Thursday, December 04, 2008

Group 4 Securicor : Private Security

Corporate Brand : G4S ( Group 4 Securicor)

Brand Analysis Count : 362

26 November 2008 was a day that has changed the life of an Indian forever. When 10 terrorists terrorized our financial capital , killing hundreds of innocent citizens , millions were watching those horror moments on television. An average Indian, suddenly was stripped of the false sense of security that he had.

The very fact that Indian security establishments was clueless about the entire event came as a rude shock. The fact that these terrorist held Mumbai siege for three days also throw light on the efficiency of our counter -terrorist mechanisms.

After seeing all these , I feel unsecure as a citizen. I am not sure how our policemen is going to protect us with his cane Lathi against the ultramodern Kalashnikovs.

As per the news reports, Mumbai terror attacks has left corporates scrambling for security cover. This is boom time for the private security agencies in India.

Indian security services business is huge . According to various business papers, the size of the market for Private security services is around Rs 22,000 crores growing at 25 %. Most of this market is unorganized and the organized security services market is estimated to be in the range of Rs 10,000 crores.

Group 4 Securicor ( G4S) is the market leader in India. Most of you may have seen the security guards from G4S manning the numerous ATM machines across the length and breadth of the country.
G4S is a global firm. and is the World's largest provider of private security services.

According to Wikipedia,the origin of this company is dated back to 1901 in Copenhagen. The company was called as Falck and was founded by Marius Hogrefe .
Group 4 was a security company founded in Belgium. In 2000 both these firms merged together to form Group4Falck.
Securicor was another firm founded in London by the Philip -Sorenson family. At that time the company was known as Securitas International. Later there was a split in the family business which gave rise to two companies Securicor and Securitas. The Securitas went on to form another company which is called Group4Securitas.

In 2004 , Securicor merged with Group4Falck to form Group4Securicor.

The Indian arm of G4S was formed in 1989. The company is the largest private security services company with operation in almost all states. Although the visible part of the businesses are the private security guards we see in companies and ATMs, the services offered by private security firms are vast.

Listing below are some of the services provided by these firms :

Cash Services : Includes cash processing, transportation, retail cash management, ATM guarding valuable escort services and treasury management.

Manned Security : Mobile petrol, VIP security ,Reception, Quick response ,detective services ,route vehicle controls, company security etc.

Security Systems : Alarm services, electronic security, fire alarms, perimeter protection etc
Other security consultation : Risk assessment, training etc

( source : G4S website)

Yesterday there was a news in CNBC talking about the increased demand for private security in the wake of the Mumbai terror strike. The increase in enquiries for private security was in the range of 5 times the average rate. According the Tops Security Services, the enquiries have increased from 50 enquiries per day to 400 enquiries per day after the Mumbai terror attacks.

Although the market is attractive, it is not without problems. The private security services is a human resource intensive business. The security agencies rely on Ex-military personnel for their staffing requirements. Now there is a trend of recruiting ordinary people and provide them training and then employing them as guards.

The major criticism against these firms are their treatment towards these employees. There are reports that the employees are given a raw deal with negligible pay and no employee benefits. The staffs of these firms are largely non-unionized and hence had to suffer the poor wage and lack of benefits.

The silver lining is the emergence of professional firms like G4S, Tops Security and Lancers which takes the employee welfare seriously . Even big firms like GMR group has ventured into the security business. These players are expected to professionalize this emerging industry.

The private security business is regulated by the Indian Private Agencies Act (2005) which has laid down certain conditions and parameters for regulation of this business. This act ensures that only players with sufficient infrastructure will be able to start this business. The act also restricts the entry of foreign firms to this industry.

Another issue that is facing these private security firms is the ability of the guards to face terror strikes like the Mumbai attack. Indian laws prevent the private security staff to be armed with sophisticated weapons. So most of these guards are armed with sticks while the new generation thieves and terrorists are armed to teeth with AK 56 rifles and grenades.

Seldom we see the ads of these security firms. These firms operate in a B2B environment and rely on references and direct marketing. In any high-contact service businesses, the employees form an important part in the marketing. For these service firms, the employees form the brand. Hence much care is taken on the grooming of these employees. Even the uniform of these guards create an impression about the security service firms. Most of the security service firms make sure that these guards are well trained and groomed.

These private security firms can play a big role in the internal security infrastructure in India. We have to take some lessons from the West where these security firms are closely associated with the Government security agencies in providing security cover to major commercial centers. There are instances where USA Government rely on firms like the Blackwater Group to provide security to vital installations in Iraq.