How ITT Grew Its R&CW Business in Europe

Residential & Commercial Water brought its two main European business units together, and is now bringing in more revenues and profits than ever before.

Europe is the perfect proving ground for ITT in its quest to evolve from a collection of stand-alone companies to a unified, global organization. With nearly 50 countries, dozens of different languages and strong customer loyalty to Flygt, Lowara and other well-established ITT product brands, Europe condenses all the challenges of creating a global "One ITT" organization into one continent.

Which makes the recent success of ITT's Residential and Commercial Water (R&CW) group for Europe, Middle East and Africa (EMEA) all the more impressive -- and instructive.

In 2006, R&CW EMEA's operation grew revenues by 15 percent to more than $320 million, which represents about one-third of all R&CW sales worldwide. Profits increased by 27 percent. It was the best twelve-month performance in a string of strong years that the business has put together since 2002.

"The R&CW team in Europe is achieving strong growth because it was willing to re-make its business profile and go to market in a different, better way," says Gretchen McClain, who led R&CW until April 2007, when she became president of the entire ITT Fluid Techology group.

The primary reason behind R&CW EMEA's growth spurt was its willingness to combine product lines, sales forces, facilities and company cultures of its two strong European brands, Lowara and Vogel, over the past five years. This integration was the first step toward building a more powerful European entity capable of serving a highly diversified market with a focused approach.

"The differences that once separated us have become a source of strength," Amedeo Valente, director of research and development for R&CW Europe.

The Lowara-Vogel integation gave R&CW the broadest range of multi-stage, end-suction and submersible pumps in the industry, enabling it to go more aggressively after the building services, the commercial OEM industry and the agriculture and irrigation markets.

As the organizational integration progressed, new products were developed and introduced. Distributors became even more loyal because they could offer their customers total water solutions from R&CW that included not just Lowara and Vogel products, but also Bell & Gossett and Goulds Pumps water products from the U.S., plus, in some cases, Flygt wastewater products.

And sales opportunities skyrocketed. As a unified company, R&CW was able to look past the traditional geographic markets of Western Europe and assess the EMEA market as a whole. Enhancing the focus on the emerging markets in Eastern Europe and in the Middle East, it established new sales offices in Moscow and Dubai in 2006.

In parallel, innovative lean operations initiatives that had transformed the Lowara plants in Italy into models of efficiency from 2002 to 2005 were put into practice last year at the Vogel facility in Austria with similar results.

R&CW is now building a new plant in Poland with the key objective to be closer to its Eastern European customer base. Later this year, the plant will start assembling four-inch submersible pump sets and surface motors on an initial operating surface of 80,000 square feet, with further space for extension over time as the business grows.

(From top) A Lowara turnkey pump solution and Vogel Hydrovar energy-efficient controllers.

A Profile of R&CW

ITT's Residential & Commercial Water group is led by John Williamson, who was named to the position in April 2007.

R&CW offers one of the broadest ranges of pumps and water-handling systems for pressurization, air conditioning, firefighting, dewatering, irrigation and numerous industrial applications, from drinking water supply to machine tool cooling. Its best-selling products are multi-stage vertical pumps that efficiently provide water to commercial buildings or industrial OEM services, and Hydrovar variable speed controllers that enable pump systems to run at a constant pressure, thereby saving energy.