2022 CEDIA Member Meeting was a Glossy Display of Overt Positivity

Selling a Vision Rather than Briefing Members w/Data

CEDIA held its annual member meeting just a couple of weeks ago in mid-December. The version offered this year was decidedly different than those in the past. This is likely due to the professional association management style of the organization’s new Global President and CEO Daryl Friedman.

CEDIA and staff offered members a slick marketing package of largely pre-recorded content and carefully controlled live content. But was it too slick? Did it really brief members with a balanced picture of both the successes and the challenges that CEDIA is facing? Or was it just a form of advertisement for the association?

Learn more about CEDIA’s 2022 annual Member Meeting…

I’ve attended most of the CEDIA annual member meetings – sometimes called a “State of the Association” report or “Annual Report.” The format can vary widely. It seems that the style of each year’s event is largely a reflection of the management at the time. This year’s presentation was slick and quick, much like an association-developed podcast on the recently changed Board member voting process. There were short, quick, tightly scripted presentations from several association management and staff personnel. The entire presentation only lasted about thirty minutes – fairly short as compared to previous versions of this event.

Compare This Year’s CEDIA Presentation with Some From the Past

See my reports on previous versions of this same annual event from 2020 here…and another from 2011 here. And when you look at the 2020 version, be sure to scroll down and look at the comments section. There are a couple of really insightful comments from members you may find interesting.

Usually, a global organization has a lot to talk about. This time, CEDIA did cover a bit of ground, but presentations were often high-level – the view from 30,000 feet. Not only that but a lot of material was presented without graphic support which can aid comprehension. And what graphic support that was presented tended to be system photographs and video imagery of various luxury smart homes…rather than spreadsheets and charts.

You Had to Pay Close Attention or Risk Missing Something Important

You had to pay close attention, as some of the presenters read their scripts in quick, low monotones. If you were even momentarily distracted, you could miss an important fact.

Large swaths of the presentation were pre-recorded – such as an interview of Daryl Friedman by Jason Knott of CEDIA partner Emerald Expositions that took place at CEDIA Expo 2022. Jason’s questions served up to Friedman at this public event were mostly softballs that offered him plenty of opportunity to expound on all the good things going on at the association. This recorded presentation took up more than 10 minutes of the 30-minute member meeting. That’s fully a third of the entire event.

Board Chairman Offers His Favorite 2022 Achievements; Including A ‘Permanent’ CEO?

David Weinstein, the Lutron Vice President who serves as CEDIA’s Chairman of the Board opened up the Member Meeting. Reading from a script, he described what he said were his favorite accomplishments of 2022. These accomplishments were:

• Onboarding Daryl Friedman, a “permanent” global president and CEO of CEDIA, “who is listening to you and improving CEDIA’s value based on that input.” I find the use of the word “permanent” troubling. He may have just meant that Friedman is replacing the “interim Co-CEOs.”
• Created a new 3-year strategic plan, “that will take CEDIA and our industry to the next level.”
• Conducted two successful trade shows, ISE and CEDIA Expo, “both of which proved the indisputable point that nothing beats gathering together in person.”
• The current Board of Directors, Weinstein says, “is functioning in the most effective manner I’ve seen in my six years of Board service.” He adds, “[The Board is] focusing on the high-level strategies while supporting Daryl and Team CEDIA in their management of the company.”

Fielding Softballs from Partner Emerald Expo on Stage at CEDIA Expo

Weinstein then turns the meeting over to Friedman who introduces the next segment of the CEDIA Member Meeting. This consisted of a recorded replay of his CEDIA Expo interview with Jason Knott of Emerald Expositions, a CEDIA partner. Knott generously started the interview by congratulating Friedman on imbuing CEDIA with “a lot more energy behind the association.” Friedman responded to Knott by modestly suggesting there were always good things going on at CEDIA, and his goal is to help the organization better tell those stories.

Because this was an interview conducted on the Smart Stage at CEDIA Expo, Friedman often framed his answers in the context of the event where the interview was taking place. So, when Knott asked him what surprised him most since he joined the association, Friedman – an accomplished politician – talked about how collegial and collaborative the CEDIA community is.

A Collegial Community and New Strategic Plan

“You see that here at CEDIA Expo,” Friedman said, playing to the crowd. “I mean competitors are enjoying each other’s company and sharing information and knowledge. And so I really was pleasantly surprised to see that because that helps me determine what kind of mission [CEDIA should have] and how we’re going to provide value to that community.”

Knott then asked about CEDIA’s new strategic plan known by the acronym ACE – which stands for advocacy, connection, and education. Friedman took time to flesh out the thinking behind the acronym and the services that CEDIA will focus on. By the way, Friedman noted, “Connection is really about what you’re seeing here today – the Expo bringing people together.”

The Only Critical [Sort Of] Question Delivered Comfortably on a Soft Pillow

More questions followed on education and workforce development. The only sort of critical question Knott asked was on the issue of member engagement. But before he asked that question, he softened it by declaring that “every association – except maybe the American Trucking Association, doesn’t have high membership [engagement] levels, in terms of the percentage of the number of people…there’s just apathy.” He then further improbably adds, “…you find that in associations across all end industries.” Knott doesn’t indicate the source of his comments, which are ridiculously broad (i.e. “every association”) and seemed to be designed to try to let CEDIA – with its abysmally low member engagement – off the hook.

Then he asked the question, “What are you doing and what is the board doing to help kind of fight that apathetic nature?”

The answer? “I think by us telling the better story about what CEDIA is doing for all of us, people will be drawn to us.” I’ve shortened the answer a bit, but this is the essence of Friedman’s idea on how to build member engagement.

2022 CEDIA Member Meeting Financial Report – A Shortened, Data-Light, Confusing Narrative

From here the program turned to Alex Capecelatro, CEO of Josh.ai and Treasurer of CEDIA who introduced Kory Dickerson, CEDIA’s Senior VP of Finance and Operations. Dickerson, Capecelatro said, would provide “a glimpse” of the financial results through October 31, 2022.

Dickerson started his discussion by saying 2022 “has been a year of stabilization for the association.” And by stabilization, he meant as compared to the previous two years of COVID-19 in 2020 and 2021, which had resulted in “restrictions and limitations on travel and in-person events and other global issues. Like many businesses, these unforeseen changes brought with it significant reductions in our revenues.”

A ‘Significant Reduction in Revenues,’ But How Much?

That “significant reductions in our revenues” caught my attention and I waited to hear the numbers. Just how significant was that reduction in revenues? I mean…Dickerson’s our numbers guy…right? I expected spreadsheets, charts, and data. Dickerson would ultimately only show one chart – about declining investment income – and in general, gave very little hard or numerical data.

So he side-stepped identifying the revenue decline amount, choosing instead to continue with his prepared narrative. Sounding reassuring, Dickerson told members that program expenses were funded with “reserves” which probably refers to their endowment received from the sale of the CEDIA Expo to Emerald Expositions. He said, “CEDIA ended 2021 in a strong financial position, with net assets of $34.6 million as of December 31, 2021.”

CEDIA’s Biz Results are Starting to Improve Over ‘COVID’ Era; Words are Important

Now with the pandemic over and live, in-person events back up and running, CEDIA is back to a full slate of events including ISE, CEDIA Expo, and the regional (and global) Tech Summit events. And this means CEDIA’s business results are improving over the last two years and are expected to attain pre-pandemic levels in 2023. Again, no data to back up any of this narrative has been provided…weird.

But words, my friends, are important. For example, Dickerson told attendees of the CEDIA Member Meeting that “CEDIA just approved its first balanced budget, excluding portfolio returns, in six years for the upcoming year.” This means that CEDIA’s budget has NOT been balanced for the last six years, way beyond the last two COVID-19 pandemic years.

Shouldn’t They Explain This?

So a balanced budget is a good thing, which is why Dickerson mentioned it. But to me, the fact that for the last five or six years budgets haven’t been balanced seems like a development that I would like my association to explain. The only thing that Dickerson mentioned was, “Following the sale of CEDIA Expo in 2017, the association invested heavily in initiatives and priorities aligned to the updated strategy that was developed at the time.” There was no further explanation.

What were those investments? What were the benefits/detriments of those investments? What adjustments were made to balance the budget this year? What was done to get the association back on track to a balanced budget…and what lessons were learned?

Endowment Investment Losses

CEDIA sold the show to Emerald in 2017 for $36 million. The funds generated from that sale were used to create an endowment that the association invests to earn income. However, Dickerson tells us, “While the results from CEDIA’s core business improved this year, the investment portfolio is not immune to the overall market volatility. The market decline has resulted in larger than forecasted unrealized losses of $4.4 million through October 31.”

Dickerson then showed the only graph of his entire financial review – a graph provided so you would see that this result…a loss…matches a comparison to a benchmark. Dickerson said that CEDIA believes its portfolio is well-positioned to recover over the long run.

Wait a Minute, Net Assets Were What Again?

With that, Dickerson summed up his presentation. “CEDIA continues to be well capitalized with no debt and cash investment reserves over $11.4 million. Net assets as of October 31, 2022, were $29.3 million per our internal unaudited financial statements. Due to the timing of this recording, October 2022 is the most recent data available.”

Wait a minute! Net assets are what again? Remember, Dickerson told you that net assets at the end of 2021 were $34.6 million. But now, at the end of October 2022, he tells us they are down to $29.3 million. That’s a decline of -$5.3 million in ten months of a year that Dickerson called “…a year of stabilization.” I wonder about the reason why, with profitable shows throughout 2022, our net assets actually declined by millions of dollars in 2022. Don’t you?

Question and Answer Period

The question and answer period was conducted live where, up until now, most of the CEDIA Member Meeting has been pre-recorded. But although Friedman and members of his staff were live online, the questions had been previously submitted and it was clear that the answers were all scripted.

There was a range of questions including:

• Will CEDIA consider a new management conference as had been done in the past? (Yes, if they can get the numbers to work. Previously, it had not been profitable)
• Will you add more Tech Summit stops in the Midwest? (One is coming to Chicago soon)
• How can CEDIA get more media coverage? (“…we have been looking and trying to come up with creative ways to have the media more involved with what we do.”)
• Can the association work on providing more networking events for women (They are working on it)
• How can you raise more awareness in Latin America and Mexico? (Will provide “tools” for members to help outreach to architects, builders, etc.)
• When will there be in-person training in HQ or regionally (Coming soon in partnership with Powerhouse Alliance)
• Will there be Tech Summits in the Middle East (Yes)
• How can you do a better job of selling the organization to non-members to expand membership? (They have surveyed non-members and will increase outreach)

After the pre-submitted questions were dispatched, there was only enough time for one live question, which was a question about the dates of the schedule of training from Powerhouse Alliance – dates that will be publicized soon, according to Giles Sutton.

The Presentation Format Left Many Metrics Untouched;

That was it. Many metrics were left untouched. For example, it is common for the association to announce the membership levels, including the number lost and the number added (member retention and new members). It was near the end of the presentation when in answering a question, Friedman mentioned in passing that membership levels crossed the 4,000-member threshold “…for the first time in anyone’s recollection.”

Actually, that would be incorrect. The association reported a total of 4,092 members in 2017.

At the end of the day, it was a nice, feel-good presentation shining a very rosy light on the association. It was not nearly complete enough to qualify as a genuine report to members on the performance of their association.

But Wait, There Was One More Surprise for U.S. Members

Friedman had one more surprise for members attending the 2022 Member Meeting online presentation. The association is going to change the time – and the place – of the 2023 member meeting. He said it will become an in-person event held at the upcoming ISE show at the end of January.

Friedman explained, “…we’re doing this in the place and time where we have the largest number of members around the world gathered together…and that’s the ISE – Integrated Systems Europe.”

Less Than 3% of ISE Attendees

So only a few weeks after the 2022 Member Meeting, the 2023 version will be at ISE Europe, taking place January 31, 2023 – February 4, 2023, in Barcelona, Spain. This newly announced decision virtually ensures that there will be few, if any, there from the United States. According to ISE data, 31.5% of attendees come from Spain. No other country, in Europe or elsewhere, represents over 9% of attendees. Remember, CEDIA is a co-owner of ISE, so they certainly know these numbers.

The U.S. isn’t even listed in the top five countries from which attendees come. In fact, only 2.9% of ISE attendees to come from the United States. The reality is that there is not a large contingent of Americans that attend ISE.

How Different Can It Be Just One Month Later?

I’m not sure just how different their 2023 Annual Member Meeting in Barcelona will be considering that only a few weeks will have passed since the 2022 Annual Member Meeting in the U.S. But at least they should have the final 2022 financial numbers, so perhaps there will be some more data. That is, should they choose to share it with members.

For those members based in the U.S. (the majority of the association), not planning to attend ISE in person, Friedman noted that they will offer an online version. But CEDIA encourages members to travel to Barcelona to participate in the event live.

To learn more about CEDIA, visit cedia.net.