Bob Forsyth, the Managing Director of MITIE Total Security Management (TSM) introduces his sixteenth blog on Infologue.com by looking at the affects of political changes.
Bob writes; “The impact of political change and decision-making on our industry, and me as the head of a business is significant. It is one of the main catalysts for my strategic thinking and actions.”
“When discussing political change, I’m not referring to direct legislative changes, such as the introduction of the Private Security Industry Act 2001 (PSIA) and the associated Approved Contractors’ Scheme (ACS), which are obvious game changers.”
“I am referring to wider policies that may not be directly linked to our industry but significantly affect the wider market or sector we operate in. These are the ones where your strategic view has to be aligned to the potential impact that may not be obvious at the time.”
“An example of the political environment shifting and changing the sector was the minimum wage legislation that was introduced in 1999. So how did this change business planning? It created a catalyst for change, not purely because of this one policy, but a number of other changes to the working week and the potential changes to the working time directive (which the security industry had an opt out of).”
“I am not debating the right or wrong about the policy changes, from a political opinion, but I am making the point that the business landscape changed; large security companies employing high volumes of low paid workers saw a sudden increase in the cost base due to wage increases which were passed on to the clients.”
“This meant the cost of the product was more expensive and each year the minimum wage increased and so did other direct costs that had to be funded by clients. So the knock on effect was to reduce spend on this product, which drove down staffing numbers, meaning that if you only operated manpower provisions your margins were under pressure and you had less revenue.”
“However, not all companies in the sector lost out, with systems companies emerging as the big winners because of the move for more hi-tech options which could reduce cost significantly. The key impact here was to make sure that the business strategy had a route to market in this area and a viable proposition.”
“My view is that innovation always happens when prices start to rule the decision-making. There is a significant incentive to reduce spend and a willingness from the provider to make it happen, driven by the potential to lose out on sales.”
“This is a simple example of where our thinking needed to change as business leaders who are trying to look into the future and make strategic decisions around investment and divestment.”
“Government policy is difficult to predict in the longer term due to changing leadership or parties as either change may see an individual in power with a different view on the issues of the day.”
“So how are decisions that the coalition government makes helping to shape our sector?”
“What is evident is that the government is determined to balance the books and reduce the country’s burdensome deficit. One area they have targeted to achieve cost savings is the police sector. It appears that there are two main objectives to achieving cost savings: 1) reduce bureaucracy and 2) get more police officers out on the streets. In addition we have seen the introduction of Police and Crime Commissioners (PCC) in England and Wales who are mandated to respond to local policing needs.”
“While this clearly presents opportunities for private security companies in providing back office support, custody suite management, cordon management and also with CSAS accredited security officers, one area of concern relates to business crime. How much of a priority will this have on the new PCC’s agenda? How much of a say do businesses have in setting the priorities of their respective PCC, and what if that business is a national business – shouldn’t they expect the same standard and priority of policing?”
“All of these changes have a knock on effect on the viability and profitability of our industry. What is clear now, more than ever, is the need to evolve to meet the financial challenges that are real and continuing.”
“Employment costs will continue to rise, we therefore need to develop a more risk-based and technology-led solution for the delivery of security. This not only leads to cost efficiency, but also reduces the overall security risk if systems and processes are correctly configured.”
“With the advent of technologies like PSIM and the evolving development of video analytics, electronic security systems are starting to reduce the requirement for people as the security front end. This reduces cost while improving efficiency as we are removing the potential for human error.”
“To summarise, in an ideal world we need a crystal ball to gauge what’s happening to the sector from both direct and indirect policy and legislation! My view is that indirect policy is the one that we must keep a close eye on and ensure we foresee the trends that can provide opportunity or conversely require us to change strategy.”
MITIE Total Security Management Website
With over 17 years’ experience in the security industry, Bob is a proven achiever at a high level. He is a strong relationship builder who is financially astute with excellent negotiation and communication skills, with the ability to work with people at every level. A team player, Bob is able to lead by example.
Bob was promoted to the position of Managing Director of MITIE’s security business in April 2010 after several notable achievements since joining the company in 2004, including his win of the prestigious MITIE new business award.
Having successfully implemented the merger with Initial Security in the Southern region and developing a profitable part of the business, Bob has continuously worked towards expansion including the implementation of the response service, and has significantly contributed towards year on year growth. In June 2009, Bob initiated the launch of the business’ total security management ethos; to take an integrated risk-based approach to security, incorporating people, technology and consultancy services.
Bob continues to move the business forward and has delivered record EBITA profit. He has increased business retention and launched new services lines including lone worker, void secure, employee screening, and security risk and business resilience. Under his leadership, MITIE’s total security management business has grown into an organisation with a turnover in excess of £280m. He takes every opportunity to promote MITIE’s presence within the industry through his involvement with industry bodies such as City Security and Resilience Networks (CSARN) and the British Security Industry Authority (BSIA).
A member of the Institute of Directors (IOD), the Security Institute and Resilience Industry Suppliers Community (RISC), Bob is championing the development of the security industry from a guarding-focused, low-end purchase, to a risk-based, technology-driven industry, and plans to work closely with the BSIA and his peers to accomplish this. Bob is passionate about the security industry and enjoys speaking at events such as TINYg in New York, CSARN conferences, and various other security and risk events.
Bob writes a regular blog for the internet news provider infologue.com to share his vision of the industry’s future. He is also an avid tweeter; taking to the social media site to both promote his ideas and listen to others from around the industry.
In his spare time Bob enjoys sports and is a devoted West Ham fan. He also appreciates current affairs, military history and travel.
Opinions expressed by contributors and commentators do not necessarily reflect the views of Infologue.com or Interconnective Limited.