IdeaXchange
Elan Sudberg editorial

Lab confusication

Why this CEO isn't on board with consolidation in the laboratory services industry.

Lately, most of the news about analytical labs in our industry is regarding lab consolidation. Described as “aggressive aggregators of smaller analytical labs,” the Big Labs have been slowly consuming all the independent Little Labs, which I don’t believe should go unremarked or unexamined.

True story: a few years ago when a Big Lab (futilely) courting Alkemist Labs was itself consumed by an Even Bigger Lab, its "sweet courtship song" changed tune considerably. It went from, “Hey buddy, let's just meet regularly for a casual lunch and continue to talk about the grand vision of what our combined centers of excellence can create,” to, “We [Insert Name of Bigger Lab] are on a rampage to acquire all the Little Labs in this industry and I am here to now say that if you don’t sell to us, the steam rollers will be crushing you in five years.” Such an attractive offer! Well, here we are halfway through year four of that threat, with Alkemist Labs growing and developing and having a good time doing it.

My stance hasn’t changed on lab consolidation, and I've never been impressed by revenue acquisition. No one lab can be good at everything, and in my experience, those who try to do everything aren’t great at many things. You may get lower prices with companies that batch samples, but the trade-off is significant delays in turnaround time while they wait for enough samples that need the same test.

Just think of the confusing challenge of combining these complicated beasts of companies! Staff quality of life is part of our corporate culture, so I feel compassion for the people working in such circumstances, especially with satisfying investor expectations being the primary policy driver. One employee for the recently consumed Big Lab told me she only found out about the merger through my LinkedIn post. That sort of thing can’t be good for staff moral, or retention. 

Since the healthiest response to disquieting events is often humor, I wrote a parody on the issue that I hope you enjoy.

Lab Confusication (sung to the tune of Californication by the Red Hot Chili Peppers)

It's a theme of the industry and all western civilization,
Small labs emerge as center of excellence, settle in a temporary location,
It's understood that lab mergers breed lab confusication.

Disengaged the Big Lab's tech, try to test your formulation,
Meanwhile a Little Lab in Garden Grove excels at plant authentication,
And if you watch these kinds of things it's lab confusication.

Treat your clients very well to stave off consolidation,
One Big Lab to rule them all—is that the war you're waging?

One-stop shop unicorn,
Data soft porn,
Dream of free information,
Transparent in every situation,
Democratic herbal nation,
Dreams of lab confusication.

Sell your lab, be our center of excellence, be our very own constellation,
We'll consolidate the redundancies to try and improve our very dire situation.
And we'll give you a seat at our executive table, it's lab confusication

Low cost testing may be the final frontier, but it's first batched in a Des Moines basement,
Turn around time will be the first to go, can you hear the complaints of debasement,
And poor quality is not far away, it's lab confusication.

Treat your clients very well to stave off consolidation
One big lab to rule them all, is that the war you're waging?

One-stop shop unicorn,
Data soft porn,
Dream of free information,
Transparent in every situation,
Democratic herbal nation,
Dreams of lab confusication.

Consolidation leads to a seemingly simple road but it also breeds stagnation,
Acquired revenues to an investor's folio, they're just another good corporate statement,
Only buying power could save the industry from lab confusication.

Treat your clients very well to stave off consolidation,
One big lab to rule them all is that the war you're waging?

One-stop shop unicorn,
Data soft porn,
Dream of free information,
Transparent in every situation,
Democratic herbal nation,
Dreams of lab confusication.

Hide comments

Comments

  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.
Publish