The profit motive in security

July 2015 Security Services & Risk Management

One of the problems the security industry faces regularly is the fact that most people view it as a grudge purchase. You buy it because you have to have it, not because you want it or because it adds any value.

This perception, that security adds no value, often leads to companies buying their security systems based on price. Cheap is in and quality and performance suffers.

However, as technology has advanced, this perception is changing as people realise there is more to a security system than merely making it difficult to enter a premises or capturing grainy video footage of people on their smoke break. Today, proper security solutions can have a direct impact on business processes as well as on the bottom line.

John Powell, MD of Powell Tronics, says there are various ways in which security technology can add value to a business. At a basic level, installing an effective security system will reduce the opportunity for theft as well as gain you a lower insurance rate – although the rate may be dependent on a well-constructed security system and not the cheapest one out there.

In markets such as the retail or hospitality industry, a return on investment (ROI) from security implementations is also possible. With effective security in place, patrons will feel more comfortable coming to the store, mall or entertainment venue, knowing it is better protected than a competitor’s location. That delivers direct bottom line benefits.

Measurable returns

These returns are what Powell calls 'no brainers' as they are easy to achieve. However, more can be done. Using biometric clocking systems, for example, companies can obtain an ROI simply by making sure they only pay their workers for the actual time they have worked. This avoids buddy clocking or manipulating manual timesheets.

When you extend this to a full time and attendance (T&A) solution, Powell says this is the easiest way to calculate a real ROI. For example, if a company employs 100 staff and a T&A system saves 5 minutes per day for each employee, that means over 160 hours the company would have paid for that it now retains. Put another way, that is just over 20 days of 8-hour workdays that company doesn’t have to pay for (conservatively calculating a workday as 8 hours and a month being 20 working days).

This type of solution saves money from day one and pays for itself in no time. More sophisticated systems offer additional value-adding capabilities such as replenishing time and avoiding smaller overtime payments when staff leave a few minutes late every day after a chat with friends or doing something other than work.

When you get to full workforce management (WFM) systems, companies benefit even more. These systems assist managers in planning their workforce allocation based on employee grades. Powell offers a simple example in nursing.

A shift may require five nurses, one senior nurse and four juniors. The WFM system will warn a manager that he has assigned more than one senior nurse to the shift, which will cost more than only having one supported by four juniors. The manager will immediately be able to see that assigning the correct grades to the shift will save a certain amount of money.

Powell says examples like these abound in the business world, as long as customers make use of experienced service providers who can explain the additional value available from what was traditionally just a security system.

Financial sense

Dave Casey, CEO of RCN, tells a similar story, but he has security systems adding value in the financial industry. He says the most common manner of gaining an ROI from security systems is by using transaction details as video indexing data. Any reference can be used as an index, be it a barcode, RFID tag etc. Therefore, if a manager wants to query a transaction or some activity, they simply enter the relevant data and are taken directly to the video footage of that activity.

This process is also finding more acceptance in the retail market, as it allows companies to query a cashier’s transaction and immediately see the associated video footage of what happened. If a teller seems to be scanning too many loaves of bread in one day, the video linked to the transaction can easily determine that the wrong barcode is being scanned so that associates of the particular teller can walk off with expensive goods for almost nothing.

To the watchful eye of security officers and retail managers, the transactions look fine, but by linking them to a video stream, the fraud becomes obvious.

Casey says that security systems used in situations like this are no longer grudge purchases, they are seen as support tool for the business due to the value they add in day-to-day operations. For instance, in the example above, the video footage can assist with dispute resolution, whether internally with employees, or externally when customers make claims the video does not support.

There are other industries where similar integration can also add value. In the logistics business, for example, tracking and tracing goods can become an automated task instead of having someone sift through a paper trail. Should an item go missing, it is a simple task to track it according to the indexing data (barcodes, RFID etc.) from when it arrives to when it is no longer there. Business now has sight of its goods throughout the business cycle.

While integrating security systems into business processes can be accomplished by barcodes or RFID tags, Casey sees some companies using specialised software developed specifically for a solution. Casey adds that it often takes a specialist to develop the software required for disparate systems not designed with this type of collaboration in mind – which often means developing the drivers required to integrate the different systems.

These are only simple examples of how security technology is being used to add value to business processes. By providing value to beyond the ‘grudge purchase’ attitude, companies are leaping ahead of competitors, integrating the data they already have to increase the efficiency of their business processes, thereby impacting the bottom line.

For more information contact: John Powell, Powell Tronics, 0861 787 2537, [email protected], or Dave Casey, RCN, +27 (0)11 476 2502, [email protected]

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