Berend Groeneveld – Managing Director, InterDam – Netherlands
The MD of InterDam details the company’s progress in becoming the world market leader in fire and blast resistant architectural structures and the company’s impressive growth since its creation eight years ago thanks to a product offering that is lighter weight and more cost-efficient than that offered by the competition.
What were your aspirations in initially targeting this niche in the market?
Initially starting off in the ship building industry, my great grand father began supplying sheet metals to a few of the largest shipyards at the time including Bodewes and Keppel Verolme with the inception of InterDam predecessors. In 1970s, as the Netherlands offshore oil and gas industry started to take off, InterDam predecessors began specializing in fire and blast resistant doors and walls. Given the Silicon Valley type lack of non-compete clauses, many employees ultimately came over to InterDam to build up our technology and products. Once you have a product that is fully tested and certified, you have to build upon it with incremental improvements. The foundation is extremely expensive to change. When we started in 2007, we did not have any certification. We had some money, and a lot of ingenuity among our engineers, and the Internet to search for the latest state of the art supply chain, both in people and products. That eventually resulted in a completely new range of products that more offer innovative, cost-efficient, and effective solutions than what has traditionally been seen in the current competitive landscape.
The company boasts an extensive global network, with agents spanning Latin America, Europe, Middle East, and Asia, and is also exposed to a greater degree of market risks. How are you structuring your business to accommodate short-term demand and supply fluctuations?
With respect to fluctuations in the market, we don’t encounter them. As I’ve said before, we want to become to world market leader in fire and blast rated architectural solutions. After eight years, we’re beginning to establish our name in the industry. But in order to become the world market leader in 2020, further steps must be taken. With the current diminishing economic climate, companies such as InterDam have persevered by cannibalizing competitors—a strategy that might remain effective for a couple of years. That is, until becoming market leader, at which point, we would begin integrating or diversifying our business segments. For us, we embrace the lower oil prices because it gets end consumers focused on budget. Since our products are innovative by nature and cheaper from an installation and maintenance standpoint, there’s a lot to say for our products. The main factor inhibiting our growth at the moment, as with any startup, is the fact that it’s new. The Dutch embrace innovation, but other markets less so. To become the world market leader, we have to alter the traditionally conservative mindset of the oil and gas industry. This has started to happen organically as we acquire more business, and in turn, more reference projects to build our credibility, especially with oil majors that essentially set the precedence from every type of prospective client. For us, it’s getting much easier. Our products are gaining more traction in the market, and consequently, our turnover is rapidly increasing year-over-year. Five years ago, our name was never on the approved vendor list. Now, it’s a different story, and we are expected to reach critical mass in 2016.
What type of global regions is the company looking to expand into?
Basically, we have a push and pull strategy. From a global scale, we’re seeing a lot of growth in East Asian countries such as China, Korea, and Indonesia. From my perspective, I believe there are a lot of opportunities for Dutch suppliers in providing the knowledge base and products to the East for projects where they have non-local clients. For example, European oil companies typically have a different set of standards when compared to local Chinese oil companies. Our products are ideal for catering to the demanding interests of such foreign companies that emphasize quality, effectiveness, and durability.
What is the significance of locating all design, engineering, and manufacturing operations here locally in the Netherlands?
As the Dutch proverb goes, “trust comes by foot and leaves by a horse”—which depicts the crucial importance and hard-earned process of establishing trust when building a business such as InterDam. The paramount is that all products leave the factory with 0 flaws. If needed, we work overtime to fix any mistakes or ask client to accept minor delays. Better safe than sorry. By using the best quality of bulk materials, hardware, coating systems and fasteners we maintain our quality level. From my experience, I’ve yet to see any other country offer such a quality assurance and guarantee, which is why, we will continue manufacturing in Holland for the foreseeable future. Adopting a more capabilities-driven strategy, we only do ourselves, what we can do better than others. Similarly, we’ve outsourced functions such as laser cutting, automated bending, and coating to external contractors that possess superior technology or competencies. It is through this strategy that we’ve managed to effectively build up our supply chain, while preserving the highest degree of quality control.
InterDam’s capabilities cater to a wide variety of segments including offshore platforms, refineries, and petrochemical plants. What type of segment has served as the primary growth driver for the company?
We’re taking on a more holistic view on the market at the moment. We feel that designs are becoming more modularized, and all of our products serve meaningful purposes in that regard. Modularization will be used in both onshore and offshore, renewables and fossil fuels. For example, our G21 Fire Panel, which recently obtained a very high fire rating type approval, H120, is the cheapest, lightest, and easiest to install H120 rated wall system. Due to its lightweight design and pre-installed packaging, the G21 Fire Panel comes in very handy when modularizing buildings. The main growth driver for us will be the movement in the engineering and production industry of our clients in building bigger modules, or even smaller modules, which would be assembled on site.
Due to the government’s energy agreement for sustainable growth, the country is now experiencing an energy transition that has resulted in extensive investments in alternative energy sources such as offshore wind. To what degree have renewables impacted InterDam’s business development?
To a high degree. For example, the G21 Fire Panel was initially designed and developed for the offshore wind industry, and now it’s being put to use in the offshore oil and gas industry. We are close to becoming market leader in the offshore wind industry for panels—encompassing both walls and doors. We currently have projects for over a handful of different customers such as Dong Energy and TennetTSO. For the oil and gas industry, more and more clients are embracing this type of panel—the 4th generation wall system.
InterDam’s G21 Fire and Blast doors truly embody the innovative spirit of the Dutch, accommodate a full spectrum of fire and blast ratings and even meeting Norsok requirements with the Ergo Latch. To what degree has this technology penetrated the broader oil and gas industry?
It already has. For instance, we have a project for the Norwegian offshore industry, where the client was really pleased and specified Ergo Latches for all sliding doors—an installation that would negate any pneumatic operating system and saves our client thousands of dollars in installation and maintenance costs. More and more clients are very happy with our sliding doors, and we only see increasingly favourable adoption rates in the coming years.
Given the dynamic nature of the industry, what type of R&D initiatives are in the company’s developmental pipeline today to make sure that sure technology remains relevant 5 to 10 years from now?
We spend over 5 percent of our annual turnover in R&D. We listen quite carefully to any growing demands from our clients—a convention that encourages us to continually innovate upon our current product portfolio and optimize them in ways that further benefit the end users. For example, our clients are starting to desire life expectancy of these products to expand upwards of 50 years now—quite different from the 20 to 30 year life expectancy experienced only several years ago. Now with more innovative drilling methods, these companies are able to extend the lifetime of their wells, and in turn, must upgrade their platforms accordingly, which is highly capital intensive. With the G21 Fire Panel, these clients, for a very low extra over price can have stainless steel 316 on their external skins. The extra over price of this system is very limited because the thickness of the steel is just 0.7mm or even 6mm thickness, compared to the 2mm, 3mm, found with some of our competitors’ products. In that respect, our technology will continue purposely serving the demands of the industry.
With increasingly innovative production, comes increasing emphasis on Health, Safety, and Environment. What type of policies or procedures have you implemented to display the company’s conviction towards integrating HSE in its day-to-day operations?
Apart from safety in our factory, in which we want zero accidents, we’ve tried to implement more eco-friendly production practices. When designing new products, we embrace the cradle-to-cradle principal, using materials that are easy to re-use. For the sandwich panel, you have to detach the steel from the insulation, which can now be performed automatically. More than 95% of what we add onto an offshore rig can be reused as the same material.
During your tenure in the company, what have been your proudest milestones or achievements thus far?
One of the more notable projects was for a company operating out of Alaska, which we supplied sandwich panels for back in 2012. Our biggest project at the time, we supplied standard panels, but also made specifically customized vertical sliding doors that needed to be operable after a blast and after a fire—a very high-end design. It was a very proud moment to see our modules penetrate the US market.
What are your personal philosophies on defining success for a company like InterDam?
Two factors come to mind. The first involves the technical aspect. As Da Vinci once said, “simplicity is the ultimate sophistication,” giving a fundamental basis for our current slogan, “safe and simple”—two technical words to go by. The second centers on the word “focus.” From a strategy point of view, it’s very important to have a clear focus of where you want to go and just go for it.
Where do you envision InterDam in the next 5 years?
We want to be the world market leader in blast and fire resistant architectural products by 2020. We’re a very simple company in that respect. Every decision that is made, no matter how big or small, where you’re a manager or associate, should help us take one step forward in that general direction.