Over the holiday weekend, I was reminded of the admonition I delivered to my team last week: “Be better at the custom work.” Its meaning is simple enough, yet probably fell on a number of deaf ears at our team meeting. I took 15 minutes to explain to our employees that the CEDIA company of the future (like less than two years in the future) won’t be able to subsist on designing and installing many of the solutions we install today. Sonos, Harmony, and others in the DIY space are ensuring our need to avoid inertia and the assumption that just because we found something that works to install today doesn't mean we should forget to scan the horizon for alternatives. If we don’t, our customers and competitors will do it for us.
I went skiing over the weekend with my daughter’s buddy and her dad (we’ll call him Steve). As I’m sure many of you find, most of our business comes from referrals and conversations like I had with my new friend Steve. He found out what I did for a living and started peppering me with questions about his setup. He complained about an infrared target sitting on his mantelpiece and specifically mentioned his ability to use the setup, but that the rest of his family wouldn’t touch it because they found it too complicated (sound familiar?).
“Do you have anything that could fix my problem?” Steve asked. Because I knew Steve was a bit of a DIY guy and didn't mind rolling up his sleeves, I instantly recommended a Logitech Harmony Ultimate remote. It's programmable with an iPhone, works great, and while not for most of our customer base, serves well in the DIY and the “doesn't-mind-tweaking-things-a-bit” segments. The interaction gave me pause.
Not long ago, the Logitech Harmony was the laughing stock of our industry. Hard to program, reviled by integrators and homeowners alike, it teed us up nicely to have conversations about professionally programmed remotes that actually worked. In 2016, things have changed big time. A professionally programmed remote by one of our traditional manufacturers (Universal Remote Control, Control4, etc.) starts around $700, all in. Compare that to $300 price point of the Harmony and we got some ‘splaining to do.
I don’t know about you, but I have no interest in running a business where price becomes a central driving point in the conversation. Most of our jobs get green-lit because of the perceived value in the finished product. We’ve been very unhappy with the world of remote controls over the past few years, as we wait for a better price point on a remote that is reliable, simple, and can be remotely supported. Until then, I’m recommending Harmony remotes to friends and folks outside our core customer (pays for service) base.
I don’t feel hypocritical, but am cognizant of the fact that no matter how much our core customer may not look as hard at price, we can’t continue to sell products like universal remotes for $1,000 a pop long term. The end is nigh for that price point, and that’s OK. We’ll make up for it in fewer programming hours. The lesson in the conversation with Steve is we’re constantly climbing to a higher rock and we can get there one of two ways: ascend on our own, or have the tide sweep us up there. I don’t know about you, but I’m a climber.
As we consider different product categories and where they’re headed long term, it’s clear the high end of the market will continue to value professionally designed and installed technology systems the longest. That's where we’re climbing (among other places); that’s the good news. The bad news is that high-end jobs can’t really be advertised or marketed to. You’re probably going to get the work from reputation or because one of your happy clients referred you.
As we shift toward more high-end work while still employing 12 full-time installers, it’s really hard to keep all the crews busy with high-end custom work every day. That leaves a lot of what we call “hang-and-bang” work (challenging enough for someone to want professional installation, but not exactly brain surgery). The custom work, on the other hand, calls for critical thinking and problem solving at every turn. As a result, we’ve ended up with two to three highly talented installers who are the “custom” guys. Needless to say, we’re trying to fix that ASAP by cross training and churning through under-performing installers.
All of this brings me back to my admonition: “Be better at the custom work.” We want more curiosity and less dogmatic behavior. We want people who ask “why?” It’s so important to us that we’re now integrating these trait evaluations into our review process.
My admonition to our team is the result of a changing market and will result in a changing team. I wish the team understood that. Maybe they do and I’ve made bad assumptions. The Livewire of the future may have fewer installers and higher payroll. Crazy talk, I know, but this is where we’re heading. How about you?
Stay frosty and see you in the field.