By Carlos David Mogollón, WC&P Executive Editor
Greg Norgaard, 47, was born and raised in the small, rural Minnesota town of Lakeville and went to college at both Gustavus Adolphus College in St. Peter, Minn., and the University of Minnesota in Minneapolis/St. Paul. He’s a small town guy, but he thinks big and his career reflects that.
Norgaard started a hazardous waste and recovery business in Minneapolis in the early ’80s, which was sold to USFilter Corp. in 1991. He worked for USFilter as vice president and general manager of its Midwest region until 1999, when he became executive vice president and general manager of Culligan International which USFilter acquired a year earlier. Until then, USFilter and Culligan were fierce competitors, dueling in a number of markets and undercutting each other’s dealer base.
It’s also during this period we saw the rise of the Internet as a marketing tool, global consolidation in the water treatment industry and the emergence of “big box” retailers such as Sears, Home Depot and Wal-Mart in the point-of-use/point-of-entry (POU/POE) market. As such, Norgaard has seen the transitions that have occurred over the past several years both from the perspective of the challenges and opportunities faced. Through it all, Culligan’s experience has reflected both, he readily admits.
Currently, the biggest name brand in the POU/POE market is preparing for a new owner since Veolia Environ-nement announced in September it would be selling most of its remaining assets in USFilter, which Veolia’s then parent Vivendi acquired in 1999. Norgaard said he doesn’t expect a deal to be announced before 2004’s third quarter. On top of Veolia’s sale of USF Filtration & Separation Group to Pall and Plymouth Products and Everpure to Pentair, the Culligan sale underscores the stark reversal in the buyout frenzy highlighted by it and USFilter’s dealer battles of the late ’90s.
That’s not to say consolidation has ended—far from it. Instead, it’s shifted to more strategic mergers and acquisitions. And unlike the lingering animosity that led to conflicts in integrating the industry’s two largest players, today, the tenor of debate at Culligan is more thoughtful toward the future—much like the transition at the Water Quality Association (WQA) that Norgaard assumed the presidency of at its convention in Baltimore last month.
Two years ago, dealers were mad about manufacturers leaving them out of a meeting on WQA governance, manufacturers were mad about WQA trade show turnout, international members were mad about a lack of a director, and everyone was mad about stagnant membership numbers and concerned about the impact of 9/11 on an already slowing economy. Also, Culligan independent dealers were feuding with headquarters in Northbrook, Ill.
Now, the economy seems to be picking up, membership is steady, an international director has refocused WQA’s overseas aims, trade show turnout is up and governance has been restructured through an expansive strategic plan that all agreed was sorely needed to reconcile changes in a more global industry. Also, Culligan dealers are looking forward to a new owner with more optimism (see: “John Packard on Prospective New Culligan Owner,” WC&P Web Exclusive, www.wcponline.com, March 2004).
Said Norgaard: “It is an acknowledgment on both sides—on the dealer side as well as the manufacturer side—that this industry has got to be together. We’re here, as a group of dealers and a group of manufacturers, essentially, to unite this industry. We’re not going to do that if we split up. My perspective on that is probably a little bit unique. Again, I don’t want to get real deeply into Culligan here… I’m sitting here as both a dealer and a manufacturer. And you know what? If you can’t get both of those working together—forget it. It’s not going to work.”
Bringing it together
Speaking before the convention about his views and goals going into Baltimore, he said he plans to build on the progress made in invigorating WQA’s strategic restructuring plan under past president Jim Baker, of Dayton, Ohio’s AmeriWater Inc. That plan, begun at the WQA New Orleans convention in 2002 and presented last spring at the Las Vegas event, was slow getting rolling. At the WQA Mid-Year Leadership Conference in Chicago last fall, however, procedures were set up to prioritize and move issues effectively through the association’s less bulky, realigned committee structure.
One point Norgaard felt was important was to continue to experiment with new alliances such as the Chicago event that was held in conjunction with the International Bottled Water Association’s convention. The IBWA show was itself integrated within the World Wide Food Expo taking up over a million square feet of the McCormick Place convention center. Norgaard said it was important to groom the liaison between the two organizations not so much for any merger but to build on and serve mutual needs of an overlapping membership base.
As far as membership, he’d like to see more action and results in recruiting some of the big companies that have entered the industry, whether through acquisition or carrying new products. That means manufacturers as well as mass merchandising retailers. It also means industrial companies involved in water treatment directly and peripherally as end-users to leverage both the Commercial/Industrial Section and Water Quality Society. And the WQA has to do better at recruiting international members, he added.
“The language issue, that’s just a speed bump,” Norgaard said. “That’s a forgivable barrier. If you’re going to be international in scope, you’ve got to overcome that. Same with the cultural stuff. You have got to prove your worth or your value to these people in running their businesses. And the way to do that is to pull them in, to get them involved.”
He noted that state and regional association membership is often driven by regulatory threats and that likely would remain true in the future. And he listed making sure regulations are fair and based on sound science as first of three primary challenges the industry faces. The other two were harmonization of standards and cost competition.
The good news, Norgaard said, was that the industry is growing and it’s healthy. He doesn’t foresee the pace of change slowing, but says the WQA is better positioned than ever to deal with that change and adjust to take advantage of whatever opportunities arise.
“The fundamentals are sound,” he said. “Water—obviously our product—is in a fixed supply and is an ever-increasing demand. People’s awareness of their water and the need for good high purity drinking water and working water is at an all-time high.”
Norgaard was not actually present to receive the gavel from outgoing WQA president James Baker at the Baltimore WQA convention because of prospective buyer presentations being made in Northbrook, Ill. Still, for his full interview, go to www.wcponline.com and click on the online version of this article.