SCV NEWSMAKER OF THE WEEK:
Dan Goetz
President, UltraViolet Devices Inc.

Interview by Leon Worden
Signal City Editor

Sunday, April 18, 2004
(Television interview conducted March 10, 2004)

Dan Goetz

    "Newsmaker of the Week" is presented by the SCV Press Club and Comcast, and hosted by Signal City Editor Leon Worden. The half-hour program premieres every Wednesday at 9:30 p.m. on SCVTV Channel 20, repeating Sundays at 8:30 a.m.
    This week's newsmaker is Dan Goetz, president of UltraViolet Devices Inc. in Valencia and past president of the Valley Industrial Association of Santa Clarita. The following interview was conducted March 10. Questions are paraphrased and answers may be abbreviated for length.

Signal: What is an ultraviolet device?

Goetz: An ultraviolet device is a piece of equipment that uses UV bulbs to disinfect either the water or the air that it's treating.

Signal: What are UVDI's products?

Goetz: We build a series of point-of-use water products, counter-top water treatment devices that are sold primarily through the Pacific Rim, in areas where there is unsafe drinking water, and where the population needs to take care of their own water (and) make sure that the water is safe.
    We also build products for residential air treatment — the kind of products you would put into your home air-conditioning (HVAC) system, (to) improve the quality of air in your home. And we build products that are installed in commercial buildings (to control) microbial growth in these buildings. Also it is an energy conservation device: It keeps the refrigeration-air conditioning coils clean, more efficient, and reduces the amount of energy it takes to change the temperature in the building.

UV Bulb Signal: Joe Consumer won't find a UVDI air conditioner or water purification system in a store, will he?

Goetz: You probably will never find a product that says UVDI on the outside of it. We're kind of like the "Intel inside." Our products are part of several major, well-known, multi-level marketing companies' products. We also are the largest seller of products into the contractor market through a marketing partner that is well known in the business for thermostats and other air conditioning products.

Signal: So you make the components that have somebody else's brand names on them.

Goetz: That's correct. We are the technology inside.

Signal: Is there any product that carries your own brand name?

Goetz: We have a branded product called Altru-V, which is a commercial product that we sell through a series of distributors and manufacturers' reps. The Altru-V product was launched about a year and a half ago. It is a very successful product right now and it's currently being installed in many original equipment-manufactured air-conditioning systems by big companies.

Signal: Why did UVDI decide to locate its manufacturing plant in the Valencia Industrial Center?

Goetz: Valencia is the home of our founder, Tom Veloz. He brought the company up here — the history of UVDI is connected to Aquafine Corp.
    Luis Veloz was Tom Veloz's father. (He) worked with Westinghouse in the 1940s and developed commercially viable ultraviolet bulbs. Later he left Westinghouse and formed Aquafine Corp. Aquafine became well known for industrial-commercial water treatment equipment. Then in the late 1990s, they were approached by a company that wanted to build a residential-consumer product, and they knew that Aquafine had great technology. So Tom, who was by then running his company from his father, worked with this organization, designed a product, and when the product was ready, UVDI was launched as a separate company to manufacture this product.
    So that's how UVDI came about. We grew very fast and separated from Aquafine, and the company has been a success since then.

Signal: How many people does UVDI employ?

Goetz: We're just under 100 employees right now.

Signal: Is there an ongoing relationship with Aquafine?

Goetz: Not really. We don't compete. They're in the industrial-commercial marketplace; we're more in the residential-consumer water marketplace, and then we've expanded into the air products now. They're not in air products very much.

Signal: How big is your market area?

Goetz: Our products are sold throughout Japan, Korea, Hong Kong, down through Asia. These are areas where the drinking water is basically unsafe to drink, where there is bacteria and virus in the water supply and people can get very sick from the water.
    In the United states, especially around Southern California, people are not happy with their water, but it's aesthetic problems — taste, odor and color. They don't really need UV to solve those problems. That can be done with filtration or reverse osmosis or some other technologies.

Signal: Do your products go into filtration plants in those countries?

Goetz: They can be part of a filtration process. The UV can be part of a bigger process.

Signal: Here in Santa Clarita we've got perchlorate contamination in some of the groundwater. Do you ever get involved in that type of water treatment?

Goetz: UVDI does not really get involved with that. I believe Aquafine does have some interest in groundwater treatment, and municipal water treatment as well.

Signal: How long have you been president of UVDI?

Goetz: Since the beginning of the year.

Signal: You've been with UVDI since —

Goetz: Since its inception 12 years ago.

Signal: Like Tom Veloz, you are heavily involved in the community as a board member of the Valley Industrial Association and the SCV Chamber of Commerce

Goetz: Also involved with the Education Foundation of the chamber and the School and Business Alliance. I'm involved with the board of directors there. As you can tell, most of my interests are in education, especially when it is related to the connection that can be made between students and their future careers.
    I think that education is a key factor in the success of business. One of the things that we stress internally at UVDI is continuing education. We have many employees out of our group that have successfully completed degrees under educational reimbursement programs, and we are avid supporters of the new College of the Canyons University Center, and the Center for Applied Competitive Technologies (CACT) over at the college as well.

Signal: How do you think the college, or for that matter the high schools, are doing in terms of providing the kind of trained workers you need? Are you seeing graduates who can walk into the kinds of jobs that you provide?

Goetz: The answer is yes, it's getting better. I think that the high schools are beginning to embrace School-to-Career activities. They have career paths, they now have kids go out on job shadowing, and they learn how to do many of the skills that become applicable out in the work force. I think there is still a real need to educate students in work ethics and interviewing skills. These are programs that are of great importance to me, to try to make these opportunities available for students.
    As to the college, I think that (COC President) Dianne Van Hook and (CACT Director) Dena Maloney are running a tremendous program with business education. (CACT) offers a variety of very relevant programs for businesses. The Valley Industrial Association is a partner with COC in securing Employment Training Panel funds, and has been for the last 10 years. We have brought probably 3,000 employees through various training programs in everything from Microsoft office skills to geometric tolerancing — project skills, many different key skills that they need to help them be promoted within organizations, and to help organizations have those key skills that they need to be competitive.

Signal: A lot of the synergy between the business community and the college grew out of the CEO Forum that you organized a few years ago.

Goetz: That's correct. Actually, the history of the relationship between the college and (VIA) goes back to 1994, when there was a group that was actually put together by Connie (Worden-Roberts), who was the founder of the first meeting. Out of that came a real defined need that the companies wanted to re-engineer and they needed certain skills, and the call was made to the college to help with that.
    So that was the creation of the Employee Training Institute. ... That was the first time that we went to the state as a group together to get funding (for) these kinds of programs. And those programs have evolved. Recently there have been two other CEO forums. Other kinds of programs that have come out of the forums have been the Santa Clarita Valley Jobs Online program, SCVJobsOnline.com, which is now very active and is a good way for people who live in the valley to find jobs here in the valley. We're trying to work with that whole "shop local, work local, live local" (effort), and this is a good way for the business community to help people with skills not have to commute out of the valley.
    Another program that came out of the CEO Forum was the Web site contest. We're in the fifth year now of that contest. We have 29 teams that are working right now. The awards night is in May. These are teams that are created between elementary or middle or high schools and various businesses. The teams of up to six students come out, interview the business, learn about the business, then they go create a Web site for the business.

Dan Goetz Signal: Does the business actually use the Web site?

Goetz: Many times they have. Sometimes they're not really usable, but the winning teams have been very exciting. And actually, UVDI's Web site was built not from the contest team, but immediately following the contest we hired some students who came in during the summer and built the Web site for us. It was a wonderful experience, having students in the company doing that.

Signal: We hear about the annual events like the Web site contest and Groundhog Job Shadow Day, where high school kids come into a business to see what it's like for a day. Do you see those experiences lasting or are they forgotten? Is there some effort to keep the momentum going?

Goetz: Absolutely. We get requests all the time from businesses that had shadows, that said, "I really would like to have this student come and have a summer job with us," or, "We'd be interested in offering them a part-time position" while they're in school. But more importantly, I think what we're doing is offering students opportunities to learn about what they want to do.
    More often than not, a student may say, "I want to go out and shadow a doctor or a nurse." They go out to that experience and they come back and they say, "I know I don't want to do that for my life." And that is just as important as going out and finding something that they do like. Because if they think, "I want to be a doctor," and then they go invest years of education and training and then they get out there and it's really not something that they like, they're going to end up back and home. ... So what we're really trying to do is help young people find career paths that are most satisfying for themselves, because they'll become much more productive members of society.

Signal: When you're hiring, are you finding more qualified candidates coming from the SCV than maybe a few years ago before this effort started?

Goetz: We hire some entry-level people for our organization. I think that when we talk about the major staff, we're talking about engineers and professional people. So the interviewing process is not as discrete as "Santa Clarita" or "out of Santa Clarita." We have a variety of ways that we recruit people. We try to find people, of course, who are local, because there is less recruitment cost associated with bringing in a qualified local person.
    I do believe the quality of the work force here is improving, and that the skills they are learning are very applicable to our business.

Signal: How are your needs communicated to the high schools and college?

Goetz: That's one of the key roles that the School and Business Alliance holds down. It is an opportunity for businesses to interface with educators on the board, and we discuss, what are the needs that the businesses have? What are the different curricula that the schools could offer?
    It's very difficult to change curriculum in a school. It's a cumbersome process. But I do see a willingness to hear those needs and to try to modify the curriculum. Especially with younger teachers who are really trying to make a mark. They want to be champions of new programs in their schools. I think that the relationships become very productive for both the business and the school.

Signal: You indicated the COC administration is attuned to your needs; are there specific things at the high school level that teachers, administrators, board members, should be considering, or things they aren't emphasizing enough?

Goetz: I think so. I think one of the shortcomings of the current system is, the secondary school system is a unit unto itself; the community college system is another organization. Although they try to coordinate their activities, there is not a very good relationship where the community college recognizes a lot of the work that is done in the high schools. So there are students who are very pro-active — they take a lot of classes, and so forth — and it is difficult for them to be recognized for that hard work when they move on to the community college or the CSU system.

Signal: What kind of jobs are being provided in this valley for people fresh from high school or college?

Goetz: There are all levels. There really is quite a variety of positions that are available. ... There will always be manufacturing jobs, I think, in the Santa Clarita Valley, in California. There are aerospace jobs and a lot of technology. But when you talk about consumer products, things that the public buys every day, there is a tremendous pressure to maintain the quality of the products, reduce the cost of the products. And businesses that are manufacturing in California have a very tough time competing. We have very high labor costs, very expensive land, so our overhead costs are high here; we have the well-discussed workers compensation cost problems; of course, California is a very litigious society. It's a difficult environment for businesses to flourish in, and a very competitive society.
    I think education helps the businesses grow and be smarter about how they're going to survive and continue to flourish. Companies like UVDI are looking at new markets, distributing products that were maybe just domestic products. We're looking at, are they applicable for sale in foreign countries? And setting up distribution for those products over there. We're looking to find, should we be manufacturing some of the products that we sell in the United States or sell overseas? Should they be made overseas, with much lower cost structures, like in China or southern Asia? There are markets that can get raw materials cheaper than we can get them here, and they have, of course, much less expensive labor markets.

Signal: Is Valencia your only current plant?

Goetz: Yes.

Signal: You say there's a future for manufacturing. Yet, you just returned from China, where you're looking to do what?

Goetz: The first thing that we're doing in China is, we have two distributors there for the Altru-V products. We're helping them get our air treatment products certified by the ministry of health in China, and we will be setting up distribution and sales in China for our commercial products.
    Secondly, we are talking with manufacturers through southern China — we already import some small components into our assemblies from China, some electronic boards and some other items — so we're looking at, what would be the cost of manufacturing one of these assemblies that we sell, over there? And of course there will be all the trade-offs, because now you have transportation costs, and a lot of inventory in process, import fees and so forth, so we have to do a full analysis of, what is the correct place for UVDI to manufacture these products?

Signal: What is your take on outsourcing? Are businesses correct to ship manufacturing jobs overseas that in the old days would have been provided right here?

Goetz: Businesses are faced with competition. If we're a U.S.-based company and we can build a product for $25 for sale here, but a company down the street is importing one that cost $15, should the company that's in the United States just give up and say, I can't make it for $15? Or should the United States company try to find ways to have products to keep jobs — sales jobs, engineering jobs, technical jobs — here in the United States? We may have to export some manufacturing so that we can have products that compete price-wise.
    The truth is that the public will look at a product for its values, and will then look at what the cost of it is, and it will determine whether or not there is a value for paying more for it. If you can't offer a differentiated value, you need to be able to compete at that price level.

Signal: If companies like UVDI are shipping manufacturing jobs overseas, what kinds of skills are you looking for here? What is there to fill the gap for the American worker?

Goetz: The truth about exporting jobs is, really you're importing products, OK, and really trying to make sure that you have a full array of products that meet the customer's needs here in the United States. In the United States, companies need to determine what their core values are, what they bring to the product. If it's the design or the proprietary technology, or if they have certain patents, or whatever the intellectual property is that they need to protect, they need to be able to configure their companies to be able to protect that value and still be competitive.

Signal: What are the jobs of tomorrow, and what can the schools do to help?

Goetz: I think schools need to continue to (focus not only) on the basics, reading writing, arithmetic, and all those kind of things, but need to help students find the technology that they are most comfortable with, find a path where they can be contributing members of the society.
    We (the School and Business Alliance) are working right now with the (SCV) Automobile Dealers Association. They're faced with a very difficult problem, and that is, the people that need to work on the cars today require some fairly sophisticated training, and the equipment that it takes to service computerized cars can't be trained at a high school. Our high schools can't afford that equipment anymore. What we need to do is find a way where the auto dealers get connected to the schools and then are able to sponsor Santa Clarita students to go to technical schools to learn the skills to become capable technicians at their dealerships. These are the kinds of things, the relationships that we need to create, in order to be able to feed our local businesses with the talent they need.

Signal: It wasn't all that long ago that a high school graduate could expect to get a job in a manufacturing plant. Other than working in a fast-food restaurant, is there anything a high school degree in and of itself is good for anymore?

Goetz: We do have jobs in purchasing, we have jobs in quality and so forth, that don't have any educational requirements over a high school diploma. Those skills are skills that we'll train in the company.
    What we really need to have the students equipped with are good work ethics, proper personality, ability to work together in teams, those kind of basic skills. We continue to stress that to the educational institutions: that they need to work on the people skills.

Signal: Tell us about the upcoming China seminar.

Goetz: It's on April 21. College of the Canyons and (CACT) are putting on a seminar at the Hyatt. It's an all-day seminar. We're going to have business development people from China here, and I believe Gruber Systems is going to do a case study about some of the work they've done there.
    It is going to be a very exciting day, and I think that there are many businesses that are beginning to look at their competitive situation and are looking across the ocean, saying, "Is that where I really need to be looking?" They're going to have an opportunity to look into that on (Wednesday).

    See this interview in its entirety today at 8:30 a.m., and watch for another "Newsmaker of the Week" on Wednesday at 9:30 p.m. on SCVTV Channel 20, available to Comcast and Time Warner Cable subscribers throughout the Santa Clarita Valley.


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