The CEDIA Channel has been going through a lot of changes over the last decade. In 2008-2009, we saw the Great Recession impact many custom integrators. Housing starts slowed substantially and projects were cancelled. Many custom integrators had to scale back their operations, close down showrooms and lay off staff due to shrinking pipelines. It forced many of them to rethink how to run their businesses in the changing economy.
A look back on the last decade
As we came out of 2011-2012, we saw a resurgence in business. Many of our customers made money in the rebounding stock market which led to signs of growth again. Pipelines started to build up and it seemed like we were back on track for continued growth.
In early 2020, there were signs of another economic collapse. We were on a 9 year growth track with the stock market and many wondered if it could continue. In January and February you started to see sell offs in the market and some large single day losses causing many to think if this was the start of the next economic fall out that many had been predicting since early 2019.
Then the Pandemic hit in March and all bets were off. There was a lot of uncertainty in the air yet the stock market picked up some steam that it had lost in the earlier months. The demand for technology in the home skyrocketed and with integrators deemed as “Essential Workers”, many of them saw a large increase in their businesses.
The challenges for custom integrators then became navigating all of the new safety protocols in place in order to safely install new products into their clients homes as well as dealing with some of the early supply chain issues that were starting to creep up due to the overwhelming demand of technology.
Now as we enter 2022, we still see massive growth but it’s met with a lot of challenges like supply chain issues, labor shortages and price increases.
While some of these challenges could’ve been predicted, most of them were out of control for the custom integrator to manage.
What Integrators can control is how things operate and function in their business and many now see the importance of their “process”.
Why you need to embrace change
Our industry is approaching another challenge that many do not see staring right at them.
You see, most custom integrators start out as technicians that were hobbyists and they turned that hobby into a business.
So now you have a technician running and working “IN” a business when they should really be working “ON” their business.
When you add this scenario to explosive growth like we are currently seeing, you have a potential recipe for disaster as it’s not sustainable. You can’t scale a business if you are working “IN” it and now is the time for integrators to work “ON” their businesses.
Because all industries have life cycles; Introduction, Growth, Shakeout, Maturity and Decline and the CEDIA Channel is in-between the Shakeout and Maturity stages.
How do I know?
I spent 18 years in the Car Audio Industry. I entered it during the Growth phase and left during the Decline stage. I’ve been through this before and I know the signs.
Signs of a maturing industry
Do you see the following things happening around you?
Growth through acquisition by manufactures and integrators?
New products focused on gaining market share rather than innovation?
Price competition everywhere from your customers, competitors and vendors?
Market saturation of products, features and categories?
More products available through distribution?
Lower barrier to entry for IOT products and the competition?
The industry landscape is changing…daily…and entering a new phase. So how do you protect your business from the future?
Our business is extremely complex. It started out that way and continues to be.
How do you dot your i’s and cross your t’s to ensure that you exceed your clients expectations in today’s chaotic environment?
Our clients think that everything is plug-and-play and a software update away from working flawlessly. It can be hard to show them our value.
So how do you do it?
How do you train existing employees and on board new ones in order to scale?
How do you preserve decades of knowledge that your company has accumulated to protect yourself in the event you lose a key employee? Or if you decide to sell the company, what are you actually selling and handing the new owner(s)?
How do you show a Client, GC, Architect or Designer how complex your role is without scaring them yet relay your value on the project?
You start by working “ON” your business instead of “in your business.
How can I work “ON” my business?
Process Creation and Process Improvement helps protect your company against the future like shrinking margins, increased competition and industry flux.
Workflow documentation helps preserve your company’s knowledge and gives you the tools to train and onboard new employees.
Process Implementation ensures that processes are followed in order to exceed your client’s expectations and holds employees accountable.
Once a business has reached its maximum potential with the owner being involved in the day to day, it’s time for that owner to elevate out of the “technician” role and put processes in place in order for employees to do their job, grow and help scale the company.
That can only be done by writing them down and documenting your processes. From how a client is billed to how the labor phases of pre-wire, trim and final are managed all of these areas need to be documented and turned into training aids so employees can be held accountable and standards can be set.
Without process and documentation, companies will implode and be forced to scale back to a smaller size in order to manage the workload. Even scaling back will not solve the problem because eventually the lack of process and documentation will catch up.
How can I get started?
Documenting a process doesn’t have to be an overwhelming task. Using the five steps below, you can get a quick start to the process and can always revisit the document later to add more detail. This exercise alone will help get your team on the path to working more insync.
- Identify the core areas of your business that need a defined process (Ex. Invoicing Clients, Project Engineering, Production Phases).
- Pick one to start with and meet with everyone who is involved with the process.
- Identify the inputs (items required for the process to work).
- Identify the steps from start to finish.
- Identify the outputs (defined standards of completion).