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Window On Alex McNutt

From the March 2007 issue of Professional Security Magazine.

I interviewed Alex McNutt in the May 2000 issue, when he was the MD of ADT UK. He then went on to become President of, ADT Europe and South Africa. As a then member of Euralarm I would hear about the exploits of this distinguished Scotsman and his dynamic management style from European colleagues. There is no doubt that Alex is in business terms very much a ‘mover and shaker’. With the recent talk of major acquisitions in the electro-technical sector, and the gossip as to who is going to be buying; Alex McNutt’s name was one of the first to be mentioned.

As most people know, he has now moved in to a different sector as the new chief executive of Anglian Group. Alex already has extensive experience in the home improvement and building products markets, as well as his security expertise. His appointment at Anglian was effective from March 2006. In taking up the appointment, he said: “Anglian is the market leader in the industry by the volume of products manufactured and the value of sales attained. The company remains in an excellent position and is achieving growth across all product ranges. Anglian has a great opportunity to retain hold on its leadership status, but is ready to take full advantage of a fragmented market place. Anglian’s quality and product range allows us to meet our customers’ needs and with 40 years’ experience in the home improvement industry, it gives customers the confidence they are dealing with a company that will be around for a long time to come." Since then Anglian has had the benefit of Alex McNutt’s focused management style and as a result, it is steaming ahead. I caught up with him at Gatwick Airport as he was flying in en route to his next destination. I asked him to update me. Alex said: "Just now I’m Chief Executive of Anglian Home Improvements. After leaving ADT I met up with Alchemy and they offered me the opportunity to join the group in effectively February 2006. They had acquired a business in 2001 and as a result they had experienced a certain amount of turmoil … but it is an industry that is worth about £4.5 billion a year. I have been there a year and we have reorganized the business and our core products are now up 20pc and we have added £1m a week on to our orders and our sales will be up from £250-300m this year. I am really loving it, I am very fortunate having good people within Anglian and I like to think that I am responsible for the new direction, but the reality is that a lot of the people that have helped build this business are from within the company and the industry." I asked Alex about the marketing aspect of his new company. Alex replied: "We have increased our marketing budget substantially over the last 12 months, from about £7m annually in general marketing to probably closer with a run-rate to about £15m. That additional marketing has given me in terms of orders year on year approximately £60m increase, so this year our orders will be around £315m and our sales probably just under £300m so we’ll probably put approximately £15-16m on to our work bank. Things have gone very well … as I say, I’m very happy." I asked Alex the million dollar question: will you be venturing into security in the near future"? He replied: "It would be fair to say that we are always on the look out for new products to add to our portfolio. We have an amazing amount of end user customers, especially domestic and we are, as I said continually looking at adding new products to our portfolio and security is one of these that we will look at … along with many more in the home improvements market. I believe that we are in a very good position, we are nationally spread, we’ve got 26 depots in the UK and we have a 105 showrooms and offices around the UK and are planning to increase that figure with an additional 40 within the next 12 months. So whether it is windows, doors, driveways or a conservatory – security is certainly a possibility!" I remarked that since they make the door they are in a good position to get their foot through it quicker with regards to on-selling. Absolutely, Alex replied with a wry smile.
I asked how long he might stay in this business? "Well I came in to turn the business around and like most companies we have set ourselves a plan and will execute that in line with our needs." Do you see yourself coming back to security? I asked. He replied: "Well, I’m really enjoying life and the business. Whether I go back in to the security industry or indeed if the security industry comes to Anglian, is merely a matter of choice. In fact back in the early 90s Anglian did have a security aspect to the business … which they sold out. However, in more recent times we have taken on board a substantial number of senior people from the security industry who are working on our core products, so if indeed we did get involved with security we are quite capable of taking it forward." I laughed as I remarked about ‘transferable’ skills. Alex went on: "This business, like the security business is about customer service and communication. Whether you are selling someone a security system or a conservatory, double glazing or another home improvement product … the customer is looking for the same benchmarks in that they want to be kept up to speed on how the job is running and its satisfactory completion. Customers want good service and 35pc of our business is repeat business which constitutes over £100m from existing customers." I commented that with all the existing products and their core business security would be a substantial add on for the future? Alex replied: "That sounds like an opportunity in terms of recurring revenue especially in view of our existing customer base and the market profile … adding a security system would not be an issue in terms of our target group." I probed further; so what about CCTV and access for that particular market segment? Alex said: "People like to feel safe in their homes, whether with perimeter surveillance or indeed CCTV and door access … but again these are early days and we have not made up our minds yet either way. We have an extremely successful core business. However, if we were to venture in to the security business, I have no doubt that we would be just as successful as with our core business." Well, he certainly has the track record for growing companies. I asked Alex about his role within ADT. "My time with ADT as Vice President and ultimately President of Europe and Africa was tremendous. ADT/Tyco was a great company. We had very good managers within the business due to organic growth and acquisition. During my time from 1999 to 2005 we made some 50 acquisitions as well as divesting some businesses in Europe. However, I have got to say that I have not missed the challenge of working with ADT, as the industry that I am involved with now is even more dynamic. Unlike some corporations that focus on the quarterly figures as opposed to the monthly … here at Anglian in terms of direct selling we work on day to day, week to week and each month is dealt with as that of a year end. This is an exciting environment especially in terms of marketing. We are able to target precisely on a week by week basis. This ensures that the business is going in the right direction. We have a strong department that consists of half of the old team and half of the new. Although I have taken on key players from the security industry I have also taken on people from the home improvement industry including senior marketing professionals from the City of London and MDs of corporate organisations both commercial and retail. We have a diverse mix of talent and with the existing core business expertise we have a good opportunity to take this business forward. Our targets for next year are pretty adventurous … but I have no doubt we will get there." I asked Alex about his wish-list for the future. "As I mentioned the business went through some difficulties some years ago and that now is addressed. Therefore, as we take the business forward we will continue with the growth and more importantly focus on the profit line and customer service." I was trying to get Alex to talk about the security market and asked him outright if he was involved with a major acquisition at this time? "Obviously people in the industry will be aware that there is talk of a major player within the security sector being put on the market. That will be an important opportunity within the UK because this particular company is substantial and within the top echelon. I understand that there are already a number of interested parties due to the European/ global coverage involved. So if I were to surmise I would say that it would probably be another big player with the synergies that would enable them to get the most they can from that type of deal. On that basis I think it would probably be more likely that an existing player will acquire it. In my view I think one of the problems is that the UK only has three truly national pan-European companies, and then you drop to good-sized companies operating within the UK who I am sure would love to acquire such a company but it would be difficult for them to extract the same benefits as one of the larger players. However, I do believe that the opportunities within the UK for growth of business concerning the domestic market are huge." I looked at Alex and said, what if an outside market such as yours identified such an opportunity? Alex replied: "If it complemented the existing business to enable leverage within the existing customer base then that would be very interesting". I will leave you with the ‘Anglian Commitment’: ‘We’re so much more than just a window company’.


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