eye health as part of overall wellness. We’ll be encouraging members to get their eyes examined yearly through communication materials and other means, and looking at ways to increase disease awareness among our client employer groups. As we work with brokers, we’ll explore ways to incorporate our vision plans into other health programs. The end goal is for employers to offer a full slate of benefits that encourage employers to be healthy and live longer, more productive lives.

“We expect that over the next decade this emphasis will increase and solidify as vision benefits really come into their own.”

Mike Hundert
President and CEO, REM Eyewear

Answer 1: “Leadership in the eyewear industry today re­quires broad forward-looking vision to create in­novative ways to leverage a company’s distinctive compe­tencies to expand channels and geography of distribution, in addition to its range of products.That requires attracting, blending and motivating a top team of people who possess superior intelligence and intuition, and who have ‘little’ patience and lots of perseverance. You also must know who you are, and what you wish to be, and communicate that constantly throughout the organization.At REM, we live the Jim Collins (author of “Good to Great”) notion that great companies face ‘the brutal truths’ regardless of what they are, while we maintain unwavering faith that we will succeed.”

Answer 2: “We have a set of intertwining growth initiatives at REM that support our long-range expansion strategy. It began with our recent launch of a luxury division, Base Curve, designed to expand our distribution channels to the eyewear boutique market and to department stores on the backbone of our new fashion designer brands, John Varvatos and Carolina Herrera. This division will combine its reach with REM’s venerable Converse brand to open sales and distribution centers in Europe, Asia and Australia bringing us ‘closer’ to our customers, learning more about the intricacies of different markets, and thereby providing customers superior ways to help them succeed.This strategy will serve as the foundation for multi-channel distribution and long-term global growth.”

Steve Wagner
Managing Principal, C&E Vision

Answer  1: “Leadership means influence. We believe C&E leads by positively influencing eyecare professionals, other buying groups and our vendors. C&E believes in partnering with the independent ECP and we work to create an environment within the industry where the independent ECP can grow and prosper, we’re dedicated to their entrepreneurial success. C&E is spending its time and resources to influence the services that buying groups deliver to their members - like our web-based initiatives -- and also influence those vendors and associations who are committed to the success of the independent ECP. ”

Answer  2: “Buying groups today are emerging beyond their classical member based discount programs and providing vendors with credit enhancement services. As with so many industries size can make a positive difference in the delivery of affordable services.C&E along with its affiliated companies is the largest buying group organization in the United States and as a result we can invest in the technology to assist our members. So, our web-based services are a major investment. Our web-enhanced services are growing--actually, these are being released faster than our ability to educate our members about them. Many of our members are logging on to view and pay their statements online via MyC&E. Our iDocs services let members see the details of their invoices and can also view the industry’s top-selling frames of their iDocs participating vendors as part of our BeyeRight service. Members benchmark their P&L with our online Benchmark simulation program, a unique tool to test the potential bottom-line impact of ‘what if’ decisions about their service and product mix.”

Raanan Naftalovich
President, Shamir Insight

Answer 1: “One one level, being a leader means trying to enlarge the pie for the whole industry. That’s why we’re very active in VCA. By enlarging the pie, you continue to grow with the industry.

“Secondly, it means being a technology leader. We have always seen ourselves as leaders in progressive lens technology. We constantly bring new products to the market and open up new categories and channels. Our focus is technology, customer service and education. We try to invest as much as possible to develop in those three areas. In the area of education, for example, we sponsor close to 1,000 events a year, ranging from regional seminars to ‘lunch and learn’ office sessions. We’re investing a lot of money into that, because we want to educate the market.”

Answer 2: “Freeform is going to be the future, and we’ve invested heavily in Freeform technology. More than that, we are in the business of making people see better. If we can recognize consumers’ optical needs that don’t yet have answers, we will make the products to meet those needs.

“How many companies in last five years have come out with a unique technology? We’ve introduced Freeform optics and the Attitude, Autograph and Office lenses. In many cases, we’ve been the first on the market.

“I like to make an analogy with the iPod. It’s brought a whole new dimension to how you listen to music. Then there’s the visual dimension. Who would have imagined that you’d be able to view high-quality television images on portable devices? We try to imagine how our optical industry will look in five years.

“We are on the verge of whole new lines of product that will address the situation. The combination of our Eye Point technology that allows us to simulate the human eye and freeform will allow us to give patients what they will need in the future. We always guarantee our customers that we’ll keep them on edge of technology. We are restless.”

Pierre Fay
Executive VP, wholesale, North America, Luxottica Group

Answer  1: “Leadership in today’s competitive climate takes a continuing commitment toward growing the entire eyewear category. We believe that if the category grows, everyone in the optical market place will benefit from it.  One of the main challenges facing our industry today is the flat consumption of frames and lenses. We at Luxottica Group are focusing on the power of our brand portfolio to boost consumption for optical frames and multiple pair sales. In addition, we encourage our customers to leverage the strong growth of the fashion sunwear business.  Our leadership strategy is to continue to invest extensively in marketing initiatives for our fashion and house brands through high-visibility advertising campaigns, public relations activities, movie placements, celebrity seedings and point of sale merchandising. Promoting consumption for industry growth and providing value-added programs and tools enables our wholesale partners to further meet consumer needs and become more profitable.”

Answer 2: “Our company is launching an exciting initiative called ‘Luxottica & Me’ designed to bring Luxottica closer to our wholesale partners. This program is part of the Working Together campaign initiated in 2006, and includes a series of tailored solutions developed to address key needs of the independents. For example, we are building turnkey solutions that enhance practice dispensing, product visibility and merchandising techniques. We are also investing in powerful marketing tools that increase patient traffic.

“Luxottica & Me represents our commitment to help the independents grow and prosper. In March 2007, we are launching a new dedicated website (luxandme.com) that will serve as a resourceful tool to our partners. Visitors will be able to find brand specific information, sponsored continuing education courses, practice management tips, visual merchandising techniques, advertising campaign and profiles among many other initiatives. In addition, we will be holding the first Luxottica Symposium in New York City where our worldwide executives will present company strategies, market trends and share key learnings and knowledge garnered from both our retail and wholesale operations. We believe that the independent will continue to be the largest segment of the market, and Luxottica wants to fuel their expansion and profits. We are working hard to be their partner-supplier of choice and we are doing so by sharing our expertise.”

Bruno Salvadori
President, Signet Armorlite

Answer  1: “My view of leadership is to be able to coordinate, choose and have the right people working for the company. For the last 14 years, I’ve had many of the same people reporting to me. Every day, I always talk to everyone who reports to me, even if it’s only a five-minute conversation. You need to show them you are close to them, understand their strengths and weaknesses, and know what’s going on. It’s one thing to be there for them when things go well, but they’ve got to know you’re also going to be for them when things go bad.”

Answer  2: “It’s very important for us to understand the trends in products, distribution and technology over the next few years, and to try to be flexible. In some ways, the U.S. is behind Europe and Japan when it comes to these trends. But because we have international operations, we can draw on our experience to tell us where the U.S. is going

“Clearly, the trend in Europe, Canada, Australia is toward the concentration of distribution in the hands of a few large retail chains and few large wholesalers. If we don’t sustain the smaller companies, though, we could have a problem. That’s why we’re making sure we support these smaller customers, both integrated retailers and labs. They face the same competition. We’re putting them in a position so they can supply premium products like backside progressives and AR lenses, that will help them remain competitive. In the long run, that will help us as well.”

Marty Bassett
President, Walman Optical Co.

Answer 1: “Walman is a leader within our marketplaces because we’ve been able to diversify of our company. We’re a comprehensive vision care company, and that’s attractive to our customers. It also helps us ride out shifts in the market.

“We do a good job within each of our markets differentiating our businesses. On the ophthalmic side, our warranties and polcies to our customers are very unique relative to the industry standards. On the contact lens side, we’ve focused on specialty niches. On the instrumentation side, we’ve been willing to do things as far as installation, training and follow-up service that not all of our competitors have done.

“We’re a 92-year-old company. We’ve had ability to serve customers through several generations. Part of being a leader is just surviving.”

Answer 2: “We’re repositioning our businesses to take advantage of more niche market opportunities. That’s our strategy in the face of consolidation. Our best opportunities are to find niche markets and focus on high end service and customer-friendly policies.

“Another important move we’ve made is making a big effort to undertake training initiatives for management and sales. We’re reinvesting in people, and trying to attract better people to our organization.

“Also, we try to vertically integrate our businesses whenever we have the opportunity. For example, in specialty contact lens products, we bought some of those companies whose products we used to distribute. We’ve done the same with frames. Five or six years ago we were almost exclusively distributing products for other companies. Today, nearly half of frames we sell we manufacture and import ourselves. That makes us more competitive, and ultimately give us control over destiny.”
--Marge Axelrad, Andrew Karp, & Cathy Ciccolella