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Dave Brockway, CEO, blogs his thoughts on the engineered equipment industry and other subjects.
Real Time
Monday Aug 16, 2010
A quick disclaimer: Though it obviously helps our company to advocate for the financial and operational benefits of intelligent front-end automation, this post isn’t meant as a self-promotional soliloquy. We launched Intelliquip to solve problems for fluid-handling equipment manufacturers, and the company continues to reflect our values. So I hope you won’t discount my observations, but rather see them for what they are: explanations of how we try to serve our customers.
A prospective client decided to build an in-house front-end sales automation system because they believed that approach would deliver the same results for less cost than our system. My partner, Tryg Dahl, soberly predicted that the company would ultimately spend five times our price and return in five years without achieving their objectives.
Jeanne Dixon should be so accurate.
I wish I could say this was a lone instance. Fluid handling equipment companies sometimes can’t resist the temptation to depart from their core business and diversify into software development. This decision might have made sense when the market lacked solid commercial options, but today, building rather than buying is usually the wrong decision.
Just as painful are larger companies who strive to appease their corporate IT preferences by buying into the “standard but custom” illusions painted by the mega-giant ERP firms. I hear tale after tale of how this becomes anything but standard - unless you consider an over-budget, behind-schedule, unsustainable system the norm.
The reasons for automating a company’s front-end abound. Reduced costs, faster response times, virtual elimination of quoting errors – those are just a few. It is an investment that keeps on giving. The question remains how best to implement.
We started Intelliquip to offer a better alternative. Over the last decade, companies around the world have increased profits and sharpened their competitive edge through our software. Our company builds on a century’s experience and is intensely focused on providing real benefits in real time to the fluid handling equipment manufacturing industry.
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Here Today, LeBron Tomorrow...
Friday Jul 23, 2010
As a former Clevelander, I watched with a mix of sadness and amazement as LeBron James recently S T R E T C H E D his “15 seconds of fame” to an hour ESPN special. As soon as he said, “Miami,” visions of the fallout in Cleveland bounced before my eyes. Yes, I anticipated the burning of his jersey, the cursing of his name and, even the poison pen letter widely distributed by Cavalier’s owner Dan Gilbert.
But, when I read a guy in Michigan who was stopped for drunk driving blamed it on James, I was a bit jolted. Especially when he told officers he was forced to drink because the star player chose the Miami Heat over the BOSTON CELTICS. Yes, that’s right, the Boston Celtics---Not the Cavaliers. Cleveland can’t catch a break.
But rather than just bemoan their fate and lick their wounds, I think Cleveland has a real opportunity.
In life, there are things we can control, and things we can’t. It’s damaging to confuse one with the other. Tim Kight, with Focus 3, has built a successful consulting company that strengthens people, leaders, and business. A cornerstone of their program rests on a simple equation:
E + R = O
Event + Response = Outcome
Life may be a constant flow of events, but success is not measured by the events you experience. Success is measured by how you respond to those events. We can’t always control what occurs, but our response is up to us. How do you respond when a prospect won’t meet with you? How do you react when your star salesman leaves the company? What actions do you take when business drops by 30%? Managing the R factor is a skill I try to improve every day. And it isn’t easy.
The story isn’t LeBron, but Cleveland. What will they do next? Can they refocus on tomorrow and let go of old news? Likewise, how well do you mange the R factor?
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Of Thrust, Drag and Generosity, Alfred W. Jones (1940-2010) Rest in Peace
Monday Jun 28, 2010
I met Al Jones on January 14, 1980 on my first day in the pump industry. Before actually seeing him, I heard a booming "Al Jooooonnnnneeessss" as he answered his phone in his office.
For many of those reading this that knew Al, you know exactly what I mean when I mention the uniqueness of his voice. It is something I will never forget, and will truly miss. I was even more surprised when I poked my head into his spartan-like office those many years ago and saw a Cheryl Tiegs poster on his closet door. Written across her navel were the words "Lordy Lordy, Al is Forty." It turned out to be a birthday gift from his wife Nancy.... the gift that kept on giving. Of course as a 26-year-old, I remember thinking, "Man, this guy is old!" With an unlit cigar chewed beyond recognition in the corner of his mouth, I got my first view of that Al Jones grin as he welcomed me to the team. We shook hands and then we started to work... and work... and work some more. I have never known anyone with Al's work ethic. He started at 6:00 in the morning and he kept at it until 6:30 at night or later, and he dragged all of us along with him.
Although he had spent many years as an application engineer for Ingersoll Rand Pumps, this move to a new, fledgling company thrust him into a combination AE, Office Manager, Human Resources Manager, and The No Money Man. Al earned his legendary reputation as the No Money Man. Like the stingy paper towel dispensers at the airport, you had to literally pull every dollar for capital, bonuses, pay raises, and commissions out of him. He could be the proverbial doomsday man at a moment's notice. He never wanted to spend money… on anything. He was "The Drag" in our company. On the other side of the equation were partners like myself, that were more, let's see, how do I put it, "sales types". We never saw a project or opportunity that wasn't worth our "investment". We became "The Thrust". Although I didn't think so at the time, hindsight makes it clear that this was a pretty good combination. Successful businesses cannot run on thrust alone. There needs to be a good dose of drag… and Al dutifully and happily provided it. Thrust may be glamorous, and Drag is boring, but trust me, you need some Drag.
As tough as Al came across regarding the company's money, when it came to his personal time and money, he was one of the most generous men I have ever met. Whether it was talking through the family problems of an employee, floating a loan to someone in a financial bind, taking his extended family on vacations, or simply donating money to various causes, Al was always there to help anyone and everyone. The notorious No Money Man transformed into a cuddly puppy when it came to his own time and funds, shifting right back into his pit bull mode when it came to protecting the company's money.
When Al moved on to retirement, he made a smooth transition. I was amazed. I didn't think he could, but he kicked back marvelously. He and Nancy traveled the world, mostly via cruises. This past Saturday, Al and Nancy were in London at the conclusion of a Corvette Club Cruise in Northern Europe. Al had a couple of pints at a pub with friends while chewing on his ever present cigar, went up to his room to take a nap before supper, and died in his sleep next to Nancy. Cigars, cars, beer, friends, cruises, and his beloved Nancy. What a combination. I hate to see Al go, but everyone has a time, and I can't think of a more appropriate departure.
Although I had only seen him a couple times a year over the past decade, he always had a big smile, a strong hand shake and a "Hi Buddy" (my official Al Jones nickname) to greet me. I will miss that greeting, and I'll miss our conversations. Al's legacy will live on through the lives that he touched---and there were many of them. I know that many of you will join me in saying "Good bye, Al, you made a difference."
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Engineered Solutions
Tuesday Jun 8, 2010
With my old engineering mentality, I’ve always loved the expression “engineered solutions”. It implies a sort of infallible, high end solution for a problem. Yet as the high-stakes fumbling and floundering around the BP oil spill continues, I worry this positive phrase will soon acquire a derogatory meaning.
Engineers routinely develop specifications, design new equipment, streamline production lines, and turn the seemingly impossible into reality. Their innovations have reduced operating glitches and manufacturing costs, increased efficiencies and fueled modernization by applying emerging technologies across all industries.
It’s fair to say that engineered solutions have contributed to real progress, but as oil rolls onto the shores of the Gulf Coast and shrimp boats float idly in the blackened tides off Louisiana, we painfully admit that sometimes perfect engineered solutions don’t exist or may be discovered too late.
Right now the ecosystem and economies of whole regions are relying on a perfect answer -- not only the perfect answer for capping the leak, but also the perfect answer in cleaning up what has already spilled. Unfortunately, perfect answers don’t exist. Many are laboring around the clock to fix the problem and minimize damage. Meanwhile, politicians posturing, BP placing million dollar image campaigns and the green movement yelling “I told you so” has not contributed to a solution.
There will be plenty of time in the future to analyze what went wrong, hold companies accountable, and change laws, engineering designs, and procedures to minimize the possibility of this ever happening again. Right now, however, we need to focus on developing a solution for this disaster---an engineered solution. We need to fully support and encourage all of those involved with stopping the leak and minimizing the shore and ecosystem damage. Here’s hoping we soon rise to the occasion.
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The Cause of Our Success
Monday Feb 22, 2010
Ok, it's time to confess it. I am cheap. Yes, cheap, as in I hate spending money. As in I've never, ever spent the company's cash unnecessarily.
Would I prefer the word frugal? Sure. But I might as well be blunt. My colleagues will tell you, I squeeze pennies - even when the economy is growing.
So it may be surprising to know that Intelliquip has spent money the last couple of years. Even as the economy caved and markets crawled, we have resisted major cost-cutting measures. We have maintained our staffing, continued reinvesting in our technology, and held true to our core mission. In fact, we plan to add some personnel in 2010.
It's times like these that remind us: In the long-term, businesses make money because of people, clients, and colleagues who deserve our best no matter what the unemployment rate is or the availability of credit. We sometimes forget that our P & L is not the cause of our success, but rather the result of our personnel and products.
I have traveled throughout Europe, Asia, and the U.S. over the last six months. The international and domestic consensus seems to be skepticism over the end of the recession. We hope but we really don't believe.
But, while I don't know what will happen with the economy, I'm confident in the basis of our competitive advantage: a team with in-depth technical expertise in software and systems development and specific knowledge of the fluid handling industry.
It pains me to say so, but tough times may be just the time to dig a little deeper into our change jar. That's my opinion - for whatever it might be worth.
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Technology Transfer…
Tuesday Nov 24, 2009
Machines served as Big Brother’s despotic tools In Orwell’s 1984. We called the wired tyrant Hal in 2001: A Space Odyssey. And, as Marshall McLuhan reminded us 35 years ago, the medium changes the message.
Humans perpetually alternate between fear and delight when learning how to harness the power of machines. That’s why videos like the one I’ve attached spark our imagination and worry us to exhaustion all at the same time.
The Internet is rewiring the world – including the world of business. It has accelerated the pace of change. Customers halfway around the world expect a prompt response to their inquiries in “real time” no matter what the time. More and more end-users want their entire transaction handled efficiently, effectively and electronically – from initial selection, configuration, and pricing to quotation and final payment. The only thing “unvirtual” is the product delivered to their doorstep.
Take a moment to watch this very eye-opening and thought provoking video. Think about how your business has changed because of the web. Then, consider how your business will change tomorrow as e-commerce continues to progress.
Click here to watch: Youtube - "Did You Know?"
For ideas on how technology can transform your business, give me a call, send me an e-mail, or Skype into a videoconference. I welcome the dialogue.
email:
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skype: dcbrockway
phone: +1(407)563.1438
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The Human Profit Margin
Wednesday Nov 11, 2009
Most of us know – and some have implemented – Six Sigma, a management approach that has revolutionized and galvanized manufacturing.
Six Sigma’s sales and retail counterpart, Human Sigma, appears to produce equally impressive results. Gallup researchers have tracked Human Sigma for a decade, chronicling how a greater emphasis on employee and customer engagement boosts revenue and reduces employee turnover, absenteeism, and mistakes.
Energized customers, say Gallup, mean a 23 percent premium in terms of wallet share, profits and deepened relationships.
This research echoes my own experiences in the sales and customer relations aspects of the engineered equipment industry.
A former company of mine made the decision to invest heavily in employee training and continued learning. The belief was that a better-trained sales force would pay off with happier customers and fewer mistakes – and we all know errors when quoting equipment can be unbelievably costly.
Likewise, our customer education programs became well known. Classes on preventive maintenance, papers on best practices, newsletters, and case studies – all these tools and others helped to educate our customers, enhance our customer partnerships, and polish the company’s image. I believe these tactics were a factor in our competitive edge that often earned us a job even when we weren’t the lowest bid.
Gallup’s latest update, a book called Human Sigma: Managing the Employee-Customer Encounter (Gallup 2007) demonstrates that real engagement works even in difficult economic times. In fact, it can make the margin of difference even in the most challenging business environment.
What have you done lately to engage employees and customers? I would be glad to share a few ideas. Contact me at
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Don't Waste the Opportunity Tough Markets Provide
Monday Sept 28, 2009
We become stronger through adversity - even in business.
A tough economy can be a catalyst for improved success. Even in mature industries like engineered equipment, innovation fueled by crisis can reap enormous dividends.
I speak from what started as a bad experience. Over two decades ago, my business sold pumping systems to the oil and gas industry. The market was red hot. Demand nearly outpaced production. Then, in 1986, oil prices fell to $11/barrel. Like a jammed parachute, our business plummeted right along with it.
But we survived and more. We pivoted off the crash, jumped into a new market and built what became a $50 million company.
What did we learn?
TAKE STOCK - Objectively consider your real assets. What do you have of real value that is transferable? People, hardware, brand awareness, and technology can all be redirected.
Technology was our game-changer. We had mastered variable frequency drive (VFD) pumping systems with their gentler start-ups, more accurate control and energy savings capacity. We simply reapplied VFD to water markets -- specifically golf courses.
INVEST NOW - Contrary to popular belief, downtimes offer the best times to retool, retrofit, upgrade or reinvent. Being less preoccupied with just shipping product allows you to shift resources to finding new markets and products and/or streamlining operations.
VFD's were untried by tradition-bound golf course superintendents. We couldn't just talk our way into new projects, so we invested in a prototype, mounted it on a trailer, and transported it to every course around. We experimented and learned that public relations could complement existing marketing strategies.
LOOK AHEAD - All markets are cyclical. Business, no matter how bad, will rebound. The real question is, "Are you building a competitive advantage for that coming upturn, or are you just hanging on?"
We improved the future of our business when the market was terrible. You could do the same. Drop me a line if you would like to talk more.
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Tribal Knowledge and Survival Success
Tuesday Aug 18, 2009
After three decades working in and for the fluid handling equipment industry, I know tribal knowledge when I see him. He’s graying and discovering the joys of gravity around the waist. His office overflows with dog-eared catalogues, wrinkled diagrams and empty M&M wrappers. He remembers every quote your company submitted over the last two decades. He can tell you to the minute when the next is due. You would love to clone him, but they broke the mold when they made this chief.
In a business where equipment can have thousands of variations and where mistakes can be bank breaking, you can’t survive by leaving mission-critical information only in one man’s brain. Lone chiefs cost you opportunities every day. Here’s three:
Risk. It could be retirement, a job offer he can’t refuse, health or family reasons – but if you lose your expert, your company is in jeopardy. Digitizing knowledge preserves and protects your company’s most valued asset.
Accuracy and Professionalism. Your expert may be great at producing quotes, but nothing beats an automated front-end. These programs create virtually error-free, branded quotations complete with customized cover letter, terms and conditions, dynamically-generated bill of materials, datasheets, curves and more.
Time. Chieftains, like all of us, have limits to both the quantity and quality of their output. By digitizing their knowledge, it is available to your sales channels 24/7/365 so other salespeople or distributors can manage more of their own work while the expert pounds out more complex proposals.
In the US TV reality show, “Survivor”, the last one standing gets the spoils. But when it comes to business, long-term success depends on the wits and resiliency of the entire company. Companies that automate front-end sales report significant cost savings, increased productivity, less need for additional personnel, and greater accuracy. Making tribal knowledge available to the whole tribe saves money and builds customer trust.
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Brick and Mortar enters The Twilight Zone®
Wednesday Oct 22, 2008
“There is a fifth dimension beyond that which is known to man. It is a dimension as vast as space and as timeless as infinity. It is the middle ground between light and shadow, between science and superstition, and it lies between the pit of man’s fears and the summit of his knowledge. This is the dimension of imagination. It is an area which we call the Twilight Zone.”
—The Twilight Zone season one opening narrative.
—The Twilight Zone is a registered trademark of CBS Broadcasting, Inc. Like a slow moving toboggan at the beginning of its journey, this global financial crisis began its downhill run many years ago as real estate prices skyrocketed and credit standards were relaxed. Initially pushed and accelerated by the greed of borrowers, lenders and investors, this nightmarish ride began to take on a life of its own over the past 12 months. Over the last 3 weeks it has ejected its driver, reached warp speed, catapulted off the track, entered a worm hole, and dragged all of us into another dimension.
We are now living in a surreal world where the powerful became powerless, the wise look like fools, and conventional logic stands on its head. Trusted banks appear shaky, conservatives demand government regulation, liberals preach fiscal constraint, and no one knows how to navigate the new galaxy. We watch helplessly as external forces mold and shape our future. We have entered the Twilight Zone.
We are boring, simple, “brick and mortar” companies. We did not create this crisis. We did not play high-stakes roulette. Yet, we, too, are being sucked into the vortex of this debacle. While our revenues, profits, and bookings remain strong, our stock prices have plummeted and our banks have no credit to extend. Our sales teams rely on Ouija boards to forecast their 2009 numbers. And next year’s budget is anyone’s guess. Business is presently great, but we are staring into the abyss. Where do we go from here?
We have all weathered rough business cycles, but our present situation has fortunately not been a part of most of our experience. The depths of this recession, its severity and length cannot be foretold. Much like an earthquake in the middle of the Pacific, no amount of seismic projection can tell us whether it will be a tsunami of catastrophic proportions, or simply large surfer waves. In any case, we need to prepare for the former, and pray for the latter.
We have some experience with tough times though. Let’s lean on it. When the oil and gas industry fell through the floor in 1986, I witnessed firsthand how successful businesspeople maneuvered their way through the maze.
It starts with strong leadership. In anxious times like these, employees are looking for strong leadership. They need some stanchion of stability in a world which seems to have run amuck. Whether you are a CEO, or a supervisor on the shop floor, your employees deserve clear, steady, courageous mentors. Give them your best.
Create a play book. It is much easier to make quick changes in tactics if you have already considered various scenarios. No one really knows the depth or length of the upcoming downturn. Be prepared to change course quickly and efficiently.
Be realistic in revenue and profit forecasts. Do your board and investors really expect 10% growth in 2009? Slow, steady growth with smart investments in the future can make the difference between still being in this mess two years from now or it being a memory. Push for longer-term planning.
Invest in your products. Your consumer is demanding greener products. How do yours stack up? How do your product lines map against your competitors? When is the last time you introduced a truly innovative product? Take a closer look.
Look at new markets. Do you presently play in a niche? Do you participate in certain markets, but not others? Why? This is a great time to strategize and lay the foundation for penetrating new markets.
Invest in streamlining your business. In good times, it’s all about production, no matter the cost or waste. However, a downturn can afford us the opportunity to identify inefficient areas of our business so we can implement new procedures and systems that streamline our operations. Don’t be fixated on your back-end processes. Your front-end sales processes most likely need more work than your backend, and would provide a higher return on investment.
Invest in your customers. Spend more time with them. Find out what your company can do to solve their problems. Become a solutions provider rather than a component supplier. By having an approach that encompasses your customers’ needs from start to finish, you can create a key competitive advantage.
Invest in your employees. Spend more time nurturing and training your people. Provide an environment and culture that rewards your most experienced employees for mentoring your newest additions.
Downward business cycles may not enliven us, but they do give us the chance to rejuvenate our companies. If we stay calm, make wise and measured decisions, and focus on the long-term rather than next quarter, we will survive and ultimately be stronger than before. Leave the Twilight Zone to others. Brick and Mortar companies can demonstrate leadership during this crisis and pull the rest of the world back to a state of sanity. |
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