Pandemic transforms the system integration industry

I have contributed to this publication for the past six years. I normally sketch out my thoughts early on and allow time for it to develop into an article. This time, I found myself redoing my outline over and over, all a reflection of the highly disruptive and volatile nature of the moment in which we are living. The COVID-19 pandemic has had a dramatic impact on everything and everybody, including system integrators and the end user clients they serve.

Part 1: COVID-19 takes the world by surprise

When the pandemic started to spread early in the year, it forced most of us into lockdowns. We entered a period of high uncertainty, anxiety and fear. The world had been turned on its head, and we had to figure out how to survive at work and at home. We had to assess the situation and visualize the short-term implications, often by creating possible scenarios.

A few years from now, we may look back and remember this period as the one where everybody learned to use video conferencing: from the children who had to continue their schooling from home to the parents who became teachers in addition to their other jobs. Grandparents who may have resisted technology in the past learned to use the platform to stay in touch with their grandchildren. Usage of web cams increased at work as it provided some sort of social touch in the middle of the mandated social distancing.

For businesses, cash became king, and it set changes for survival. Cash preservation became vital. Wise SIs understood their teams were just as vital as their cash reserves. They moved quickly to ensure their teams were taken care of. As much as possible, they removed the immediate existential threat to them. Many SI leaders shared the challenges faced by their organizations in a very transparent way, in some cases, also sharing their cash-flow projections. This allowed teams to compartmentalize their financial worries and focus their efforts on adjusting to the new environment.

Impact on end users

Some industries served by system integrators were badly hit and had to slow down production (e.g., automotive, aircraft manufacturing, oil and gas). Other industries had to ramp up and/or set up additional production capacity to adjust to increased consumption (e.g., cleaning supplies, food and beverage) or drastic changes in consumption patterns (e.g., toilet paper for residential versus commercial). Several months into the pandemic, some of these industries have not caught up to the increased demand. System integrators helped end users with their challenges and found ways to do it safely. For many, this translated into remote access, which demanded increased cybersecurity measures and/or investments.

Part 2: Coping with the situation

Along with the rest of the economy, SIs have been impacted by the pandemic. System integrators are nevertheless resilient and resourceful, and most have found a way to make it work — at least for now. To ensure their teams continued to be cared for, some SIs reached out to their employees and offered office furniture to ensure proper working conditions for their home offices. Many realize the pandemic will be with us for a while and, therefore, remote work will be part of our future work setup.

While most SIs were set up for remote access to resources like email, not everything may have been set up for full remote access for this long of a period. This crisis forced everybody to address these shortcomings. Managers also had to develop new approaches to ensure work was being done and, at the same time, provide the flexibility many required to cope with new personal demands (e.g., child care, emotional challenges coping with the pandemic, etc.).

Impact on end users

Uncertainty has been and is likely to remain a constant throughout this crisis. As time goes by, scenarios may end up developing in unexpected ways. While the home building industry is not served by SIs, it illustrates this point.

Early in the year, health and economic fears tied to the COVID-19 pandemic sent new home sales plunging. This industry is currently undergoing a dramatic rebound, and the associated lumber futures have set a record high.

End users have been investing to increase their ability to operate with reduced onsite staff. This translated into immediate investments to enable remote access (with associated cybersecurity) and, in some cases, increased deployment of increased automation and robotics on the manufacturing floor. SIs have benefited from additional service contracts to test and ensure resiliency of their installations, including secure power and associated backup generators.

While the world lacks a COVID-19 vaccine today, there are several candidates currently being tested. In anticipation of a possible winner, investments are being made in production lines now to reduce time to market. System integrators serving the life sciences/pharma industry are likely to benefit from this significant investment for years to come.

Part 3: Thriving in a new world

While the pandemic is far from over, experts have been forecasting a second wave for the fall. Despite this, it seems society is getting used to this new, uncertainty filled reality. The Control System Integrators Association (CSIA) surveys members through a monthly survey called EZ Stats. One question asked consistently is around business sentiment. Participants decide if the outlook for the next six months looks up or down. Business sentiment dropped from an optimistic 80% (approx.) in January and February 2020 to a pessimistic 20% in March 2020. Sentiment has since progressed upward; in June 2020, it turned positive (54%) again (see Figure 1).

The pandemic has forced dramatic changes on us. Some of these changes will stay with us going forward (see Figure 2).

Impact on end users

In previous articles for this publication, I have shared my enthusiasm for digital transformation. Some progressive end users shared their digital transformation journeys with outside audiences. I also have met many end users who have used cybersecurity as their “excuse” for deploying digital transformation in their organizations. The pandemic is forcing end users to address their cybersecurity challenges as the pandemic has forced them to rely more on remote access. Because the cybersecurity issue will be addressed, I anticipate an accelerated adoption of digital transformation. This will also benefit the SI industry.

Where does CSIA come into play?

At CSIA, the Best Practices and Benchmarks are the core of the association. This manual enables SIs to set up successful SI companies. The prolonged nature of the pandemic is providing an “extreme testing” opportunity, in particular to the section related to “Disaster Recovery and Business Continuity.” Many SIs have created plans that helped them through natural disasters like the September 2017 Harvey (Houston) and Maria (Puerto Rico) tropical storms and earthquake (Mexico City) as shared by three SIs at the 2018 CSIA Executive Conference.

As an association, CSIA had to redefine itself very quickly. The current Chair of the Board of Directors is the owner of an SI company based in Northern Italy, a place hit early by the pandemic. This helped CSIA gain an early warning and informed the decision to cancel the 2020 Executive Conference, which was scheduled for May 2020.

CSIA quickly created a site with pandemic-related resources for its membership. Presentations were organized to help SIs better understand the requirements and process related to payroll protection program (PPP) loans. The CSIA EZ Stats program was quickly reworked to survey the membership on relevant pandemic topics.

I am proud of the way CSIA, its leaders and, most importantly, its members responded to the situation as well as supported each other throughout some very difficult times.

Looking to the future, CSIA leaders and staff are optimistic knowing, despite the pain and the loss, CSIA and the SI industry have a unique opportunity for reinvention.

We are determined to use forethought, creativity and resilience to help the association and its members meet this challenge and not only survive the transition but thrive.

About the CSIA

CSIA is a global, nonprofit professional association with a mission to advance the practice of control system integration to benefit members and their clients. CSIA has more than 400 system integration company members and 100 vendor partners in 27 countries. CSIA is a CFE Media content partner.

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