20 Questions with Dave LaGrand, President and CEO, NORDYNE
Originally published: 05.01.09 by Terry Tanker
Dave LaGrand, President and CEO of NORDYNE, has a simple-but-effective leadership philosophy. He shared this and other thoughts with publisher Terry Tanker recently.
1. I heard you’ve got a passion for cars – true?
I like German cars and have driven BMWs for a long time. I also have a 1995 Porsche 911.
2. Have you ever taken a sports-car driving class?
I have. It was two days in class and on track at the Porsche Driving Experience. My instructor was Hurley Haywood, who has had a lot of professional success racing Porsches around the world.
3. What was the first car you bought with your own money?
A 1967 Camaro. I wish I still had it.
4. You worked at Ford Motor Company after graduate school. What brought you to hvacr?
I grew up in Michigan, received my MBA in marketing from Michigan State University, and was recruited into Ford’s Parts and Service Division. I went through their executive training program and was with them for six years. Following that, I was recruited by York when they were owned by Borg-Warner, to help improve their parts business.
5. Do you have a leadership philosophy?
Create alignment with employees with clearly defined values, standards, and beliefs. Communicate often and clearly. Establish goals, monitor progress, and adjust as necessary.
6. You’ve been at NORDYNE for more than 20 years. How do you make sure the thinking and ideas stay fresh?
Before hiring our key managers, we put them through a rigorous testing and interviewing process. We feel very confident that once the process is complete, the results will show if we have a great fit – or not. Those individuals are empowered to “manage.” We look outside of our industry as well; we try to learn and adapt good business and management techniques from others who have similar manufacturing, distribution, marketing, and sales channels.
7. A third of your employees have been at your corporate headquarters 10 years or longer. Can you share some tips with contractors on how to retain good employees?
Share your goals and objectives and find individuals who “buy in” and want to help you get there. Make everyone feel like they are part of the team and important to your success. Give them an opportunity to grow, and reward success.
8. How do you cultivate innovation with your employees?
We are extremely open to new ideas and willing to try to be different. We look at technologies used in other industries that we can apply in ours. We hire people who are bold enough to suggest new ways of thinking and problem-solving. When you have people who are willing to push the envelope, that type of thinking spreads throughout the culture.
9. What’s the most innovative thing happening at your company right now?
There are some things I can’t mention for competitive reasons, but we’re very excited about the heat pump version of our iQ Drive® air conditioner. Preliminary testing rates it at up to 22 SEER, making it the most efficient air-source heat pump available. We expect to have it in the market by the end of May.
10. What about innovation outside of product development?
We’ve launched the NORDYNE Interactive Network, a Web-based venue that allows us to share technical training demonstrations and announcements with our customers. On that same network, we’re also launching online business training for dealers. Through a series of on-demand videos, our dealers can receive the business training they want on a schedule that fits their workload and life.
11. How do you strategically position online communication with your customers?
For contractors, we have a dealer extranet for marketing materials and the NORDYNE Interactive Network for training. Distributors can access a private NORDYNE site for news, sales bulletins and product updates. We also use the NORDYNE Interactive Network for product presentations and updates.
12. NORDYNE is celebrating its 90th anniversary this year. As you look back over the company’s history, what are some of the most significant milestones?
I think our three most significant milestones were
1) the first oil heater and first central air conditioning system for manufactured housing (once you figure out how to heat and cool those structures, the rest is a piece of cake!),
2) the SmartLite® ignition system to extend igniter life and
3) the 24.5 SEER iQ Drive® air conditioner.
13. What core company values have remained the same throughout the company’s history?
NORDYNE’s core values haven’t changed. We sum it up in two words: Genuine Value. For the past 90 years, we’ve worked to provide outstanding product performance, innovation, and responsive customer support – all at a fair price to create genuine value for our customers.
14. Where do you envision the hvacr industry in the next 5-10 years?
It’s an exciting time as the industry globalizes further, and we design products incorporating new materials and technologies. There will be a lot of innovation to talk about. Technology will play a much more significant role, specifically with regard to monitoring and tracking system performance. Energy costs are going to continue to rise as will minimum efficiency regulations, which are very likely to be implemented in regions instead of nationally.
15. What specific adjustments have you and your management team made to combat the prolonged economic downturn?
We’ve made many proactive changes at NORDYNE to stay lean and operate in the most efficient way possible. We’ve suspended some employee benefits and have cut back on travel, tradeshows, and advertising spending. Our employees have all stepped up and are doing the work of a much larger team.
16. Have NORDYNE dealers and distributors given you any insight to what the balance of 2009 and 2010 may look like?
We should see our markets start to recover beginning in mid-2010 and hopefully have some tailwinds as industry volume improves beyond that.
17. The American Recovery and Reinvestment Act of 2009 includes a residential energy property credit up to $1,500 in 2009 and 2010. Do you believe this is enough of an incentive for consumers?
I believe it’s enough of an incentive to shift demand from products that consumers might otherwise purchase to systems that are more efficient and eligible for the tax credit.
18. What else could the government be doing to help consumers specifically with regard to hvacr?
I’d love to see something that saves energy in big way and helps the industry at the same time. One idea that we keep coming back to is a way to incentivize the replacement of installed older residential equipment. We like the idea of an opportunity for buyers of existing homes to include a system upgrade in their mortgage. In many cases we believe the extra mortgage amount would be entirely offset by lower operating costs.
19. What more could they be doing to help manufacturers?
Same answer! Everybody wins. The country saves a lot of energy. Consumers save on utilities and repair costs; contractors, distributors, and manufacturers enjoy additional volume and help create more jobs.
20. Is there a silver lining in the gloom and doom of this economy?
Yes, surviving it makes you tougher and a better competitor. On the other side of this recession (or depression for our industry), we’ll see pent-up demand for new and used housing drive renewed growth for our industry.
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