diff --git a/commands/operator-sdk/cmd/build.go b/commands/operator-sdk/cmd/build.go
index 9349b79c876..08b97b67b74 100644
--- a/commands/operator-sdk/cmd/build.go
+++ b/commands/operator-sdk/cmd/build.go
@@ -82,7 +82,7 @@ func buildFunc(cmd *cobra.Command, args []string) {
 	if err = yaml.Unmarshal(fp, c); err != nil {
 		cmdError.ExitWithError(cmdError.ExitError, fmt.Errorf("failed to unmarshal config file %v: (%v)", configYaml, err))
 	}
-	if err = generator.RenderDeployFiles(c, image); err != nil {
+	if err = generator.RenderOperatorYaml(c, image); err != nil {
 		cmdError.ExitWithError(cmdError.ExitError, fmt.Errorf("failed to generate deploy/operator.yaml: (%v)", err))
 	}
 }
diff --git a/pkg/generator/deploy_tmpl.go b/pkg/generator/deploy_tmpl.go
index 719d63c6ad0..645dc89f1c8 100644
--- a/pkg/generator/deploy_tmpl.go
+++ b/pkg/generator/deploy_tmpl.go
@@ -76,3 +76,9 @@ roleRef:
   name: {{.ProjectName}}
   apiGroup: rbac.authorization.k8s.io
 `
+
+const crYamlTmpl = `apiVersion: "{{.APIVersion}}"
+kind: "{{.Kind}}"
+metadata:
+  name: "example"
+`
diff --git a/pkg/generator/gen_deploy.go b/pkg/generator/gen_deploy.go
index 59eb10473fd..b56cd139469 100644
--- a/pkg/generator/gen_deploy.go
+++ b/pkg/generator/gen_deploy.go
@@ -24,6 +24,7 @@ import (
 const (
 	operatorTmplName = "deploy/operator.yaml"
 	rbacTmplName     = "deploy/rbac.yaml"
+	crTmplName       = "deploy/cr.yaml"
 )
 
 // OperatorYaml contains all the customized data needed to generate deploy/operator.yaml for a new operator
@@ -78,3 +79,24 @@ func renderRBACYaml(w io.Writer, projectName string) error {
 	r := RBACYaml{ProjectName: projectName}
 	return t.Execute(w, r)
 }
+
+// CRYaml contains all the customized data needed to generate deploy/cr.yaml.
+type CRYaml struct {
+	APIVersion string
+	Kind       string
+	Name       string
+}
+
+func renderCustomResourceYaml(w io.Writer, apiVersion, kind string) error {
+	t := template.New(crTmplName)
+	t, err := t.Parse(crYamlTmpl)
+	if err != nil {
+		return fmt.Errorf("failed to parse cr yaml template: %v", err)
+	}
+
+	r := CRYaml{
+		APIVersion: apiVersion,
+		Kind:       kind,
+	}
+	return t.Execute(w, r)
+}
diff --git a/pkg/generator/gen_handler.go b/pkg/generator/gen_handler.go
index d8e19429b93..cac2739fdcc 100644
--- a/pkg/generator/gen_handler.go
+++ b/pkg/generator/gen_handler.go
@@ -24,10 +24,15 @@ import (
 type Handler struct {
 	// imports
 	OperatorSDKImport string
+
+	RepoPath   string
+	Kind       string
+	APIDirName string
+	Version    string
 }
 
 // renderHandlerFile generates the stub/handler.go file.
-func renderHandlerFile(w io.Writer) error {
+func renderHandlerFile(w io.Writer, repoPath, kind, apiDirName, version string) error {
 	t := template.New("stub/handler.go")
 	t, err := t.Parse(handlerTmpl)
 	if err != nil {
@@ -36,6 +41,10 @@ func renderHandlerFile(w io.Writer) error {
 
 	h := Handler{
 		OperatorSDKImport: sdkImport,
+		RepoPath:          repoPath,
+		Kind:              kind,
+		APIDirName:        apiDirName,
+		Version:           version,
 	}
 	return t.Execute(w, h)
 }
diff --git a/pkg/generator/gen_main.go b/pkg/generator/gen_main.go
index d88c44ae25f..8cd40f7d9c4 100644
--- a/pkg/generator/gen_main.go
+++ b/pkg/generator/gen_main.go
@@ -33,10 +33,13 @@ type Main struct {
 	OperatorSDKImport string
 	StubImport        string
 	SDKVersionImport  string
+
+	APIVersion string
+	Kind       string
 }
 
-// renderMainFile generates the cmd/<projectName>/main.go file given a repo path ("github.com/coreos/play")
-func renderMainFile(w io.Writer, repo string) error {
+// renderMainFile generates the cmd/<projectName>/main.go file.
+func renderMainFile(w io.Writer, repo, apiVersion, kind string) error {
 	t := template.New("cmd/<projectName>/main.go")
 	t, err := t.Parse(mainTmpl)
 	if err != nil {
@@ -47,6 +50,8 @@ func renderMainFile(w io.Writer, repo string) error {
 		OperatorSDKImport: sdkImport,
 		StubImport:        filepath.Join(repo, stubDir),
 		SDKVersionImport:  versionImport,
+		APIVersion:        apiVersion,
+		Kind:              kind,
 	}
 	return t.Execute(w, m)
 }
diff --git a/pkg/generator/generator.go b/pkg/generator/generator.go
index 1975c60cb77..b38e02cb89e 100644
--- a/pkg/generator/generator.go
+++ b/pkg/generator/generator.go
@@ -54,6 +54,7 @@ const (
 	config          = "config.yaml"
 	operatorYaml    = deployDir + "/operator.yaml"
 	rbacYaml        = "rbac.yaml"
+	crYaml          = "cr.yaml"
 )
 
 type Generator struct {
@@ -127,12 +128,12 @@ func (g *Generator) renderCmd() error {
 	if err := os.MkdirAll(cpDir, defaultDirFileMode); err != nil {
 		return err
 	}
-	return renderCmdFiles(cpDir, g.repoPath)
+	return renderCmdFiles(cpDir, g.repoPath, g.apiVersion, g.kind)
 }
 
-func renderCmdFiles(cmdProjectDir, repoPath string) error {
+func renderCmdFiles(cmdProjectDir, repoPath, apiVersion, kind string) error {
 	buf := &bytes.Buffer{}
-	if err := renderMainFile(buf, repoPath); err != nil {
+	if err := renderMainFile(buf, repoPath, apiVersion, kind); err != nil {
 		return err
 	}
 	return writeFileAndPrint(filepath.Join(cmdProjectDir, main), buf.Bytes(), defaultFileMode)
@@ -159,7 +160,7 @@ func (g *Generator) renderDeploy() error {
 	if err := os.MkdirAll(dp, defaultDirFileMode); err != nil {
 		return err
 	}
-	return renderRBAC(dp, g.projectName)
+	return renderDeployFiles(dp, g.projectName, g.apiVersion, g.kind)
 }
 
 func renderRBAC(deployDir, projectName string) error {
@@ -170,9 +171,24 @@ func renderRBAC(deployDir, projectName string) error {
 	return writeFileAndPrint(filepath.Join(deployDir, rbacYaml), buf.Bytes(), defaultFileMode)
 }
 
-// RenderDeployFiles generates "deploy/operator.yaml"
-// TODO: rethink about when/what to generate when invoking build command.
-func RenderDeployFiles(c *Config, image string) error {
+func renderDeployFiles(deployDir, projectName, apiVersion, kind string) error {
+	buf := &bytes.Buffer{}
+	if err := renderRBACYaml(buf, projectName); err != nil {
+		return err
+	}
+	if err := writeFileAndPrint(filepath.Join(deployDir, rbacYaml), buf.Bytes(), defaultFileMode); err != nil {
+		return err
+	}
+
+	buf = &bytes.Buffer{}
+	if err := renderCustomResourceYaml(buf, apiVersion, kind); err != nil {
+		return err
+	}
+	return writeFileAndPrint(filepath.Join(deployDir, crYaml), buf.Bytes(), defaultFileMode)
+}
+
+// RenderOperatorYaml generates "deploy/operator.yaml"
+func RenderOperatorYaml(c *Config, image string) error {
 	buf := &bytes.Buffer{}
 	if err := renderOperatorYaml(buf, c.Kind, c.APIVersion, c.ProjectName, image); err != nil {
 		return err
@@ -238,7 +254,8 @@ func renderCodegenFiles(codegenDir, repoPath, apiDirName, version, projectName s
 
 func (g *Generator) renderPkg() error {
 	v := version(g.apiVersion)
-	apiDir := filepath.Join(g.projectName, apisDir, apiDirName(g.apiVersion), v)
+	adn := apiDirName(g.apiVersion)
+	apiDir := filepath.Join(g.projectName, apisDir, adn, v)
 	if err := os.MkdirAll(apiDir, defaultDirFileMode); err != nil {
 		return err
 	}
@@ -250,7 +267,7 @@ func (g *Generator) renderPkg() error {
 	if err := os.MkdirAll(sDir, defaultDirFileMode); err != nil {
 		return err
 	}
-	return renderStubFiles(sDir)
+	return renderStubFiles(sDir, g.repoPath, g.kind, adn, v)
 }
 
 func renderAPIFiles(apiDir, groupName, version, kind string) error {
@@ -277,9 +294,9 @@ func renderAPIFiles(apiDir, groupName, version, kind string) error {
 	return writeFileAndPrint(filepath.Join(apiDir, types), buf.Bytes(), defaultFileMode)
 }
 
-func renderStubFiles(stubDir string) error {
+func renderStubFiles(stubDir, repoPath, kind, apiDirName, version string) error {
 	buf := &bytes.Buffer{}
-	if err := renderHandlerFile(buf); err != nil {
+	if err := renderHandlerFile(buf, repoPath, kind, apiDirName, version); err != nil {
 		return err
 	}
 	return writeFileAndPrint(filepath.Join(stubDir, handler), buf.Bytes(), defaultFileMode)
diff --git a/pkg/generator/generator_test.go b/pkg/generator/generator_test.go
index e001288d50c..6274fafa17f 100644
--- a/pkg/generator/generator_test.go
+++ b/pkg/generator/generator_test.go
@@ -19,15 +19,25 @@ import (
 	"testing"
 )
 
+const (
+	// test constants for app-operator
+	appRepoPath   = "github.com/example-inc/app-operator"
+	appKind       = "App"
+	appApiDirName = "app"
+	appAPIVersion = appGroupName + "/" + appVersion
+	appVersion    = "v1alpha1"
+	appGroupName  = "app.example.com"
+)
+
 const mainExp = `package main
 
 import (
 	"context"
 	"runtime"
 
-	stub "github.com/coreos/play/pkg/stub"
+	stub "github.com/example-inc/app-operator/pkg/stub"
 	sdk "github.com/coreos/operator-sdk/pkg/sdk"
-	sdkVersion  "github.com/coreos/operator-sdk/version"
+	sdkVersion "github.com/coreos/operator-sdk/version"
 
 	"github.com/sirupsen/logrus"
 )
@@ -40,15 +50,15 @@ func printVersion() {
 
 func main() {
 	printVersion()
-	sdk.Watch("apps/v1", "Deployment", "default")
+	sdk.Watch("app.example.com/v1alpha1", "App", "default")
 	sdk.Handle(stub.NewHandler())
- 	sdk.Run(context.TODO())
+	sdk.Run(context.TODO())
 }
 `
 
 func TestGenMain(t *testing.T) {
 	buf := &bytes.Buffer{}
-	if err := renderMainFile(buf, "github.com/coreos/play"); err != nil {
+	if err := renderMainFile(buf, appRepoPath, appAPIVersion, appKind); err != nil {
 		t.Error(err)
 		return
 	}
@@ -61,10 +71,16 @@ func TestGenMain(t *testing.T) {
 const handlerExp = `package stub
 
 import (
+	"github.com/example-inc/app-operator/pkg/apis/app/v1alpha1"
+
+	"github.com/coreos/operator-sdk/pkg/sdk/action"
 	"github.com/coreos/operator-sdk/pkg/sdk/handler"
 	"github.com/coreos/operator-sdk/pkg/sdk/types"
 	"github.com/sirupsen/logrus"
-	apps_v1 "k8s.io/api/apps/v1"
+	"k8s.io/api/core/v1"
+	"k8s.io/apimachinery/pkg/api/errors"
+	metav1 "k8s.io/apimachinery/pkg/apis/meta/v1"
+	"k8s.io/apimachinery/pkg/runtime/schema"
 )
 
 func NewHandler() handler.Handler {
@@ -76,18 +92,55 @@ type Handler struct {
 }
 
 func (h *Handler) Handle(ctx types.Context, event types.Event) error {
-	// Change me
 	switch o := event.Object.(type) {
-	case *apps_v1.Deployment:
-		logrus.Printf("Received Deployment: %v", o.Name)
+	case *v1alpha1.App:
+		err := action.Create(newbusyBoxPod(o))
+		if err != nil && !errors.IsAlreadyExists(err) {
+			logrus.Errorf("Failed to create busybox pod : %v", err)
+			return err
+		}
 	}
 	return nil
 }
+
+// newbusyBoxPod demonstrates how to create a busybox pod
+func newbusyBoxPod(cr *v1alpha1.App) *v1.Pod {
+	labels := map[string]string{
+		"app": "busy-box",
+	}
+	return &v1.Pod{
+		TypeMeta: metav1.TypeMeta{
+			Kind:       "Pod",
+			APIVersion: "v1",
+		},
+		ObjectMeta: metav1.ObjectMeta{
+			Name: "busy-box",
+			Namespace:    "default",
+			OwnerReferences: []metav1.OwnerReference{
+				*metav1.NewControllerRef(cr, schema.GroupVersionKind{
+					Group:   v1alpha1.SchemeGroupVersion.Group,
+					Version: v1alpha1.SchemeGroupVersion.Version,
+					Kind:    "App",
+				}),
+			},
+			Labels: labels,
+		},
+		Spec: v1.PodSpec{
+			Containers: []v1.Container{
+				{
+					Name:    "busybox",
+					Image:   "busybox",
+					Command: []string{"sleep", "3600"},
+				},
+			},
+		},
+	}
+}
 `
 
 func TestGenHandler(t *testing.T) {
 	buf := &bytes.Buffer{}
-	if err := renderHandlerFile(buf); err != nil {
+	if err := renderHandlerFile(buf, appRepoPath, appKind, appApiDirName, appVersion); err != nil {
 		t.Error(err)
 		return
 	}
diff --git a/pkg/generator/handler_tmpl.go b/pkg/generator/handler_tmpl.go
index 8a22bd3431e..ee528d09698 100644
--- a/pkg/generator/handler_tmpl.go
+++ b/pkg/generator/handler_tmpl.go
@@ -18,10 +18,16 @@ package generator
 const handlerTmpl = `package stub
 
 import (
+	"{{.RepoPath}}/pkg/apis/{{.APIDirName}}/{{.Version}}"
+
+	"{{.OperatorSDKImport}}/action"
 	"{{.OperatorSDKImport}}/handler"
 	"{{.OperatorSDKImport}}/types"
 	"github.com/sirupsen/logrus"
-	apps_v1 "k8s.io/api/apps/v1"
+	"k8s.io/api/core/v1"
+	"k8s.io/apimachinery/pkg/api/errors"
+	metav1 "k8s.io/apimachinery/pkg/apis/meta/v1"
+	"k8s.io/apimachinery/pkg/runtime/schema"
 )
 
 func NewHandler() handler.Handler {
@@ -33,11 +39,48 @@ type Handler struct {
 }
 
 func (h *Handler) Handle(ctx types.Context, event types.Event) error {
-	// Change me
 	switch o := event.Object.(type) {
-	case *apps_v1.Deployment:
-		logrus.Printf("Received Deployment: %v", o.Name)
+	case *{{.Version}}.{{.Kind}}:
+		err := action.Create(newbusyBoxPod(o))
+		if err != nil && !errors.IsAlreadyExists(err) {
+			logrus.Errorf("Failed to create busybox pod : %v", err)
+			return err
+		}
 	}
 	return nil
 }
+
+// newbusyBoxPod demonstrates how to create a busybox pod
+func newbusyBoxPod(cr *{{.Version}}.{{.Kind}}) *v1.Pod {
+	labels := map[string]string{
+		"app": "busy-box",
+	}
+	return &v1.Pod{
+		TypeMeta: metav1.TypeMeta{
+			Kind:       "Pod",
+			APIVersion: "v1",
+		},
+		ObjectMeta: metav1.ObjectMeta{
+			Name: "busy-box",
+			Namespace:    "default",
+			OwnerReferences: []metav1.OwnerReference{
+				*metav1.NewControllerRef(cr, schema.GroupVersionKind{
+					Group:   {{.Version}}.SchemeGroupVersion.Group,
+					Version: {{.Version}}.SchemeGroupVersion.Version,
+					Kind:    "{{.Kind}}",
+				}),
+			},
+			Labels: labels,
+		},
+		Spec: v1.PodSpec{
+			Containers: []v1.Container{
+				{
+					Name:    "busybox",
+					Image:   "busybox",
+					Command: []string{"sleep", "3600"},
+				},
+			},
+		},
+	}
+}
 `
diff --git a/pkg/generator/main_tmpl.go b/pkg/generator/main_tmpl.go
index 053c28cd9c4..5283b35001c 100644
--- a/pkg/generator/main_tmpl.go
+++ b/pkg/generator/main_tmpl.go
@@ -36,8 +36,8 @@ func printVersion() {
 
 func main() {
 	printVersion()
-	sdk.Watch("apps/v1", "Deployment", "default")
+	sdk.Watch("{{.APIVersion}}", "{{.Kind}}", "default")
 	sdk.Handle(stub.NewHandler())
- 	sdk.Run(context.TODO())
+	sdk.Run(context.TODO())
 }
 `