When choosing the installation company for a large security project, clients often ask what selection criteria they should have for their decision process. Of course, the answer is almost always “it depends”, but there are some basic concepts that every security manager should consider when faced with a similar decision. The primary consideration for most large companies, especially those with overseas operations or dispersed continental locations, is “Do I choose a single large, national service provider, or several regional vendors?” With the frequent recurrence of mergers and acquisitions taking place in the security industry, this decision gets harder and harder to make.
Arguments can be made on both sides around the decision to go with a nationwide company or to use smaller, regionalized companies in each area your company has a presence. Often, the decision isn’t left to the security director alone, as the legal, purchasing, or some other department may have some influence on this selection in order to comply with corporate policies regarding liability or invoice processing. This can be problematic if those departments are permitted to tip the balance of logical selection criteria based on security philosophy to one of corporate bureaucracy.
The single most often stated requirement for a large-scale nationwide integrator is the concept of “one stop shopping”. This is often the most compelling reason to pick one of the “big boys”. National companies can offer nationwide or even international installation and maintenance support for your security program. This single source solution can represent a wealth of instant knowledge and access to resources you didn’t have before. I have seen projects where a national service provider can throw enormous resources at a project to help resolve a problem or meet a deadline. This would be difficult or even impossible for a smaller dealer. These providers often can represent significant influence on an equipment manufacturer for better pricing or special considerations.
Still, these conveniences come at a price. You can typically expect to pay more with a national service provider, even if you have national account status. It is not uncommon to see 15 to 25% above list price markups for equipment, and average or high labor costs to install that equipment. After all, larger companies mean larger overhead. A word of caution: a national service provider is also only as good as the regional office. So if a vendor has a strong office in your home town, but has weak offices in several other cities in your corporate footprint, it could mean trouble. “But that’s not my problem, it”s the vendor’s problem, right?” Ultimately, yes, but be prepared for the possibility of project delays, inconsistent installation practices, and unforeseen cost overruns.
The single most important thing when having a national service provider: A single point of contact for your account. This may seem obvious, but it is not uncommon for this position to get passed around, and if you’re in the middle of a large integration project, this discontinuity could be disastrous.
Ultimately, your preeminence to a large vendor will depend on profit, communication, proper planning, and time. If any of these becomes disproportionately too much or too little, your priority ranking to that company just got changed. “So, I should use regional vendors and just pick the best one in each area I’m going to be in, right?” Well, maybe. Using regional vendors has certain risks and rewards as well. The rewards should be obvious: you should have more influence over a smaller, regional vendor. Expect better customer service, and personal attention from these smaller vendors. Personally, I like being able to call the president of the company when I have a problem that warrants his attention. You likely represent a significant portion of his revenue, and he will be more likely to “bend the rules” to accommodate special conditions or requirements.
Regional companies typically have better availability, more flexible schedules, are more open to custom configurations, and may have more specialized and technically proficient technicians. Expect lower pricing on most bids, and especially on change orders and project add-ons – which always creep in. Contrary to what you might think, I’ve usually found the regional vendors have better field technicians in terms of technical competency and being able to think outside the box. This of course assumes the vendor is willing to pay top dollar for technicians and keeps him trained with current technology.
The drawback to working with several regional vendors is the overhead and administration that you will have to do to properly oversee these contractors. Just selecting the best vendor for a particular area can take time. Starting with a recommendation from the manufacturer of the equipment you want installed is a good idea. They can usually provide you with a couple of their better vendors in a particular area. Still, a methodical due diligence process is recommended, and your legal or contracts department can probably help. Even when you have selected all your regional vendors, properly overseeing their operations can be a time consuming task. You alone will be responsible for coordinating all matters related to a cohesive security program: installation guidelines, help desk troubleshooting, service and maintenance requests, warranty management, work policies, project management, equipment selection, and software programming guidelines, to name a few.
If you are not comfortable managing this process, consider temporary or permanent outsourcing to setup and manage it for you. It could still be cheaper. Other problems in using regional vendors: limited resources and scheduling conflicts, lack of working capital may require the vendor to ask for more money up front for a large project, less flexible payment and leasing options, lack of influence on major manufacturers for custom product development or special situations.
Hopefully this article has given you some insight into the issues around choosing the best security contractor for your corporation. Ultimately, the decision should be based upon your budget, security philosophy, and your operational requirements, but your decision should weigh the convenience of having a “one stop shopping” solution and paying for the convenience, or tackle the burden of managing multiple regional vendors to save money. Either proposition will still require some coordination and vendor education on your part.