How to Run a Successful Business in Paradise

Hawaiian security integrator IST overcomes challenges of keeping talent and finding customers, and expects to keep growing in the next decade under a well-traveled, highly regarded husband-and-wife management team.

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Branching (and Flying) Out

While most of IST’s work is centered in Hawaii, the technicians do have to hop on planes on occasion to get to the job site, but it’s not to where you might think. IST’s other main sources of business include Guam for Navy and commercial installations (eight hours by plane) and Kwajalein, an atoll in the Marshall Islands about 13 hours away.

“There are so many integrators on the West coast [of the U.S.], that’s not really a good target,” says Andrew. As they grow in stature through the SBA set-aside, IST will have more ability to go through the PSA Security Network, one of many organizations of which IST is a member, to secure work in the continental U.S.

“In our core business alone, the market would support us at $15 million,” says Andrew. “The opportunities are unlimited.” IST offers program management as an ongoing support service, but recurring revenue has always been less than 20 percent of its annual revenue and remains “a targeted area for growth,” he says.

“In the past we’ve always been willing to meet the customer’s requirements, and truthfully we make more profit from non-negotiated service calls because those clients are paying a higher rate,” says Christine. “However, we’ve experienced the pain of trying to grow a company with volatile project revenues, so we’re definitely assessing models that are purely RMR-based, but it hasn’t been a top priority. I think we’ve just been busy expanding our health care system offerings and launching our Federal 8(a) program.”

Related: Empowering Employees With an Ownership Stake

IST also offers profit sharing to its employees and emphasizes training and certification for everyone who works on a job at any point. “In DOD especially, you have to show those credentials,” says Andrew. “You can’t just say you have five project managers.” IST’s recent partnership with Rauland-Borg will allow the company to spread itself more fully into a new market, with nurse call systems combined with IP development. “Health care is going to be a big focus for growth,” says Andrew. “That’s big with K-12 and higher ed really suffering right now.” Christine agrees health care is a big market for IST, but knows it won’t be easy.

“The Rauland Responder V and all of its integration capabilities are an exciting opportunity for us, but as an organization, we have a lot to learn about the health care operating environment,” she says. “We are standing up a smaller internal unit dedicated exclusively to the health care field, and we’re bringing on complementary vendor partners in an effort to be the highest quality provider to the health care industry in Hawaii and the Pacific.”

Staying at the Forefront

Andrew and Christine emphasize education, not only for their employees but also for customers and prospects, which is why they regularly offer lunch-and-learn sessions on myriad topics, including the NSCA-SIA Partnership Alliance for Safer Schools (PASS).

“I’m very impressed with Andrew and Christine’s commitment to professional development and staying involved in trends and issues,” says NSCA executive director Chuck Wilson. “They’ve become great advocates for our MNEC and PASS programs and are helping us promote and educate NSCA best practices within their client base. It’s certainly not convenient or inexpensive for them to be as involved as they are in attending BLC or our regional conferences, but they do in order to differentiate their company and to establish themselves as industry leaders.”

The Lannings are especially proud of their investment in training and knowledge-sharing.

“We try with each hire to create opportunities for internal staff growth as well as new opportunities for the local workforce,” says Christine. “Many of the national competitors here must bring mainland expertise to bear when they take on integration projects. We have nearly two centuries of industry experience spread across our staff.”

IST has “trimmed a lot of the fat from our overhead, and we’ve built exclusive distributor relations with the PSA Security Network to help us control material costs,” says Christine. The company is “focused on bolstering our team’s IT certifications in preparation for the security industry’s full-scale adoption into the IT space.”

“We don’t see a place for non-IT centric security companies in the near future and although we lead this space in Hawaii currently in physical security systems, we’re preparing to be even better IT partners to our current and future clientele,” she says.

Another Satisfied Customer, or Two

IST’s work with Lenel led Gordon Bruce, chairman and CEO of Pacxa — Hawaii’s largest systems integrator — to connect with company principals Andrew and Christine Lanning for an island-wide access and management system, which eventually expanded into the city and county levels. Bruce also hired IST to install access control through the cloud at Pacxa through a pilot offering and is looking to work together on larger projects.

“They certainly had the understanding of the industry,” says Bruce. “They also knew what the federal government was doing and could see the needs and gaps in the system. You can sit down and intelligently talk to them about your ideas.”

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