David Taylor-Smith loves a challenge. Just as well, really, because the 45-year-old chief executive officer with overall responsibility for Group 4 Securicor’s (G4S) Security Services and Systems functions in the UK and Ireland is now heavily embroiled with making fundamental changes to the company’s business operations.
Come the end of 2006, the physical and logistical merger of Group 4 Falck with Securicor – set in motion by Nick Buckles and Lars Norby Johansen (‘Two’s company’, SMT, March 2005, pp20-23) – had been hailed a success. Share prices had doubled, and all the objectives boxes were ticked. Where to next?
“We decided that the company needed to enter an enhanced growth phase,” states Taylor-Smith at the beginning of our discussion in the Boardroom at Group 4 Securicor’s beautifully quaint Carlos Place offices in London’s West End. “Given their size and state of development, it no longer made sense to run our UK businesses as separate entities. David Beaton was in charge of Security Services, for example, and I ran Justice Services, but we came to the conclusion that it would be better to combine everything into one market-facing UK and Ireland operation.”
According to Taylor-Smith, his promotion last December to head up this ‘new’ business was a “logical progression” engendered by “sound succession planning”. Under his direct control now lie the UK Security Services, Justice Services, Aviation Security and Electronic Security businesses. On top of that, there’s the Channel Islands and Isle of Man operations, the Security Services business in Ireland and Justice Services in the USA and Canada. That little lot represents a near GB pound 600 million turnover concern employing over 20,000 staff.
A challenging remit to say the very least, but Taylor-Smith is undaunted. In fact, he’s the epitome of calm – then you discover why he’s so bullish. “The Justice Services business had grown well under my tenure,” explains Taylor-Smith. Something of an understatement, it must be said. In truth, it was one of the star performers in the Group, more than doubling in profits and growth between 2002 and 2006 – and all thanks to strong organic development and sound management.
Concentrating on strategy streams
Taylor-Smith – a physical geography graduate who studied at the University of Southampton – then digs down into the essentials of the changes he’s now making, and why.
“Security guarding is most definitely an important base point for us. In terms of our own operational service delivery, this part of the business is now better than it has ever been. We are retaining over 95% of our clients. I don’t think you’ll find a more efficiently run security guarding company in Britain.”
However, for Taylor-Smith there’s a catch. “Do we find the security guarding market compellingly attractive? No. We don’t. It has been subject to price competition and low barriers to entry. Security Industry Authority regulation is excellent, and we are fully supportive of it, but this merely brings the industry up to a standard we had attained.”
Having teed up the story, he then reveals his hand. “We have identified strategy streams we are going to concentrate on based upon customer-led growth,” asserts this long-time Fellow of the Royal Geographical Society. “The basic aim is to grab a greater percentage of the outsourced secure support services spend. We also want to drive market segment-led growth. Our Justice Services business is a market segment, so too the Aviation Security operation. That’s why the business as a whole is now organised along market segments and customer needs. We are also looking for further security and Secure FM capability acquisitions.”
At my request, Taylor-Smith delves deeper into his plans. “I would like us to tackle three or four big themes that are emerging. For a start, I want greater exposure for us when it comes to public sector contracts. Then there’s the whole area of critical national infrastructure protection. In France, most of their critical areas are looked after by the public sector. In the UK it’s a different story. We have one of the most diversified ownerships of such infrastructure in the world.”
Group 4 Securicor’s UK operation, of course, manages private prisons, immigrant detainee escorting, security at party political conferences and major sporting events in addition to protecting many key installations. “We are already managing a portion of the critical national infrastructure that’s under private and public ownership,” adds Taylor-Smith. “It’s obvious when you look at current threats to the UK’s national security they demand a far more coherent approach to national security. We’d very much like to be at the forefront of that.”
Our Civil Nuclear Constabulary is a specialised force of over 650 police officers and personnel tasked with protecting civil nuclear sites and materials. “Who independently tests them, though?” queries Taylor-Smith. “Who ensures that they are doing an adequate job, and that they’re fit for purpose?” In the US, Group 4 Securicor is involved in security operations at around 50% of all civil nuclear sites. Other providers (and State personnel) are in the security mix, too .
“The vital point is that we can work in partnership with the public sector and provide testing and compliance programmes designed to improve security at these locations,” adds Taylor-Smith. “I can see that model being applied at critical transport hubs and power stations, too. We want to increase our exposure to what I would call this kind of Secure Facilities Management (FM) business. Don’t be surprised if you see us involved in a more diverse range of activities from now on, but security will always be at the core of what we do.”
Towards an holistic offering
Listening to what Taylor-Smith has to say, it immediately struck me that a conscious decision has been made to distance Group 4 Securicor from being seen purely as a security guarding company. It now seems to be more about holistic security services and solutions.
“You’re right,” affirms Taylor-Smith. “We’ll be making some ‘capability’ acquisitions. These will be around specific market sectors. We might buy-in some rail, event, maritime or aviation support services operations that enable us to offer total FM services in secure environments. What you will not see is Group 4 Securicor becoming a bundler of services in any non-secure environments.”
It’s pretty clear that Taylor-Smith isn’t enamoured of the MITIE-style model, then. He realises that it’s a pretty sure-fire way of increasing turnover, but he’s not a big fan. “If you look at the players who have gone down this road, the evidence suggests that many have diluted their profit margins and expertise, not improved on them.”
Sticking to his doctrine is going to mean that Taylor-Smith will now have to employ individuals of a different ilk to those of yesteryear. “We are already on to that,” he asserts. “Look at the Justice Services business. We now have people in there that can run prisons, people who can design things, people who can project manage, people who are capable in large scale project finance and those who are comfortable working in consortiums.”
Interestingly, it emerges later on in our conversation that Taylor-Smith is adamant Group 4 Securicor should be engaged in sector-led consultancy. They may look to buy a small security consultancy in a particular market sector – for example maritime – or invest in a more general consultancy. “Having such a service at our disposal will help us move into new areas of Government,” continues Taylor-Smith. “We can then ascend the value chain still further with existing customers. It will complete our portfolio.”
Two years on from Security Management Today’s (SMT) aforementioned exclusive interview with Buckles and Norby Johansen, values and culture still sit centre stage in defining how the company operates. Taylor-Smith is a massive supporter of their ideals.
“The values and cultural merger that has taken place post-Group 4 and Securicor joining forces is still ‘work in progress’. If you are undergoing such a procedure in the right manner it never has an end. The more you do, the more you realise you need to do. It is a subject matter we have spent a great deal of time working on, at the country, corporate and product levels. If we don’t have the buy-in for our values and culture, what’s the point of us being the biggest security company in the world? We operate in many countries and employ almost 500,000 people. It’s the common culture and values we all share that binds us together.”
Making of the man
Taylor-Smith was born in Winchester and raised in England, Scotland and Canada. One of five boys, his father was an army officer and his mother an actress. He learned early on how to survive. “If you want to be heard you have to be sometimes noisy, sometimes dextrous. At the dinner table, those of us who had the strongest voices had the most to eat – and to say!”
Taylor-Smith loved being a team player and ended up as Head Boy of his school. That team ethic expanded at university, where he was elected to President of the Students’ Union. At the ripe old age of 21, he found himself in charge of 8,000 students and a budget of “several million pounds” residing with the University’s Council. Taylor-Smith represented a broad church of interests, which proved invaluable when learning to chair meetings “in a consensually dictatorial manner”.
Post-university, Taylor-Smith turned down job offers from several blue chip corporations in favour of joining the army on a short service commission, operating in a tank regiment with the Royal Dragoon Guards. Having served in England, Germany and Northern Ireland, Taylor-Smith’s final posting involved working in Cyprus for the United Nations. These peace-keeping duties sparked an interest in working overseas, and led to a three-year sojourn running conservation and community programmes in Zimbabwe, Panama, Chile and Botswana on behalf of Operation Raleigh (a British non-Governmental organisation).
“I have seen sights others can only dream of,” recalls Taylor-Smith as he turns back the clock to his late twenties. “I lived in the Kalahari for a time, and on the top of an ice cap in Patagonia. I have been charged by rhinos, walked across deserts and climbed active volcanoes.” An active type, then? “You could say that. I bobsleighed, skied and parachuted in the army, as well.” He was even held hostage at gun point by Cubans while in Panama. One suspects this is the kind of experience that makes or breaks you. On that basis, Taylor-Smith is very much a self-made man.
In 1994, he was appointed as a director of Project ORBIS, an international sight-saving operation which runs a ‘flying eye’ hospital. “We set up ‘eye banking’ schemes in Burma, and ran medical programmes in both China and India. Seeing someone who is bi-focally blind having their sight restored is one of life’s great thrills and experiences. It ranks alongside seeing your first child being born” (Taylor-Smith is a married father of two).
The world of big business
Two years later, Taylor-Smith signed on the dotted line to work for Jardine Matheson, a long-established, British-Asian conglomerate with interests in the insurance, retail, automotive and property sectors (among others). He managed the corporate communications function across 30 countries for a couple of years from his Hong Kong base – during which time Hong Kong was officially handed back to the Chinese – before joining the Jardine Matheson joint venture with Securicor in 1998.
As Hong Kong managing director of the Jardine Securicor business, Taylor-Smith also found himself on the Board of Jardine Securicor Asia. “I ran the business in Hong Kong for three years, and was responsible for developments in Asia,” he recalls. “Securicor owned and managed operations in ten Asian countries.”
In 2002, Taylor-Smith was appointed divisional managing director of Group 4 Securicor Justice Services. That business was pretty much ‘invented’ during the early 1990s, when there was a Conservative Government policy to look at areas of work previously the domain of the public sector that could be outsourced to private concerns. This tactic recognised the fact that the public sector had endured a poor track record of delivering large projects on time and to budget.
“It used to take 76 months to deliver a new prison,” sighs Taylor-Smith, before he concludes in far more confident tones: “Now, it only takes 38. Private sector participation here has been a huge success.” The move has also helped to reform and redefine service delivery in the public sector. It was accepted that Trade Union practice within certain areas of Government – the prison service included – was blocking reform. “The introduction of private sector contractors introduced competition, and put pressure on the Unions to reform.”
Do we need more prisons now? Taylor-Smith doesn’t pull any punches with his answer. “If you look at the current Government’s policies and the laws that it has passed, it was obvious that prison capacity would be exceeded at some point. If you change the law, Judges will apply the new laws. This generates activity which then puts pressure on resources in different parts of the criminal justice system.”
Here is one security professional who’s adamant the Government must re-start its prison building programme, which ground to a halt four years ago. He’s not alone in his views.
Learning lessons from history
Taylor-Smith has sat on the Board of several charities, and is currently a Trustee of the World Wildlife Fund (UK) – he’s a “passionate conservationist” – and the Scientific Exploration Society. Indeed, he was awarded an MBE in 2003 for all of his charitable efforts. “It’s very important for executives to have a balance of outside interests whereby they can learn and demonstrably put something back into their own business,” suggests Taylor-Smith.
It transpires that this articulate, sharp-suited professional loves reading up on military history. “Books on this subject tend to show up the very worst and the very best of human nature,” he explains. “During war time, you see both the most utterly selfless and utterly selfish acts being committed. It’s a glimpse of the human soul. You can learn from the lessons of history. Sadly, and all-too-frequently, it seems, most people are asleep during the lesson.”
The good news for Group 4 Securicor – and the industry at large – is that David Taylor-Smith is very much awake.
