[305] #Allegion with Futurist Robert Martens #ASIS16

Rob Martens. Which name of the company? Legion, also known as Schlage, is one of our go-to-market brands.

So Allegion is the parent company for brands like Schlage, Von Duprin, LCN, Optique Mobile. I didn't know that. Now, is that a new development? It is about two and a half years ago we actually spun from Ingersoll Rand. We had an activist investor come in and say, 'Hey, there's great value here.' So it's a wonderful opportunity for us, about a just over two billion dollar company. And Von Duprin, people don't know what this is. I know that those are the stage stores in the studios, very specific, push panic bar. And that's been around a long time. Absolutely, we actually created that category. So the Von Duprin and LCN brands are kind of legendary brands from the standpoint they actually created the door closer and created the panic bar.

Absolutely. You know, a hundred years of making good stuff and making stuff that lasts, and a lot of legacy there, but also a lot of new futuristic cool stuff, and that's my job.

Absolutely. And it's just a good sturdy lock and key set. And you know, he was my buddy and been the back, it seems to all still work, so I'm very really half of that product. And then the push button, push bars are really, really good. Heck, we even had one he pushed it and had time or delayed. Yeah, and in some places that fire code is not allowed, but it's just to keep somebody from stealing something really fast. 10 seconds it opens up after that.

Yeah, yeah, you know, absolutely. What everybody wants is Star Trek. But you know, the interesting thing when we talk about that, the term that everybody uses is convergence. Right, right. And you know, I think there's a misnomer about convergence. Convergence doesn't mean everything mechanical going away. It means what's the right blend of mechanical and electronic solutions. Yeah, and just because you can do something doesn't mean that you should. Right, right. And so that legacy, that hundred year history of helping consumers, facility executives, other people understand how to apply the technology really comes into play. You know, again, we can make all kinds of cool devices that do all kinds of things, connect to the internet, let you remotely monitor, you know, all kinds of things that we could talk about, they're fantastic. But at the end of the day, what really matters is was the technology applied in the right environment.

So to your point, if we do apply the technology incorrectly and it doesn't go with the consumer, it's gone. And you guys sound like you're thinking these things through, and that's really, really important because if you don't think it through, it's going the way of the Edsel or something. Absolutely. So my role in the company is I'm actually Allegion's futurist. And so what that means, great title, yeah. And you don't normally hear that tied to a company like Allegion. Sometimes people look at Allegion and they go, 'Wait a minute, Schlage, Von Duprin, how do you have a futurist?' Well, I'm here to help identify and kind of break some paradigms, right, but to do it in a responsible way. So when we talk about access control and physical security, what we're really talking about is a balance between true physical security and convenience, right? Because this is the tipping point. That's it, you got it. And so what this boils down to is how can I give you something that masters the blend for you? Electronics largely are about convenience. For example, you know, hey, I want an automatic action to take place. I've identified that Chuck is at the door, he has the ability to come through this door. Now that he's come through the door, I want the following other actions to trigger, right? But there are also some other fantastic elements. So you know, productivity is the name of the game, right? For a lot of folks, especially managing large facilities, how many physical plant employees do I need to have on staff in order to manage a couple thousand or campus? And wouldn't it be great if those devices, whether it be a panic bar, whether it be a cylindrical door lock, and whatever it may be, could call out to me and proactively tell me I'm not operating the way that maybe I should? Yeah, instead of me having a panic and send someone immediately, it could proactively tell me, 'Hey, the next time that you're doing a cycle and you're doing a tour, come touch me, change my battery, check me.' Or heaven, even something like an audit, a simple fire safety audit, 'Hey, I haven't been audited yet.' You know, so all kinds of possibilities, all good things that can come of this. But again, there's this balance between you know what I hear a lot about is Star Trek. You know, it's like, hey, when I walk up to the door and I want it to sense my proximity to the door and then I want it to unlock. And whether it's in a residential application, which we do a lot of too, sure, or a institutional one, you really have to think that through. You need to be a security provider before you become the software guy to understand the ramifications of that. What if you happen to be somewhere within the semi-hemisphere of where that door can sense you, but you really haven't demonstrated clear intent, but it unlocks anyway, and a bad actor enters?

Well, you know, it's a great question. That's absolutely the right question to be asking the industry right now. As you see crowdfunding and Internet of Things, you know, some more familiar, all these connected things, many of them focused on single-family home. But you see Kickstarter campaigns and all these crowdfunding things. We have people who are basically software guys who've decided, hey, I think it's a great idea to make a lock. Exactly, exactly. And the thing is, it's really crazy. And so where we come down on that as a company, and in you know from our value statement, is we're a lock and security company first. So we default to that, up right. You know, that's table stakes, right? That you have a secure product that's difficult to pick, that's difficult to break, you know, that's going to last. You've got to be a lock first and then add an Internet of Things to it, right? And I think a lot of people are coming to that conclusion very quickly. As you know, YouTube is a wonderful thing, and when you see these things getting destroyed, you get a sense. I think the other thing is, it's imperative for people to understand there's a blend. Nothing's a hundred percent secure. Nothing is. You know, who come forward and say these types of things are baiting the hacker community. Now, by the way, can be your best friend. I mean, I want those guys trying to break your product so that you can continuously improve both the mechanicals and the electronics. But at the end of the day, it's what you said: it's starting with a great lock or a great device that you know is going to be reliable, it's going to do the job, it's going to stand up to a beating, and then let's add some things to it. What you're going to see from us over the coming years, maybe a little preview for you, yeah, like two days, you're going to see us gradually introduce electronics into these robust platforms that you've seen. It's going to be different. Allegion, I suppose. I think so, yeah. And I think that it's going to be a slow but steady pace towards things. And the value that we're going to try and bring initially isn't necessarily the Star Trek type value. It's about how can I make sure that the lock that you put on that door you're not going to have to replace, for example, if you change the security panel. You know, you've got a big investment right in your panel, right? You know, are these things? How can I put some equipment on the door that's going to be a good solid long-term investment, where when you make changes, it's going to adapt to you? And so we're big fans of open architecture, open standards, both across our entire portfolio. And we just believe proprietary doesn't mean more secure. As a matter of fact, when we do things in an open architecture environment, it lets people like you have access to the best in other things, and we improve.

Yeah, well, you know what's amazing about that is so therein lies a very good use case and something that we think about sometimes is again the balance between you know Primus is a fantastic solution, very robust, very strong, but in balancing between the security and convenience element, it may be that if you lose key control, you are going to be rekeying a significant number of doors. Now it could be that if we can address the cost concerns, you know, because typically electronic locks are on the perimeter of the building, right? You don't tend to see them on the interior. So we have a couple products where we're trying to make it more cost effective. You know, 15 minutes to put it on, self-registers on the network, cost point where it needs to be, right? And what that gives you is the ability to essentially rekey the facility without having to touch every lock. Yeah. And so when you have a security breach or something like that, that may be a solution for certain people to say, look, I would like to change the firmware, I'd like to update these other elements. There's been a hack, there's been something that goes on that gives you the ability to make a quick change. You know, I think that's where we start to talk about real security. And these other kind of I call impostor companies, they don't really understand the core business. And it's not a question of if you're going to get hacked, it's a question of when, right? And how you respond, what's your plan, how are you going to deal with that circumstance. And I think that that's something that we excel in. And that's a big part of our focus: how can we give the security professional the tools that they need to respond in the manner that they want to? And I think flexibility is key. I mean, you cannot get away from the importance of a mechanically strong secure device, but if you start to just siphon in little bits of value-added technology, right, it makes a huge difference.

Sure, www.legion.com.

Rob Martens, futurist.