The Investment That Paid Off: An Executive Interview with Lennox Industries

The Investment That Paid Off: An Executive Interview with Lennox Industries

You know the old adage: All the flowers of tomorrow are in the seeds of yesterday. For Lennox Industries, planting seeds is something they've always done. For a company that is more than 100 years old, the examples of such seeding are many.

When Contracting Business.com sat down with Doug Young, president and chief operating officer, Lennox International Residential Heating & Cooling; and Gary Bedard, vice president and general manager, Lennox Residential, the focus was on the current plantings, if you will — especially in light of the economic conditions the country and the industry are currently experiencing.

Young, who originally joined the Lennox team in 1999, says the company is actually having a great year. He says, "It's an exciting time for us. We have many new products hitting the market right now and they are the result of initial investments made four to five years ago that are paying off today.

"Our longtime strategy is to continually invest in research and development when it comes to product efficiency and refrigerant use," Young says. "Despite the economy, that strategy never changes and that is how we deliver real value to our HVAC contractor customers."

Bedard, a 20-year HVAC industry veteran, joined Lennox in 1998. He speaks in terms of the green movement and the consumer desire to reduce their carbon footprint. “But they're not sure where to turn for help in doing so. Many are interested in learning more about how solar technology, for example, can help them reduce energy use, but really don't know who to turn to for more information.

"This is a huge opportunity for HVAC contractors, and thanks to research and development work done by Lennox, they can now be solar advisors for their customers."

Bedard is referring to Lennox' latest product, introduced during their annual dealer meeting in Austin, TX in March 2010. The SunSource® heat pump and air conditioning unit is powered by solar energy. In fact, not only is the air conditioning powered in this manner, but there is potential for the SunSource system to supply enough electricity to be used throughout the home, reducing overall electric use, providing a return on investment much sooner than traditional high efficiency systems, and playing into the green movement/carbon footprint reduction that so many consumers are looking for today.

Says Young, "we adopted a 'sit down and listen' approach to product design by forming focus groups and contractor councils. We heard contractors say they needed products that were easy to sell, install, and maintain. And our designs produced higher efficiency furnaces and air conditioning systems with smaller footprints (from 40 to 33 in.) providing more room for add-ons and easy installation."

"From the air conditioning perspective," says Bedard, "Lennox prepared for the refrigerant changeover years ago. We began focusing on R-410A in our top-of-the-line equipment and structured the move to it throughout our lines over a fairly long period of time."

"I like to think that our contractors will almost always opt to sell the consumer the best long-term solution — the R410A product," Young says. "We provide the products and the training. They do the rest."

"Lennox has invested heavily in developing online technical training in the form of their HVAC Learning Management System," Bedard says. "This provides them high quality training in a first rate format."

In fact the Learning Management System is a way for contractors to create individualized training plans for each employee, and then track the learning progress online. Plus much of the technical training is NATE CEU certified. Visit www.hvacls.com to learn more about this program

Training is such a key issue and Young says that segues into what he calls the top issues contractors face today. He says the biggest and most difficult issue to deal with is change.

"Contractors must stay on top of the changes impacting the industry and that is often hard to do, The important thing for them to remember is that they're not in it alone. As a partner, Lennox constantly conducts research on things that I like to call the art of the possible," Young says.

"That includes not only technology, but things like staying in front of tax incentives, sales, management, and strategy. It means communicating what we find and teaching contractors to better network together."

The second biggest challenge facing contractors today, according to Young, is manpower — finding the right people, training them well, and the finding ways to retain them. Nothing new here, right? Wrong. Lennox is creating "people" programs that can help contractors create top quality co-workers through training. Things like their "Build a Salesperson" program come to mind. This class helps contractors create top quality salespeople for their businesses.

Then there is the "Build a Tech" program where technicians are taught about retail selling.

Young says the bottom line is that if contractors are successful, Lennox is successful.

In the end, both Bedard and Young say that the major theme for their organization is innovation from both a technical and business perspective. The challenge is in the fact gathering and in the execution.

"But that becomes easier because we're focused on why we do what we do and for whom we do it," Young says. "We're very excited. This is an exciting industry and we’re living in exciting times. Our products and services are necessary for the health and well being of our society. But we remain cognizant of the need to be good energy citizens. The contractor sits in the intersection of everything that is happening today and that is very exciting for us." — Mike Weil

Betting the Farm: Lennox Industries Invests in the Future
In this age of cutbacks and reductions, it’s somewhat rare to see a company sticking its neck out to invest in its future and the future of its customers. But in the last few years, one company, Lennox Industries Inc., did just that.

Did they bet the farm? Not really. But the gamble was to research and develop products that would meet current and future standards and do it at price points that would be affordable and profitable. In Austin, TX in March, during one of eight, two-day contractor meetings, Lennox examined the marketplace, the economy, and the HVAC business and put it into perspective.

Operative word: change. No question. For Lennox, the change came as a result of investing in the research and development of new technologies and product re-alignments.

The result: the introduction of a number of exciting new products to attract consumer interest and help contractors sell more. The products include:

icomfort Touch™ — simple, smart comfort controls. This device is the "brains" of the comfort system from an installation and maintenance standpoint.

Cooling products — four new Dave Lennox Signature™ Collection products that are among the most quiet devices that meet federal tax credit guidelines

Solar technology — Lennox’ new SunSource® home energy system that provides solar energy as an affordable source for central heating and cooling and more.

Next generation furnaces — The company is introducing their next generation of high efficiency furnaces that have a new flexible 33-in. compact design, efficiencies rated at 98.2% AFUE, and extremely low noise ratings. There have also been improvements made to make the units easier to install and service. These new models meet all requirements for federal tax incentives.

With the expected stabilization of electric and gas prices, and projections for an improved housing market this year, Lennox officials believe the economy will be markedly improved over last year. Their research and development is banking on it.

To learn more about the latest innovations from Lennox industries, go to www.lennox.com/about/latest.asp

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