Thousands of residential HVAC contractors around the country have used the knowledge of Matt Michel to build a profitable business. That is just one of the many reasons he will be receiving The NEWS’ Legends of HVACR award at Service World Expo this year.
“These awards are flattering, but this is not an individual award,” Michel said. “There is a team of people that work their tails off. They are incredibly bright and talented. Without them, nothing would have happened.”
But what did happen was the creation of one of the finest HVAC contractor organizations — Service Roundtable. Oddly enough, the president of Service Nation, the parent company, did not begin his career in the residential contracting world. In fact, he wasn’t expecting to build a career in HVAC at all.
After graduating from Texas A&M University, Michel started as a project engineer with the Turbo Refrigerating Co., performing manufacturing engineering that he was prepared for and mechanical engineering that he wasn’t.
“I literally read the ASHRAE handbook multiple times,” Michel said.
This would not be the last time he would learn on the fly.
Michel got a little closer to his eventual HVAC career when he took a job with Lennox.
“I took The NEWS directory and wrote letters to every manufacturing company within 30 miles,” he said. “I would write to the vice president of manufacturing looking for a job.”
Lennox had a new position for an advanced manufacturing technology engineer to be in charge of factory automation for nine manufacturing facilities. With only two years of experience, Michel talked his way into a job that required 10 years.
At Lennox, it did not take long for Michel’s natural marketing talents to be recognized.
“Marketing got a computer and needed someone to show them how to use it, so I volunteered,” Michel said. “I noticed the marketing team was louder, more positive, and had more fun than manufacturing. I also noticed they traveled to better locations than manufacturing and were more apt to get promotions and advance in the company.”
He was asked to move into marketing because Lennox thought it was a better fit. Although Michel took a few marketing classes while finishing his master’s, he, once again, was learning on the fly. He learned well enough that he moved up the chain and wound up handling marketing for Lennox’s Western Division.
From there, Michel had stops at both Titus and Air Serve. At Titus, he was in charge of variable air volume (VAV) boxes and direct digital controls (DDC).
“Titus was dependent on high-rise construction, which cratered just after I started,” Michel said. “Talk about perfect timing. So I was trying to figure out the air distribution side of the industry and realized that if we were going to hit our numbers, we needed new products. By hook and by crook, we managed to roll out nine new products in an 18-month period, increasing sales while the rest of the industry slumped.”
Michel got back in the residential side of the HVAC industry when he helped launch the Aire Serv franchise system out of Waco, Texas.
“When I got there, all we had was a desk and a logo,” he said. “So basically, I had to create the franchise system from scratch.”
That, no doubt, would come in handy a few years down the road when launching Service Roundtable. But Michel had one final step in between. He went to Decision Analyst and worked with a plethora of companies, including Amtrak, Time Warner, and a host of high-tech and telecom companies.
“I ran as far away from the HVAC industry as I could,” Michel said.
However, he could not stay away for long — legends of the HVACR industry never can. His next stop was a start — the emergence of Service Roundtable. Michel had noticed that there were a lot of contractor groups focused on the top 5 percent of contractors. He felt there was a void for the middle majority, and he helped design Service Roundtable to serve those contractors.
“I kept getting calls from people in the HVAC industry when I was with Decision Analyst, and I did some work with associations and manufacturers,” Michel said. “Over time, I came to realize I liked working with contractors and enjoyed the people in the HVAC industry a lot better than the people in the high-tech industry. HVAC is more grounded. I think very highly of contractors. They are people working their butts off every day. They may have gotten no training in business. But they are taking a risk and succeeding.”
Michel had the Service Roundtable concept for years. With the help of contractor Steve Saunders, he was able to schedule a few meetings with distributors to pitch the concept. Nobody was biting. Finally, in an ad hoc meeting with a number of people on the future of the HVACR industry, Michel pulled out the old presentation, and it was met with enthusiasm.
“They asked me how much it would cost, and I gave them a number,” Michel said. “They laughed and cut the number by 75 percent. I remember getting the first check from the investor and realizing that I had just taken a step there was no coming back from.”
Turns out there was no need to look back. They begin the process in April and launched in September of 2002. The core design that was invented with the help of multiple people over those few months is still in place now. When they launched, they had just over 100 contractors.
“It has been an amazing journey with lots of twists,” Saunders said. “Matt had an original vision of what the industry needed and how he might be able to marshal resources and ideas to satisfy those needs. Service Nation and the Service Roundtable delivered on that original vision, and Matt deserves the credit for sharing the vision for a better contracting world.”
The organization currently has just under 4,000 members.
“I had some great contractors helping me out when we launched this thing,” Michel said. “People like Mitch Cropp, Larry Taylor, and Ron Smith. Of course, there were so many more, too. These are great contractors. They were our founding members and were all out pushing the program.”
Of course, the legend used a healthy dose of marketing to build the Service Roundtable brand. While attending some trade shows and some other traditional marketing, Michel said the organization did more than its fair share of guerilla-type marketing. This included writing for the trade press magazines to get the word out and communicating via email lists long before it was commonplace.
Michel is happy with the course he took.
“I preferred the residential and light commercial market that I knew from Lennox,” Michel said. “It was more fun to me. On the heavy commercial side, it is less marketing and more personal selling and relationships.”
David Heimer has been with Michel since that first meeting about Service Roundtable. The senior vice president of Service Nation has great respect for his co-worker.
“Matt Michel will have a lasting impact on our industry in many ways,” Heimer said. “His book, ‘Power of Positive Pricing,’ remains the seminal guide to contractor pricing in our industry. Matt’s creativity is often noted, and deservedly so. What people usually miss is that his creativity is based on a foundation of deep understanding of the industry and a quantitative knowledge based on his career in engineering and market research. It’s a rare combination.”
And 16 years later, Service Roundtable continues to grow. It now also includes the popular Service World Expo event. In the ever-changing world of communication, Michel freely divulged the secret to growing the business and changing with the times.
“I have been able to hire people who are better than I am and smarter than I am and give them the problem,” Michel said. “My expectations were exceedingly high when we started this thing. We have not exceeded my expectations even though this may have exceeded the expectations of others. We have not gotten all the way there, but we will.”
As for this legend, he does not plan on slowing down anytime soon. And why should he? Michel enjoys his job immensely.
“The favorite part of my job is when I hear contractors stress how the Service Roundtable or Service Nation Alliance turned their business around and did so much for them personally and professionally,” Michel said. “The contractors really deserve the credit. We can’t execute for their businesses; only they can execute. They take the information and put it into action. Hearing people who were struggling and are now thriving is what makes it all worthwhile.”
Members of the organization feel they owe their success to him.
“In a turbulent world, it is important to have support that provides stability and knowledge and shines a light on the potential paths for success,” Saunders said. “Matt Michel has been a rock of support for countless contracting firms in the last two decades. His vision and advice have helped us all. His creation of the Service Roundtable has even given us a forum and format to help each other.
“The industry is better for his leadership,” he added.
Publication date: 10/8/2018