Guest post by Ian McDougall of Fenestration News
As a follow up to the earlier glasstalk networking event, Andrew & Matthew Glover along with Paul Godwin and Jon Twigge have done it again, they managed to get the good and the great from the industry together under one roof once more. glasstalk at first seems too simplistic and benign an idea to have much relevance to anyone, but it works. It works in ways even those that attended still haven’t probably grasped.
The day started off in the now familiar ‘glasstalk’ speed networking format, a combination of speed dating, and hi my name is “xxx” and I’m an alcoholic. It works, it works in a way that people get to meet others offering services and products they probably didn’t know they needed.
After a few sessions of table hopping and speed networking the session moved into the ‘on the couch’ phase. This was handled by Paul Godwin in a sort of Michael Parkinson/Robin Day style – it’s the person being interviewed and not the interrogator that matters. The warm up act was the all knowing Chris Ball of MBA associates; the subject was how and why companies fail. Given his wealth of experience with many of the well known names in the industry he has a lot to share. However, Paul missed out on asking Chris the most important question of all “Given your vast experience, what would be the System Company you would choose?” Strangely a question that Chris was more than prepared to answer.
Next up on the couch to face Paul was Dave Ruzicka, Sash UK. It was billed as a conversation on dominant suppliers and phoenix operations. However, it didn’t quite come over that way. The view given, and I am sure I am going to get corrected on this later, was ‘that without the competition Sash UK would be in a better place today’, which had us all looking in amazement at one other, and asking was that really what was said. Given that this was then repeated, people were left unsure of where this idea was coming from.
‘glasstalk’ – lunch and more confessions around the table, then we get to the next session on the couch.
Glass pricing, set to be the most contentious issue and coming about as a result of a petition on the Downing Street website which was tabled by Steve Sutherland of Dortech .
A lot of the mistrust of the glass manufacturing industry comes as a result of the antitrust findings against them in recent years, the result of which had the glass industry being found guilty of price collusion. As such their actions now are all viewed with some suspicion.
The irony is that for years the Fenestration Industry has been collecting from its customers money not fully due to the glass manufacturers, yet when the fine was levied it was the same innocent sector being punished once again. There is no compensation for the victims, just costs in that they are the ones really paying the fines.
As part of the findings from the antitrust case we now have the situation that the glass manufacturers are not permitted to meet one another. As a consequence it was in this instance left to Saint-Gobain to put their side of the story at ‘glasstalk’. To be doubly clear they were not talking as representatives of the glass manufactures but solely relating on how the situation is seen from Saint-Gobain’s and their own personal point of view.
To try and condense the full meaning of an hour’s conversation into a few paragraphs does not do either party justice.
On one side we have Steve Sutherland of Dortech and Jeff Hooson, Managing Director at Custom Glass and on the other side for Saint-Gobain there was Dr Alan McLenaghan, Managing Director Saint-Gobain Glass UK and Vice President, Manufacturing, Saint-Gobain Glass Wordwide and Derek Dragten, Marketing Manager Saint-Gobain Glass UK. In the middle, guiding the process in a meaningful way was Paul Godwin.
Steve Sutherland, as did those who signed his petition, quite reasonably saw that all glass prices increasing at the same time once more from the entire glass producer industry was an indication they hadn’t learnt.
Coupled with that was Steve’s concern that his company Dortech was making long term commitments in tendering and contract pricing, as is convention, that were then being rendered nonsense by the rapid and extreme changes to the glass prices.
Saint-Gobain in their defence made it clear that their first objective was with the profitability and survival of their company.
In the first instance and relating to the price increases by all glass producers at the same time, it was suggested that it was just one of those things, which just happened. Saint-Gobain had previously tried to raise its prices to cover its cost base, but found by doing so on their own meant they lost market share and they couldn’t make the increase stick. However, increasing prices in unison with other manufacturers seemed to work. Read into that what you like.
Saint-Gobain went on to explain how their industry sector was highly capital intensive, and constantly subjected to volatile energy and material pricing. There was no one in the room that didn’t grasp or appreciate this. Dr Alan McLenaghan then went on to explain, although they were originally well meaning in their commitment to a 5 week warning before any increases, the practicalities behind their trading situation has meant these commitments now have no meaning.
It is possible to go on and on, and relate these set of circumstances to the lack of knowledge of the supply chain by the supplier companies, and to who the real customer is. It is also possible to relate to the fact that having dominant players in any supply chain does no end of damage to an industry as a whole. We could eulogize how collective action on this and other concerns could be seen to benefit an industry as a whole, but these would be to miss the point.
Dominant players are a fault of the regulators and as they have no stomach to redress the situation, by default we have to assume they are condoning it. So the realism is, it’s not a new situation for the industry, learn to live with it.
Collective action would also require collective responsibilities and collective rules, even down to the collective sharing of supplies and customers. Did anyone go into business to be part of a collective?
There is only one way to improve the situation you find yourself in and that is to take responsibility for it yourself. The only reason to own or run a business is to make money; you can have an ethos on how you wish to achieve this, which is all very nice. However, there is only one fundamental discipline that will support these ideals while ensuring a future and that is having the profit to fund it.
Yes it would be nice to work well with your suppliers, but as Saint-Gobain has pointed out their end game, as with any business, is to turn a profit. That discipline will always override all other good intentions. As individuals and companies we do not always like the actions of others in the way they maintain their business, but we can certainly respect it.
Saint-Gobain may not have gained new friends, but they gained the respect for their position and stance.
How did ‘glasstalk’ help the industry?
There was no great new idea, no golden bullet and no one carried a torch for those that are convinced the industry is in a mess and needed to be shown the way forward. However, it allowed people to step outside of their own little bubble for a while, hear how others work and from that come to the realisation that they themselves had all along known what was needed to do to advance their own endeavours. It’s called ‘getting a grip’.
Glasstalk net-worked the industry, it broadened understanding and focused attention on who and where the responsibility for future actions laid.
Should there be another ‘glasstalk’? Of course.
All joking apart, I can only imagine that Anglian are doing a very good trade as a result of jumping on the GGF’s petition. I can only suggest that should the government take the decision to support the window industry with such a scheme, then consumers will definitely be very responsive. Just what the industry needs!
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