Randall Chann, president and CEO of Environmental Dynamics International, sat down with Water Online Radio for this live interview from the show floor at WEFTEC 2011 in Los Angeles. Chann talked about his company’s aeration offerings, as well as its philosophy on delivering value to the customer. Listen or read on to learn more.
Todd Schnick: We are back, broadcasting live from the Los Angeles Convention Center and the tradeshow floor of WEFTEC. I am Todd Schnick, joined by my co-host, Todd Youngblood. Todd, we are in the homestretch. We are almost there. It’s been a great day.
Todd Youngblood: I don’t want it to end. I really don’t.
Todd Schnick: I’m fired up. We ought to have an evening shift.
Todd Youngblood: Anyway, it’s a good we let our guest sit down. He was looking bedraggled.
Todd Schnick: Bedraggled. I don’t know what the word bedraggled means, but it doesn’t sound good. Let’s get to our exciting guest. His name is Randy Chann. He is the president and CEO of EDI - Environmental Dynamics International. Welcome to Water Online Radio.
Randy Chann: Thank you. This is exciting to be here.
Todd Schnick: We’re excited to have you. Before we get into a conversation Randy, take a few minutes and just walk us through a little about who you are, your background, and tell us about EDI.
Randy Chann: Environmental Dynamics has been involved in aeration and biological treatment for many years, starting back in 1975. I’ve been involved in the business for almost as long. Started in the ‘80s, did some work for British Petroleum, and now I’m blowing air and water with Environmental Dynamics.
Todd Schnick: Blowing air and water.
Todd Youngblood: Just let it go. Let it go.
Todd Schnick: It’s the end of a long day. We have so many directions we could take that.
Randy Chann: That’s supposed to prompt a follow-up question.
Todd Schnick: What do you mean by that, Randy?
Randy Chann: We’re really involved in the biological process and wastewater treatment. As we try to clean up and remove organics from water, we’re using microbes, aerobic microbes. They need oxygen to keep alive and for mixing.
Todd Youngblood: We’re moving forward, Randy. What do you see as the biggest trend in the water/wastewater industry in the U.S.?
Randy Chann: There are lots of trends. If we look at the Midwest as an example, there’s a lot of pressure on the fishable/swimmable criteria. That means we got to disinfect wastewater. There are also a lot of trends in nutrient reductions – total nitrogen and total phosphorous.
Todd Schnick: How about internationally? Are the trends in the U.S. any different?
Randy Chann: They are a little different. Internationally, you run into a lot of markets where they’re building their first plants, and so these plants, these guys are driven on first cost. They’re looking at what’s the lowest capital that I can spend to get some wastewater treatment online.
Todd Schnick: How is EDI positioned to deal with these trends?
Randy Chann: Positioned pretty well. We’ve been around since 1975 and, by definition, we’re technologists and engineers. We started off with a lot of innovative solutions for the lagoon marketplace. We’re jazzed up about making products, so we’re vertically integrated. We’re involved in the research, the development, and the manufacturing of these products. We’ve reached out to international markets. Today, we service over a hundred markets worldwide. We were fortunate to win the U.S. Department of Commerce Presidents Award, so I had the pleasure of meeting President Bush.
Todd Schnick: Kudos.
Randy Chann: That was fun.
Todd Schnick: I think that would be. Randy, I want to take you back to the markets where you’re installing the first sets of equipment.
Randy Chann: Sure.
Todd Schnick: You mentioned low cost. I mean, very clearly, the lowest cost is not necessary the best long-term value and best long-term investment. How do you deal with that? If I don’t have the money to buy the best thing, I don’t have the money. What do I do?
Randy Chann: Clearly, that’s a challenge. I guess we’re patient. We understand that we have to meet these market conditions and drivers, but our current slogan is “Aeration for Life,” meaning that we want to attract these facilities and service the long-term of these facilities.
So technologies can be incorporated into existing facilities to improve its performance over the long haul. You can’t convince every customer in the beginning of the game to do total ownership cost. So it’s recognizing market demands and doing the best you can at each step.
Todd Schnick: We understand that EDI is showcasing a new product this year. Give the audience a snapshot of what’s that all about.
Randy Chann: Yes. StreamLine is a new diffuser assembly for us, and the genius of StreamLine is really its simplicity. When you look at aeration systems, there are fairly mechanically intensive type devices. Every piece has a specific spot. Any failure of a component is a problem. StreamLine goes a long way towards installation simplicity, robustness in design, mechanical reliability – those types of attributes.
Todd Youngblood: Randy, I’ve been explaining all day to Schnick what an aeration system performance envelope is and he doesn’t believe that my explanation is correct. So, could you just explain it so that he knows that I’m actually knowledgeable about this?
Randy Chann: Many people look at an aeration system as a constant design point. We like to think of an aeration system as an envelope of opportunities on how you can design that system – much like a pump curve, or akin to a pump curve.
What we try to do with ASPE is to communicate to the end user how the total ownership cost of the system varies as a function of its design point. So while you may ask me for a standard design point, I’m almost by definition going to give you an idea of what happens if you strive for a lower cost system, maybe higher total ownership cost; or a higher cost system, or a higher efficiency system, and what that does to your total ownership cost.
Almost by definition, we need to think about the design of an aeration system in accordance to the financial drivers of that system. If we are in the Midwest and we’re paying 8 or 9 cents per kilowatt for energy, or if I’m in Hawaii and I happen to be paying 25 cents per kilowatt for energy, you would think that you could design the system to a different optimum operating point efficiency. And the industry doesn’t really do a good job with that. So we’re proactively reaching out, communicating this kind of information, trying to educate buyers and designers on that proper set point.
Todd Schnick: All joking aside about our communication breakdown, it has actually been a common theme throughout our broadcast today, that the industry isn’t doing a good job on communicating to the marketplace and the end user. What can the industry do to improve that communication flaw?
Randy Chann: I think that’s a difficult area. We are experts in our area. We try to promote features and benefits of our products as we move forward. ASPE is part of that. It’s a bigger story when a simple answer is being asked for. There’s that education component. We’re also starting to spend more time talking to end users and trying to really understand the drivers that an end user has – the facility owner.
Todd Schnick: Randy, many companies are dramatically cutting back what they’re investing in tradeshows like WEFTEC and you have two booths here. So you’re really bucking the trend. Why is that? What value do you see here that makes you make that kind of an investment?
Randy Chann: As Environmental Dynamics has grown, you know I talked about our vertical integrated structure; we’re also growing from a horizontal integration play. And horizontal integration play means that we are delivering more than just a hardware solution. We’ve expanded out with the DiffuserExpress Division, which provides replacement parts for basically all diffusers. It’s akin to the tires on your car – we want to service all cars, not just EDI’s aeration equipment. And we’ve also branched out with Aeration Works, and Aeration Works is an ability to get technical people out into the field to help maintain these plants.
So to carry those different messages, we feel that it’s better to have that separation. We’re attracting different customers – facility owners in one case, maybe design engineers in another.
Todd Youngblood: Its sounds like you’re very deliberately diversifying the market segments that you’re selling into. Is that part of your business strategy that’s driving that?
Randy Chann: We clearly want, again, Aeration for Life. We want to be involved in these systems for the long haul. If you look at an aeration system, you may spend, say, $100,000 on a capital basis. You’ll spend 30 times that in power over its life.
And so as technologies develop, we feel that there’s an opportunity to take those advance technologies, integrate it into existing systems – give that end user a contact to this technology stream.
Todd Schnick: Randy, what does the next three to five years look like for EDI?
Randy Chann: Next three to five years is really focusing on the OPEX side on the equation. The costs are huge. If you talk to facility owners and you look at rate structures, they’re constantly going up. The cost of power is going up. If you look at the opportunity or availability to pay for those costs, there’s a big gap.
So we believe that we can deliver technology solutions, improve the long-term operating and maintenance budgets of these facilities, and help in that big sustainability picture. That’s a buzz word out there, but when an aeration system touches 50, 60, 70% of the operating horsepower of that plant, so it’s almost an obligation to focus on those areas.
Todd Youngblood: Obligation is exactly the right word, I think.
Todd Schnick: Randy, we hate to say it, but we’re out of time. Before we let you go, share with the audience how they can contact EDI and learn more about the work that you’re doing?
Randy Chann: All of our information is really available on our website. We’ve been ahead of the game, so it’s easy to catch us at www.wastewater.com.
Todd Schnick: All right. Randy Chann, president and CEO of Environmental Dynamics International, it was a pleasure having you. Thank you for joining us today.
Randy Chann: Thank you, folks.
Todd Youngblood: Thanks for the insights, Randy.
Todd Schnick: That wraps this segment. On behalf of Todd Youngblood, I am Todd Schnick, Water Online Radio. We’ll be right back.