Smart VAR Gets An A In Classroom Support

Not every company can say that it still has the first 14 customers it had when its doors opened nearly 20 years ago. But CSI Technology Outfitters can -- and today those 14 join more than 600 other clients that are in education, local government and non-profit organizations. The business is divided into two segments: a flagship accounting software package, and a traditional reseller of technology such as the interactive classroom, IP telephony and video conferencing. Last year, CSI reported $44 million in sales at its technology business unit.

Co-founder and President Nancy Hedrick talked with Everything Channel about how her company has been able to foster growth internally and also about the opportunities the education market provides.

In addition to ranking 385 on the 2008 VARBusiness 500, CSI was also on the CRN Fast Growth 100, coming in at 38. The company generated a 122 percent increase in revenue during the past two years. How do you account for that kind of growth?

We've had good growth in the last three to four years, mainly because we've bought a number of companies. In January of 2007, we bought the Mobile , Ala., accounting software company McAleer. In April of '08 CSI bought ICS Systems, which had 10 employees and 85 customers. and we just finished the acquisition of software developer Version3. It's a Microsoft partner, as we are, that writes software that layers on top of Active directory, offering a high level of Sharepoint development opportunities. Their solutions provide a bridge between our hardware and software divisions. We picked up 10 more employees from there. We know the company pretty well, because we've partnered with it for the past four years.

It can be challenging to meld the different companies together.

We had respect for all these companies, because we knew the folks and products well. The challenge lies with beginning the product overlay with the software companies so that we have one solid product rather than three. We've inherited great management teams that have stayed in place to do just that. In the case of the Alabama [McAleer] acquisition, we can now leverage hardware sales down there; it accelerates the growth of our solution delivery capabilities in the Southeastern U.S. markets. Not a lot of negative to it right now, knock wood.

Has the economic slowdown impacted your business?

The economy is on everyone's mind. We in the public sector are sheltered a little bit because not all funding sources dry up on [the same] cycles. Definitely, we are seeing some deals pushed back a bit. They're not getting canceled, but there is a wait and see attitude. Some of that concerns gas prices; for example, school districts have to account for gassing up their buses. But I am cautiously optimistic.

The media also plays on everyone's nerves about the economy. Not that there isn't anything there, but we need to batten down the hatches, take excellent care of customers and not miss any opportunities. With every RFP, we need to at least get invited to the dance. We have 600 customers, and that's a great luxury. But we must make sure we are talking to all the stakeholders at these accounts. There are multiple avenues we can talk to customers about, such as VoIP, distance learning and interactive whiteboards.

I'm hearing more about the interactive classroom. How is it different than, say, using Powerpoint?

When you see an interactive classroom, it engages kids at all ages. We are the exclusive supplier of Promethean Activboards in the Carolinas. The devices enable "active votes" so questions can be thrown out and the teacher can find out and gauge understanding all the time. We used to take pop quizzes at the end of the week; this technology lets the teacher continually research whether students are really "getting it."

A teacher mentioned to me that knowing how to really use these devices can lead to extra money in her paycheck.

A local district bought over 1,000 boards and brought in 1,000 teachers for training and then brought their trainers in and learned the ins and outs of the boards. Once a teacher uses it, he or she can see it's not just a place to show a Powerpoint presentation. It's very exciting. There are also other things that go with the interactive classroom package. Studies are finding that students in the back of the classroom can't hear, so audio systems are being installed in the classroom.

Teachers are now wearing microphones. We sell hardware as a means to sell service, in this case interactive classrooms. We can cross-sell within our technology areas. To do interactive classrooms, for instance, you need to be sure the correct infrastructure is in place, to support the higher level of demand on their networks. The classes include a phone, so you've got a VoIP opportunity. You a wrapping services around a whole suite of products. We install it, support it and, if needed, provide training.