Fireside Hearth & Home: Constant Innovation

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"I wish I had a team of trade contractors like Fireside." That comment, coming from an NHQ judge who also happened to be a home builder, would sound like sweet music to anyone in the home building trades. But for Fireside Hearth & Home, it represented the essence of what boosted the firm to achieve a Silver Award for the 2008 NHQ Awards — a solid ability to impress their customers, even when their customers happen to be the NHQ Award judging panel.

Fireside Hearth & Home Jim Plazak, national field operations manager, left, and Roger Oxford, senior vice president, guided NHQ Judges during site visits.

Certainly, it takes much more than customer satisfaction to achieve any level of NHQ Award recognition. NHQ judges are methodical in their evaluation and very discerning when it comes to doling out awards. So Fireside had to make an impression and show positive results when it came to areas including leadership, strategic planning, performance management, human resources, and construction quality as well.

Fireside Hearth & Home formed in 2000 when two of the nation's largest fireplace distributors were acquired by Hearth & Home Technologies. Since then, through expansion and acquisition, Fireside amassed builder distribution facilities in 34 cities across the U.S. In addition to the builder distribution facilities, they also have dozens of owned and independent direct retail showroom stores. Hearth & Home Technologies is also manufacturer of the Heatilator and Heat & Glo fireplace brands. These businesses all operate under the umbrella of the HNI Corp.

The corporate structure forms a unique integrated supply chain where all levels benefit from established processes, clear channels of communication and a corporate mindset focused on uncompromising quality and constant innovation. Valuable feedback gained at the distribution, service and retail levels can be channeled back to the design, engineering and manufacturing levels to facilitate product and service advancements and improvements.

However, the focus of the NHQ judge's visit was only on Fireside Hearth & Home. Here's what they found to be working in Fireside's favor.

Strategies for Planning: Communication is Key

Business strategies at Fireside are driven by a rolling three-year strategic plan that is revisited and updated annually. This gives the firm an opportunity to assess current market conditions and make adjustments. Additionally, each region as well as each division within those regions operates under its own formal business plan that works directly into overall strategic planning goals. Regional and divisional groups are directly accountable for achieving goals.

NHQ judges were impressed with the sophisticated computer-driven visual management tools in place at Fireside that work to assist managers in closely monitoring performance progress. These include "dashboard" reports that are updated daily and monthly "scorecards." Scorecards are color coded, allowing managers to be quickly alerted to problem spots so changes can be made to address any deficiencies or variances from the established business plans.

Fireside also tracks outside building permit information in their markets to predict future sales demand. This type of information is shared with the Hearth & Home Technologies' parent to facilitate adjustments to the manufacturing side.

When it comes to performance management, Fireside excels in maintaining established processes and policies throughout the organization by using effective communications tools. In addition, a corporate culture and philosophy that espouses continuous improvement allow every employee to make suggestions for positive or progressive changes to processes and policies.

The firm also works to capitalize on best practices that are developed at the local levels by sharing those practices regionally and nationally. Good ideas that are producing positive results in one region can be implemented company-wide.

Happiness is a Warm Hearth

Fireside employees recognize their primary customer is the home builder. They also recognize their secondary customer is the homeowner. If the homeowner is happy with their fireplace, that in turn reflects positively on the home builder.

Fireside employees are well aware their product brings fire into people's homes. This conjures images of couples or families gathered around a cozy hearth enjoying conversation, playing card games or drinking hot cocoa. But there's a not-so-warm-and-fuzzy side. The firm realizes there are serious risks with fireplaces that may not be installed or used properly.

As a result, solid processes have been put in place that guide all fireplace installations. Procedures have been standardized across all regions and divisions to assure consistency, safety and security.

Taking it a step further, Fireside branded its installation process, calling it its "Signature Installation." It dictates installation procedures that go beyond manufacturer's requirements and local and national codes, assuring fireplaces in Minnesota are installed in the exact same manner as those in Maryland. Most importantly, it works from a risk management standpoint to help limit liability. NHQ judges were able to directly observe this consistency of installation techniques and lauded Fireside for being able to maintain that consistency across regions and divisions.

A Culture of Membership

Interestingly, Fireside does not have "employees," instead referring to workers as "members." Recognizing that people are their greatest asset, Fireside operates under a member-owner culture where everyone is a stock owner and participates in cash profit sharing that rewards performance.