Volume 87

Volume 87 | December 23, 2024

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My Reflections on My Trip to Nedap's HQ: The Nedap Story, Not Just Security

Visiting Nedap was the perfect way to end my year—a company that has intrigued me for years. What sparked this intrigue? Initially, it was their branding, look, and feel. At every trade show—whether Intersec or The Security Event—their presence stands out: clean, clear, colorful, and distinctly Danish in design. My interest deepened when an industry friend joined their team, and as I met more Nedap Security employees, each one consistently impressed me. Their engagement in disruption-focused discussions caught my attention, too—they would attend our Thought Leadership Pavilions, engage with written posts on LinkedIn, and show genuine interest, which naturally drew me in further. As I learned more about their market perception, my curiosity grew because while the Nedap name was universally recognized, each region viewed them differently. In the U.S., they were known as "the long-range reader company"; in Europe, "the Dutch company like Genetec"; and in the Middle East, simply "Nedap."

When companies are around for a long time, their offerings evolve. They make strategic decisions about products, hiring, regional investment, and channel partners. Eventually, their story becomes what others perceive it to be. This reminds me of Gallagher Security, Brivo, STid, and others. While it fits the "you can call me whatever you want as long as you call me" mindset, I believe—and see some companies making efforts in this direction to correct it—that as our industry becomes more globally connected rather than regionally focused, product portfolio management, digital user experiences, brand management, storytelling, and cohesive marketing messages will become crucial. Credit where it's due: Genetec has done this well, as has Axis. These companies stand out because they've succeeded both in the market and online, where the real separation becomes apparent. But enough of my marketing talk—back to Nedap.

As I said, I was intrigued, so when the opportunity arose to visit their headquarters, I jumped on it—literally. Cramming into the last week of the working year wasn't kind to my body (overnight flight, land, do my routine, eat, and early morning flight back), but it proved excellent for the mind and soul.

I gained a comprehensive education in who they are, where they've been, where they're going, and the opportunities ahead of them. I am excited to share the following with you.

Picture of the original factory in Groenlo. Still standing BTW.

History and Culture Meets Design: Opportunity Abound.

Nedap (N.V. Nederlandsche Apparatenfabriek "Nedap") was founded in 1929 in the Netherlands by G Kraan and J K Schwarts (per the annual report of 1930). It started as a manufacturer of electrical equipment (bakelite plastics) and evolved into a company specializing in technological solutions, including security systems, RFID, and energy management.

Nedap was established during a period of industrial innovation and growth in the Netherlands. Over the years, the company has focused on innovation and adaptability, which has allowed it to remain relevant across many industries for nearly a century.

The company initially operated from the former Dutch Cocaine Factory in Amsterdam, producing various products for different clients. In the 1940s, Nedap began developing, producing, and marketing its own devices under the Nedap brand, achieving significant success. In 1947, the company relocated to Groenlo, Netherlands, where it opened a new factory and went public. They just celebrated their 95th anniversary, making them one of the oldest listed companies in the Netherlands. The company was listed on the Amsterdam Stock Exchange, now part of Euronext Amsterdam. This step marked a significant milestone in Nedap's growth, allowing it to access capital for further development and innovation. The event was also done because their founders were both tragically killed in Auschwitz. As a Jewish American I felt compelled to get this story out. I was fascinated by it and wanted to hear all the details.

Over the decades, Nedap evolved into a global specialist in electronics, transitioning from electromechanics to electronics and pioneering RFID technology in the early 1970s.

While the founders' personal stories are not extensively recorded, their legacy is evident in Nedap's enduring commitment to innovation and technology that enhances people's professional lives.

The logos over the years.

Here is a quick overview of key milestones over the decades.

Early Years (1929–1950s): Foundation and Innovation

Expansion into Security and RFID (1960s–1980s)

• 1960s: Introduced the first access control systems, marking an entry into physical security.

• 1970s: Early adoption of Radio Frequency Identification (RFID) technology for various applications.

• 1980s: Focused on expanding RFID capabilities in access control and livestock management.

Market Leadership and Diversification (1990s)

• 1990s: Became a leader in access control systems in Europe.

• Introduced new products in healthcare, such as parking systems and identification solutions.

• Continued investment in R&D for RFID and IoT (Internet of Things) applications.

Global Expansion and IoT Solutions (2000s)

• 2000s: Entered global markets focusing on advanced security and RFID-based solutions.

• Expanded offerings to include retail loss prevention and supply chain management.

• Pioneered IoT integrations to enhance real-time data collection and analysis.

Focus on Vertical Markets (2010s)

• Shifted strategy to prioritize vertical market solutions, such as:

  • Retail: Anti-theft and inventory visibility solutions.

  • Healthcare: Automated dispensing systems.

  • Security: Advanced access control and visitor management.

• Enhanced partnerships with global distributors and integrators.

Technological Innovation and Sustainability (2020s)

• Embraced sustainability in operations and products, aligning with global ESG goals.

• Leveraged AI and advanced data analytics in security and retail solutions.

• 2020–Present: Focused on software-driven solutions, with continuous innovation in access control (AEOS platform) and other key verticals.

• Expanded market presence in North America and Asia-Pacific.

Through technological innovation and focus on specific vertical markets, Nedap has steadily expanded its reach and capabilities. In recent years, the company has emphasized sustainability initiatives and software-driven solutions, positioning itself for growth in the 2020s and beyond. This evolution is particularly relevant as we enter what I believe is the dawn of enterprise software in our industry.

Nedap is well-positioned to join other "transformed" companies capitalizing on a $100B opportunity—one that goes beyond safety and security to deliver operational efficiency, revenue generation, and delightful user experiences. I'll explain more about this below.

A picture of the campus courtyard.

Groenlo & “That” Office

Nestled in the historic town of Groenlo in eastern Netherlands, about 2.5 hours from Amsterdam, Nedap's headquarters reflects the region's rich heritage and the company's forward-thinking approach. Groenlo, with its well-preserved fortifications and canals dating back to the Eighty Years' War, provides a picturesque setting for this modern enterprise. The town of 10,000 residents combines historic charm with contemporary amenities, including the legacy of the famous Grolsch brewery. As the area's largest employer, Nedap benefits from the region's attractive cost of living, proximity to a university, and growing suburban population.

The company's headquarters is a testament to innovative architectural design, seamlessly blending with the countryside landscape. The building's striking facade combines warm wood elements with contemporary concrete, creating an impressive first impression. The campus layout brilliantly reflects Nedap's organizational structure through four distinct wings housing their core businesses: Security, Healthcare, Retail, and Livestock Management, with central administrative functions occupying the heart of the building.

Each division's space has been thoughtfully designed to embody its unique identity while maintaining cohesion with the overall aesthetic. The Retail wing features sleek metals and bold purple accents, while Healthcare incorporates active elements like a climbing wall. The Livestock Management area includes agricultural touches like life-sized cows, and the Security wing maintains a professional atmosphere with its neutral palette, product labs, and collaboration spaces. Despite the significant commute for many employees, the campus provides all necessary amenities, including an exceptional full-service restaurant, making it a truly great place to work (plus fresh fruit, tea, and coffee service - like real coffee - you come to expect at most European offices).

The facility is a remarkable example of how architectural design can support corporate culture and functionality. It's a destination worth visiting for anyone interested in how thoughtful design can enhance organizational effectiveness.

Analysis & Market Opportunities

Nedap represents a fascinating convergence of technologies and capabilities. Imagine combining Gallagher's enterprise security solutions, STid's innovative RFID technology, and Invue's retail expertise into one cohesive platform. But that is it right there…it needs to be combined (more on that below). The company shows both forward-thinking elements (particularly in software and vertical market focus) and areas for modernization (such as proprietary hardware strategy and nuts and bolts like OSDP adoption).

What makes Nedap particularly interesting is its potential to lead the access control industry (and the broader security sector) through an "inside/out vertical integration" approach. While traditional access control focuses on securing building perimeters or exterior doors (outside / in), the future lies in leveraging access control systems for operational efficiency and revenue generation within spaces (inside / out). This shift is crucial as customers increasingly seek integrated solutions where access control becomes a feature within larger operational platforms - think point of sale systems, WiFi management, HR/employee lifecycle, or desk reservation software.

Nedap is nicely (not uniquely, but well ahead) positioned to capitalize on this change in the market. By integrating their medical software/relationships/install base/expertise or retail RFID systems/relationships/install base/expertise with access control, supported by strong branding and marketing, they could create a compelling ecosystem that would be so far up the funnel and unlikely unbundled that they could own those verticals. This approach could transform their security channel strategy, introducing new types of system integrators and speaking to different decision-makers. Most importantly, it would shift focus from hardware and access control software (from onsite to cloud as their evolution) to identity management with all the bells and whistles, potentially disrupting traditional hardware-centric business models, the market, and themselves (in a great way - that is part of their story over the 95 years. They have always adapted and now is another one of those times).

The company has many of the necessary pieces in place. While their access control system needs more modernization, recent product announcements suggest they're moving in the right direction. Their primary needs are:

• A comprehensive strategy to bundle their solutions effectively

• Willingness to invest in new marketing & messaging and new channel development - globally

• Focus on vertical-specific systems, particularly in Healthcare and retail

Two cultural aspects that stand out and make them a bit different are what they call "soft power" and also "the Dutch way." I heard "soft power" used by a handful of people throughout the day. What they mean by "soft power" is how they culturally embrace empowerment. Their team is empowered to do what is needed to get the job done. Whether that is how they handle their days off, where they work, how they work as a division (hence the design), or the roadmap, there is a clear understanding handed down by the leadership team on what needs to get done and an empowerment structure that supports them doing what's required to get that job done. I then heard and saw the second cultural aspect: "the Dutch way." During multiple sessions where I provided my thoughts and feedback, I was reminded that the Dutch just want the straightforward truth. As someone who is usually not lost when it comes to doing just that, even my hesitancy to being brutally honest when I was not impressed by something or thought they could go further was met with, "Lee, we are Dutch; just tell us." This brutal straightforwardness with nuanced respect in how to deliver it and receive it (and get it back) has and will continue to help them immensely as they evolve the business from where it is today to what is ahead.

Beyond the opportunity in how they go to market is a juggernaut market opportunity in where they go to market. The North American market represents a significant growth opportunity. Despite having a 40-person team and relationships with major brands like H&M and Under Armour, Nedap's security presence remains limited, primarily known for long-range readers (by now, if you've read this far, you know they are much more). Expanding in North America would require substantial investment. Still, the potential returns are compelling enough to do it (without overanalyzing it and buying all the terrible market reports on the market. It's not a secret. The North American market is open and fruitful). Companies like iLOQ and Gallagher Security have demonstrated that European and even APAC firms can successfully penetrate the U.S. market, especially as traditional barriers diminish in our increasingly globalized marketplace and companies specialize first and expand when they land.

Success will require difficult strategic decisions - potentially discontinuing certain product lines, accepting short-term growth impacts, forming unexpected partnerships, or reorganizing divisions. However, these changes could position Nedap for another successful 95 years of innovation.

The foundation is there. The question is whether Nedap will take the bold steps necessary to realize its potential in an evolving access control and broader security landscape. Given the market's appetite for integrated solutions, I'm optimistic about its prospects, but it has to commit to this transformation. Will it? It will be fun to watch and see.

I recognize that the last paragraph sounds familiar to those of you who have read some of these Briefs this year after I visit with a company. The truth is, I think the reason for that is twofold. I believe many of these companies are in the midst of transformation and have me visit them to discuss the opportunities before them and pressure test their evolving strategies and assumptions. I also believe it's a trend and also because of me. I believe you are seeing my honest observation and desire to see these companies make the necessary changes to capture the $100B opportunity. I lean more positive that people will make the changes or more; I hope they do, so maybe I am trying to will it to happen, but I also recognize I have no control over who does and who doesn't. What I know I control is the stories I tell and how I frame them up against the inevitable opportunities any and all companies can get - if they want to. So, there is an observation of a trend. Many companies are at the crossroads of today and tomorrow, and many just need to start with the desire and action to do something about it. But what is also true is the need to do it now. Every day that goes by is another day of wasted opportunity, and at some point, if you do not act, you will be left behind. No matter how long a history you have or what has happened over the past 30 years. The next has nothing to do with the past.

Thank you to everyone at Nedap who welcomed me to your home and to everyone who helped put it together. I look forward to the next opportunity to connect and, even more, burgundy sweaters 😀. IYKYK