The threat of a long term economic downturn means a few things to electronic system integrators like IDtek Solutions.
According to official crime figures in the United Kingdom, last year domestic burglaries were up 4% and fraud and forgery were up 16%. Where this becomes relevant is that the Home Office’s statistical bulletin for July to September 2008 showed a nudging upwards in the levels of property crime compared with the summer of 2007, and that Government is linking to the recent economic downturn.
“Our modelling indicates that an economic downturn would place significant upward pressure on acquisitive crime and therefore overall crime figures,” wrote Jacqui Smith in a memo to Gordon Brown, which was leaked late last year.
According to Reuters, police chiefs in the United States say the economic downturn is fuelling a rise in crime and warn that cuts to their budgets could handcuff their efforts to tackle it.
Some private sector participants are following suit in tightening their budget despite an anticipated increase in crime. However, as a whole the electronic security industry continues to grow steadily at about 7% annually. (6 October, 2008 – Security Surveillance Blog.)
This growth in the security industry has been fuelled by many factors including crime and perceived threats and also by new innovations in security technology.
In the past year, IDtek has boosted its staff levels by 50%. IDtek managing director Julian Thorrold believes that security threats are up and the company wants to align its business so as to 'serve customers better'. He said the company has hired across the board with staff taking up roles in sales, project management and in the technical division.
“We have completed our hiring process and we have made sure that we are placed well for 2009/2010. In addition we have new resources to look into new areas of our business with our customers.”
However, Thorrold refers back to the history of the electronic security industry to contextualise where IDtek is headed. “In South Africa as much as abroad the need for electronic security protection is enormous. We encounter new entrants into our industry on a weekly basis. Newcomers are attracted by the potential to make a quick return on new installations. The industry has shown few barriers to entry and plenty of unsuspecting clients.
Once these newcomers get to completion of their first project they become financially pressurised and do as much or as little as it takes to get paid. Then true to form they immediately become attracted to the zeros of next project. Suddenly Client 1 calls for support. Decisive moment – do they suspend their current project to go back to Client 1 on a call-out – which the client will no doubt refuse to pay since the system has only recently been installed? Or rather do they continue with their efforts in trying to deliver on their current project with all of its reward? The answer is simple. Unless Client 1 has some sort of leverage they do not return to offer post installation support.
Amongst these short term operators you find the odd exception. One such company is IDtek. IDtek focuses on becoming a solution partner over time with an honest approach that has a different end objective. Delivering on a clearly defined project with proven technology from reliable suppliers becomes but the first step in the client relationship. Through offering proper testing, snagging, commissioning, documentation and training hopefully the client or the relevant consulting engineer is impressed enough to offer a service level partnership with ongoing reciprocal benefits. These are: (a) for the client – protection of their investment with proper post installation support and (b) for IDtek – an annuity revenue stream which brings with it financial stability.
So ironically, while a recession could potentially mean that more security projects may surface; in fact what will happen is that more opportunistic contractors will enter the market. This does not bode well for the industry as a whole.
In this recessionary environment IDtek has not responded with a change in focus by frantically undercutting price to secure the next best project with the next best technology while leaving a pathway of dissatisfaction. Instead IDtek continues to focus on better ways to manage each project from design through to completion so that it potentially brings with it a client who will partner with the company for the long term.
For information contact Julian Thorrold, IDtek Solutions, +27 (0)11 706 0101, julian@idtek.co.za
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