POV: Will You Become a Digital Integrator?
Apr 1, 2007 12:00 PM,
By Randal A. Lemke, Ph.D. e, Ph.D.
The essence of commerce is producing something that people are willing to buy. The greater the value, the more willing they are to buy, and the more they may be willing to pay. If you are not thinking of the value proposition when you sell AV communication products and systems to your customer, you may be missing some opportunities.
Keeping up with technology is not enough, however, because business practices may shift, and all of a sudden your value statement may lose its value. For many in AV communications, the buyer has changed from the director of AV to the IT department. Suddenly you have a buyer used to purchasing goods and services in a different manner.
Customer demands are also changing. Today, we are selling to a customer who is focused on fulfilling established communication needs, rather than the love of technology. Luckily there are more people who need communication solutions than there are people who love to be the first on their block to adopt new technology.
In this dynamic world, where will your company exist? I would suggest three current value propositions that will exist until more changes demand new value statements.
Box sales are the way that many AV companies got started, and most have retained some transactional sales. The value proposition used to be strong when the products were priced high, and the early adopting customer was willing to pay top dollar for new technology. Today, many products are commodities, and the pricing has changed. Customers want a solution, not just a technology project. Though the world has changed, box sellers using the Internet and other tools can still make money even with diminished margins. There just isn’t room for as many of them to exist.
Ten to 15 years ago, many AV dealers began to call themselves systems integrators. They began to deliver a working system of various boxes designed to meet the expressed communications needs of the customer. Systems were designed to meet the needs of one room. In that model, the value presented to the customer was in design and installation services on top of the product. In an industry with more than 100,000 products, it was little surprise that solutions were available, but it was difficult to identify the products that worked together to create a great boardroom or classroom. At first, most systems integrators gave away their design, but over time many began charging for design and installation because the products in the system began carrying smaller profit margins. Today, the successful system integrator may be able to produce the same margin as 10 years ago, but the percentage of profit has moved away from product toward professional and technical services.
As you might guess, there is a third value statement that AV companies must consider. The networked world has changed our customer and is changing all of our technology. Content can be shown on our AV systems over networks that could be in the same room, across town, or across the globe. Customers are also looking to use conferencing and presentation technologies to communicate, and they are increasingly knowledgeable about information technology and how it is sold and implemented. The challenge is to create a value proposition that allows us, as digital integrators, to bring together the best of AV and IT to create effective communication systems.
That means providing structured cabling, creating LAN and WAN networks, connecting to the Internet and intranets, sourcing and integrating the bandwidth necessary to run high-end systems, and creating technical environments that make it possible for people to produce and receive robust visual and aural communications.
Right now, the new magic in our industry is in the integration of IT and AV, compared to 10 years ago, when it was about creating a perfect image or emitting a crystal-clear sound with the full beauty of the original. Today, those video and audio skills are still necessary, but they are not enough. Systems integrators who focus solely on those skills do so at their peril. They are giving up the opportunity to provide their customers the full digital AV communications solution. Today’s AV communications companies need to be knowledgeable about IT and know how to unite the worlds of IT and AV. These digital integrators represent the future of the industry.
Randal A. Lemke, Ph.D., is the executive director of InfoComm International, a trade association of the professional audiovisual and information communications industries. InfoComm International has developed a new AV/IT Integration course with a hands-on lab.