CEOs Roll With the Punches, Plot Higher Profitability

In an exclusive roundtable, executives from four installing security contractors shed light on how their firms successfully navigated the recession to emerge primed for future growth. Find out how they adapted to changing market conditions, among other strategic moves.

Morris: The most obvious negative impact the recession had on us was the new home market; it went away. The good that came from that is I am a much better manager than I was. My key people are better managers. We are much leaner. We trimmed all the fat we could, and there was a lot of fat; whether it was what we were paying for telephone service, Internet services. It was a lot of things, things you should look at every year and we weren’t doing. It made us a better company. Pre-recession, most established alarm companies could make money in spite of themselves. It’s not hard to run a company when you are riding a profit wave. We were forced to go out and find new business. We have strengthened our position. We are much leaner and much better managers now.

If I can use one word it would be accountability. We hold everybody in the company accountable, including myself. I have an accountability partner in the company. I have a meeting every single morning at 8 a.m., including a satellite office that calls in. I ask two questions and it’s all I want to know. The whole meeting takes 15 to 20 minutes. I want to know what did you do yesterday and what are you going to do today? I used to get snapshot reports for each week to review. They were just vanilla reports. But when you are having a meeting and somebody has to answer for the time they spent yesterday, they are not going to say things like, “‘I followed up on three proposals and I made two cold calls.” They know what I am going to ask them: “OK, what did you do after 9 o’clock?” They have to give a good accounting for their time. When we started that our productivity went up. No. 1, it gets us all on the same page.

Lindberg: At Dial One Security we were never a big player in the home builder market. When the market collapsed it hardly affected us. But what we did see was a big downturn in the commercial jobs, as I mentioned, the bigger commercial jobs. It’s just a new way of doing business. I think eventually they will come back but it is going to be very slow. It has made us more residential than commercial in sales volume. For at least the near-term, that’s a permanent change.

We acquired a couple mainly residential companies, so that added to the mix, and we’re doing a lot more servicing of existing and upgrades of existing residential markets. It has changed the makeup of our company. It wasn’t through great leadership [laughter] that we decided to one day do more residential. It’s just what happened because the bigger commercial jobs haven’t come back.

Hood: First Alarm is very heavy in the Silicon Valley so lots of commercial, tenant improvements, access, video, larger buildings — lots of money. Then the recession hit, and it was real abrupt. It was like I came into work one day and we didn’t have any sales in the commercial area. We went through our own stress test of testing our business model. We knew part of it was risky and that we had lots of employees whose jobs were really built out from this commercial business.

In talking about the stress test, the attrition was the thing. I come to work every day and that’s the thing I’m watching. I’m waiting for those numbers to start creeping up. Attrition did initially creep up. What was interesting was the numbers turned right back around and I still can’t believe what I saw. The numbers started to decline. It was a very fulfilling feeling to say we have these wealthy, older clients. We’ve qualified them on price and service and hopefully they joined our little club because they think we are going to do a good job. They are well-heeled, credit-worthy people and they didn’t disappear. We instructed all of our customer service people and field people to really have a full-court press if somebody wants to try and cancel.

I would say this ‘stress test’ built some confidence in our team that maybe we do have a good plan, even though it’s not a rapid growth plan. It’s also not a rapid decline plan when things turn down. There were other companies, including some of the ones we bought, that were in trouble, they were on a very rapid decline.

About the Author


Although Bosch’s name is quite familiar to those in the security industry, his previous experience has been in daily newspaper journalism. Prior to joining SECURITY SALES & INTEGRATION in 2006, he spent 15 years with the Los Angeles Times, where he performed a wide assortment of editorial responsibilities, including feature and metro department assignments as well as content producing for latimes.com. Bosch is a graduate of California State University, Fresno with a degree in Mass Communication & Journalism. In 2007, he successfully completed the National Burglar and Fire Alarm Association’s National Training School coursework to become a Certified Level I Alarm Technician.

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