Talking Heads
A bout of fascinating acquisitions has propelled Federal Signal Technologies, a new name in the ITS sector, to the forefront of the industry – especially in terms of press coverage. Eager not to miss out on a slice of the FST cake, Thinking Highways dispatched Harold Worrall to Irvine, California to catch up with his long-time friend Manfred Rietsch, the new company’s group president.
During the first six months of 2010 Federal Signal Corporation quietly and deliberately implemented the strategic acquisition of several of the world's top Intelligent Transportation System (ITS) technology companies.
| The move caught many in the industry by surprise with existing and potential clients wondering how the new company, Federal Signal Technologies, would benefit them. Industry observers are receiving the newly formed company with enthusiasm noting the critical mass of divergent, yet complimentary technologies and the fact that an open architecture is being promised by the new entity.
Manfred Rietsch is the man at the helm of the new company. Riestch knows ITS and he knows leadership. A retired, decorated US Marine colonel and jet fighter pilot, in 2000 he founded VESystems, Inc and quickly grew it to become one of the premier electronic toll collection system solution providers in the world. A well-known and friendly face in the ITS and tolling industries, Rietsch is softly spoken, jovial and direct. He is laser focused on building an open but profitable company which offers new approaches to road user charging and ITS in general.
Thinking Highways recently had a chance to sit down and speak with Rietsch to talk about his approach and what the formation of Federal Signal Technologies means to the industry.
A lot has happened in Manfred's world recently and it's created something of a buzz in the ITS community. So, to coin a phrase, let's begin at the beginning.
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Federal Signal Technologies group president Manfred Rietsch |
You and your firm were purchased by Federal Signal Corporation which means the vision for the new company came before you did, so how did it all start?
“There is one key individual at the center of this and he is Bill Osborne, the Chief Executive Officer of the parent company – Federal Signal Corporation. Bill joined Federal Signal in 2008 having come from the automobile industry serving in senior leadership positions with Ford, General Motors, and Chrysler. As Bill surveyed the transportation landscape and evaluated the future of Federal Signal Corporation, he saw a tremendous opportunity to do something revolutionary in the industry....something that would bring new value to clients and would benefit the lives of their customers. He saw several parallel industries that were in differing stages of maturity, each building on what they knew but not seizing on the common threads they all possessed. He, and his leadership team, knew of the right entities from these industries could be brought together the sum total would be much more powerful that the parts.”
“So Federal Signal Corporation developed a well thought out strategic plan that called for identifying those firms in the ITS, tolling, parking and public safety industries which were the technological leaders in their fields, and through acquisition create a new subsidiary company within Federal Signal Corporation that would serve as the platform for revolutionizing the industry. Though the approach is built on existing technologies, the over all strategy will be to give the client those hardware and software components they desire or a complete solution that is thoroughly understood by the client. The intellectual property of the client's fundamental business processes is not usurped into a complete solution owned by the integrator.”
“I'm really pleased VESystems, Inc. was the system integrator and back office firm that stood out from the crowd within the tolling industry, and I'm even more pleased that Bill Osborne and the Federal leadership team chose me to lead the Federal Signal Technologies team which will be providing these innovative solutions to the market.”
A revolution in the offering
You said that the new company will be revolutionary within the industries you identified. What do you mean by that? Also, which companies have been acquired and how will they differ from how they were before the acquisition?
“The new Federal Signal Technologies (FST) is made up of five companies which were strategically chosen to improve the efficiency of the public transportation system and the safety of the travelling public. The firms that were ed were Diamond Consulting Services (Idris), Sirit, VESystems, PIPS Technology UK & USA, and Federal Automatic Parking Division (FAPD). All the individual units are the best in class and their company purposes, ethos and suite of product offerings fitted extraordinarily well together and are complimentary to each other.”
“Let me elaborate on this point a bit further. When viewed as individual companies, it is easy to focus only on their unique missions and not see the potential synergies of their products and research and development. Here's and example that may help drive this point home. Go back as little as 10 years and consider personal computers and cell phones. Each technology was cutting edge at the time and each served a different purpose. Look at where we are in 2010; the two technologies have virtually melded into one. Cell phones are now communication devices that have enormous computing power and personal computers have vast communication capabilities. This is a great example of two industries that are cross-pollinating with the result being more flexible and powerful products emerging. This synergy greatly benefits both sets of customers.”
These synergies already exist in the intelligent transportation and public safety industries.
Exactly, and by cross-pollinating technologies and investing in advanced research and design, the companies that have been brought together under the Federal Signal Technologies umbrella will serve as an incubator of technology and will create new and more powerful applications which will better serve their shared customers.”
Can you share with us any of these new synergies, particularly those that you see as being for ITS and public safety?
“I won't be too specific on this point at the moment but the basic philosophy of continuing to offer component technology solutions to clients and the private sector will see us working to combine these technologies into new solutions reaching across many market segments. We will continue to sell Idris products through their technology partners at the same time that we consider technological synergies like developing a PIPS camera that carries some of the Idris lane controller functions in the camera itself. This combined product offers new approaches in High Occupancy Toll (HOT) and other open road tolling deployments. We will publish the interfaces to our product software so other integrators and technology companies can integrate our products to create better solutions for the marketplace. This gives us the ultimate client options on how they proceed.”
Needs must
Manfred, we've talked a great deal about technology and the future; let's focus for a moment on the needs of the customers of the five core companies. What will change for them with the emergence of the new Federal Signal Technologies division? How will they do business with the company and what will change for them?
“First, let's discuss how they will do business with the new company. The answer is simple, they will continue to be served as they were served prior to the acquisitions. That is, of course, unless they desire to make and change and help us understand how we might serve them better. Meeting and exceeding our customers' needs are our most important concerns. Federal Signal Technologies is absolutely committed to ensuring the current transition does not adversely affect any of our existing customers. We are very pleased to continue to provide our customers with absolute continuity in our services.”
“As we move forward in bringing the individual operational units together, FST will look for operational ways to improve our customer interfaces and find ways to make doing business with us easier, more efficient, and more beneficial to customers. The real “value-added” plus will be in the technology break-throughs and new applications that will result from the new FST platform. We will make certain our customers are the first ones to benefit from our progress and that they have the first opportunities to implement the technology advancements that are created”
So can we discuss for a moment some of the key products Federal Signal Technologies offers to the marketplace?
“Absolutely! FST truly provides products that cover the full spectrum of intelligent transportation systems. The five operational units – Idris, Sirit, VESystems, PIPS Technology and FAPD – offer products which cover all aspects of electronic toll collection, vehicle communication technologies, key elements of roadside communication as well as fundamental parking, safety and security technologies. The combination of VESystems' complete system operations, Sirit's Radio Frequency Identification (RFID) applications linked with Idris detection and classification software and existing PIPS automated license plate recognition technology, immediately transforms the value of the ITS offerings made by FST.”
A complete picture
Looking into the future plans of Federal Signal Technologies, will more companies be added to the fold? Are there any missing technology pieces that could enhance the new divisional jigsaw?
“I believe that Federal Signal Technologies has brought together the “all-stars” of the industry. The firms, and the people that work there – are the recognized leaders in their industries.”
“I also believe that the FST technology platform is comprehensive and will enable the firm to successfully deliver on its potential to serve the entire ITS Industry. What we must keep in mind though is that we operate in a technology continuum, meaning our technologies are evolving at ever-increasing rates and in order to remain relevant and deliver on our potential we must be willing to reinvent ourselves when appropriate. For now, FST has all of the pieces it needs to be the overall leader in our industries, but we will remain vigilant and evolve as needs must to stay at the top.”
“Personally, I am very excited to be leading the FST effort and to be working with such excellent professionals within our company. FST is going to do great things in the future that will benefit our customers and the public”
For more information please visit www.federalsignal.com or contact Manfred Rietsch via email at manfredrietsch@vesllc.com
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