"If I were an access control system manufacturer, I would..."
It is a statement many in our industry need to write on a whiteboard (or shared doc) and have a hard conversation about it. I understand things have changed. I know they are complex. They are multi-dimensional. I am purposefully oversimplifying the statement to make a point. I believe in times of massive change, and there is an opportunity to take a step back and critically think about your strategy and path forward. What worked yesterday is not going to work today magically. Some of the changes in the market that was already in motion have just accelerated. Prior, it was OK just to keep pushing forward because the market was excellent. That was yesterday, and this is today.
Please note that this is primarily for the traditional access control system manufacturers. You know who you are 😉. What I am writing is also not a criticism, but more of a suggestion on what I think you should do. My hope is by keeping this simple and offering three ideas on how to approach redefining what it is that you do, you will take the time and think about it.
OK with that said, "If I were an access control system manufacturer, I would..."
Get real with who you are. Be honest, most of your revenue is from a 3rd party hardware company that sells controllers, readers, credentials, power supplies, and locks, through you. It is not from the software. You may even have great models that show large RMR down the road, but realistically, you have not fully committed to being a software company. You, more or less, sell hardware and give away your software. I do not care that you charge an annual license fee for the software. Your definition of "a software company" is stuck in the late 80s and early 90s. I get that it is hard to change, but it is even harder to play catch up or pretend to be something you are not. You also are not indeed a cloud-based software company because you offer a web client. This all goes beyond just the product. It is in your culture, it is in your messaging, and it is in your blood. What you are is a hardware reseller that has configuration software that runs on a PC. And in the end, that is OK. There is nothing wrong with that. But what is wrong is when you are not honest and comfortable with who you are. You create internal and external churn.
- Here are my suggestions if you want to be a software company: Get your internal strategy, vision, and story, from your board to your outside sales team, straight and embrace the good and bad that comes with building a recurring revenue business.
- Start treating your software as a product and create monetization plans around the service offerings you have.
- Set a path to where you start to manufacturer your hardware. Not all of it, but where it aligns with the vision and strategy of the company. I would start with end-user experiences for whatever vertical you focus on (more on that below). That means if you need to make your door locks because none on the door lock manufacturers support the experience you need, either find an OEM partner that will or build it. That is different from the current format where you "integrate" a 3rd party lock and are stuck with whatever experience they tell you it is going to have.
If you do not have the appetite or desire to be a software company, then stop pretending to be one and be the best client-server based system on the market. Stop the "cloud" messaging and focus your resources where they need to be. Maybe form relationships with some of the other software companies in the experience space and partner deep. They either need access control, or they are going to develop it themselves. Right now, we have too many companies in access control unwilling to set a strategy and make the necessary changes to evolve into it. It is hard. I get it. But, being honest with yourself and the market will save everyone much heartache and give you a better chance of being successful in the long run.
Get exceptional at A thing vs. being OK at everything. Is there one vertical you dominate? How about a geographic region? Probably not. Sure, you have pockets of success, but again, I am talking about mainstream success. I find that most of the access control software companies are OK at best, and that is because the broadness of your offering used to be a feature and a selling point. Now it is a bug and an anchor. Access control systems historically were built for general use. You used the 80/20 rule. It did not matter if it was an airport, commercial building, school, or multifamily housing. It was a lock, a card, an admin, and a schedule. They got it not matter what size use case they were or the level of complexity needed. Most end users (note: not admins but end users carrying cards) never saw the system. They just used the card, and when it went "beep," they entered. Now, primarily because of software and consumerization, the expectations are that the user experiences are unique to that vertical type. It has also created vertical corner cases, like nomenclature, that go beyond security corner cases, like mantraps. Due to you actively spread across 100 different verticals, you are unable to dedicate the proper enough developmental resources to deliver a best in class experience for any single vertical.
I believe you have two choices: (1) continue doing what you do and become marginalized or rendered useless as software companies around you create these unique experiences and make access control a feature of their system or (2) decide what verticals you are going to focus on, build or partner, and go a mile deep versus a mile wide. That should be the mantra. This also may hurt for the short term, but it is worth it in the long run.
- Here are some suggestions: Stop letting your dealer channel dictate where and how you are going to be successful. Drive your products with your dealer network into those channels. Create a program, Find new dealers that serve that vertical. But stay disciplined and go deeper.
- Level up or substitute the talent needed to execute the vertical strategy.
- Give clear direction, reward, and hold your sales team accountable for executing the strategy. Most outside sales teams I meet with are generalists. We need more specialists that have deep relationships in the verticals you are targeting.
- Go beyond the product and the admin. Value the messaging, Value the end user. Value the experience. Build for it.
- Get your product development team and software development team closer to the vertical. The more they know, the better they will build.
- Point your resources here.
Set a new vision, have a strategy and tell a story. The three most significant differences I see between the companies that are set up to lead long term and those that are having a hard time turning the corner are:
Many of the incumbents that have been in the security and access control industry for a long time have lost touch with what their vision needs to be, have not updated who they are serving, and do not have a good idea of what good looks like long term. Sure they have catchy slogans like "make places safer" or "take care of people." Still, of the 75+ interviews, I have done since January, the vision, the strategy, and the story being told by incumbents who are moving in the right direction and the new companies that have had the right view from the beginning are far and away better, crisper and frankly, exciting. Most, but not all, of the incumbents, talk about metrics of the past or incremental advancements in sales or product. Most of them talk about the future as though the past has already determined it. I am sure I will hear, "so what? That does not matter when it comes to sales today," and my answer to that is, "I think you are wrong, and you are missing the point." Things have changed—the market, society, the expectations, the customer, the technology, and so on. And you need to as well. If you get a new vision, put a strategy next to it, and get a great story, you will be able to lead through the change and, in some cases, be the thought leader the industry needs right now. If anything, it will give clear direction to your team and the market on where you are focused and the value you are providing.
So, in the end, there is no way for me to tell you precisely what you should do.
Only you know.
That said, what I can tell you is this:
It is time to celebrate your companies past by treating it properly and putting it on a successful path for tomorrow.
I would start easy and start by being honest with yourself.