In today’s competitive market all providers are constantly striving to find ways of distinguishing themselves from the ever-growing pool of competitors.
Yet gaining an advantage, either by offering the equivalent service or product at a lower price or delivering differentiation through an enhanced level of service, is never quite as easy as it sounds.
When I first started out in the electronic security systems industry nearly 20 years ago, it seemed a lot more straight-forward.
The customer had limited choice in terms of supplier, and technology was a lot less sophisticated. A security system was invariably seen as a grudge purchase to meet insurance or regulatory requirements – as opposed to today where it is regarded as an essential purchase.
Wind forward to 2015, however, and the security systems landscape has changed considerably. It’s now reportedly worth over £40 billion worldwide – an astonishing amount when you consider where it has come from.
Technology has moved from analogue to digital, the market is converging with risk and IT, and the economic climate has forced a change in our customers’ buying attitudes and behaviours.
Furthermore, the market has become increasingly fragmented and there are now a whole host of players from multi-national to small local/regional companies to new entrants from IT, FM and construction services market sectors.
So, with this mind, the need for the security systems provider to deliver a differentiated offering has never been greater.
The transactional approach is outmoded
Most of the time our customers are simply searching for a reliable and responsive level of service however expectations are certainly on the up – business efficiency, optimising the use of security resources, delivering innovative solutions and providing life-cycle cost of ownership, to name but a few.
Traditionally, differentiation in our market has been achieved through a combination of relationship building with the customer and providing a perceived better product/service – a very transactional approach.
In my experience, however, this approach should be considered as ‘me too’ and is no longer sufficient to sustain a position of growth in this market. So, how do security providers now achieve competitive advantage in today’s rapidly changing and competitive security systems market?
Achieving differentiation in my experience is about developing a clear and focused strategy (versus price leadership) that leverages the company’s brand, scale and expertise.
Without this, it can be very difficult to gain an advantage over your competition – invariably it then becomes a fight to the bottom based around price.
I am also a great believer in knowing your customer and making sure you know exactly what makes them tick. Ever since I moved into sales, my view that you target the right-fit customers has not changed one iota.
From the outset, you need to decide who to target, why, and what the approach is. Will the customer buy value, will they recognise our credentials or will they just select the lowest bidder?
Value creation
If you want the customer to recognise your competitive advantage, this up-front assessment of an opportunity is absolutely vital.
We also need to be a lot more connected with our customers and their markets, developing greater subject matter expertise in order to respond in the right way and with the right solution.
We know that price will always be a factor however if your strengths and capabilities are aligned to the customers, price becomes less of an issue and is transformed into value creation.
The continued convergence of security with IT means that we need to tackle and embrace the change and divergence in technology.
Being able to address complex issues such as the integration of multiple intelligent building solutions such as security & CCTV, BMS, fire, HR databases etc across the IT network is already happening and will very soon become the norm.
As a result, selecting the right technology partners to work with will be key. Aligning your business with developers of cloud and software-based security solutions and applications, as opposed to traditional hardware equipment manufacturers, will be crucial in a world dominated by the internet and smart multi-functional devices.
Finally, there is a real need to strengthen customer relationships to better protect, grow and tie-in existing customers. Our customers are now exposed to far greater choices and only through closer collaboration and the constant delivery of innovation and service excellence can we achieve competitive advantage and growth in this rapidly changing market.
Since I joined Mitie’s Security Systems business in July last year, we have taken giant steps forward to react to these changes by enhancing our end-to-end proposition that offers the customer far more than just a product and service.
This includes everything from consultancy and design through to implementation, integration and professionally managed services.
In short, Mitie is ready, able and already adapt to the new environment. We encourage everyone to join, for the good of our clients and the industry.
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ifsecglobal Fantastic article as always- Rebecca