After forty years under the Rutledge banner, the integrator’s sale to New Jersey-based Diversified was finalised in April 2019, and the name change to Diversified completed in August 2020. In the meantime, they’d delivered an award winning 3,500 loudspeaker PA system to the MCG and were operating under one of the world’s hardest lockdowns out of their Northcote, Melbourne head office.
I spoke to Andrew Morrice, Diversified’s Country Manager in Australia, about their new international superpowers, and what 2021 looks like for our most established AV company…
While the sale process of Rutledge to Diversified seemed relatively quick and simple from the outside, I assume it was longer and more complicated. How did it work?
The sale followed a fairly traditional process with a business broker engaged to represent Michael and Sandy Rutledge. We worked together on an Information Memorandum and the broker then managed the engagement process.
The complexity of the transaction, the size of the company, the professionalism of Diversified, and the involvement of private equity meant there was significant due diligence to be undertaken.
As part of the process, delegations from Rutledge and Diversified met in Hawaii. Diversified being based in New Jersey, Hawaii was approximately the halfway point. It was an exciting process, but not without its stresses.
In the end, it was the significant similarities between the two companies that made the acquisition relatively easy. Diversified has followed a strategy of growth both organically and through acquisition for some time and is well rehearsed in the process, meaning it all ran smoothly in the end.
We share a matrix reporting structure and are now well integrated with multiple lines of communication to maximise the sharing of knowledge across what is now one global business.
Now that you’re Diversified, what difference is there in the customer experience compared to the Rutledge days?
To the customer or end-user, the experience is mostly the same. There’s still the extensive local support that there’s always been, but now it’s backed by a major international organisation that has significant horsepower in specialities.
Rutledge was always a full-line generalist, with expertise across the company servicing multiple industry verticals. Given the size of the US market, Diversified has organised its business around verticals with specialist divisions.
In Australia we are able to leverage that expertise, complementing the knowledge and experience that we have locally. For example, when working on the recent MCG PA Upgrade project, we had access to Diversified’s team of dedicated stadium experts. We now also have the backing of multiple network operation centres around the world.
We’re currently implementing a global ‘follow the sun’ model for service, which will enable our customers in Australia to benefit from Diversified’s Global Services Ecosystem.
This system has a lot of similarities to Rutledge’s original service offering. From a marketing perspective, we have more resources and more power to get our message out. It’s all a benefit to our customers.
What other new products and services has the acquisition enabled you to provide?
Diversified’s speciality business units have both strengthened and added to our offerings.
For example, we are doing a lot of work around medical innovation in partnership with a local medical technology company which is opening the door to new opportunities.
Diversified has a big footprint in broadcast in the US, which is tying in nicely with our broadcast specialists both with Diversified and in our sister company, Soundcorp (also a Diversified Company).
There’s also expansion opportunities in digital signage; Diversified has thousands of digital signage endpoints under management via US based control centres. They have remote cameras in New York’s Times Square, set up to watch digital signs to ensure uptime with actual visibility of what is displayed, given the cost of advertising there is at such a premium.
Diversified has thousands of digital signage endpoints under management via US based control centres
These same control centres can manage digital signage end points here in Australia. And, of course, the newly launched Global Services Ecosystem, which we anticipate will reshape how service is delivered in Australia.
How has the pandemic affected Diversified’s operations both here and in the US?
It’s turned Australia into a multi-speed economy. Victoria, Melbourne in particular, is stuck in first gear, and every state and territory seems to be running in a different gear.
For example, in NSW, we just won a major contract to deliver the new Sydney Football Stadium, WA is almost business as usual, but here in Melbourne we are dealing with significant challenges.
The introduction of Stage 4 restrictions in Melbourne in August was almost a blanket ‘stop work’ which unfortunately resulted in standdowns. This was so frustrating, as the border closures prevented us from moving our teams interstate.
This has been a very effective model in the past, dealing with peaks and troughs in demand around the country. It has been demoralising on so many levels, though we are beginning to tentatively emerge from it now and everyone is looking forward to positive announcements from the Victorian Government.
Diversified US has been very supportive throughout the whole ordeal. They have certainly had their own challenges to deal with given how hard the US has been hit by COVID-19. The approach from Diversified on both sides has been ‘what can we do, and how can we help?’
What is changing in AV integration in response to the pandemic?
So much, so fast. For example, over the last couple of years, huddle spaces have been very popular. But how do you now utilise them when we are all supposed to be socially distancing? We are now “huddling,” on our own, in different rooms/locations.
The market progression for Teams and Zoom has moved forward at least five years in just three months. I think that one of the most significant implications for this technology is the move into, and take up by, the consumer market.
The market progression for Teams and Zoom has moved forward at least five years in just three months
This has had a major impact on its usability and acceptance. Not too long ago, if you’d proposed a trivia night with your friends over Zoom, it would have been unlikely they would have known what it was or how to
set it up. Even if they did, it would not have been thought of as a real substitute.
Now it is accepted, particularly in Melbourne, as perfectly reasonable. When it’s being used by GPs for telehealth it has to work seamlessly. You can’t have a 70-year-old with asthma who needs to talk to their doctor fumbling with installation instructions. It works because it must.
Where to you see the business opportunities being in 2021 and beyond?
This again depends on location. We are seeing strong opportunities in traditional markets in some states, but Victoria seems to be about government infrastructure spending on tunnels, bridges, rail, and roads.
Opportunities for AV integrators are there, but it’s not classic corporate AV. For example, we have been looking at tunnel PA systems and how to tune and align them correctly. It’s an interesting sound and physics problem requiring specialised products and skill sets.
Any work gained off the back of that infrastructure spending is going to take thought and effort. It is hard to see any significant investment in hotels or office buildings next year, but there is a raft of COVID-19 workplace modifications evolving which will provide opportunity, provided there is budget.
Diversified in Australia has some level of shelter with major projects underway in Sydney and a lot of work being driven out of Canberra in our Secure Agency business. Ideally we’d like to see that kind of health in the market spread to the rest of the country, but it will take time.
Opportunities for AV integrators are there, but it’s not classic corporate AV
CX Magazine – November 2020
LIGHTING | AUDIO | VIDEO | STAGING | INTEGRATION
Entertainment technology news and issues for Australia and New Zealand
– in print and free online www.cxnetwork.com.au
© VCS Creative Publishing
Published monthly since 1991, our famous AV industry magazine is free for download or pay for print. Subscribers also receive CX News, our free weekly email with the latest industry news and jobs.