Alan Brown – the director of group security at major High Street retailer Tesco – was a guest speaker at the CameraWatch Forum that took place in Edinburgh at the tail end of last year, and what he had to say back then about the private security world was both insightful and not a million miles away from my own view of events.
That being the case, I was much looking forward to what he’d have to say on this occasion as he replaced a guest speaker from Shell who, unfortunately, was taken ill prior to the Security Industry Authority’s (SIA) Stakeholder Conference and was thus not able to attend on the day.
Brown took up his role at what is one of the world’s leading international retailers in September 2006 after a highly successful career in the police service. The SIA’s biographical notes for the day mentioned the fact that Tesco’s UK business is “significant”. It certainly is, with upwards of 360,000 employees spread across 1,988 stores (and counting).
Nowadays, the retailer has diversified its services, which now spread across the online sales, banking and insurance spheres. Let’s not forget the fact, either, that the group operates in 13 markets outside of the UK in Europe, Asia and America. Employees worldwide number over 1,000, and they generate a staggering gross annual turnover of GB pound 58 billion.
Beginning his speech on the cusp of 2.30 pm, Brown mirrored his CameraWatch Forum delivery by asking the audience for a show of hands to discover how many of us were currently proud Clubcard holders. As before, I raised my right hand, as did plenty of others around me in the 200-strong audience at The King’s Fund.
Subject to continual review
Brown informed us all that, as a business, Tesco has to generate around GB pound 200 million per annum in order to cover its security costs.
The Tesco ethos – underpinned by “a DNA that’s all about selling” – is always one focused around stripping out what’s deemed to be unnecessary or ‘expendable’ cost and, as a result, every department (including the security function) is subject to continual review.
“As a business, we buy, we distribute and we sell,” explained Brown, “but perhaps we’re not quite so good when it comes to the purchasing scenario.”
A refreshingly honest assessment from Brown, who then went on to explain that there’s no local procurement regime within the Tesco business model. Everything’s bought in by a centre-governed operation “with tight controls in place”. Brown was again honest enough to admit that this set-up “presents a significant challenge when it comes to buying-in support services”.
According to Brown, in the wider world the buyer is not always a knowing individual when it comes to security procurement. “That is why we look to solutions providers,” asserted Brown. “We should know what we want, but retailers can be guilty of not knowing. That’s a major problem.”
Delivering a profitable business
Retailers – like most end users – know they need security, but the retail environment is nothing if not cut-throat and “people at the bottom can be unclear as to how security can help in delivering a profitable business.”
The choice in terms of what kind of service the retailer desires can, Brown stated, vary quite markedly. “Do they want someone at the entrance to the shop who’s inviting or abrasive? The former would seem to be the appropriate choice, and that’s where the security guarding sector is headed post-licensing and regulation. However, lack of integration and supervision of frontline staff can be a problem. The outcome? An unseemly race to the bottom among service providers when it comes to price.”
For Brown, that last scenario is most definitely not the way forward. “What we need to do, I believe, is move the guarding sector more towards that ‘old school’ public sector concept of best value. This requires a true partnership approach based on a level of knowledge.”
Drilling down to the local level, Brown spoke of the smaller Tesco store in a city like Manchester, where the level of violence perpetrated against security staff can be of the same high level that SIA chairman Baroness Ruth Henig had earlier pinpointed as being totally unacceptable.
“Each and every store must be risk-assessed,” asserted Brown, and quite rightly, too. “How do we mitigate the risks? What controls are available to us? What competency levels are we looking for from security officers? The answers to all of these questions and others will ultimately inform us about the breed of officer we need and what they’ll be required to do.”
Procurement of guarding services
When it comes to the procurement of guarding services, Brown is adamant that the whole process must revolve around thorough assessment and Key Performance Indicators (or KPIs for short). “All-too-often, guarding services will be bought by the customer without them having afforded any consideration to KPIs. Fundamentally, the customer must know their host company’s basic requirements.”
Knowledge is a two-way street, however, and Brown was right to assert that he desires – on an ongoing basis – “knowledgeable security providers” with whom Tesco can develop a solid working relationship.
Harking back to Brown’s comments on ‘the Tesco way’ of always looking to strip out cost, The Security Institute’s chairman Mike Bluestone asked a very pertinent question. “Alan, on the one hand you’re talking about wanting to procure and provide a quality guarding service, but on the other there’s all this mention of the continual push to strip out costs. How do you reconcile that in the real world?”
“Security is always going to be vulnerable to cost reductions because not everyone in a given business is clear on where and how it adds value to the organisation,” replied Brown. “We need to be more efficient, and that means we need to employ more technology, and really be clear about what it is we want from our solutions provider.”
All I would say on this subject is that the old adage is absolutely true: in this life, you (for the most part, anyway) get what you pay for.
Clients who batter guarding companies on price are only kidding themselves, while those contractors who willingly take such work on board knowing that margins will be reduced to shreds are doing themselves and their competitors a disservice. They set a very low benchmark, and there’s only so far that benchmark can be lowered before self-destruction is on the cards.
Comparison of business metrics
Skills for Security’s chief executive David Greer, who was sitting immediately behind me in the third row, then asked a salient question of both Brown and Andrew Nicholls (the head of security and licensing at Mitchells & Butlers who’d spoken immediately prior to Brown, again on the subject of a purchaser’s perspective in relation to security service procurement).
“Do you compare business metrics across your suppliers at all?”
“Well you can’t always compare apples with apples,” explained Alan Brown as he sat beside SecuriGroup’s md Russel Kerr and Nicholls for the first Q&A of the afternoon.
Nicholls himself then chipped in: “I’d have to say the key issue for us would be the levels of violence in a given area. We regularly review protection plans based on this issue after store managers have been spoken to, and there’ll always be a cyclical element to how we change our security regime according to the time of year.”
James Kelly – the BSIA’s chief executive – then added his voice to the debate. “Why don’t we set up a specific Forum for the client side of the business and invite along organisations like CIPFA and the Chartered Institute of Purchasing and Supply to discuss Best Practice in procurement?”
An excellent suggestion, and one which Nicholls and Brown would apparently be more than happy to facilitate towards reality.
The Solutions Provider and The Brand
Mark Harding – the managing director of Showsec and also chairman of the UK Crowd Management Association – was in the front row of the audience to my right, and when the SIA’s Hazel Russell invited further questions from the floor Harding was keen to ask something of Tesco’s Alan Brown.
“It’s entirely obvious that Tesco has a strong brand and an even stronger brand awareness,” observed Harding. “How far is your security provider entrenched within that?”
“Tesco’s security operation is 50% in-house and 50% outsourced,” explained Brown. “As a company, we do have a strong track record of taking operations in-house. That said, we are not a security company – we sell things. Bringing all of the security service in-house would be counter-productive to raising standards. We prefer to develop strong and real partnerships with our service providers.”
Professor Martin Gill – director of Perpetuity Research and Consultancy International – made the comment that it’s not always easy to sell the security service. “On that basis, to what extent must we look to change the perception of security as a discipline among business leaders? Can the SIA play a part here?”
Between a rock and a hard place
“We have been fortunate in that our clients have appreciated – and continue to appreciate – the value of security,” outlined Russel Kerr.
“It’s not always the same when we go after new business, though. I hope that’s due to the recession and the fact that everyone is looking to reduce their costs. You can be caught between a rock and a hard place. The rock is the buyer, while the hard place is convincing staff to work with what the client has given them.”
As to whether the SIA can assist in ameliorating the situation, Kerr continued: “Education of end users is the industry’s job. We must all be looking to build real relationships.”
Andrew Nicholls added: “We must realise in business it’s not just the security function that’s under the microscope when it comes to financials. Anything that impacts on the bottom line negatively or positively will be scrutinised. That’s quite right. What does security achieve? A good deal, but we have to explain that. Again, that’s only fair.”
