CGI Stays Focused on Growth

Facing a weakening market, the Miami-based manufacturer implemented changes to expand
April 6, 2011
FEATURE ARTICLE | Close-Ups

Rising from the devastation of Hurricane Andrew in 1992, CGI Windows & Doors Inc. got its start by focusing on products that could meet the stringent impact-resistant building codes that emerged in the storm’s aftermath. Faced with a devastating economic environment 15 years later, the company has stayed true to its core, but reinvented itself in many ways too.

 
 CGI CEO Brian Evans

The company was founded by Flavio Quesada, who had a background in the commercial window business.  It started with a focus on that segment, but quickly moved to the residential market, which now accounts for about 75 percent of its business.  “CGI’s strategy was and still remains to provide products with exceptional value and high quality,” states Brian Evans, CGI president and CEO. “We do not consider ourselves a commodity manufacturer.”  With that basic approach, the Miami-based manufacturer has reinvested in product designs over the years, and grown by word of mouth. 

“When markets began to decline in 2007, we chose not to let the extreme housing and overall recession get the best of us,” Evans explains. “Instead we focused our resources both on executing our day to day opportunities as well as on investments that would allow us to grow and better serve our dealers and customers in the years ahead.”  Executives at the Miami-based company began to initiate a number of changes, including the implementation of lean strategies in its manufacturing, a refinement and expansion of its product line, and concerted efforts to serve new dealers with a broader territory.

Going Lean
Even for companies in the higher end, price competition has long been a way of life in this industry and companies must be fiscally efficient to survive these most difficult times, Evans note, adding that “CGI was no exception.” Starting four years ago, the company embarked on its strategic operations initiative, starting with numerous lean events with plant personnel, the company has seen numerous changes in the plant.

 
 CGI personnel have conducted numerous lean events in recent years to improve the efficiency of its manufacturing operations.
 

CGI manufacturing floor supervisors are now responsible for their production lines and post key measures for safety, quality, cost and productivity on the lines for all to see, reports Jorge Santaella, COO.  It is their scorecard and provides critical information to the line workers for and keeps proper focus on what is important. "The changes have yielded sizeable productivity gains," he states, “And these improvements were made with the direct support of our production personnel’s involvement through our lean events.”

Importantly, the lean initiatives have also allowed CGI to free up enough floor space in their existing facility to add new products. “Not having to add fixed facility costs has been very important in our ability to control unit costs with the many new products we have launched,” Santaella says.

Product Launches
One advantage CGI had as a start up in the post-Andrew years, Evans notes, is that unlike other manufacturers, it didn't have to take existing designs and work adapt them to meet the new test requirements. It started engineering its products from scratch. CGI initially focused on commercial products, but it quickly took its expertise from that market and moved into residential applications, which now represent about 75 percent of the company’s business.

For the past five years, CGI has introduced several new products each year, adding to its initial Estate Collection line with such products as multi-panel doors. The most significant introductions came in 2010, however, first with the launch of the Estate Entrances Collection. “This is an exciting product line for us that provides both hurricane and security resistant features with architecturally pleasing high end designs for a great front entryway statement,” Evans states. With numerous design options, the line serves both contemporary and traditional tastes with finish choices including solid colors, anodized and Aspen woodgrain finishes.

In May, the company followed that launch with a line of blast-resistant window and door products designed for both superior protection, as well as strong aesthetic appeal. Finally, in October of last year, the company introduced the Sentinel by CGI product line designed to competes directly in the mid-tier market. “This offering has been two years in the making and we are excited about its prospects,” states Evans. “It has been positioned competitively while offering a variety of product features and benefits that we feel set it apart and that value conscious consumers will appreciate.”

One step that many window manufacturers—even those based in Florida—have taken, but CGI hasn’t is the introduction of a vinyl product line. Evans doesn’t rule it out for the future, but notes vinyl is a relatively new product to be offered in CGI’s markets and has gained momentum primarily through the recent tax credits that expired at the end of 2010.

  
From its start, CGI has focused on production of impact-rated products.

“The markets we predominately serve,” he continues, “still ask for and prefer the strength and durability of tried-and-true aluminum framed products.”
While the company may one day add vinyl, Evans definitely sees CGI maintaining its focus on hurricane- and impact-protection products. “The vast majority of the markets we serve require them,” he notes. “We also understand that good impact product designs are different than non-impact products, taking into consideration many areas including frame design, hardware, installation, glass, etc. It remains our companies’ expertise and our main focus to offer the best protective products in the marketplace.”

Evans also sees plenty of growth ahead with such products. “We do see continued opportunities for growth in hurricane zones as people remodel for added protection, for insurance coverage savings and improved energy efficiency,” he notes. “Additionally in some jurisdictions we are seeing an increased level of enforcement of their hurricane building codes.”

Beyond markets with such codes, he sees potential with its new blast resistant product line. “We also sell our products to customers wanting the advantages of an impact product which includes security, sound abatement, UV protection and overall strength,” Evans notes. “Our Estate Entrances line is great for security and is available for many markets outside of Florida.”

Expanded Network
With its eye on expanding its territory and continued growth in the face of declining markets, CGI has invested considerable effort into expanding its dealer network over the past few years. A big part of that, reports Steve Dawson, executive vice president, is “greater emphasis on dealer and customer support and improving their ability to quickly resolve problems.”

CGI also recently implemented a new quoting and manufacturing enterprise system for its business, the foundation of which is WTS Paradigm. “Dealers are seeing the advantages of the quoting system, CGI calls Quotrac,” Santaella notes.

Some of the new features include the capacity to handle more product options in the software, visualization tools when selecting products and the ability to prepare customer quotes more quickle, Evans adds. “Tools that help our dealers such as Quotrac are all important factors for our dealers and part of our desire to continue to improve their ability to do business with CGI.”

One advantage the company has had during this downturn is a product mix that meets the need of residential and commercial applications in both the new construction and remodeling markets. “We work with residential and commercial dealers that are new construction and remodeling focused and prefer to have the right mix of dealers for each territory,” he states. With the downturn in the new construction activity, CGI has seen remodeling account for a much larger share of its business as it has expanded its dealer network into new territories, Evans notes. “We are fortunate to have products that serve each of these markets.”

 
 CGI's operations team includes, from left to right, Ignacio Escobedo; Oscar Cordova Jr.; Robert Hernandez; Jorge Santaella and Marcus Bentine.

Looking forward, Evans is optimistic for CGI’s prospects despite continued weakness in the market. Housing starts at some point will begin fuel growth as retirees and others continue to move into Florida to take advantage of warm sunny climate and lack of state income tax, he states.
CGI will also continue to evolve and adapt. With its new product lines still in the roll-out stage, the company expects to see increased sales for years to come. A number of newer markets for the company also show significant promise through share growth working with the right set of dealers, he adds.

“Operationally we will continue to improve our customer service effectiveness by making it easier to do business with CGI,” Evans states. “We will continue to drive our in-house productivity using lean manufacturing concepts and reengineering our business processes.”  The company also has the ability to consider acquisitions that support our overall strategy, he notes. In addition to working toward orgqanic growth, CGI will actively consider growth through acquisitions.

“A company that stops changing is soon left behind,” Evans concludes. “We like to continually provide new and enhanced products and services for our customers. We also have a goal to continue to grow our business every year. We believe CGI has set the stage for some exciting times ahead.”