Custom-manufacturing businesses tend to be cyclical, project-specific, offer complex products and require significant technical design and sales talent, but it's often difficult to profitably keep adding the staff needed to support growth.
When looking to expand several years ago, Calgary-based Evans Consoles Corp., a designer and manufacturer of custom control-room solutions. was faced with just such a challenge: How could it continue to profitably grow its business around the world without having to keep adding sales and project management staff?
Increased sales required increased project management resources to generate proposals and, as more proposals were sold, more design resources were needed. However, because of the custom nature of Evans' products, it took an average of 18 months to train a technical resource.
The company's experience was that increasing sales volumes required a similar increase in hiring resources, which was just not sustainable going forward. While the demand for more business was there, it was not possible to profitably grow the business simply by adding more people. The risk of a downward cycle in the market and the effect it would have on increased overhead was too significant.
Therefore, a new and innovative way had to be found to handle the anticipated growth in a more cost-effective manner.
Founded in 1980, Evans is a private company owned by chief executive officer Greg Smith and chairman Bill Burkett. The largest console manufacturer in the world, it serves multiple market segments, creating specialized furniture for control rooms and other mission-critical and technology-intensive facilities globally.
What helps differentiate Evans is the quality and brand recognition it has developed over the last 30 years. Perhaps more importantly, Evans is able to provide each of its customers with a unique solution; with more than 9,000 control rooms built to date, no two are of the same design.
To be able to provide this level of service, Evans has the largest technical team in the industry, equally split between project management, including technical sales support, and design, which focuses on detailed product design.
All project proposals, including revisions, are done by the project management team in about two-week cycles, meaning that the sales person or dealer submits the information with the customers' expectations and the proposal, including drawings and a price quote, are returned within about two weeks.
To meet the company's challenge, Matko Papic, vice-president of engineering and product development, and Richard Game, executive vice-president of business development, created a plan to shift Evans from a labour-intensive sales, proposal and design process to one that was automated with new software called Snap Design II.
Instead of relying on designers and engineers, the software allows an Evans' non-technical representative and a customer to collaboratively engage in a custom design exercise in full 3D using a simplified user interface (UI) specifically designed by Evans.
Working with Autodesk, Evans developed a new tool using standard Autodesk 3D design software called Inventor and combined this with a programming logic software program called Engineered to Order, or ETO. This was a new concept at the time as no one had tried to automate a 3D design platform; prior to this, ETO was used to automate only certain routines in 2D Autocad.
A key component of the solution is the ability to automate repetitive engineering tasks and reproduce complex design processes for completely non-technical users. As a consequence, designers and engineers no longer have to be directly involved in the proposal process, while they still maintain full engineering control of the solution, since those principles are embedded in the software, which is then able to produce, in real time, a full 3D model of a desired console solution, proposal drawings, a price and logistics quote, invoices and 3D renderings.
While Autodesk was involved in developing the initial program architecture and helped to set up the first software product platform, Evans now does all of the new software development in-house. After two years of development, Evans launched the new solution in 2008.
The business has been able to grow without adding additional staff resources. It has also reduced proposal turnaround times.
Since the deployment of the new system, Evans has been able to increase its proposal throughput by 35 per cent with no additional human resources, Mr. Papic says. As well, products being proposed and sold through SNAP require minimal project management time and at least 80 per cent less time in the design group. And training sales and channel partners on using SNAP now takes only about six hours.
In addition, Evans can now carry out many more proposals in the field without having to go through a time-consuming qualification process or involving project and technical teams.
"Sales/dealers now do an average of 150 SNAP quotes a month [none prior to SNAP]with no resource involvement from Calgary, with approximately 50 of these turning into qualified projects, of which 30 are sold directly through SNAP and 20 require some minor input from the Calgary office," Mr. Papic says.
To use a hockey analogy, this facilitates a rapid response that allows Evans to take 'more shots on net' and get more goals while at the same time ensuring that 'missed shots' do not needlessly consume scarce and expensive engineering resources.
Special to The Globe and Mail
Chad Saunders is an assistant professor in the Entrepreneurship & Innovation and Strategy Areas of the Haskayne School of Business at the University of Calgary.
This is the latest in a regular series of case studies by a rotating group of business professors from across the country. They appear every Friday on the Report on Small Business website.
Join The Globe's Small Business LinkedIn group to network with other entrepreneurs and to discuss topical issues: tgam.ca/linkedinsb