Pelco Powers Up
Global warming has wreaked havoc with weather systems, but Schneider Electric’s acquisition of Pelco created the most earth-rattling thunderclap to reverberate through the electronic security industry during 2007. Having pulled off perhaps France’s greatest conquest since Napoleon’s rule, the French building controls giant is positioning Pelco as the crown jewel of a security business that also includes Integral Technologies and TAC. What’s so special about Pelco? Founded in 1957, the firm rose meteorically as a supplier of CCTV cameras and components after being acquired by a group led by David McDonald in 1987. In the next 15 years, the company astonishingly grew 30 times its former size, cultivating a fiercely devoted following built on high-quality products and exceptional customer service.
Operating from its Clovis, Calif., headquarters, Pelco produces 5,500 items, including cameras, enclosures, positioning systems, network video products, matrix systems, DVRs and other video security devices. More than one million locations worldwide include Pelco products, such as the Spectra®, Camclosure® and Endura® lines. The company employs 2,600 worldwide and its 2006 sales revenues topped $506 million. Throughout it all, the company has placed as much weight on employee satisfaction and morale as it has on smooth pan/tilt/zoon mechanisms. Thus Pelco established unrivaled loyalty internally as well as externally.
Schneider Electric’s story, on the other hand, is more enigmatic despite its recent push into the U.S. security industry and distinguished history overseas. Founded in Paris in 1836 by the Schneider brothers, the company started out in steel, heavy industry, railroads and shipbuilding before turning its attention to the emerging electricity business in 1891. There it prospered for more than 100 years until expanding into building automation and controls in the late 1990s.
Today, Schneider Electric separates its business into Electrical Distribution and Automation and Control (which includes security and fire protection) divisions, and has identified four key markets: Energy & Infrastructure; Industry; Buildings; and Residential. As of 2006, the company had 105,000 employees working in 130 countries and sales of $17.2 billion (U.S.). Domestically, with headquarters in Palatine, Ill., Schneider Electric had sales of $3.7 billion.
About $1.5 billion of that was reinvested to obtain Pelco, in which Schneider Electric found a bedrock-solid foundation to greatly strengthen its U.S. presence, as well as round out its security portfolio throughout the world. Conversely, in Schneider Electric, Pelco found a suitor who would pay handsomely, allow some of its aging owners to gracefully bow out, and provide the brand and employees an environment of deep resources, broad ambition and growth.
What can installing resellers, end users, distributors, competing suppliers and other industry professionals expect now that the famously independent video equipment maker with the ubiquitous products and unmatched customer service has become part of a foreign conglomerate? For the most part, more of the same, only better. At least that is what executive management promises.
Their acknowledged mission is to maintain, even enhance, Pelco’s fanatical customer support and training while offering better, broader and more innovative products and solutions than ever before — all the while extending the company’s global footprint. An order that tall can’t help but illicit some skepticism, and both Schneider Electric and Pelco are going out of their way to reassure the marketplace with sound strategy, effective communication and immaculate execution.
The new ownership is wasting little time in demonstrating its decisiveness. Integral Technologies has swiftly been consolidated into Pelco and the company’s first access control product, Intelli-M, is already on the market. In addition, at press time it was announced Pelco’s Orangeburg, N.Y., facility would be shut down and its in-house travel agency would be phased out. SSI tracked down Dean Meyer just days after he was named Pelco’s new president and CEO, and Scott Schafer, senior vice president, Marketing and North America Sales, for an exclusive in-depth discussion of the top challenges surrounding the transaction and corporate integration, and what it all means for customers.
Integral Integrated Into Pelco
Where are you in the process of integrating Pelco and Schneider Electric?
Dean Meyer: When companies do major acquisitions like this, they have objectives they expect to accomplish as a result of it. The big thing in that perspective is the merging of Integral with Pelco. That’s a biggie and one we’ve been aggressively focused on as a management team since the deal closed. Merge the organization, merge the thinking from a product roadmap standpoint, and merge the product alignment in terms of future releases and generations.
We had a video platform in Pelco, we had a video platform in Integral. Both bring advantages to the table. The key is leveraging the best information between them and merging that forward into a next-generation platform. Also, maybe not well known, but Pelco in its own right was pursuing an access control offering prior to this acquisition/merger. Integral already has an on-the-market product offering, which we have subsequently branded as Pelco. So we are combining those activities into a common platform and strategy for access control.
Another priority is the commercial leverage that we get with our new parent, being Schneider Electric, a global player with great market share throughout the world. Some of the fastest growing markets in the world are outside of North America. With their presence in those markets, we are working daily diligently to find ways to leverage their position in our ability to move Pelco into a stronger global market leader.
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