July 30th, 2013
Energy Efficiency: How Much Vision Do You Have?
An energy-efficiency explosion is looming on the horizon. Will you be ready? When I visit with presidents, owners, CEOs and engineering directors of various door and window companies, I see three types of philosophies with respect to addressing energy-efficiency standards. There are the first responders, the visionaries and the cleanup crew.
The first responders are focused more on the here and now, but their senses are sharp. They sit back and wait to see what new energy standards and legislation may appear on the horizon. They keep the radio lines open in case an emergency call comes in, like word of new Energy Star legislation being approved. When the time comes, and the standards are approved, they jump in their vehicles and race to the scene. They may get there in time but they may not. When they do arrive, they will roll out the bandages and stretchers and do the best they can to save the day. Eventually, they will patch things up and have a product line that meets the new standards but it may not be the best. It may be higher cost than it needs to be, which puts them at a disadvantage in the marketplace. They may have gotten there by switching to a better low-E glass, warmer spacers or foam filling when perhaps they could have gotten there at a lower overall window cost with an improved window frame design. But this would have necessitated vision. If only they would have started planning ahead!
In contrast, there are the visionaries. These companies have CEOs or owners who look much farther into the future. They look past the bumps in the road and they focus on what they perceive the marketplace will look like in the future; perhaps even a five- year plan. Considering market, economic and political conditions—and most importantly consumer buying trends—visionaries formulate a plan that gets them where they feel they need to be in the future to maintain market leadership. They are focused on strategic planning. These CEOs and owners had already anticipated the Most Efficient category standards that have just come out (see DWM article EPA Invites Comments for Most Efficient Criteria for Residential Windows.) They will also be closely tracking the progress of a slew of new energy efficiency legislation that has surfaced in Congress (see DWM article Added Legislative Push Toward Energy Efficiency.) Visionaries do not want to be the first on the scene to an accident, preferring to avoid an accident altogether! They want to steer around obstacles and arrive at their destination far ahead of their competition! In order to accomplish this, visionaries will make investments in tooling for new window-framing systems that offer improved thermal-performance numbers at an overall lower window cost. They will invest in manufacturing equipment that will enable them to fabricate with warmer edge-spacer systems, advanced glass coatings and exotic gases which will help keep them on the cutting edge of thermal-efficiency technology. Additionally, they will invest in automated equipment that will help them improve quality while boosting manufacturing efficiencies! In the end, visioaries will become the market leaders!
And then there is the cleanup crew. These are the companies that do nothing. They are last on the scene, only wanting to clean up the mess and restore things to the way they used to be. But the trouble is that nothing will ever be the way it used to be! Everyone is moving ahead of them. The cleanup crew will soon find themselves selling to the lowest end of the marketplace where everything is sold on price. In the end, their profits will just become unacceptable and they may find themselves out of business. Because no matter how low your price, there is always someone crazy enough to sell lower!
So, in light of all that is going on in terms of new energy-efficiency legislation, take a look at your company and decide. Are you part of a first responder, visionary or cleanup crew?