There has been a tendency in certain quarters to ‘rubbish’ the performance of the manned security sector. However, these criticisms rarely suggest solutions for the economic factors that lie at the heart of most of the difficulties facing the sector. It is these that have the major impact on operational standards and working conditions – not any lack of desire to improve, or problems with current inspection systems.
Before considering the major factors contributing to the current state of play, let us not forget the thousands of contract hours that are regularly worked by security officers, much to the satisfaction of customers.
Not only that, many officers regularly discharge their duties with great distinction, bringing credit to themselves, their employers and their customers.
Combating the threats
The manned guarding industry has witnessed a phenomenal rate of growth over the last 20 years or so, as society in general has taken greater steps to protect its people and property. Growth has come in an environment where the perception is that the threat to personal safety and property has increased dramatically due to the side-effects of influences such as community deprivation, drug-inspired crime and terrorism.
We live in a commercial world where all individuals and organisations want the "biggest return for their bucks". As with all societies, pecking orders evolve and it’s those with the most muscle that achieve the "biggest return for the buck" and are able to extract ‘cost-effective terms’ (a euphemism for rock bottom prices) out of their suppliers.
This propensity is magnified many times over where the supplier’s goods or services are not perceived to be directly involved in the end user’s own business activities.
We have to acknowledge that manned guarding is currently a commodity service, with barriers to entry being extremely low. The result is that the number of suppliers within this sector has proliferated at an alarming rate, creating massive over-capacity and thereby strengthening purchasers’ ability to force prices down even further.
The manned guarding industry has allowed itself to be bullied into accepting ridiculously low prices under the misguided notion that it’s acting in the true spirit of competitiveness. In reality, it is doing nothing of the sort.
The Competition Act was not designed to restrict pay to the basic minimum wage for those working within manpower-oriented industries. In addition, current trend towards open-book accounting, where clients can see a breakdown of costs – including the rates paid to officers – often encourages customers to chip away at these rates still further.
This acquiescence to the lowest common denominator represents an artificial suppression of prices that is the root cause of many of the industry’s ills. Thus we have the classic, vicious downward spiral where, to stay in the game, guarding companies must search for every opportunity to cut their costs even further if they are to safeguard existing contracts and win new business.
Manned guarding is a labour intensive industry. Thus the only way a supplier can begin to match customer expectation during a tender exercise is by looking at the workforce’s pay rates and other employment terms and conditions – and cutting them back.
If that’s not enough, they will be forced to cut back on the number of security officers or hours assigned to a contract, and/or the supporting supervisory and management resources.
As a consequence of these factors, manned guarding providers experience a business churn rate of between 15-25% per annum. Since security officers either leave the industry for good or feel compelled to move from one employer to another to secure the best hourly rate possible, average staff turnover is in excess of 75% per annum.
Thus all components that constitute the workings of this industry conspire against the creation of a stable workforce. In spite of the fact that, in the manned guarding industry, a stable workforce has to be the sine qua non of a quality service. Anyone who sees this differently is living in cloud cuckoo land.
A strategic vision
In the past, with the scramble for growth in turnover, industry leaders – and I take my share of the responsibility in this – have lost their way in terms of a strategic vision for this sector. They must reappraise this issue of volume business and avoid being ‘busy fools’ at all costs. By allowing itself to be governed by the lowest common denominator on a range of issues, the industry must hold itself as responsible as any other factor for creating the highly fragmented market we have today, and with it the accompanying spectre of extremely low margins, which has made sustained reinvestment in standards and systems almost impossible.
In terms of the way forward, there is an enormous amount of work to be done. Our problems will not be solved merely because the industry is to be regulated. Nor will the situation be improved by any inspection process alone, least of all by ‘independent auditors’ observing sites in the early hours of the morning on behalf of the end user under the simplistic notion that this is the panacea for all the industry’s ills.
The problem will go some way to being solved when the industry itself decides to stop chasing volume at any price, and to pay its security officers rates of pay that are in line with a whole raft of other comparable industry rates.
The state of play will improve dramatically when the industry insists that its customers agree to optimum levels of supervision and contract management, and charges realistic prices to cover all these costs adequately.
If the manned guarding industry is to take a quantum leap forward, suppliers and customers must understand that it will come at a cost – within or outside a formally regulated environment.
