G4S moves into the integrator space
Traditionally known as a big player in the guard market, G4S Secure Solutions has been making strategic technology acquisitions over the last few years to better position itself as a full-service security provider. Is G4S the next big integrator on the block?
Canadian Security: Tim, most people know G4S as a guard and cash-in-transit company. But given the company’s more technology-focused acquisitions over the last few years, the goal seems to be more towards being known as a security integrator, is that true?
Saunders: In principle, when you look at our business, yes, absolutely we are a guard-focused business, but what we’ve certainly seen in the market is that clients are asking for and talking in terms of complete security programs. What they want is a complete, integrated security system.
The baseline advantage to those types of engagements is that there are cost efficiencies. A client can go from a multiple vendor scenario to a single vendor scenario. There are advantages to the client in terms of direct costs and, when you look at the evolution of IP environments — the barriers are closing in terms of integration of manned tasks and the technology side of access control and CCTV.
Post orders are now automated and when you look at incident reporting processes, those are all automated — they’re fulfilled in IP environments. Mobile tools such as BlackBerries enhance our guard performance overall. I think our programs are better because they’re getting real time information. Compliance is improved because the information is stored and incidents are better documented.
So the integration is absolutely there. I was in a meeting in Montreal recently and the conversation was around the fact that the company had not only integrated their security systems, but all identify management as well. The IT guys were in the meeting in which I presented to the client. It may not be there yet for a lot of clients, but it’s absolutely coming.
Canadian Security: You mentioned the use of BlackBerry devices. What is your Mobile Guard application?
Saunders: It gives real-time reporting and provides the guard the ability to do things like take a picture of an incident and depending on the severity of the incident the guard can report it in real time to senior management. Perhaps the head of security has indicated he wants to see all Severity 1 incidents no matter what time it is in the day. Basically you define what information you want guards to collect and it’s sent in real-time to pre-determined recipients. It can be emailed to the appropriate individuals in maintenance, security or facilities etc. Right now it’s built for BlackBerry. In the U.S. G4S also has Secure Trax, which is security management software.
Canadian Security: So how has G4S changed its approach with clients now that there are more technology-specific products to take to market?
Saunders: It’s three-fold. Organizationally, I think it’s important we structure ourselves to answer the market demand and there are things we’ve done to help meet the client needs. We’ve segmented our business to be very much an integrated solutions perspective. Secondly, it’s people — we’re investing in the appropriate training and skills for back end and frontline people. We’ve created the vision and culture to know where we’re going as an organization.
Frontline people have to be able to have that broader conversation with clients when it comes to talking about technology as well as providing guards. We’re not saying to the client: “Let’s do a guard deal and then I’ll bring in a technology guy.” One person can speak to both pieces of business.
We’re also spending a lot of time and money upgrading the skill set of our sales individuals so they are now solutions experts with a layer of technology subject matter experts behind them. We have a whole community of people working in the common mission of having a much broader conversation with clients about developing a security program versus a segmented approach.
The third approach would be purely from a product perspective and that’s developing relevant integrated product suites for our clients. So that might look like a guard holding a mobile device as opposed to just a guard; it’s access control integrated into the guard program and so on.
Canadian Security: What vertical markets are you really interested in right now?
Saunders: There are verticals like health care that demand specialized product. It’s clearly a vertical I’m excited about and our goal is to continue to invest in that area.
The country’s health care infrastructure is in need of upgrading. In terms of retrofitting hospitals we believe there is a huge opportunity there. Hospitals are looking for cost efficiencies and now we can play a role in helping them do that and we are fully engaged in a health care strategy.
Our Western Canada presence is strong this year in nurse call technologies and high-risk environments and there’s more to come from us this year in how we plan on addressing that market.
Condominium is another specialized market for G4S. When you’re selling to a condo board the most important buying criteria is often cost and there is a lot of opportunity for us there in terms of the integration of product. If you were to take a traditional conversation about condominium security which is often, ‘Why is your guard $12.07/hr but I have a quote from a competitor for $12.02/hr?’ All of a sudden you’re having a conversation about a nickel. We want to look at how to change that conversation.
We have a very well established new construction division lead by Mike Tomas, who is a 25-year veteran in the industry. We’re putting a lot of focus and effort into the new construction effort because there’s a lot of terrific integrated technology we can put in buildings before they open.
So when we look at condo there’s really two specific approaches to the market — one is the pre-build stage where you can take the smart building philosophy and integrate security into the infrastructure while it’s being built.
Then there’s the building that requires retrofit and how do you change the conversation with the client from it being about the guard or concierge to the building overall. One of the things we’re doing with condo is integrating access control and the facilities management system with the security program. We just completed a strategy where we are offering financial options as well. So instead of looking at a price per hour for the guard you’re looking at a price for all your key infrastructure systems inclusive of a guard. That becomes a stickier deal and you get a full service offering. You have traditional product but how you package it is what’s fundamentally different.
We’ve been in the access control business for years and now we’re getting into the facilities business of monitoring boilers, so you take something like that which is pretty traditional and you layer a guard on it and build a financial plan around it — that makes it more attractive in that particular segment.
We also have a government strategy. We just invested in our internal resources to make sure they are compliant with all federal requirements and we passed the Canadian General Standards Board certification which allows us to engage in government opportunities.
When you look at the competing pressures governments are under right now it’s cost savings and efficiencies versus the public demand for greater safety. So when you think about the recipe for a good integrated strategy that’s exactly what integration will accomplish for any client. They get efficiencies built into leveraging advanced technologies.
We also have a contract with Canadian Border Services to provide electronic monitoring. GPS or electronic monitoring really speaks to leveraging leading edge, advance technology in terms of public safety. If you look at the threats any country is faced with right now in terms of tracking offenders you still need to keep track of them. Electronic monitoring is a cost effective means — if you look at the cost of incarceration versus monitoring, it’s huge. Globally, G4S has acquired some very strategic companies that have made us one of the top electronic monitoring companies in the world.
We can take the global power of G4S and regionalize it and make it relevant to our markets and draw upon those strategic acquisitions and assets that we have globally. All the key acquisitions G4S has made in the last six months have been technology — we have not bought a guarding company — G4S has bought technology companies.
A lot of our strategy around customer service and delivery is about how do we differentiate ourselves in the market. The overwhelming conclusion is that we’ve got to be an integrator.