What do you call a business entity that is a technology and software developer, hardware manufacturer, value-added distributor but also works with other dealers, resellers and manufacturers representatives, all at the same time? Observint Technologies is probably one of few companies, if not the only, in the world that fits the bill. asmag looks into the company’s history, development path and future directions, in hopes of setting an example and best practice for others to reference from, especially in times of uncertainty and austerity.
What do you call a business entity that is a technology and software developer, hardware manufacturer, value-added distributor but also works with other dealers, resellers and manufacturers representatives, all at the same time? Observint Technologies is probably one of few companies, if not the only, in the world that fits the bill. asmag looks into the company's history, development path and future directions, in hopes of setting an example and best practice for others to reference from, especially in times of uncertainty and austerity.
The physical, electronic security industry has grown, evolved and reshuffled over the last decade, thanks to rapid technological advances, ever-changing market dynamics and global financial troubles. Having the “right” technology and R&D team alone is no longer sufficient. A successful company in security also has to have the best possible talent and partners in sales and marketing, business and channel development, and technical support and services — not to mention a management team that has the vision and chutzpah to take calculated risks in uncertain times. Observint Technologies seems to be one that has struck the perfect balance, within the organization itself and among its subsidiaries.
In August 2006, The Carlyle Group, a global alternative asset manager with more than US$157 billion in assets, formed an investment group, now known as Observint Technologies, to pursue the acquisition and development of security-focused entities. Observint then acquired Supercircuits (SC), a direct provider of video and audio surveillance gear. SC was — and continues to be — a dominant player in the direct marketing and sales of surveillance equipment. The company's most valuable asset was its extensive customer database, with more than 300,000 customers accumulated over the past 23 years.
.jpg)
SC's business model is unique and advantageous in offering a platform for collecting real-time feedback from customers, allowing the company and its technology partners to more quickly respond to customer needs and rapidly changing technology. This extensive customer base enables SC to quickly introduce new technology to a broad market, including US law enforcement, government agencies and a very large, loyal dealer network. Last but not least was the experienced management team, led by Brian Wood, who now serves as Chairman of the Board, CEO and President of Observint Technologies.
Prior to joining Observint, Wood was VP/GM of US Public Sector and Large Enterprise businesses at Dell. “Along with other members of our leadership team who share a Dell background, I saw the opportunity to approach the security market in an innovative way,” Wood said. “Leveraging our collective learnings from Dell and past experiences, we saw the opportunity to deliver a better experience for both security technology providers and customers through differentiation.”
Continued Expansion
In 2009, right after the financial crisis, Observint acquired a second direct distribution company, Security Cameras Direct (SCD), to quickly scale the business and reduce overhead costs by leveraging Observint's core functional strengths, namely marketing, operations/IT, order fulfillment and finance/accounting. SCD had also been very successful in serving a very different and distinct customer set, ranging from retail to education segments. The SCD customer base provided Observint with direct access to a much larger set of customers and dealer partners. The company left intact SCD's customer-facing resources, namely sales and support, to build on valuable customer relationships, maintain continued high levels of customer experience, and preserve the distinct SCD cultures and unique value propositions. This shift toward a “shared services” model started paving the way for future strategic acquisitions (Digiop and Infinias) and strategic partnerships (LG and 3S).
With the emergence and accelerating adoption of IP-based video technology, Observint realized the importance of investing in and partnering with like-minded companies, allowing its diverse portfolio to deliver both cutting-edge and differentiated security solutions. Observint partnered with Digiop in 2010 and started selling the Digiop-branded solution through its direct distribution companies. “Leveraging our business model, we were able to quickly deploy the Digiop solution across a broad range of applications, and received immediate feedback from our customers. This very positive feedback provided us with confidence in our ability to sell to and support entry- to enterprise-level IP installations, and led to the consideration and pursuit of Digiop as a potential acquisition opportunity,” Wood said. In March 2011, the acquisition was finalized. “We left the customer-facing sales and support functions intact, leveraging Observint's ‘shared services' to immediately accelerate Digiop's go-to-market activities, consolidate and scale supply chain management efforts, stabilize fulfillment and improve logistics.”
Given Wood's plans to continue to expand his business to support a broader range of technologies and/or technology partners, it was the right time to start to build public awareness of Observint, its unique business model and differentiated capabilities. “Similar to our direct distribution companies, other distribution partners rely on operational, marketing, sales and technical support from the technology companies they represent — a requirement for long-term success. Many technology companies do not have the resources, or the experience, to provide a high level of support, even for a single distribution partner. We continued down a path to building scalable capabilities to support the addition of future technologies to the Observint portfolio, through acquisition or partnership.”
Differentiate to Win
Regardless of the strength of the global economy, the security space will continue to be a relatively large industry, and Wood feels that the companies that are able to differentiate and add the most value for their customers (from distributors to end users) will thrive. “Our plans are to continue to deliver innovative, differentiated technology, to deliver world-class, differentiated support for our portfolio technologies, and to deliver these differentiated technologies and capabilities through a broader network of distribution channels and partners.”
Most of all, Observint's unique business approach provides multiple benefits to end users. The most significant is that it offers a single point of contact and delivery for fully integrated video surveillance and security solutions. As Observint continues to evolve, its business model, technology portfolio and value-added services will undoubtedly grow, providing security professionals with more efficient and effective turnkey solutions that meet their specific needs and help resolve challenges.
Check out the complete story on your iPad now!