With his move to Rhode Island from Australia, Laurent Vernerey is a living example of what the purchase of APC by Schneider Electric is all about.
He is French, but received his MBA at Duke; Schneider’s leaders are French, Australian and British, and have come from many of the companies that Schneider has acquired over the years. Vernerey himself has worked for all of Schneider’s major divisions.
He spoke with Providence Business News about Schneider’s vision for APC-MGE as it integrates the $3 billion unit into its global operations.
PBN: This merger closed quickly. Why do you think that was?
VERNEREY: It was a great strategic fit. There is clear leadership in product categories [for both APC and MGE]. There were technology and approaches that we didn’t have at Schneider. APC brought the company into the IT world, a place that Schneider was not in previously. APC-MGE is a full energy efficiency package for data centers. All the business lines are in high-growth areas – we expect 10 to 15 percent-a-year growth in our business out into the foreseeable future – much of it driven by the data center market and enterprise networking, which we believe is growing 25 to 30 percent per year in our product areas.
PBN: Why is that market growing at that rate?
VERNEREY: It used to be that 10 percent of a data center’s budget was taken by energy costs. That is now approaching 48 percent. … We believe that we can save 10 to 30 percent of that electricity bill.
PBN: Are there any potential negatives to the merger?
VERNEREY: We focus on the elements that define success. And in that area, we have two priorities, our employees and our customers. We believe that driving employee satisfaction drives customer satisfaction. … To that end, we are making sure that we are welcoming APC as a new member of the family for Schneider. Our first asset is the people here. Our executive team is APC-MGE, not just from Schneider. After myself and the CFO, who I brought with me, we have put the team together here, and I am quite proud of them. I’m most proud of the level of vigorous debate we have had … it came about really fast.
PBN: How well you are succeeding at connecting with the entire employee base?
VERNEREY: We already had a great story to tell – we are about growth, efficiency and people. But the question was, how do you manage expectations now that we are functioning within an $18 billion enterprise?
In the case of a merger like this … our No. 1 priority in the first days after the merger was to create a sense of direction among employees that focuses on taking care of customers. Every 30 days, we review results of a plan that we made. We are closing in on the end of the first 100-day plan. And we are now rolling out the two- to three-year roadmap to success. … I believe we have been able to manage the transition from employee and customer perception. We have a full story – the integration of power and cooling story. But it’s not like we have a book and open it to page 87 to tell us what to do.
PBN: What were the similarities and differences between APC and MGE/Schneider coming into the deal?
VERNEREY: I was in Australia for Schneider to oversee a major acquisition – Clipsal, a company similar to APC in its commitment to entrepreneurship, as well as being engineering-driven. … It is easy to make an assumption that Schneider Electric is one block, with the same approach to business throughout. That is not true. Our role at APC-MGE is to bring in Schneider’s diversity to APC and keep the best practices and innovation that APC brings and make it permeate the new company.
PBN: How will APC be able to influence the part that was MGE?
VERNEREY: APC is a game-changing type of company. The deal started a new conversation in the company that was a side benefit. And it will influence the rest of [Schneider’s] business. … One way that will happen is that APC-MGE personnel will be able to move around. If you want an international career, we will offer it.
PBN: Where else do you see growth coming?
VERNEREY: In terms of industrial applications, in microchip and flat-screen panel plants, there is a need for a reliable power supply, but also for pure power. We need to get solutions for the connected consumer as well. People can afford to have nice equipment, but they don’t want it ruined by a surge, so we want to solve a real problem there.
PBN: You talk about solutions, as opposed to products. Do you see APC-MGE doing more consulting work, much like IBM has positioned itself as an IT consultancy?
VERNEREY: In the past, APC did not focus on products alone – it was always talking in terms of solutions. … Customers are expecting integrated solutions; we have to do that. Plus, if we do not do that, we will lose customer intimacy, which helps drive growth.
PBN: What issues do you anticipate in doing business in Rhode Island and the United States?
VERNEREY: I haven’t been in the country long enough to know about the business climate, but I am impressed by the quality of the people here. I’m happy we have made the decision to be here in the middle of this talent pool. It is a dynamic community. We have been welcomed; I have met with [Gov. Donald L. Carcieri] and [Providence Mayor David N. Cicilline]. … Schneider also believes in giving back to the community. Across the company we give to children and educatonal issues, and expect to do so here.
Interview: Laurent Vernerey
Position: President and CEO, APC-MGE
Background: Vernerey became leader of APC-MGE in February, after France’s Schneider Electric – an $18 billion maker of power and control products for the IT, residential, building, energy and infrastructure markets – completed its acquisition of West Kingston-based American Power Conversion and renamed the company. Previously, since 2003, Vernerey had been managing director of Schneider’s Pacific zone, stationed in Sydney, Australia, following three years at the corporate staff in Rueil-Malmaison, France, most recently as senior vice president, manufacturing and logistics. He joined Schneider in 1985, when it acquired Telemecanique. He also has worked in the Merlin Gerin and Square D USA divisions of the company.
Education: B.S. in finance and marketing, 1983, Ecole Superieure de Commerce, Dijon, France; MBA, 1998, Duke University
Residence: Still searching for a home in Rhode Island
Age: 47
