Richard Fenton-Jones, board member of services firm OCS and managing director of its security arm OCS Resolution Security, talks to Mark Rowe about SIA licences and providing good and profitable guarding services.
Without wishing to show disrespect to anyone, the venue for the meeting with Richard Fenton-Jones – the Oldbury offices of OCS – is not as grand as the previous place I met him, the RAC Club in London. The view from the first floor meeting room is of the urban West Midlands – think junction one, M5; and a tea bar on a street corner called Bostin Butties. It is a down to earth part of the world, but then the services the parent group OCS (One Complete Solution) provide are down to earth – such as cleaning, catering, and laundry, besides security. <br><br>Reduced manpower<br><br>Anyway, I was not there for the view but, first, the most pressing topic: the March deadline for SIA guard and CCTV operator licences. Manpower costs are soon going to go up, Richard said, though he suggested that rises would be regional. “A lot of our clients are going to be saying, do we have the best solution; and that new solution may well involve reducing manpower, particularly in the silent hours; and looking at technology solutions, such as remote monitoring to a central control station, with a mobile patrol back-up provision.” On that score, OCS Resolution Security recently acquired Kent-based installers Access Communication Systems. <br><br>‘Ludicrous’<br><br>When we met in late January, the latest news was the Government’s approved contractor scheme ‘decision’ that however lacked details; and the SIA’s Operation Forewarn, whereby the regulator’s inspectors visited 27 (unnamed) guarding firms. Richard said: “I mean, it is absolutely ludicrous that here we are, eight weeks before the licence deadline, and we still actually do not know what approved contractor is going to cost us, and we don’t know what the requirements are going to be.” The guarding industry, Richard added, sought 12 months’ notice, because generally there are only annual price reviews with clients. And there was, Richard recalled, hardly any notice of the cost of licences – not only the £190 application fee, but extras such as the £35 for exam certificates. <br><br>Same, with licences<br><br>Earlier, Richard recalled how SIA chief executive John Saunders at the authority’s launch – was it really in April 2003? – spoke of transformation of the industry. Richard said: “And what we don’t want post-licencing is for the industry to be the same with licencing slapped on it; and frankly everywhere I look now all I see is the same industry with licencing slapped on it. So what has happened, therefore is that maybe prices have moved up – marginally – and by that I mean genuinely marginally; in some cases I am not even sure people are covering the basic costs of the licencing. And we are still scrabbling around over margins, competing on price. I don’t know where the industry is going to go if that is the case.” And meanwhile stake-holders in contract guarding – whether the company share-holders or in the case of OCS, a private company, the family owners – still expect top-line growth. He suggested that like-minded competitors ought to support one another, to get away from the competition on price driving down margins: “Otherwise the industry is just in a downward spiral, in terms of a profitable industry to be part of … because the only people that really suffer are our clients and our employees, because our employees don’t get the same level of training as arguably they did some years ago. We cannot invest to the same level as we would like in their welfare, and by welfare I mean pension, private health schemes, more generous death in service cover, longer holidays, that I think most people would like, but we don’t have enough left in our margins to cover it. But because of the lack of differentiation between [guarding] businesses, our clients have nothing else to go on but price. So our challenge, I think, as an industry, is we have to do something that we have been very bad at, and that is, we have got to educate our clients, and particularly the purchasing departments; we have got to educate them as to the a) importance of a quality security provision, but b) the value to them, as an organisation, that our services bring. Because we don’t put a price tag on the value our services bring to our clients. We don’t help our clients understand that service A is going to bring them business benefits equal to £x and service B is going to be £y. We are very bad at making that transparent to our market-place, as an industry. Somehow we need a way of demonstrating in monetary terms the value of the service we provide to them [clients] because until we do that, in fairness to our clients, they have nothing to go on but price; and we can all sit there and say lots of promises about how we care for our staff and will train them and put them in new uniforms twice a year; but these are all words at the point of sale, when we are trying to win business. It does not give our clients what they are looking for, some quantifiable difference between one service provider and another.”<br><br>Service<br><br>He recalls his dozen years at an employee relocation consultancy. (Briefly, Richard Fenton-Jones joined OCS in March 2002, as Managing Director of OCS Security Services. He was previously a regional director with Securicor.) Say a bank manager was re-locating from Plymouth to Leeds; Richard’s firm would arrange house sale, removal, grass-cutting, new schools for children – a high-value service, Richard recalls. The re-locator offered a solution applicable to the client, and gave a total price. “Now contrast that with the security industry where w go along to the client and the client tells us how many guards he has got, what their pay rate is, and how many hours they want to buy, and then what do we do? we then give them information about every single cost element that builds up our price, which means that we can find ourselves negotiating two pence an hour over sickness and one pence an hour over uniforms and our management overhead and training, which to me detracts from what we are really trying to offer clients.” Instead, we should encourage clients to say why they want security. For there are a variety of reasons why someone seeks a security service: staff welfare, to protect against loss or threat, or merely because insurers demand it. Why not, in other words, start with a blank piece of paper? <br><br>Pay rates<br><br>Richard called for more freedom to pay staff. He said: “I would love to give different rates of pay to guards. I mean, contrast a guy who has maybe worked on the same site as a security officer for six, eight, ten years and he is a really good guy, knows the site inside out, highly regarded by the clients; but he is only ever going to be a security guard.” That is, he is trained and of value to the client, but on the fixed, guard’s, rate of pay, the same as the officer with four days’ training, who has just joined. OCS, he pointed out, has a contract to fill all hours in that contract, and will be penalised if it does not. “Clearly we are going to have to pay appropriate rates of pay, but I would like to reward skills people bring to a contract: now it may be length of service, training, client relationships.” OCS, he went on, does what the firm calls a ‘job chat’ a mini-appraisal every six months. “And that gives us the ability, not only through regular supervisor and contract manager and operation manager visits to the site; but it also gives us a formal process where we can assess competence, training needs, et cetera, and they can be linked to pay.” Richard paused for a sip of coffee. “I just think that would help to create a more motivated workforce and improve loyalty and staff retention.” Also on that topic, OCS has Investors in People and as reported last issue, passed its NSI gold re-audit. Significant here is (as reported in our May 2005 issue) that OCS are among sponsors of the Security Research Initiative (SRI), by Prof Martin Gill’s consultancy Perpetuity. The aim: to study how clients view security, to measure value – in short, to answer some of these practical questions. <br><br>Service<br><br>But to return to the point: “We have to break the cycle we are in as an industry, where everything is price-driven; a customer says, that is what I want to buy, here is your number of hours, your guard wage rate, and what is your price? Where does a guard firm position itself, then, in a SIA licence world? In the London market? As a regional, or niche market player? You cannot be all things to all men, Richard said. That said, while the number of contract guarding companies will reduce, in Richard’s opinion, he does not believe that it will be a drastic reduction to 200 or 300 as some commentators have said. And bear in mind that Richard is a MD who has possible company acquisitions pass over his desk. Why, as Richard put it, has life changed for a small guarding company, if that company has its officers licenced? Yes, unscrupulous guard firms may not get licences for staff and cannot re-recruit, or some may see the cost of change as too high. At the risk of generalising, as Richard did say, guard firms selling out may be because the MD is of retiring age and the SIA is only the trigger event. <br><br>P s<br><br>As for the approved contractor scheme like everyone else in guarding you talk to Richard’s view is that if you are not in the ACS, you are not in business. Yes, some firms may see it as extra admin, but whatever the details of the ACS, it will be a set of processes – a work-book, whatever. As Richard said, most important for the approved contractor is the right to deploy an officer awaiting a licence: “Having said that, realistically it is still going to take what, two or three weeks for a approved company from recruitment to deployment.” Because from the day you recruit, the new-comer may have to wait a day or two for a four-day training course to start (OCS has all such training in-house). After the course, the firm has to send the recruit’s certificate to NOCN, the exam awarding body, for assessment. Only when the awards body gives the OK can you submit the licence application form to the SIA. And only when the SIA sends the acknowledgement of receipt can the recruit go to work. Richard added: “This is going to mean all companies are going to have to carry a larger team of reliefs and temporary workers because officers can leave the organisation very, very quickly; and much quicker than you can recruit. So the pool of staff is going to have to be significantly larger than we currently would carry.” A guard firm not in the ACS will have to wait seven, eight weeks for a joiner to gain a licence and go on a site. “In the labour pool we are trawling in, how many potential new recruits are going to wait seven or eight weeks before they can even start work – the pay cheque comes later. They [recruits] haven’t got the financial wherewithal to do it.” <br><br>About the man<br><br>The next question came out rather baldly; what does Richard do? As a director of the overall business, he has to have an awareness of the other arms of the company; and he acts as an interface between security and the board, to explain what is going on, and try to make sure that the strategy that the security division is working out is complementing the wider, group’s strategy. “We have been set a very clear goal by the group board and the group chief executive, which is ‘one-five-ten’. For OCS to achieve £1 billion annual turnover with an average of five per cent profit across the group, by 2010. And all that has been broken down into individual targets for the various businesses. So I have a target that I have to achieve by 2010, that encompasses both turnover and profit. So I have to make sure the strategies we adopt in the security division as a discrete entity are complementary.” And Richard oversees particular group-wide strategies, such as Investors in People – “it’s something I particularly believe in … because I genuinely believe as an industry we need to get better at looking after all of our people. That is only going to happen – if you will forgive the soap-box just for a moment – if I and the security board can make our middle managers feel valued, so that they in turn can genuinely make our security officers feel valued. Because you cannot tell a manager to go and make people feel valued, if they do not feel valued themselves.” As Richard added, it is not altruistic, it makes sound business sense: “Because if our people feel valued and genuinely feel the company cares about them, they will stay longer, recruitment costs go down. Staff retention increases, which means the quality of service we are offering to clients improves, which means client retention improves and we get more [clients] by way of recommendation and retention.” And Richard did add that the security division was blessed with a strong management team, including some from Resolution, the London-based guard firm acquired by OCS in 2004: Dai Prichard, Dougie Blackford, and Martin Rackstraw. <br><br>More about the man<br><br>So to carry on being nosey about what the MD of a large UK guarding firm does: lots of meetings, plotting a way ahead, reviewing progress, budgets. Senior regional staff from all sides of the business meet in each region, to share ideas; directors are a part of that; Richard chairs the Midlands team meeting. “And then I do try to see as many clients as I can,” Richard added, though as is the way of these things, much of the time clients get in contact because something is the matter. “And obviously I like to go around the sites, meeting both managers and officers.” OCS has 18 regional offices, from Aberdeen to Manchester to Fareham. And like others, he feels he spends far too much time dealing with e-mail; did people really have to send a copy of that attachment?! He recalled he was heavily involved in the NSI audit, feeling it necessary for staff and the inspectorate to see that he was taking it seriously, and not just as a tick-box exercise. In other words, just by being there the MD sets the tone, has influence. Similarly, Richard said he spends quite a lot of time with the sales team, at presentations. Prospective clients like to see that they are important enough for the MD to be there; and to do that, the MD has to be part of the tender process, and the preparing for the presentation. <br><br>Enough hours?<br><br>Are 168 hours in a week enough? Richard chuckled, and replied: “That’s why you need a good team around you. I am quite hands on; I need to understand a lot of detail in the business.” About half of OCS Security is London-based; the other half, not. In terms of Richard’s working week, it means that living in Gloucestershire he is handily placed for the regional half, not so for London. He tends to be in the capital for three days a week, and will stay over in London in company flats. His week will start by hitting the road at 5.30am and M4ing it; he likes to be in the Clapham office before 8am, Monday. While in London he may be in the office until 8pm, 8.30pm. <br><br>Regions<br><br>Finally, does he see any regional differences? As an observation – not a complaint, he said – he said that whereas in London a client with a problem will expect a senior person to attend, in the regions the client will accept a response from a lower-ranking person. That is, if something goes wrong, the London client will typically want to see someone with a director title. In the regions, a client will be happy with a immediate, ’phoned response and a ops or regional director visiting, say, next Wednesday. And, Richard added, it was the same when he was at Securicor. Why is that – is it just seen as the norm in London, is it a faster pace of business in the capital? <br><br>Tour<br><br>On the way out Richard showed me around the Oldbury building – the open-plan office where cleaning, security and so forth employees work side by side; and the depot where the Cannon Hygiene arm of the business deals with, say, the feminine hygiene products – in other words, that side of the business where OCS staff call to carry out some service, rather than be on site. After a hand-shake in reception I was walking to my car parked beneath the flagpole flying the OCS company flag.
As reported in our February print issue, OCS Resolution Security has kept its NSI Gold standard after a three-year guarding audit re-assessment by the National Security Inspectorate.
OCS chief executive, Chris Cracknell, said: “We have always known that our offering is market leading, but to have this confirmed by such a highly regarded and independent source is fantastic. I am particularly proud that the auditors gave such positive feedback about our culture, which included remarking on our supportive management, our no blame attitude and the fact that innovation is actively encouraged and taking place at all levels.”
