The Recession Is Over!
By: Steve Thorburn
As I walked into the International Association of Amusement Parks and Attractions (IAAPA) 2010 trade floor, it was clear that there was an energy level on the floor that I had not felt in 10 years. This industry took a big hit after 9/11. IAAPA was a ghost town in 2001, and no one traveled for almost a year. Now, it seems, everyone is wheeling and dealing, optimistic about the future. Combine this with reports that things look much better for the design and construction industry in 2011 and you arrive at my bold claim in the title of this column.
I’m reminded of the giant mechanical pirate ship in front of Treasure Island in Las Vegas. Every night that ship comes around the corner, engages in battle, and slowly starts to sink. But just when it looks like the ship is about to go under, it stops, and shortly after the show ends, it reverses motion, rising up out of the water and moving back to reset itself for the next battle. This last recession worked a lot like the pirate ship. The ship has stopped sinking, and (hopefully) we have begun moving back up.
Once the ship starts to rise, it will be interesting to see who has still been able to cling on in the icy waters of our economy. More importantly, how can you make sure you are one of the lucky ones to emerge perhaps a little dampened by the recession, but no worse for the wear?
The first key is to be a company that can follow directions and give the client what they require of you, within a timely manner and at a good value. Clients are still very price sensitive, and that’s not likely to change any time soon. While the recession might have washed away some of the weaker competitors, there are still plenty of people out there bidding the same projects you want, and value will often be a deciding factor.
Secondly, more than ever the quality of your people and their ability to provide customer service will dictate your future success. Perhaps my expectations have risen, or maybe I have become more acutely aware of the intrinsic value of a dollar, and since I know what it takes to earn it, I place a higher premium on what it should get me in return. Or, what is more likely is that organizations struggling to stay alive have slashed training budgets and staffing levels requiring more work from fewer people with less guidance from management. This will only work for so long. As the ship starts to right itself, the smartest businesses will take the time to seek out the best people to work for them.
With a nearly 10 percent unemployment rate, there is a huge sea of people available to tap for work, but you will have to weed through a bunch to get to the good ones. Taking the time and resources upfront to find the best people will help you down the road (though, to be fair, retaining top talent is a whole other issue).
Finally, I think it is increasingly important for everyone to take ownership in projects they are working on. It might mean taking a little extra time to train the on-site technicians how to operate a system or troubleshoot problems. Earning that reputation for customer care will lead to the next project, and success for the company.
Unfortunately, like the pirate ship at Treasure Island, our economy is likely to go through this dip again in the future. Maybe by that time the rules will have changed, but by following these key steps you’ll at least be closer to the top of the mast for the next “show.”
Research Shows Industry Optimism
NSCA and the Consumer Electronics Association (CEA) recently released the latest Market Intelligence Briefing (MIB) report, Commercial-Residential Crossover in the Electronic Systems Industry, which examines opportunities, challenges, and perspectives of commercial and residential integrators.
Despite economic challenges during the past two years, 54 percent of integrators overall have a more optimistic view of 2010 than 2009, the report found. Integrators involved in both the commercial and residential markets were slightly more optimistic, with 60 percent expecting a more positive 2010.
While the complexity and specialization of systems and services can differentiate commercial from residential projects, these industry segments often intersect at the technological, design, and information technology levels. Slightly more than half of those surveyed in this new MIB report are involved in both residential and commercial projects.
Randy Vaughan, founder of Ambassador Enterprises, and new chairman of CEDIA’s board, feels that it has been a great asset to have both commercial and residential projects on the AE roster over past few years, but warns against companies who think they can simply add the other market to their business. “You’ve got to be able to talk the talk, and understand what the real needs are,” he said. “The products are very similar, but that’s the least of the whole thing. If they do the research, and understand the market, it could be excellent.”
According to the report, the top three revenue venues for commercial integrators are: corporate facilities; restaurants, retail facilities, and shopping malls; and K-12 schools. Among these categories, this year’s survey respondents gave the highest ranking to retail venues. This increase highlights areas of crossover between commercial and residential integrators, because the technologies and services used for retail projects correlate with tools used by integrators working on residential projects.
We’ll see what 2011 brings, but Vaughan feels positive about the upcoming year. “I expect it to be slightly better in residential, and in commercial we’re dealing with a backlog now.”
This article was originally published at System Contractor News.