Security Sales & Integration June 2022 - 30

EXCLUSIVE!
Executive Interview
CTSI's Master Plan
We're not going to mess with your benefits.
We're not going to mess with your salary. We're
going to take good care of you. " We need to
be aware that they're very sensitive, and they
should be because they don't really know everything.
We need to overcommunicate. We
make sure they're comfortable. We do that by
video. We do that by letters. That is a top lesson
I learned regarding the acquisition targets.
Do you see consolidation as a major
trend for the industry itself?
Katz: We are seeing more consolidation now.
Other private equities have seen what we have
done and they're looking at similar strategies.
M&A has been extremely active and is going to
continue to be probably for the next few years.
The idea of consolidating is hard in our industry
as it's so fragmented. We're excited about the
opportunity of the bolt-on acquisitions, not just
large acquisitions because you have to be very
opportunistic and we're super excited of what
we did last year and continue to do this year.
Cross-selling
for me is a very,
very big
opportunity
because there's
many different
forms of it.
- Joe Oliveri, CEO
What is your ideal or target for
acquisitive vs. organic growth?
Katz: We're way ahead of our integration process,
which is great. The idea is to look at our
synergies as well as opportunities of cross-selling
to grow organically. We have seen, between
all these 10 businesses that we acquired, a great
amount of those opportunities.
Oliveri: Most of our geographic expansion is
going to be to chase our global accounts and
support our existing customer base. That's really
what's going to drive where we acquire companies.
As far as organic growth, we expect each
business on its own synergies to grow at least
10% to 15%. Then we have cross-sell on top of
that. Cross-selling for me is a very, very big opportunity
because there's many different forms
of it. One cross-sell is just taking a customer
where we just service in the Southeast, and then
taking our footprint in the Northeast and using
that relationship to sell. Another area is product
lines, whether it be cybersecurity or whatever
we have, taking that to all of our business units.
There is a really good opportunity and we've
set up a really good program, not only from a
rules of the road and compensation program,
just how it works. It's easy to say " cross-sell, " but
it's not easy to accomplish. We've hired a crosssell
leader. That's all they do, dedicated to crosssell
and tracking that, making sure the meetings
30
Security Sales & Integration JUNE 2022
happen. Because if you don't do that cross-selling
will not happen naturally on its own.
What vertical markets are core and what
are some you envision strong growth?
Alan Rosenkoff: We've been historically really
strong in the healthcare, large enterprise, K-12
and higher education markets. Through some
of our recent acquisitions we're seeing critical infrastructure
in datacenters and public utilities as
great markets, along with growth opportunities
for us retail, financial, transportation and logistics.
You talked about the cross-sell, what
else does CTSI bring to the table to
cement its value proposition to clients?
Oliveri: The breadth of our offerings, from critical
infrastructure to fire to security to cybersecurity.
We have a solid platform to deliver as a onesource
to a customer. That's the main thing. The
second piece is service. What's going to determine
whether we're successful moving forward
or not is how we serve our existing customers
and if we serve them better than our competitors.
The most important thing is being customer-focused
and taking care of our customers
and making sure it's easy to do business with us.
How's this year shaping up? You mentioned
the 10% to 15%, is that being hit?
What do you see the next couple years?
Oliveri: We are seeing that growth. Growth has
been really strong. The backlog is up significantly,
but the challenge we have, that many of our
competitors have, is just product shortages. We're
really working hard to minimize those product
shortages, and also labor. Labor is also a challenge.
I look at the two things that we've faced that are
really holding us back from growth; it's having the
product we need and having the labor to execute
those projects. That's by far the industry's biggest
challenges. We have to constantly work through
it. It's a day-to-day challenge, making sure we
have a part for each project when we need them,
and we're just juggling the best we can.
Do you see the supply chain issue
easing any time soon?
Oliveri: I haven't seen it get easier. If anything,
it's a little bit more difficult. I'm hopeful that Q3
and Q4, it smooths out a little bit and gets more
predictable, but right now I'm not seeing that.
We have had to get more efficient with our
inventory management because on some projects
with long lead times we need to order
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Security Sales & Integration June 2022

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