Executive Interview: Michael Vohrer, Rohde & Schwarz

As Rohde & Schwarz celebrates its 75th Anniversary, Microwave Journal’s European Editor, Richard Mumford, asks president and CEO, Michael Vohrer to trace how the company evolved from a two-man operation to a world leader with a global presence. He outlines the political impact of German reunification and the expansion of the EU, explains the importance of investment in R&D, academic institutions and its staff before looking forward to the next 75 years.

After studying communications engineering Michael Vohrer began his professional career at Rohde & Schwarz in 1975. Having started as a development engineer he rose to become Head of the Test and Measurement Division with responsibility for the marketing, design and development of T&M instruments and systems. In 2003 he was appointed President and COO with specific responsibility for the Test and Measurement, Radiomonitoring and Radiolocation, and Broadcasting Divisions. He was appointed CEO of the company in January 2006.

MWJ – Rohde & Schwarz was established 75 years ago. Can you briefly outline the company’s development over that period?

Vohrer – It all began in the summer of 1933 in an apartment with 120 m2 of floor space in downtown Munich, which Dr. Lothar Rohde and Dr. Hermann Schwarz rented to set up an electrical engineering laboratory: the Physikalisch-technische Entwicklungslabor Dr. L. Rohde und Dr. H. Schwarz (Physico-Technical Development Laboratory). Originally, the co-founders only intended to develop measuring instruments under contract for the electrical engineering industry – manufacturing was not part of their plan. Six months later, the company had its first international customer, from England, which came about without any advertising or help from a network of representatives. As the demand for off-the-shelf instruments increased, high-volume production began.

The company continued to expand, including into new fields of business. In the 1940s, broadcasting was added. In the mid-1950s, operations were expanded to include radio monitoring and radio location as well as radio engineering. During that same period Rohde & Schwarz reached the magic mark of 1,000 employees and kept growing at a fast pace. Only six years later that number had doubled. Today, Rohde & Schwarz is world leader as a provider of EMC test and measurement solutions as well as terrestrial TV transmitters. We rank among the world’s leading suppliers in all our fields of business.

MWJ – During those 75 years, what do you think are the main factors that impacted the microwave industry and shaped its development?

Vohrer – Microwave research was already taking place at the end of the 19th century. Yet the term ‘microwave’ only became recognised in the 1940s. Furthermore, the frequency range referred to as ‘microwave’ has changed a number of times over the years. For example, our first measuring instrument, which had a wavelength range of 3 m to 3,600 m, was considered to be a microwave instrument in those days. In the 1940s, our ESD radio monitoring receiver had already reached 470 MHz, which likewise was considered a very high figure. Today, engineers understand ‘microwave’ to be at least a few GHz, and our latest network analyzers operate up to frequencies of several hundred GHz.

Over the years, the frequency range in which you could work was determined by the components that were available. Thus, the transition from tubes to transistors and then to integrated microwave circuits brought about significant advancements. To enable ever smaller structures on large-scale integration (LSI) components, we now work with thin-film and bonding equipment that we develop in our own labs and produce in our own clean room.

MWJ – What are the advantages and disadvantages of being an independently owned company operating in the commercial marketplace of the 21st century?

Vohrer – Unlike many other players on the market, Rohde & Schwarz is a privately owned family enterprise, which gives us a very high level of independence in making all of our decisions. We are driven not by short-term results but by long-term success. This fortunately allows us to finance our R&D activities from our own resources. We also have the entire value-added chain of our products within the company, thus enabling us to offer our customers first-rate quality from a single source. At other companies, this may very well differ.

MWJ – What is the basic philosophy of the company and has it changed over the years?

Vohrer – No. There have been two primary driving forces at Rohde & Schwarz since it was founded. First, we consider ourselves to be an enabler. In other words, we empower our customers to be successful. We do this by working hand-in-hand with them on tomorrow's technologies beginning at an early stage. In practical terms, this means that pioneering innovations have been our bread and butter from the very start.

The second factor is the culture of appreciating all of our employees – worldwide. Innovation occurs when people are given the freedom to be creative, to think, to explore. We strive to make this our culture, and, I believe, we are quite successful at it. It is not by mere chance that Rohde & Schwarz has appeared on the list of best employers in Germany for the fifth time in a row in surveys conducted by the Great Place to Work Institute.

MWJ – As a German company, did the reunification of East and West impact Rohde & Schwarz commercially, economically or logistically?

Vohrer – The reunification was accompanied by a general opening toward Eastern Europe. Access to those markets became significantly easier. Of course, we were already present in Eastern Europe before 1989, but in the past 15 years we have put greater effort into establishing subsidiaries there – for example, in Russia, the Czech Republic or Poland. Plus, after the borders were opened, a great need for better infrastructure arose in the countries of Eastern Europe. We were able to meet this need exceptionally well with our products. For example, we carried out large-scale projects involving the setup of nationwide sound and TV broadcasting networks in Rumania, Russia, Poland and the Czech Republic.

MWJ – Has the formation of the European Union benefited European manufacturing companies in general and Rohde & Schwarz in particular?

Vohrer – Political developments of this nature are beneficial to us as an international company – where the key factors are open borders and the simplified transport of goods. For example, in 2001 we already had our own production site in the Czech Republic near our German factory. Following the country's accession to the EU in 2004, everything has become even less complicated. Nevertheless, most of our production is done in Germany so that we can maintain the high quality we demand.

MWJ – Rohde & Schwarz’s portfolio of RF test and measuring equipment is vast, including spectrum and signal analyzers, signal generators, network analyzers, wireless communications testers and systems, etc. Over the years, have there been particular innovations that you feel have greatly impacted the industry?

Vohrer – If I couldn't answer that question with “yes", then Rohde & Schwarz would have no right to be in the high-tech business. Let me explain with a few examples:

When we entered spectrum analysis in the 1980s, the sector was new to us and the competition was well-established. In 1986, we introduced the FSA and, by doing so, vaulted to the top of the world market in one leap. In terms of dynamic range, precision, operability and documentation capabilities, we set new standards. Today, our product portfolio − which ranges from handheld models to the first spectrum analyzer up to 67 GHz − fulfils virtually any requirement. We consider ourselves to be the driving force in spectrum analysis worldwide.

In signal generation, we set standards in single sideband phase noise in the 1990s with the R&S SMP microwave generator. Signal purity for high-precision measurements is a key point, and our latest model − the R&S SMF100A − is a world leader in this regard.

With regards to power measurement equipment, in the mid-1980s, Rohde & Schwarz became the first to integrate a data memory for calibration data directly into a power sensor. Then in 2002, we introduced the world's first USB power sensors.

Last but not least, network analysis: In 2005, we launched the first network analyzer that enables customers to perform measurements on eight ports up to 8 GHz. Our new millimetre-wave converters permit four-port measurements up to 325 GHz.

MWJ – With such a large test and measurement portfolio, which is only one part of the company’s broad scope of products, how does the company focus on developing each sector to its full potential?

Vohrer – Our prime objective in all of our fields of business is to be as close to the customer as we possibly can. That's why we now also have subsidiaries, offices and service centres in more than 70 countries. In addition, we have set up development centres around the world to give us a local presence with respect to technological trends – to date in the USA, Korea, China, Singapore, Denmark, France and the UK. The latest step has been the opening of our regional headquarters for Asia in Singapore. To keep a finger on the market pulse, you have to be close to the customer and you must be able to virtually forecast the latest trends. We are trying to do precisely that.

MWJ – Do you develop and market products for specific geographic markets and if so to what extent?

Vohrer – It goes without saying that different markets and regions have different needs. The international structures which I just mentioned must be in place in order to meet these requirements. That's why we have application engineers who can adapt our products to local needs in virtually all large countries. We participate in the work done by all major standardization bodies so that we will know which technologies demand our attention. Ultimately, Rohde & Schwarz offers all significant standards implemented around the world both in wireless communications test equipment as well as in broadcasting.

MWJ – Was Rohde & Schwarz’s introduction of low-cost test and measurement instruments manufactured in Asia a response to the threat posed by mass production manufacturing in that region and has it been successful?

Vohrer – We are not having products manufactured on a large scale in Asia. While we have indeed set up local final assembly operations for broadcast transmitters, that is an exception. Our main production sites are in Germany and, as mentioned earlier, in the Czech Republic. To cover the favourably priced segment, we acquired HAMEG as a subsidiary in 2005. That was a very good decision, and, with this factor in mind, we do not perceive Asia as a threat, but rather an opportunity.

MWJ – The R&S FSV is your latest introduction. What prompted this development, and explain what it adds to the company’s portfolio?

Vohrer – By offering the R&S FSV, we are supplementing our broad product portfolio in spectrum analysis to include an innovation in the mid-range segment. We are proud to say that the R&S FSV measures and analyzes large-bandwidth signals faster than all comparable products on the market. It stands out as being the first spectrum analyzer to exceed the threshold of 1,000 sweeps per second. Furthermore, it is the only instrument in its class to handle all current and also future wireless and cellular standards. And we are offering, for the first time, an instrument with a touch screen in order to make its operation as easy as possible.

MWJ – In the test and measurement sector, what particular features are customers demanding and where do you see development heading in the near future?

Vohrer – One truly crucial aspect is to shorten time to market. On the one hand, in production, the most important requirements here are high measurement speed and accuracy. Both increase throughput. Plus, customers want a compact and cost-efficient product – lots of power at the lowest price possible.

On the other hand, in development, our latest highlight is the R&S ESL EMC test receiver. It enables users to test whether their developments comply with the standards that apply long before certification takes place. This makes later reworking unnecessary.

And, of course, as I have mentioned, we work hand in hand with our customers to develop future features. This is likely to involve higher upload and download rates, plus mobile TV of course.

MWJ – How much emphasis does the company put on research and development?

Vohrer – R&D is the backbone of our success. That's why we annually invest approximately 15 percent of our turnover in R&D, which is more than the industry average.

MWJ – Explain Rohde & Schwarz’s involvement with academic institutions and its work to encourage the personal growth of engineering students.

Vohrer – For us, everything revolves around having highly qualified engineers. That's why it is very important for us to establish contacts early on and to support the universities – particularly when recruiting from their degree programs. This includes furnishing their labs with our equipment as well as holding seminars or providing scholarships. For example, this year we conducted our ‘case study competition’ for the fifth time. It involves presenting real-world problems to the students. In 2008, for instance, universities from Germany as well as the National University of Singapore and the Nanyang Technological University from Singapore took part.

MWJ – What ambitions does Rohde & Schwarz have as a company and what are its aims for the next five (or even 75) years?

Vohrer – We are a company that's at home in wireless engineering, and that will remain the case. At the same time, our primary objective is to grow without losing our values. Therefore, we have to keep our finger on the market pulse and always develop precisely the innovations that the market needs − whether it is an additional feature for a new standard or a completely new product. In doing this, we of course put out feelers to see whether there are other wonderful things out there that might interest us and that will allow us to grow even more.