Crestron fully automates homes and offices

Crestron

US company Crestron's single platform control technology for homes and offices is gaining popularity in Israel.

Technology is increasingly and continually taking control of our lives - ranging from smartphones found in nearly everyone's pocket, to tablet computers, PCs, home cinema systems, and even electrical appliances found in most of our homes and business establishments. To 'make sense' of all these different technological devices, we need help from none other than - technology itself.

There are products on the market today that facilitate controlling a number of electronic and electrical devices from a single platform. The average consumer is familiar with it from 'smart home' systems, through which all devices found in the home are controlled using a smartphone or tablet. But it's actually companies and organizations that make much greater use of that technology - expressed in their ability to monitor corporate conference rooms, communications centers at government offices, classrooms, visitor centers, control rooms, etc.

The ability to command and control technology-intensive facilities requires a comprehensive system that facilitates convenience, efficiency and, most of all, cost savings in associated expenses. Crestron is the world's leader in this industry, whose products are deployed in conference rooms and communications centers at the top corporations and institutions in Israel and across the globe.

Crestron was founded in 1969 by the late George Feldstein, a yeshiva student and son of a New York Jewish family, who until his death last month had complete ownership of the company. Crestron's current President & CEO is Randy Klein, who was appointed to the job in March 2014 after 25 years with the company, during which he filled a number of key positions, including Executive Vice President and VP of Sales. Dan Feldstein, the son of the late founder, is Deputy Chairman and the Chief Operating Officer.

Crestron specializes in integrating different technologies. The company develops integrated solutions for command and control, audio-video, climate control, electricity, lighting and other systems, which are controlled by touch screens, pushbutton panels, cell phones, tablets and other user interfaces all designed to simplify and enhance our homes and workplaces. The company's corporate headquarters are located in New Jersey, and Crestron has offices throughout the US, Canada, Europe, Asia, the Middle East, Latin America, Australia, and Israel as well.

The company's suite of products consists of over 2,500 products for command and control systems and audio-visual management and distribution solution. Crestron consolidates the command and control over all the technology-based devices from a single platform, making it possible to improve and streamline how different resources are managed - resulting in operational efficiency and greater ease of use. The company's products facilitate integration of all the sophisticated technologies found in electrical devices, including 4K video, optical fibers, HDMI, streaming, HDBaseT and H.264.

Crestron's products offer a comprehensive solution - similar to a 'one-stop shop' - for audio-visual command, control and management in homes, corporate conference rooms, public facilities, educational institutions, hotels, hospitals, security agencies, and more. The company's flagship product is DigitalMedia, which is used to manage and distribute high-resolution audio-visual content, including 4K ultra HD video resolutions. One of the company's most interesting corporate solutions is the Fusion software platform, which was developed thanks to the companys close cooperation with Microsoft. Fusion enables users to manage and reserve conference rooms throughout the organization, and to monitor and control the audio-visual systems, electrical systems, energy consumption and lighting in the different rooms.

For the residential market, Crestron offers 'smart home' control solutions for audio-visual, sound, electricity, energy, climate control and other systems throughout the house. The cost of a 'smart home' controlled by Crestron products can range between just a few thousand shekels and several hundred thousand shekels - everything is possible and based on the client's needs. In a conversation with the company's CEO, Randy Klein, we were told that Crestron is not necessarily targeting the average consumer, but rather caters to the premium and high-end market. The company has also begun offering those affluent clients stylish and extremely quiet motorized shades, which are controlled by its systems.

Crestron's global corporate headquarters, located in Rockleigh, New Jersey, extend across a six-building campus owned by the company. Crestron has about 3,500 employees worldwide, many of whom are engaged in R&D, and about 500 hardware and software engineers who are entrusted with developing and manufacturing its cutting-edge products.

Even though the company is privately held and does not publish its financial statements, "Globes" was given special access to some of the numbers. According to them, Crestron is highly profitable company, arising from total sales of roughly $700 million based on company sources. Furthermore, Crestron has experienced an average annual growth of approximately 15% in recent years. One of the more interesting facts about the company is that over 20% of its sales volume is invested entirely in R&D.

An R&D Center in Israel?

The company's Israeli office, Crestron Israel, which was opened at the beginning of 2012, is managed by Ronen Brookstein. His son Omer, who in 2008 worked at the company's headquarters in the US, is Director of Technology & Business Development at Crestron Israel. The office, located in Kfar Saba, was established in light of Crestron's growing business in Israel and to further increase the Israeli market's exposure to the company's products. The local office works with the leading integrators in the country in the corporate, government-military and private sectors, and provides consulting, training and support services to clients.

Ronen Brookstein was appointed Crestron Israel CEO after doing business with the company's corporate headquarters for over 20 years. In his previous position, Brookstein was the CEO of Barkai Ltd., which supplies solutions for integrated communications systems. Barkai still serves a leading Crestron integrator and dealer of its products in Israel, alongside other integrators that are active in the different relevant markets.

Crestron's global clients include Microsoft, Time Warner Cable, ESPN, Nestle, security companies, and universities across the US and worldwide. Crestron Israel's clients include Teva Pharmaceutical Industries Ltd. (Nasdaq: TEVA; TASE: TEVA), Perion Networks Inc. (Nasdaq:PERI: TASE:PERI), Conduit, Assuta Medical Centers, Tel Aviv University, Ben Gurion University, the Tel Aviv-Yafo Municipality, Haifa Municipality, Israel Electric Corporation (IEC) (TASE: ELEC.B22), Bank Hapoalim (TASE: POLI), Israel Aerospace Industries Ltd. (IAI) (TASE: ARSP.B1), government ministries, hotels, and numerous high-tech companies.

With regard to the Israeli market that Crestron Israel is in charge of, Klein notes that "none of our competitors have invested in Israel like we have - we set up a full-scale office in the country, just like our other offices around the world. We've trained employees and invested hundreds of thousands of dollars in equipment and in opening an advanced training center. No one in our industry has done what we have done in Israel. We've invested a lot here and intend to continue investing because I believe that there are many opportunities and great potential for Crestron in Israel."

Klein adds, "The Israeli market is a highly unique market, and not only in terms of how we operate and manage it. We currently have ten different management territories around the world - six territories in the US, one in Europe, one in Asia, one in Latin America, and the one in Israel. Every office is managed by our people who were sent there by the company, whereas in Israel, Ronen and Omer report directly to me. I think that this kind of direct management is more suitable to Israel rather than conducting it via one of the other territories. And the results speak for themselves."

Will you consider opening an R&D center in Israel in the future?

"Because Crestron has technological partners in Israel, the office is extremely vital to developing some of our new products. Will we open an R&D center here? It's not out of the question."

Ronen Brookstein adds, "We gained the trust that Mr. Klein gave to Crestron Israel after working together for about 20 years. Based on the decades of my experience, our relationship has no equivalent when compared to the relationships that others have with companies overseas, and we'll continue to justify that trust."

Crestron's investment and trust in the local office have been obtained even though, as may be expected, Crestron Israel's business accounts for only a small share of Crestron's turnover worldwide Crestron Israel's annual sales amount to roughly $5.5 million. Crestron Israel recently reported that in the past fiscal year, which ended on June 30th, it registered an increase of more than 47% in local sales compared to the previous year, which totaled around $3.75 million. Overall, the Israeli office has doubled its sales in the first two years since opened.

In that regard, Brookstein says: "Crestron Israel enables the global company to develop and maintain ongoing ties with its various clients, and helps them achieve an ideal solution witnessed by the sharp growth in sales."

Prior to the interview with Crestron's CEO and with its CTO, Fred Bargetzi, we were taken on a tour of the company's campus in New Jersey. Even in today's technological reality, Crestron still controls and performs the whole production cycle on its own starting with the product's development, the assembly of the printed circuit boards and other components, the fabrication of the frame, the testing, and up to the completion of the final product. Only a very small portion of the production is done through partnerships for which Crestron also assumes full responsibility during the entire process.

The company also has an impressive visitors center, consisting of over 800 square meters and located at its corporate headquarters. It showcases the company's leading products for both the commercial market as well as residential market including a home theater based on Crestron's audio-visual and control solutions, such as the DigitalMedia and Procise systems that the company manufactures.

In all the company's different departments whether production, customer service, quality control, or testing, and up to and including distribution and deliveries, one can easily see that this is one big family, where the sum of its parts make up a stable, well-established and happy whole. Crestron conducts repeated tests for every product that has been ordered or is under development, and delivers its final products only after they undergo stringent quality testing.

It is also clear that customer service is a top priority at Crestron, and no compromises are made when it comes to satisfying clients. These strict standards would be unthinkable if we were to try and implement them at Israeli companies, where customer service is purely a recommendation for many of them. This kind of service standard is however typical of large American companies.

In our interview with the company's CEO, Klein asked to stress Crestron's commitment to its clients, which often comes at the expense of cost savings and efficiency. "Imagine going to a restaurant to enjoy the meal, you expect your order to come out of the kitchen flawlessly, without the staff having to go across the street for the bread, and after that to buy the wine, and so on and so forth. That's what we provide a complete system. The client understands and appreciates that when using our systems."

You could save a lot of money if you would outsource some of the production.

Klein said, "On the surface that could appear to be true, but Crestron supplies all the technology in a room, in a building, or at home. Therefore, we want to design and build all the parts so they are compatible and interface with each other, and after that with the central management system. We have partnerships and at times make use of different experts from a variety of fields when it makes sense. But even in those cases, we always take complete control and responsibility over all of it."

What differentiates Crestron from other companies in the industry?

"Lots of companies and people in the industry are conventional AV (audio-visual) people. We're not a conventional company. We want to do, and in fact do, everything on our own starting from the formulation of the idea, to the engineering design, the production, quality control, and even some of the distribution. Crestron has many representative offices around the world and we don't outsource jobs to subcontractors."

According to Klein, the knowhow possessed by the people who run the company is what makes the difference. "I've been in this industry for nearly 40 years, and Fred for 25 years, and we have production workers who have been with the company for 3 decades. The same holds true for those who fill other key positions in the company."

"Technology is everywhere today," adds Klein. "Whatever building, home, or hotel you go into, this technology exists everywhere that's the business we're in. We manufacture all the different parts in this technology we produce the lighting system, the AV system, the energy management system, and all the rest. When we first started out, we produced one controller that interfaced with all the other systems. Today, we produce an all-encompassing, wall-to-wall solution."

In relation to Crestron's technology, Bargetzi adds, "The solution that we offer is everything, ranging from workplace management connecting my device to the screen so it will be able to control the room to activating and monitoring the environment by means of the lighting control systems, energy management, and more. We also do business in the high-end residential market for the affluent, the very affluent."

Crestron's conference room management systems also allow users to check whether the room is available, and even book it in advance. "That saves time and resources, so that groups won't hold meetings in places where they shouldn't be. It saves time between meetings, and also makes it possible to track and monitor occupancy levels in the facility in order to save time, energy and, of course, money. We have clients that have dozens of buildings and thousands of conference rooms and thanks to us, they save a lot," adds Bargetzi.

Klein expands on that saying, "There are many companies that do a good job with lighting control systems. But because that's all they do, they have to interface with the other systems at the corporations. In our case, when a corporation approaches Crestron, we have the unique ability to offer them everything they need under one roof ranging from control of the electrical switch to the conference room table. We can also network any other component in the facility, and everyone knows that all these devices report back to the central management system which integrates all the communications in a single place, and that's a huge advantage that none of our competitors have."

You mentioned that in the residential market, you only cater to high-end clients. Why not approach the average consumer?

"I have no doubt that everyone would like to have our products. But our strategy and our focus is not on products for the general public. Everyone would like to have a Ferrari, but Ferrari doesn't make a car that everyone can afford. We are a luxury brand and have all intentions of remaining one at this point in time. We want our products to have more value and more practical usability that creates the experience we produce you can't go to the store and buy that experience in a box."

What are the company's targets and yours personally as its CEO?

"My personal target and Crestron's target are one and the same. Crestron is my family, it's my life. Members of my family work in the company. My wife works here, so the targets are identical. What do I want for Crestron? The answer is quite simple I want the company to be better every year, every month and every day."

You're a privately held company. Why not take it public?

"People take their companies public when they need cash or want to retire - neither of those conditions exists at Crestron. We've been around for 45 years and are no doubt the leaders in our industry. We are much larger than any of our competitors, and our financial condition is very robust. We do a very good job making money on our own - we've never bought a company and we've never scaled back our business activity."

"One of the indirect consequences of becoming a publicly traded company is that you begin to work for someone else rather than for the client. You start working for the financial institution, or the investors, or the shareholders whereas we work for the client. And that's it. It costs so much to secure a client, and it costs a whole lot more to regain an unhappy client who has left. As a privately held company, I do what's best for us, and what's best for us is best for the client."

To what extent are you, as CEO, involved in all the stages production, marketing, customer service?

Klein said, "I'm definitely a hands-on manager, who at times is involved in many details. First of all, I demand one thing from everyone and from myself as well I demand that everyone take responsibility and ownership over their area of work. Leading means being part of the thing itself, and I'm the one who bears the ultimate responsibility for the company. Our employees are the company's most important asset and I want to make sure that I'm setting a good example for them, and make sure to show them that I care and that I'm involved in what they're doing."

"During the 25 years that I've worked here, we've never fired even one person due to cutbacks or hard times. Even during the economic crisis in 2008, when most of the companies in our industry were laying off many of their employees, we were careful not to fire anyone and even hired new people where we identified potential, high quality people who had been fired from other companies. Our employees treat the company as if it were family. They view it as a stable place, a place they can rely on. In exchange, we demand the same - we want to rely on you and you can rely on us."

Published by Globes [online], Israel business news - www.globes-online.com - on December 7, 2014

Copyright of Globes Publisher Itonut (1983) Ltd. 2014

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