Four Legs
A popular way to look at a traditional home improvement company is to compare it to a three-legged stool: one leg sales, one leg marketing, and one leg administration, including installation. At Thompson Creek Window there’s a fourth leg: manufacturing. Thompson Creek isn’t the only window replacement company that makes its own products ? think Newpro, Stanek Windows, and Champion Windows, to name just a few ? and making the product certainly adds a layer of complexity to what is already a fairly complex business. Risks include producing a product that becomes obsolete and the need to keep the factory ? a fixed cost and not a small one ? producing throughout the year.
Rick, whose background is in manufacturing and who spent a year in his teens making window service calls, leveraged Thompson Creek Window’s manufacturing into a significant competitive advantage. “If I see a better glass package, a better lock or better balance, a better way of sealing the window, yes it will be an investment, but we’re always prepared to make those investments,” he says. He points out that making your own window allows you to design the product to your own specs and to deliver it at a cost that eliminates a layer of distribution. “I learned a lot about what could go wrong with a window,” he says, “and it’s worth it for me to pay an extra dollar in manufacturing costs knowing I won’t have to worry about replacing that window in 10 or 12 years.” So Thompson Creek Window builds a window strong enough to sustain its Double Lifetime (i.e., two consecutive homeowners) guarantee, and one that’s engineered for the Mid-Atlantic market. That’s a story that sells. “A lot of [our success] comes back to the factory,” Gerrior says. “The fact that we can create the product for the market.”
Growing Pains
Nine years ago the Wuest brothers ran leads, manned booths, installed windows, all of it. Today Thompson Creek Window has 273 employees and does 20 times as much business. You could say that it’s a different company, or you could say that it’s the same company with mostly different people.
Rick Wuest insists that that growth is all about the people who work for the company who, once placed, tend to stay. “In part it has to do with the organizational chart,” he says. “We clearly establish what we want out of different positions in the company. We hire people who are competent. And we explain what’s expected and allow them to do their jobs.”
An important part of doing the job is coming up with solutions and solving the problems that a continually growing organization is going to run into. Rick is the kind of executive who notices things and isn’t afraid to ask questions or challenge his managers to find ways to solve problems and produce targeted results.
For instance, where to get new business without taking your business elsewhere? Marketing director George Schaub, tasked with generating the roughly 150 appointments a day that the salesforce needs, has a map on the wall behind his desk. Sold jobs register as black dots. Red zones indicate ZIP codes with customer demographics with the highest correlation to existing customers. Orange is a high correlation, but not as strong as red. Green is a moderate correlation, white is low. “I don’t like guessing,” Schaub says. “I like facts.”
The map extends north to Bel Air, Md., west to just past Frederick, south to Dunfries, Va., and over to the Eastern Shore of Maryland. The current map has every job sold between January 2006 and the end of 2009. Schaub updates it annually. Three concentric rings surround the star where the company’s factory and offices are located.
Thompson Creek sells a midrange price-point window, and there’s no shortage of competition, especially in a market where, as Vin Gerrior says, “we have the world’s largest employer, and that employer doesn’t have lay-offs.” So this year the company ? with its sales mostly cash ? negotiated an agreement with a major home improvement lender and marketed to potential customers who would be inclined to finance rather than paying out of pocket. The idea, Schaub says, was “to expand our customer base to a new group of people.” To expand within the rings.
Momentum
Going from $30 million in sales to $45 million might sound outrageously ambitious Replace Text a 50% jump Replace Text but it’s a target that managers at Thompson Creek Window assume will be reached. The other number that pops up is $70 million, which is what Rick and others believe the company can do in 2011. “Our new strategy,” Schaub says, “is to do $100 million in the ring market.”
Of course, how long could that last if it was merely a matter of ratcheting up face-to-face marketing and then hiring and training new salespeople? When Rick talks about what the company is doing, he doesn’t talk about leads or sales. He’s more inclined to talk about, for instance, a new method of generating additional business from prospects to whom the company pitched but who didn’t, for whatever reason, buy. The goal? To convert a minimum of 10% of them. Or how to make use of the data generated by third-party validation service GuildQuality, which has upped customer satisfaction survey return rates from 30% to nearly 80% and yielded a ton of data about potential weak points in Thompson Creek’s various overlapping systems.
You get the sense that Rick Wuest, an earnest and deliberative manager, enjoys challenging his managers as much as he enjoys challenging himself. He has the kind of confidence that comes from knowing that all business problems are solvable, provided they are tracked and measured. He also sets a high standard. “Green is good, red is bad,” he says, explaining the two sets of colored marking pens used on the whiteboard in the company’s sales training room. Studying the demo and closing numbers on the board of those who have dropped below acceptable thresholds, what’s obvious is that the standard at this company is a high one. Failure here would be considered success of a sort somewhere else.
And so, can Rick and his managers find the people they need for that growth? His idea is to hire in front, so as not to be caught short-handed. People who are challenged, and encouraged, usually do well. He likes to go back to that anecdote about the fall of 2008 when somehow the leads came and somehow the sales followed. “Momentum,” he says, “is the most powerful force in business.”
