By Donald A. Mounce
Pentair Water / Pentair Filtration, Inc.
502 Indiana Avenue
Sheboygan, WI 53081
Main Tel: (800) 645-0267 or (920) 457-9435
Fax: (920) 457-6652
Employees at this facility: 340 (240 plant and 100 office)
Pentair, Inc.
(NYSE: PNR)
5500 Wayzata Blvd.
Golden Valley, MN 55416-1259
Tel: (763) 545-1730
Over the next few months, as WC&P prepares for and celebrates its 50th anniversary of publication excellence in 2009, this column will take a special look at some of the leading executives, companies and organizations of our industry. This month, we will focus on Pentair Water’s Neil Desmond. The 2006-2007 WQA President, Desmond is Vice President/Commercial Business Unit of Pentair Filtration.
During the past 25 years, Neil Desmond has seen many changes in water treatment and filtration technology and innovation. And being with a leading company such as Pentair has made that an enjoyable adventure.
“Change is the key to any company’s long-term growth and to be on the forefront of these changes with Pentair is the ultimate professional challenge,” says Desmond. “We have been able to lead that change by coming up with new and innovative technologies as well as spreading engineering development to all regions of the world.
“Pentair, Inc. is such a large and diversified operating company, employing 16,000 people in more than 50 locations throughout North America, Europe and Asia. With sales of $3.30 billion (in 2007), I could never have imagined the growth in the water industry since I began my career.”
“I first became involved in the water industry in 1984 when I transferred to the Plymouth Products Division of Ametek located in Sheboygan, WI,” notes Desmond. ““My career actually started with Ametek in 1974, right out of college, at their headquarters in Paoli, PA.
“I have been at the Sheboygan location for 25 years, serving in the past as Controller, Director of Operations and Vice President/General Manager. And I became Vice President of the Commercial Business Unit operation in 2008.”
The challenge of change
“Global growth and demand for water treatment and filtration products have made it necessary for Pentair to become aligned with the needs of all areas of the world,” says Desmond. “Regions outside of North America have become a more significant part of our business than ever before and we see that continuing.
“The recent declines in the US housing market have definitely impacted the demand for our residential products. This has proved a challenge for Pentair Filtration, as it has for the industry as a whole. But the diversity of our product, distribution channel and technology portfolios, as well as our wide-ranging geographic footprint, have all helped us to remain strong and grow from a global perspective.”
“Changes in cost structure have also made it necessary for Pentair to produce products across the globe in order to better serve customers,” adds Desmond. “With plant locations around the world, we have had the ability to produce what we need where it is needed, as the leading global provider of innovative products and systems used in the movement, treatment, storage and enjoyment of safe, clean water.
“Pentair is committed to ‘winning right.’ Those two words embody both our drive for success and our dedication to doing business led by the highest ethical standards. We are committed to building success on strong, fundamental values embraced by every employee. We believe that honesty and integrity should define our relationships with customers, business partners, investors and each other.”
Corporate history
Headquartered in Golden Valley, MN, Pentair is composed of many diverse manufacturing businesses, in two core business groups: Technical Products and Water. Under the Water umbrella are three divisions: Flow Technologies, Pool & Spa and Filtration.
The Filtration division is comprised of the following acquired businesses: Fleck Controls (Brookfield, WI); Structural/Essef (Chardon, OH); Plymouth Products (Sheboygan, WI); Everpure (Hanover Park, IL); WICOR (Long Beach, CA; Murietta, CA; Dover, NH); SHURflo (Cypress, CA); Porous Media (Conroe, TX and White Bear Lake, MN); and Krystil Klear (Winimac, IN). Within Filtration are the residential, commercial, industrial and municipal market segments.
Pentair recently added a joint venture with GE Water & Process Technologies of Glendale, WI to the mix earlier this year, in order to combine their respective global water softener and residential water filtration businesses. Under the terms of the agreement, Pentair has an 80 percent ownership stake and GE has a 20 percent stake of the joint venture – Pentair Residential Filtration.
The partnership is expected to better positions both Pentair and GE to serve residential customers with industry-leading technical applications. The primary areas of focus will be water conditioning, whole house filtration, POU water management and water sustainability.
Combined focus
“Pentair’s current residential filtration strategy is growth,” says Desmond. “The company believes it will accelerate revenue growth by selling GE’s existing residential conditioning and treatment products through Pentair’s sales channels, and by gaining access to some of GE’s current and emerging filtration technologies.
“In 2007, the combined residential and commercial net sales of the parent companies were approximately $450 million USD. Three of the filtration facilities–in Rockford, IL; Sheyboygan, WI; and Cypress, CA–will be closing within the year to make more efficient use of manufacturing processes and space and enhance revenues for the future.”
“Pentair Residential Filtration will serve as the primary sales channel for Pentair’s and GE’s respective global residential water filtration and water softener businesses,” adds Desmond. “It will also serve as the manufacturing arm for residential and commercial tanks, valves and some limited filtration products for the parent companies.
“Pentair and GE will continue to serve existing municipal, commercial and industrial water treatment customers separately, sourcing select products from the joint venture as needed. Pentair Residential Filtration will bring together approximately 1,100 employees from Pentair and GE in 15 facilities in the US, Europe and China.”
Future plans
“While I cannot get specific about the company’s plans, there are some key growth initiatives and themes we’ll be building upon as part of Pentair Filtration’s short- and long-term plans,” says Desmond.
“These initiatives will include optimizing the potential of the newly-formed Pentair/GE residential joint venture, successfully executing planned growth initiatives in commercial and industrial segments and continuing to expand global presence and penetration levels. Additionally, Pentair will continue to focus on developing new and emerging technologies to serve all markets and business segments.”
“Increasing the diversity of our product, technology and market offerings will help us capitalize on emerging global market opportunities,” notes Desmond.
“We will also continue to drive lean productivity initiatives throughout the organization.
“This will help us build upon the vertical market organizational structure and ‘mindset’ that Pentair Filtration put in place in early 2008. It will help us successfully deliver on our plans as well as serve our customers at a higher level than ever before.”
Association leadership
Desmond has been an active member of the Water Quality Association since 1988, working on different committees and boards. He also served as President of the Association in 2006-2007 and has maintained a strong focus on proactively facing the challenges and trends of the water conditioning industry.
“We just dodged a bullet with the veto by California Governor Arnold Schwarzenegger of AB 2270, which the WQA vehemently opposed and fought,” notes Desmond. “This would have had a significant long-term impact on our industry, but most importantly would have had a negative impact on the rights of the consumer to utilize clean and pure POU water.
“The industry does need to take a leadership role in developing alternative, salt-less and green technologies. We also need to get on top of emerging technology platforms relative to gray water reuse and rainwater harvesting, as well as how to best deal with the lasting effects of the downturn in the US housing market so closely related to our domestic industry.”
“At Pentair Filtration, we see a number of trends that present opportunities and that are growth drivers for our company and the industry,” adds Desmond. “We will continue to help WQA best understand environmental factors such as water
scarcity and reuse issues in the US, Australia and other locations. We also will help best define long-term solutions for green technology needs, such as the bottled water backlash and efforts to ‘refill not landfill’ plastic bottles.
“Our industry also must work on building our global economic infrastructure. The new economies in India, Asia and the Middle East are and will be demanding water conditioning and purification equipment and application support.”
“Aging infrastructures in developed countries like the US and many in Europe also need our guidance, as do construction companies for new homes being built globally ‘off the water grid,’” says Desmond. “Emerging market municipalities are just unable to guarantee safe water.
“Economic factors such as in-home filtration versus purchasing bottled water are also key factors requiring our guidance, as increasing consumer wealth in emerging markets is driving the demand for advanced water treatment solutions.”
“Consumer awareness is rising globally. It is being driven by increasing media coverage of contaminated water crises,” concludes Desmond. “The next 25 years is even going to be a more challenging ride than in the past, as it relates to drinking water quality.
“The global concepts of regulation, conservation and filtration need leadership from the WQA and companies like Pentair. And our goal is to ensure that level of support is maintained and enhanced. Clean water is our future.”