Guarding Outlook: Trends in Hiring, Retention and Turnover
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In this webinar, we outline the key themes surrounding the state of the guard industry, highlighting some of the ways in which security firms are mitigating the risks associated with turnover to retain talent, hire skilled guards, and minimize costs associated with onboarding and administration.
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Guarding Outlook: Trends in Hiring, Retention and Turnover
- 1. Copyright 2019 Valiant Solutions, Inc. Proprietary and Confidential The Guarding Outlook: Trends in Hiring, Retention and Turnover March 26, 2019
- 2. Copyright 2019 Valiant Solutions, Inc. Proprietary and Confidential AGENDA 1 2 3 4 The Guarding Outlook: Analysis of the current market Top Challenges in the Industry: How turnover is a catalyst for operations Technology’s Impact: Where companies are leveraging technology Industry View: How guard firms are facing these challenges head-on
- 3. Copyright 2019 Valiant Solutions, Inc. Proprietary and Confidential DRIVERS What is the impact of record low unemployment coupled with rising minimum wage? How are you paying your guards to promote retention? Largest Consolidation of the Market Record Low Unemployment Increased Regulatory Action & Oversight WHAT TO WALK AWAY WITH
- 4. Copyright 2019 Valiant Solutions, Inc. Proprietary and Confidential Lisa Dolan, CPP President, Chief Executive Officer / Founder • Founded Securit® as a product safety company • Grew the company exponentially by adding Security Guard and Investigative services • Certified in Security Management as a “Certified Protection Professional” • ASIS Professional Certification Board • Licensed Private Investigator • Co-founder of TDI; a computer supply company TDI was acquired by OfficeMax in 1997 • Joined Valiant to head up Sales, Marketing and Business Development • 19 years experience with Valiant solutions, serving the security market throughout all operations • Attended, facilitated and participated in ASIS, CALSAGA, ASSIST, NCISS and Valiant's National executive roundtable events Jeff DiDomenico VP of Business Development TODAY’S SPEAKERS
- 5. Copyright 2019 Valiant Solutions, Inc. Proprietary and Confidential 30 YEARS OF GUARDING 2018 Company Employees Allied Universal 140,000 Securitas 110,500 G4S Secure Solutions USA 57,000 National Security Alliance 14,661 Andy Frain Services, 11,750 SecurAmerica 7,000 SOS Security 6,500 Whelan Security 5,700 Walden Security 5,500 Command Security Corp. 5,200 DSI Security 4,300 Covenant Services Worldwide 4,200 St. Moritz Security Services 3,000 United American Security 2,825 Madison Security Group 2,465 Per Mar Security & Research 2,036 SunStates Security 1,936 APG Security 1,882 CPS Security Solutions 1,600 Monterrey Security Consultants 1,500 Elite Investigations 1,453 Titan Security Group 1,400 Vinson Guard Service 1,125 Premier Security/Apex3 Security 1,100 Arrow Security 1,100 Cambridge Security 1,000 Monument Security 950 United Security 850 Master Security 810 GMI Guard Management 600 1990 Company Employees Burns International Security Services 42,868 Pinkerton's Inc. 24,206 The Wackenhut Corporation 22,000 Wells Fargo Guard Services 15,100 American Protective Services 10,500 Guardsmark, Inc. 8,000 Stanley Smith Security Inc. 8,000 Allied Security 6,958 Advance Security, Inc. 5,000 Security Bureau 5,000 Murray Guard 3,400 First Security 2,800 Professional Seecurity Bureau 2,800 Weiser Security 2,600 Barton Protective Services 2,500 Effective Security Systems 2,500 American Security and Invest. Svcs. 2,500 United Security Group 2,300 SecuriGuard 2,250 Security Forces, Inc. 2,200 Pedus Security Services 2,000 Security Operations Systems 2,000 Command Security Corp 1,815 Doyle Detective Bureau 1,680 Bell Security 1,550 SpectaGuard 1,500 D.B. Kelly Associates 1,400 OCS Security 1,300 A&R Security and Investigative Services 1,258 Guardian Guard Services 1,200 Per Mar Security Services 1,150 Vinson Guard Service, Inc. 975 Lansdell Protective Agency 900 McRoberts Protective Agency 800 MVM, Inc, 760 193,770 399,943 - 100,000 200,000 300,000 400,000 500,000 Total Lives in 1990 Total Lives in 2018 5,536 13,331 - 2,000 4,000 6,000 8,000 10,000 12,000 14,000 Average Guard Firm Size in 1990 Average Guard Firm Size in 2018
- 6. Copyright 2019 Valiant Solutions, Inc. Proprietary and Confidential 50% OF THE MARKET’S REVENUE is held by 4 major security guard firms 25% 15% 6% 2% 1528 787 644 231 60 31 27 26 20 12 8 9 0 200 400 600 800 1000 1200 1400 1600 1800 Number of Guarding Firms by Employee Size Over 87% of the market is made up of Companies under 250 employees A MARKET VIEW According to a report published by the Bureau of Labor Statistics, more than 78 million Americans* — or nearly 59 percent of the U.S. workforce — are hourly workers. Encapsulating such a substantial percentage of the workforce, it’s vital that companies implement employee development programs that will focus on this underserved sector of the American workforce. *https://www.bls.gov/opub/reports/minimum-wage/2015/home.htm $44b $24.5b $11.9b $6.6b Outsourced & In- House Security Industry Outsourced Contract Security Industry Revenues For The 3 Industry Leaders Revenues for the 2 Majority Foreign- Owned Industry Leaders 800k 8k Companies in the U.S. 5% Organic Growth For The U.S. Market 6.5% Total Revenue Growth For the U.S. Market Outsourced Security Officers
- 7. Copyright 2019 Valiant Solutions, Inc. Proprietary and Confidential 1-100 101-250 251-1000 Over 1000 56% 19% 13% 13% THE GUARDING OUTLOOK Number of Clients ServedSeniority LevelSecurity Guard Firms By State Series 1 17% 3%
- 8. Copyright 2019 Valiant Solutions, Inc. Proprietary and Confidential 0 0.005 0.01 0.015 0.02 0.025 0.03 0.035 0.04 0.045 0.05 10 13 16 19 22 25 28 31 Pay Rate Bell Curve* Low Avg = $14/hr High Avg = $23/hr Avg = $17/hr 14% 39% 48% 14% 0% 10% 20% 30% 40% 50% 60% No Overtime Under 3% 3-7% Over 7% Non Billable Overtime 86% incur some level of Non-Billable O/T *Assumption: Broad Scope, takes into account Armed and Unarmed Guards, from all States, showing a wide-ranging average OPERATIONAL OUTLOOK
- 9. Copyright 2019 Valiant Solutions, Inc. Proprietary and Confidential TOP CHALLENGES 1. Turnover: The ability to attract, onboard & retain talent for security work 2. Non-Billable Overtime: Incurring overtime that you cannot bill the client for 3. Wage & Labor Compliance: Ensuring that you are meeting the acceptable U.S. Department of Labor requirements (ACA, FMLA, FSLA, etc) 4. Payroll & Billing: The ability to accurately run payroll in a timely manner and bill clients quickly, and get paid on time 5. Margins & Profitability: The ability to maintain or increase margins on client accounts and overall profitability for your company 1 Turnover 2 Non-Billable Overtime 3 Wage & Labor Compliance 4 Payroll & Billing 5 Margins & Profitability
- 10. Copyright 2019 Valiant Solutions, Inc. Proprietary and Confidential TOP CHALLENGES Turnover leads to lack of resources… filled to posts, incurring NBOT… that cut into profit margins. 1 Turnover 2 Non-Billable Overtime 3 Wage & Labor Compliance 4 Payroll & Billing 5 Margins & Profitability
- 11. Copyright 2019 Valiant Solutions, Inc. Proprietary and Confidential • 3.8% Record LOW Unemployment Rate • More Variety in the Job Market Free Products Company Stock Full Benefits Package College Tuition Employee Discount Competitive Pay Rate Full Benefits Package Tuition Reimbursement Partner Discounts Competitive Pay Rate Full Benefits Package Tuition Reimbursement Security Firms must compete with non-security industries for talent: Employee Discounts Competitive Pay Rate Full Benefits Package Tuition Reimbursement WHAT IS DRIVING TURNOVER? • Competing with Other Industries • Rise in the Minimum Wage
- 12. Copyright 2019 Valiant Solutions, Inc. Proprietary and Confidential ADDRESSING TURNOVER? Sourcing & Retaining Talent National Average, Hourly Workers = 62% 0-25% 25-75% Over 75% Turnover Rates
- 13. Copyright 2019 Valiant Solutions, Inc. Proprietary and Confidential LOOKING AHEAD – FUTURE STATE 26% 26% 21% 19% 6% 0% 5% 10% 15% 20% 25% 30% Job Boards Referrals In-house HR team Classifieds / Craigslist Recruiters 45% Digital Outreach 27% HR Driven 26% Referral HOW ARE FIRMS FINDING TALENT? Text Open Rate = 99% Text Response Rate = 37% Email Open Rate = 8% Email Response Rate = 2%
- 14. Copyright 2019 Valiant Solutions, Inc. Proprietary and Confidential What is involved with Cost to Hire? It’s more comprehensive than you think: Job Boards Drug Tests Background Onboarding Certifications Training Uniforms Re-Training Admin. Work Fire Safety COST TO HIRE: WHAT IS THE TRUE COST? Cost per Employee/Month to Hire
- 15. Copyright 2019 Valiant Solutions, Inc. Proprietary and Confidential COST TO HIRE NEEDS TO FACTOR TURNOVER Take $100/Employee/Month Or $1200/year 0-25% 25-75% Over 75% Take 50% Turnover Rate For every $1 Spent on Hiring, a $1 is LOST to Turnover: 50% turnover at $100 per employee per month = $1200/per employee/year LOST A $100 cost is really $200 when you apply Turnover rates Turnover Rates Cost per Employee/Month to Hire
- 16. Copyright 2019 Valiant Solutions, Inc. Proprietary and Confidential • Eliminating the “Domino Effect” • Morale Affects Performance • Impact on Security / Vulnerability • Two Ways to Mitigate Risk – “Triage” HOW DO YOU RECRUIT?
- 17. Copyright 2019 Valiant Solutions, Inc. Proprietary and Confidential THE “TRIAGE” APPROACH • Honesty in the interview • Filtering your Candidates • Provide Pros and Cons • Interaction with Supervisors Pre-Hire • Compliance • Training and Re-Training • Incentivization • Acknowledgment • Benefits Post-Hire
- 18. Copyright 2019 Valiant Solutions, Inc. Proprietary and Confidential Will Technology Adoption impact Human Capital? TECHNOLOGY ADOPTION IN GUARDING A Means To Streamline Operations Amidst Challenges
- 19. Copyright 2019 Valiant Solutions, Inc. Proprietary and Confidential RETAIL SPACE GOING DARK More than 90 million square feet of retail space closed by Q2 in 2018. The Record Breaking Numbers of Retail Space Closures in 2018 Source: CoStar Group
- 20. Copyright 2019 Valiant Solutions, Inc. Proprietary and Confidential RETAIL SECURITY HOW WILL TECHNOLOGY IMPACT HUMAN CAPITAL? CASE IN POINT: TECHNOLOGY’S IMPACT
- 21. Copyright 2019 Valiant Solutions, Inc. Proprietary and Confidential 5% 22% 54% 19% Manual – Boards, paper, etc. Spreadsheets, Email, Text Messaging Desktop Workforce software Mobile Workforce Software Type of Technology Adoption Do not TOP SOFTWARE DEPLOYMENT 70%Use Software Do not 30%
- 22. Copyright 2019 Valiant Solutions, Inc. Proprietary and Confidential 74% are using Mobile to augment their Operations 26% 24% 18% 16% 9% 7% 0% 5% 10% 15% 20% 25% 30% Touring and Checkpoint Management Incident Management Tracking Punch in and Punch out Push Notifications Shift Posting and Swapping None of the Above Top Uses of Mobile Technology in Security MOBILITY IN GUARDING
- 23. Copyright 2019 Valiant Solutions, Inc. Proprietary and Confidential • Guarding Market is in the Mid-Market Majority • Turnover is a Catalyst for driving other Operational Challenges • Low Unemployment + Rising Minimum Wage = Risk! • Digital Outreach Remains a Major Trending Method for Hiring • Beware of Cost to Hire Coupled with Turnover = True Cost • Technology Adoption is strong, with Mobile becoming Key to Success • Use Technology to Streamline Operations, Reduce Cost & Increase Margins CONCLUSION
- 24. Copyright 2019 Valiant Solutions, Inc. Proprietary and Confidential QUESTIONS? Our integrated Workforce Solution is purpose-built for the Security Industry, backed by a team with more security expertise than any other solution provider. Technology + Experience = Results. OPERATE SMARTER. www.valiant.com 1.800.521.4555
Editor's Notes
- Hi everyone, I’d like to thank you all for joining us today. My name is Jeff DiDomenico, VP of Business Development at Valiant and I am joined with Lisa Dolan, who is the President, Chief Executive Officer / Founder of Securit®. Today we’re going to talk to you about some of the current trends in the Security Guard Space around key challenges and analysis around Turnover, Hiring and Retention as a major impact on the Security Guard industry. We have some interesting data we will share, and Lisa has joined us to provide some insight into how guard firms like hers are addressing challenges within their operations. Let’s get started.
- Thank you and welcome to todays webinar. What we’d like to cover today involves the guarding industry and the challenges that are impacting operations. We recently conducted a survey, the first of it’s kind, to the market to truly understand the market impact the size of the market and the top challenges. So we will review the guarding industry in aggregate, as a whole and with respect to our survey. Then, from the data, we will outline what the respondents said were the top challenges facing operations. We will also spend some time looking at technology’s impact on these challenges and how companies are currently leveraging technology. And, throughout the presentation, we will be getting feedback and commentary from one of your own – lisa dolan. Let’s get going and talk a little about our speakers for today.
- If I had to summarize what will be covered today, it centers around this. We have been experiencing one of the largest market consolidations to date, and with a combination of record low unemployment and increased regulatory action and oversight, the industry has many challenges related to hiring and compliance. So what we would like you to keep in mind in against these drivers is, “What is the impact of record low unemployment coupled with rising minimum wage? How are you paying your guards to promote retention?
- Jeff’s entrepreneurial experience began in 1984, as co-founder of TDI; a typewriter rental company which grew over 13 years to become one of the nation’s leading distributors of computer supplies. TDI was also recognized by MetLife as vendor of the year, along with major companies IBM, Lexmark and 3M. In 1997 TDI was acquired by office product giant OfficeMax. Lisa’s career began in the field of Correctional Administration. She founded Securit® as a product safety company and grew the company exponentially by partnering with Joseph & Lisa Garcia and adding Security Guard and Investigative services. Lisa’s direct responsibility is Federal Government Liaison, Business development, Strategic planning and instilling excellent service at every level within the company. Lisa is Board Certified in Security Management as a “Certified Protection Professional” and is a Board member for Private Security Company’s within the American Society for Industrial Security (ASIS). Lisa Dolan holds many trademarks and copyrights in the safety industry and is a graduate from John Jay College of Criminal Justice with degrees in Criminal Justice and Correctional Administration. She is also licensed as a Private Investigator.
- Before we start and look ahead, let’s look back. In the 30 years of guarding, we have seen a stark shift in the growth of the industry, which is encouraging. While many of the core players still remain, there are many that have been absorbed or merged with larger firms. But over the 30 years the number of lives in service has grown over 100% and the average guard firm size in terms of employees has grown 116%.
- In the Security Guard industry, there is a tremendous level of complexity and market factors that are creating various challenges to reduce costs, improve profitability and operate in the most efficient manner possible. It’s one thing to theorize about market challenges and make assumptions, however it is far more valuable and insightful to take a more quantitative approach and analyze data points to examine trends in security guard operations. In this webinar, we will look at a comprehensive set of data from the Security Guard sector that outlines not only the key challenges facing guard companies today, but also look at how technology is becoming a mitigating factor in their operations.
- Compiling a data set from a wide range of Security Guard Companies was an important factor in ensuring a wide range of responses, in order to get a clear picture of top challenges and operations. We conducted a survey of a sample set of guard firms within the U.S. ranging in size and scope. The guard firms that participated spanned a wide range throughout the continental U.S., however the majority of guard firms centered around California, New York, and Texas. This is in line with the market distribution, which is similar across the wider market. Looking at the size of the firms in the market, we saw an interesting distribution in terms of number of employees. Again, looking at the distribution, the largest grouping is under 100 employees per company. This is not surprising, since the wider market has a larger segment of the market that is on the Small to Mid-Sized Business size. The size distribution fits in line with the wider market. In terms of the seniority level of individuals that were surveyed, we saw a larger distribution of senior level employees that participated. This is typical for many security guard firms; the owner and C-levels are very much involved in the operational aspects, especially the smaller sized organizations. This also provides a unique perspective on the results of the data; having a top-down view provides a much more accurate viewpoint on the operational aspects of Security Guard Operations. The last data point to illustrate the firms in the survey are around the number of clients served. With many security firms, the number of clients they contract with can also determine the level of operations needed and contribute to the level of complexity. So with this data set, we saw a nice, even distribution of companies serving different number of clients, which provides a good sample set of different company sizes and scopes: The Typical Guard Owner: Does not disclose pay rates Does not share data Competes with each other for talent Does not track metrics for
- Taking into account the demographics of the firms participating, it’s important to look at the overall operations aspect of the business. Mainly, what are companies doing to ensure that they are operating efficiently and minimizing costs and keeping profits? Let’s look at the overall pay rates. Pay will vary by size of the company, bill rates that can be contracted, and number of clients. However, within the survey, most of the respondents varied from low average of $14/hour to higher averages in the $23/hour: In addition, when looking at operational efficiency and how the workforce is distributed, it’s important to understand the idea of Non-Billable Overtime. Incurring Non-billable Overtime can be an indication of an organization’s ability to adequately staff resources that are under hours to fill a post. The inability to post resources that are under hours can be a leading indicator of lack of resources, lack of visibility into schedules, or overall efficiency of a company’s ability to operate. In this case, only 14% over respondents highlighted a 0% overtime rate that is not billable. The remaining 86% had some level of overtime that they incur, which cannot be billed to the client. This is a leading indicator that there is some level of risk associated with operations around resources. Causal factor that lead to this will be explored in the next section. When analyzing the data to this point, you see a large number of smaller guard firms operating in the market, with a fairly competitive pay rate compared to other market sectors (the average is double the Minimum wage rate). Still, 86% of guard firms are forced to incur some level of Non-billable Overtime, which can be attributed to a number of factor, most notably the ability to staff the appropriate resources that are under hours to meet the scheduling needs. Based on this assumption, what did the participants say were the biggest challenges facing operations today?
- It is pretty clear, and overwhelming that the majority of respondent cited Turnover as one of the major challenges facing their operations today. The ability to not only atttract new talent, but retain talent is one of the largest challenges in the industry. Workforce is a strategic Asset - expecations
- The second and third major points are the margins and profitability, followed by the non-billable overtime. However, it’s important to note and surmise that one challenge can clearly lead into another. Without the right amount of resources to work a post, companies are forced to post overtime that is not billable to honor their contract, which is ultimately not billable, which factors into the overall margin and profitability. Turnover is often seen as the catalyst to other challenges in the guard firms. So what are companies doing today to mitigate risk of Turnover?
- Beyond stats, here’s an anecdote: Webster noted a Wendy’s franchise owner who said he experienced a 40 percent turnover rate, noting that it would cost as much as $2,000 to hire, train, onboard and pay workers. That all changed when he offered real-time payments for wages earned — reducing corporate costs, along with acquiring and retaining workers. It makes sense, Frew noted, when gig workers who also have QSR jobs may need to opt for the former (where they may get paid more quickly) to supplement income, taking a sick day from the fast food shift to make it all happen. It’s a ripple effect that hits employers and employee
- With an overwhelming competitive wage market, the guard service firms are not just faced with competitive turnover – losing to another peer – but also turnover to other industries. Favorable wage rates and a historically low unemployment rate contribute to resources leaving the industry altogether to seek better pay rates. This is a major challenge to try and offer a competitive rate for a job that demands more of it’s employees for security and safety of a client. Retail is one of the largest competitive threats to the guarding industry today – the wage rates from big box stores can impact the ability to retain talent, and security firms are forced to maintain competitive wage rates to retain business. Ultimately, this cuts into their margins, which can force a company too seek efficiencies in operations. How much turnover is being seen in the industry? When asked about turnover rates, the figures were alarming. The National Turnover rate in the last few years (as presented by Mercer Data was around 22%. This will obviously vary by industry, but serves as a baseline. While 48% fell in line with the national average, the reality is that in the security guard space, over 50% of the industry is seeing a turnover rate that is higher than the national average. This simply shows that this level of turnover is not indicative of a larger national shift, but that security firms are seeing higher turnover rates than the average. How are firms sourcing and retaining new applicants? And How much is spent in their overall budget to recruit and onboard resources? This becomes a data point that can illustrate the level of effort required to keep the turnover trend at bay.
- What’s interesting is the wide range of options that are employed by security guard firms. This indicates that there is no “magic bullet” in terms of recruiting talent; companies are trying various different ways to build their applicant pool. 45% of firms are using some sort of digital outreach, whether through job boards or craigslist, while another 27% are leveraging more traditional HR teams and recruiters to seek out applicants. Perhaps the most interesting factor is the 26% that stated referrals still are a major source of their recruitment methods. This is particularly of note in that referrals are a lower cost source of recruitment and often can help to alleviate the burden of building a talent pool through paid methods. Whether this is employee referral or client referral, it still stands to reason that security firms still have the ability to attract talent through this method.
- What’s not outlined in the figure above is the actual cost to that is incurred for each employee that is hired. Looking at the same group, we asked what the average employee cost per month to hire and onboard, including the cost of the recruiting methods, training and onboarding. As you can see, the figures are fairly split evenly, ranging from under $100 to over $300 per month per employee to attract, hire and onboard new talent. This isn’t completely surprising, considering that there is a need to keep hiring costs low. This rate is well below the national average, but for a low-margin business, it’s important to be as lean as possible when looking to increase resources.
- Let’s just run an example against the data to see the impact. If we know that the majority of guard firms are seeing 25-75% turnover (let’s take an average of 50%) and it costs an average of $100 per employee per month to hire and onboard, what is the impact? 50% turnover at $100 per employee per month = $1200/per employee/year LOST This means that for every $1 we spend on an employee, we lose $1 on a lost employee due to turnover. So, the cost to hire an employee is effectively DOUBLE what we think it is, just because we expect to lose half of them. So, with a turnover factor applied, a $100/employee/month expense is, in reality, a $200/employee/month expense with turnover factored into it. Now I’d like to turn it over to LISA DOLAN, who will provide some in the field experience with hiring and retention
- How do you recruit: Do you just look for bodies? A pulse? A constant parade of different guards to a customer can cause service problems and significant unease that may trigger the cancellation of, or failure to renew, the contract. BUT, more importantly the domino effect among the ranks is low morale which creates unintended consequences- morale affects performance. It is a reflection of the company that tells the guard you don’t care- you are not invested in them. These disaffected security guards who likely have keys, pass codes, access to critical areas within the client firms then represent a serious security vulnerability. There is the direct cost to the company of continually having to replenish its work force. You will have a competitive advantage over other security firms if you can keep minimize your turnover. The strategies to reduce turnover will generally be divided into two categories: pre-employment and post employment.- I refer to this as Triage
- Triage is the interview - Prepare the candidate with an honest and realistic outline of the job. How do you preemptively eliminate candidates who are at a higher risk of not lasting.- weeding out (how did they dress for the interview, were they early, late, did they do more than just move their head up and down during the interview? Exchange in dialogue perhaps???) Provide accurate information – pro and con about the site to all applicants. When at all possible have site supervisor for site you are interviewing for present at interview (interaction important to see, they are more insightful due to being the boots on the ground, etc) Remember, front line management is the organization to the guard! Compliance- Discuss importance of compliance and the role it plays in retention. -training /retraining costs, etc to be discussed here Incentives to retention- raises vs commendations, acknowledgement/certificate Benefits (insurance, vacation etc)
- What we’ve seen is that security guard firms are faced with challenges that contribute to their overall bottom line. Higher than average turnover forces organization to absorb costs in recruiting and onboarding. Competitive job markets are driving higher wage rates to ensure an acceptable retnetion rate. Yet with all these factors, turover rates still force Non billable overtime, driving into overall margins. As a result of this cascading effect, companies are turning towards other methods to help achieve efficiencies and streamline their operations. One of those is in technology adoption. The Gated Community Nest Story -
- One point of note is the idea of retail space. Over the last few years, we are seeing a growing trend of retail space going dark – closing their doors to respond to market pressure from online and big box retailers. As a result, this space is largely unguarded which contributes to the overall risk that is growing in security.
- When you look at the overall impact technology has on the industry, you can look back before you look forward. Years ago, when the automobile was first introduced the number of cars to horse-drawn carriages was small…..for every 100 horse carriages, there was one car. This was in 1910. In 1920, the situation reversed itself; for 100 cars on the road there was 1 horse carriage. The same is becoming true in other aspect of industry. Look at what the fast casual and fast food markets are doing. Whereas once you had cashiers to handle volume, technology has replaced this with self-service kiosks in retail, eliminating the need to have as many cashiers on staff. Now, with companies such as knightscope, you are seeing a trend towards robots covering a percentage of the guarding operations. While still years out, the technology is there and it is ever-present in the growth of technology and it’s impact on operations….will security guard become like the horse carriage? We hope not, but it’s a reality we need to deal with.
- Looking at technology as a driver for many companies, we are seeing that the majority of guard firms have some level of software solution to help them manage their workforce. Of the respondants, around 70% state that they are using software solutions in their business. Digging deeper into the data, the majority of guard firms are using true software solutions for their operations:
- Part of the attraction of software solution is that it provides a level of automation that eliminates manual entry, data errors, and gives companies a much better way to streamline operations and reduce costs. Another important aspect is usability. Companies want to adopt solutions that will drive value, and leverage a platform that is familiar to their end users. Of the firms that have adopted technology, 74% are using a mobility technology to augment operations. One of the powerful aspects of mobile is the ability to drive further value to get real-time information on operations. By having these real-time operational aspects tracked, it’s a lot more beneficial to drive costs down, and manage schedules more effectively. Over here is a drill-down on how companies are leveraging mobile technology: The majority of these mobile functions contribute to the ability to access real-time activities within the context of operations. This means being able to track the time worked, the activities within that time period, any incidents that might impact operations, and being able to gain visibility and control over those activities. Data from mobile helps to create a larger view into operational efficiency, and allows business to see any impact of these operations on costs and profit margins.
- In this report, we’ve seen some interesting data points around the top challenges facing the security Guard industry. Perhaps the biggest of which could be considered a catalyst for many other challenges, and that is Turnover and Retention. If you look at the data, an overwhelming number of respondents see turnover as a major challenge to maintaining operations within their business. With an increasing competitive job market, many security firms are not only competing with their peers for resources, but also other industries, such as retail, for a share of the job market. The challenge of turnover can impact the business from multiple facets. If an organization has limited resources, they may be forced to post guards that are over hours, which impacts non-billable overtime. In turn, incurring non-billable overtime will ultimate cut into margin and impact profitability. So one challenge bleeds into another. <<<CLIENTS ARE STARTING TO CHART THEIR EMPLOYEES AVAILABILITY TO WORK – AND WHERE THEY ARE WORKING WHEN THEY ARE NOT AVAILABLE….PROVIDES DATA POINTS AS TO WHY THEY ARE WORKING ELSEWHERE >>>> With turnover as a constant challenge, companies need to look to other ways to help streamline operations, reduce costs and maximize their margins. Most of this comes through technology adoption, specifically around solutions that combine both Web-based and mobile solutions. The primary focus for technology in alleviating operational constraints is to reduce the manual effort associated with maintain schedules, optimize scheduling to provide a better allocation of billable resources, all with the goal of offsetting additional costs to ensure margins are as optimal as possible.
- With that being said, I’d like to turn it over for questions. Just before I do that I did want to take a moment to talk a little about Valiant. All the points we spoke of are able to be achieved using Valiant Solutions platform for workforce management. Valiant is purpose-built to provide you with the tools to manage and track your workforce, connect time and labor to billing and payroll, and eliminate manual processes while reducing risk. We believe in reducing the risk associated with disparity, and that is why our integrated solution connects all aspects of your workforce operations to ensure compliance and accuracy. With over 25 years of experience in building solutions for the hourly workforce, Valiant Solutions is designed to give you visibility and control in time, labor, payroll and human resource management. We believe that the combination of our industry-expertise, pedigree for the hourly workforce and our technology make us a true partner for driving value and success with our customers. With that out of the way, I’d like to answer any questions you might have.