At Cenero, the Data Is In: Managed Services Model Works

Published: 2017-09-21

It probably looked like a typo when in Commercial Integrator’s “10 Fast-Growing Firms” coverage we highlighted that Malvern, Pa.-based Cenero has been averaging 30 percent year-over-year revenue growth for the past 15 years. Well, it’s true and it’s not by accident, says Cenero CEO Chris Henry.

Cenero is an integration firm but it’s also a managed services firm. However, it’s not an integration firm that is incorporating managed services like so many in the industry have been trying to do over the last few years. It’s an integration firm that, when it launched in 2000 into an industry with a reputation for “less than stellar business acumen,” according to Henry, intentionally avoided the traditional industry business model.

So Cenero’s approach is different—by design. [related]

For Cenero, excelling in managed services was always the goal. The strategic plan for launching Cenero was largely built around tools for providing managed services. The investments during the early stages of Cenero centered on building a managed services infrastructure.


Now, 17 years later, the 30 percent year-over-year growth demonstrates the yin-yang relationship that integration and managed services can have when that later isn’t an afterthought. At Cenero, managed services drive the installation business and the installation business drives the managed services business, Henry said in CI’s Fast-Growing Firms article. “It’s a symbiotic relationship,” he said, with “each pulling the other up the revenue ladder.”

Again, Cenero’s approach to managed services is different by design. A major component includes the integration firm gathering information from audiovisual systems and providing it to customers in the form of valuable business data or analytics that can help them make informed business decisions.

Organizations increasingly recognize the value of business data and it’s not surprising that they would, in turn, recognize value in the company that provides it to them. It’s that aspect of managed services that, for an integration firm, Cenero seems to uniquely grasp.

“Managed services, to us, are a necessity,” Henry says. “Obviously, it helps with profitability, but the real differentiator is the value that it provides our clients.”

The ‘Less-Than-Stellar Business Acumen’

The unique way Cenero is structured is easily traced back to its founders’ perception of the traditional AV integration company model. That perception wasn’t particularly favorable.

“I’ll put it this way,” Henry says. “I think there’s plenty of room for improvement.”

Back in the 1990s, Henry worked for a venture capital group inside a Fortune 1500 company. One thing about good venture capitalists: they know a lot about companies and they learn industries inside and out. After a few years of grueling travel and intense merger and acquisition work with his venture firm, Henry got together with a friend and developed a business plan around being an application service provider into the systems integration business.

managed services, Cenero

He wasn’t interested in starting an integration firm; he was interested in providing software solutions to address integration firms’ business needs that he had observed in his venture work. Henry hired Rob Gilfillan, now president of Cenero, to help create a business model focused on building online software for contractors such as integrators. The original goal was to explore developing online tools for standardizing procurement models, project management and standardizing how manufacturers communicate with the channel, Gilfillan recalls.

The research led to development of a tool that he says makes pre-design of systems extremely efficient.

“We’d be able to get about 90 to 95 percent of the system specifics up front, which would allow us to get it through logistics fairly quickly, cut off some time to market and increase accuracy of designs,” he says. “Still, to this day, it’s amazing how many people work off of a materials list, go right into logistics, start building and then they find the hole during the build. It’s still a problem in our industry.”

Then (and now) there wasn’t (and isn’t) “a lot of efficiency in the marketplace,” according to Henry. “Our view was to basically come up with software products and processes to help people in the industry work more efficiently.”

So Henry and Gilfillan were preparing to launch as a vendor partner with what they felt were valuable tools for integration firms. By late 1999 they had raised nearly $10 million in verbal commitments. Then everything changed.

“The capital market dried up and the funding was going away,” Henry recalls. “We had a choice to either kill our business off or essentially turn it into our target customer.”

So instead of serving integrators with the solutions they developed to address inefficiencies, Henry and Gilfillan ended up becoming an extremely efficient and forward-thinking integration firm that leverages those solutions from within.

“We had assembled a quality team and decided to transform ourselves into a target client,” he says. “That’s how Cenero started. We come at this business from a very different perspective compared to most companies.”

In 2017, that’s still relatively true, according to Gilfillan. One of the reasons that, back in 1999, he and Henry were optimistic about converting their business plan to become an integration firm is that they saw an opportunity to stand out.

“One of the things that was very attractive to us is it’s a fragmented industry,” says Gilfillan. “There are not a lot of major players. Even large companies, by comparison, aren’t behemoth. And there’s not a ton of business acumen, at least at the time. It’s getting better.”

“Managed services, to us, are a necessity,” Henry says. “Obviously, it helps with profitability, but the real differentiator is the value that it provides our clients.”

This is nothing that integrators haven’t already heard. The stereotype is of a relatively small company that is big on passion for technology and lacks focus on the business end of things. That generalization, however, reflected an opportunity for Cenero.

“There’s no shortage of opportunities in this industry,” Gilfillan says. “I could list 15 different opportunities that you could take advantage of to create a way to make a living and improve the industry.” So that’s what Cenero did.

On Managed Services and Project Revenue

One of the opportunities that Cenero recognized was there for the taking related to managed services that support meetings. Many of Cenero’s customers in the early days had multiple offices or were multi-national. Henry and Gilfillan saw “a lot of pain around” how meeting room technology was traditionally supported, Gilfillan recalls. It was reactive. When elements of a system failed, it was a matter of waiting until they were fixed.

“We saw a lot of pain in the meeting space and the meeting experience that these companies were experiencing and we saw that as an opportunity,” he says. “We didn’t see anybody really addressing it.”

The managed services opportunity wasn’t just to fill a need. Cenero saw managed services as an essential way to create a business than can grow.

“It’s important to invest to be able to move things forward so we aggressively invested in the business and the things that we knew were annuity-based income streams,” Gilfillan says. Investing in managed service, he adds, set up Cenero “to continually grow as opposed to the ups and downs of the project work.”

It’s not that Cenero’s growth (remember, an average of 30 percent revenue growth over the last 15 years!) is easy, but the investment in managed services makes it more sustainable. Henry estimates that 60 percent of Cenero’s business last year came from outside of its geographic areas. “That’s because our managed services allow us to support systems throughout the world.”

Cenero’s managed services structure can generally be broken down into three parts, according to Henry:

managed services, Cenero

Cenero CEO Chris Henry estimates that 60 percent of the company’s business last year came from outside of its geographic areas.

Constant Connect

This is kind of like OnStar but for audiovisual and conferencing solutions, Henry says. It includes proactive testing of systems that allow the firm to continually monitor and anticipate issues.

24/7 Reactive Services

This is essentially a helpdesk offering staffed by engineers reachable by phone or messaging. It also includes a suite of monitoring services. Henry calls it a “traditional managed services offering.”


Cenero collects functional information on its clients’ audio-visual systems and provides it to them so they can make decisions. Information about system and room usage might help them learn how they ought to invest in future space and systems. Other information might clue them in on inefficiencies within their organization.

When Cenero hired Melissa Nick four years ago, its managed services offerings were already robust. The problem, however, was that “people didn’t know it existed,” she says. Similar to most integration firms that offer managed services, the offerings were mostly sold into projects. Nick wanted to change that and began hunting for new support services-only business.

“I went out and talked to clients about how they’re supporting their systems, how our model isn’t one-size-fits-all and asking how we can best customize solutions to augment their staff,” says Nick, now Cenero’s director of managed services. “In a lot of large corporate environments they have IT people but they don’t have AV people,” she says. “So [Cenero could] be that outsourced AV specialization arm to support room with UC and everything else under the AV umbrella.”

So, while the three-pronged approach nicely encapsulates Cenero’s managed services offerings, it’s actually the customized aspect of it that took sales to the next level. “We have an umbrella of managed services and underneath that umbrella there are a lot of different things,” Nick says.

Elements under that umbrella include:

  • Staffing for customers that require on-site support
  • Reactive services by which Cenero rolls a truck to service issues that arise
  • Preventive maintenance visits
  • Access to an in-house support team
  • Access to an “on-the-street” support team so the integrator doesn’t have to pull technicians off of projects
  • Proactive service which may include nightly system testing (“We’re not just pinging or powering the system on and off,” Nick says. “We’re actually running a full closed-loop test.”)
  • A slew of remote maintenance (both proactive and reactive) services

On Analytics and Growth

These services feed the analytics aspect of Cenero’s managed services.

managed services, Cenero

“One of the things that was very attractive to us is it’s a fragmented industry. There are not a lot of major players. Even large companies aren’t behemoth, and there’s not a ton of business acumen. It’s getting better.” – Rob Gilfillan, President of Cenero.

“All of the information from an inventory standpoint and a service standpoint from a project goes into the analytics,” Nick says. A customer can log into a portal at any time and see all the information. If they’re a reactive service customer, they can see all their ticket information. If they’re a proactive service customer, they see the ticket information but they also see usage reports and all of the data that’s gathered from us monitoring devices in the room. They can see exactly what’s going on.

“It’s the business data that Cenero presents to its customer that takes its managed services to the next level,” Nick explains. “We’re not just concerned with the experience of the technology in the room. We’re also gathering information about what the users’ experience when they walked into the room.”

At press time, Cenero is poised to release a new look and feel for the dashboard customers’ experience when reviewing analytics. Based on feedback from customers, Nick says the new dashboard ensures that “we’re hitting the nail on the head” in regard to presenting the information they need — “tying it into scheduling, taking us to the next level of what people are looking for in a managed services offering.”

The expectation, of course, is that Cenero’s new analytics dashboard will help it grow its managed services business even more. It begs the question: How much growth can an integration firm already averaging 30 percent growth per year handle?

“There’s a limit on how fast you grow,” Henry acknowledges. “It’s based on cash flow, employee hiring and training.” While Cenero prides itself on being unique, it has one challenge in common with most other firms in the integration industry: Recruiting.

“It’s a constant challenge,” Henry says. “It’s been that way for us really since the inception.” Cenero addresses its recruiting challenges in a couple of ways. “One is we hire talent wherever they’re located – California, Oregon, Illinois, it doesn’t matter,” Henry says. “If we find a talented person we bring them on board and develop the infrastructure and communication and collaboration methods to make them effective and feel part of our team.”

Another way Cenero addresses this challenge is by being in a perpetual state of recruiting. That is, whether it has an open position or not it will hire a talented person that has the right technical background and that meets their cultural requirements.

“It’s the business data that Cenero presents to its customer that takes its managed services to the next level” — Melissa Nick

“We know we will have that position opening up at some point in the future,” Henry says. Cenero also focuses on promoting from within, supporting that with a requirement that employees have at least 40 hours of formal training per year. It also works with college interns and encourages employee referrals. Company culture, therefore, plays a role in recruiting.

“The best compliment and the best check you have of a new employee coming in is if somebody that’s already in the company wants to work with them again,” says Henry. Generally speaking, however, Henry says that for the type of organic (not through acquisition) growth that Cenero is experiencing, 30 percent year over year is appropriate.

“Business school will teach you there are lots of ways to calculate how fast you can grow from a cash perspective,” he says. “Our experience is that if you get over 30 percent it becomes much more difficult to manage. It’s a cultural thing. It’s a stress on the organization. It’s a cash flow thing.”

Of course, there probably aren’t a lot of integration firm executives that will feel much sympathy for Cenero and its challenges around supporting that 30 percent year-over-year revenue growth. Henry admits that it’s a good problem to have.

“Well, it’s better than the other problem, right?”

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