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The ROI and TCO of surveillance

Organisations spend a lot of money on their surveillance systems and want the assurance that their investment will not only deliver their requirements over the long-term, but that the costs over the life of the installation won’t escalate dramatically. With technology advancing rapidly, organisations need to consider the expected lifespan of a surveillance installation and how to make sure it gains a return on its investment while managing the long-term cost of ownership.

Neil Cameron.

Typical surveillance system longevity

Like any technology-based system, a CCTV solution will require an initial layout, with ongoing investment for maintenance and to ensure appropriate upgrades in identified high-risk areas.

A CCTV solution comprises the peripherals – the cameras and technology deployed in the field – and a server, the network recording system. The network recorder will need to be upgraded regularly as patches and OS upgrades are released.

As for the peripherals, the technologies used will determine the lifespan of the equipment. Newer IP cameras that are interoperable typically have a 10-year lifespan, but technology is advancing rapidly, which may prompt upgrades. In high-risk areas, for example, advanced features such as HD and 360-degree viewing, motion detection and intelligent learning algorithms can be highly beneficial.

Organisations looking to extend the longevity and optimise the performance of their systems need to ensure they have suitable maintenance agreements or service-level agreements (SLAs) in place.

Service-level agreements

SLAs are a key requirement in the implementation of any CCTV solution, helping to optimise performance and functionality. There are usually three phases that need to be taken into consideration: the initial installation; system refinement, which occurs as occupants move into a facility and identify their high-risk areas (e.g., the finance office, areas reserved for specialised personnel, or where high value assets are kept); and the system enhancements that are triggered when a breach or incident occurs. This last phase is reactive.

In order to effectively manage the costs of an SLA, service providers should build a proactive assessment of risk into the SLA. This will allow them to ensure they deploy suitable equipment for their client. For example, very specific approaches will be applied to manage access, protect the business from pilferage, protect assets and even protect the business from disgruntled employees.

This will enable the surveillance system to do what the organisation needs it to do in terms of managing risks, performing at a high level, and ensuring that costs remain predictable.

Let’s talk ROI

It’s easy to talk about a return on investment (ROI), but organisations need to be able to show their board of directors that the spend on surveillance is worth the money – it needs to be measurable.

In South Africa, crime is a reality and the threat to property, assets and people is tangible. Surveillance and security systems are an essential part of every responsible business. The ROI can be found in the form of protection against, prevention of, and early detection of threats.

However, surveillance equipment that is sufficiently advanced can also be used to directly add value to a business. With the right intelligence driving them, cameras can be used to identify specific behaviour and trigger alerts. For example, alerts can be triggered when queues in a retail store become too long, or the movement of customers in a store indicates preferences for certain goods, leading to the decision to stock them more often.

Surveillance as a service

Organisations not looking to make a heavy investment into infrastructure can look at subscription-based solutions, which offer the option to make security and surveillance an operational expenditure (OpEx) item.

In order to maximise the effectiveness of the solution, it will be critical to ensure that upgrades are part of the agreement. At a more advanced level, a software-as-a-service solution could also give the business access to solutions that may otherwise be too expensive to deploy. For example, access to a platform that integrates analytics, monitoring facility performance and systems, and alerting the right people if equipment fails or other anomalies occur; or integrates external intelligence, such as Twitter feeds, to provide real-time alerts of potential threats, such as strike action.

It is important to note, though, that when using a subscription service, organisations need to remain aware of the risk and ensure they keep their options open. By financing the security equipment separately, for example, and building SLAs and exit clauses into the subscription contract, the business is not tied to any one provider. At the same time, building a relationship with a security provider is important. Over time, a specialist provider will get to know the business, assisting it to identify risk and address it, applying the most suitable technologies – technologies that may well add considerable value to the business.

Risk and reward clauses based on the objectives of the customer can be built into the contract, incentivising the provider to perform well and add value to the business. As with any service provider contract, the business should ensure it is can quickly recover and remedy the situation in the case of the provider not delivering on the contract requirements or going out of business.

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