One global company was able to reduce costs and provide better service by replacing local suppliers with a single strategic security partner.
Agilent Technologies is an analytical instrument manufacturing company with more than 170 locations in nearly 30 countries. For years, we relied on more than a dozen suppliers around the world to fulfill security needs. A few years ago, however, we decided it was time to move to one provider for all facets of our security. In the process, we also reassessed which services we truly needed and which of those handled in-house could be outsourced.
When you start talking about identifying a single company to be your strategic partner in securing your people and assets, you’re talking about a fundamental shift in paradigms. This kind of a shift doesn’t happen without support from senior management. Management must be open to innovative methods and willing to take a few risks to move the model to the next level of maturity. Agilent management gave the security department the support and latitude we needed to approach the sourcing process in a less traditional manner.
One of the key reasons Agilent had been using so many vendors was our tendency to use local suppliers for many facilities. Our new objective was to improve consistency and cost-effectiveness.
When you consolidate services into one supplier, your leveraging opportunities expand exponentially. In addition, you can more easily assess and manage performance. And, of course, you get more consistency in everything from the appearance of the guards to the protocols and training.
The security industry has been changing as well, with several service providers moving from commodity providers to solutions providers. The various companies were finally at a point where they could offer Agilent what it needed.
The Sourcing Process
To begin the process, we pulled our internal security team together with our sourcing team and started mapping out which services we really needed. We made a conscious decision to avoid discussions about whether various services should be internal or outsourced and just focused on what functions had to be carried out.
As the internal security providers, we had to separate ourselves from the concept of, “Could these guys actually replace us?” And that’s a tough thing for people to do. When you start talking about outsourcing different services, the first thing that people think is,“Well, I’m not going to outsource my job.”
But if you start by outlining what has to remain in-house, you limit yourself before you even start the work. We didn’t want to do that, so we made sure to avoid any parochial bias.
Next, we set some general guidelines. We knew that we’d need strong leadership, deep knowledge, investigative expertise, and technical support for our worldwide security systems, and the ability to carry our existing educational and risk assessment programs to new levels. Above all, we needed a single point of accountability for the security of Agilent and a clear mechanism for measuring the success of the model on a real-time basis.
At the same time that we were assessing needs, we began a deep-dive into our existing costs to deliver security services across the company. We used that cost detail as a benchmark. We then worked with management to define a specific percentage of cost reduction that we would be striving toward during the sourcing work.
Finally, we pulled together a list of our current locations, including those where we didn’t have any physical security presence and those where we relied on landlord-provided security services. We were looking for a provider that could support any of our locations if called upon to do so, not just those where they had a day-to-day physical presence. That’s what a strategic partner does.
With the scope of services and our locations of operations defined, as well as having a price point in mind, we had the foundation to begin the request-for-proposal (RFP) process.
Our next step was to select qualified suppliers that we would invite to bid on the project. If you’re looking for a single company to provide services around the world, you obviously end up being limited to a smaller number. The fact is that there were no respondents that could deliver “direct services” in every location where Agilent operated, so we had to also look at the strength of their alliance agreements and partnerships in many areas of the world as well as the list of clients that they currently supported.
We also found in speaking with the RFP respondents’ various customers that our expectations surpassed the existing services that these suppliers were providing to their clientele. We wanted more than guarding services. We wanted a partner who would be integral to the protection of Agilent—from the functional strategic planning to the proactive oversight of our key programs, from expert support in critical investigations to help with lighting in our parking lots—and everything in between.
I had more than one of my peers in the industry simply smile and ask me to keep them informed of our progress with such a lofty goal. The implication was that it couldn’t be done.
We did eventually find the right partner—G4S, which had a portfolio of services and a footprint that aligned with our needs and our RFP criteria. The company was collaborative and transparent as we worked to identify cost efficiencies with our various sites.
G4S did not actually have operations in every single one of Agilent’s locations, but it had strategic partners that could fill in wherever G4S was not located. Additionally, Agilent had gone into the RFP process hoping to find a company that could also provide worldwide support for our systems security. G4S was not initially selected to provide our security systems support, but we gave them that responsibility after they acquired Adesta. We made this change about 20 months into the relationship. Now, after nearly two years of experience with our new model, we have seen the return on our efforts.
Assessing sites. In addition to expecting G4S to staff posts and handle systems, we wanted them to help us determine the level of security needed at sites. To that end, my global team and G4S first developed an assessment tool. Then G4S was given responsibility for carrying out the security assessments according to a schedule based on the risk ranking of every site. They continue to conduct staffing assessments on an ongoing basis.
Monitoring. In addition, G4S is the point of contact when we need to arrange anything from close protection assignments to investigative support in complex, cross-geographic investigations. These arrangements are made on an as-needed basis. For all of these services, I have a real-time “dashboard” view of my functional costs, and we maintain a change order process flow to ensure that we are able to show why we are above or below budget at any given point in time.
One reason the partnership with G4S has worked so well is that they truly are our strategic partners, rather than just another company we are contracting with for security. Ron Oberem, director of international accounts for G4S, is my lead contact. I also have an internal manager assigned to each of our three geographic regions of the world, and they have counterparts in the G4S organization who participate in our functional meetings, held monthly, and in developing investigative strategies.
These G4S personnel suggest tactical and investigative strategies, and they share goals with Agilent. G4S has also been able to make technology recommendations that have helped to keep costs down for Agilent. For example, we have made improvements in our usage of existing systems, including consolidation of our security operations centers in the United States; we have also increased remote monitoring capabilities, and used our technology to focus our manned patrols on higher-risk areas.
Oberem says the partnership has been successful in part because Agilent regards the G4S team as the security experts. “Agilent has kind of handed us the keys to their facilities. So we take the ownership [in] how we provide the security to Agilent, and that translates down to all the security personnel at G4S. So there is a sense of ownership at all levels within this account,” he says.
The most challenging part of the process was the change in management, going from using companies near Agilent locations to just one supplier. It was also important to shift reliance from internal resources to G4S resources.
For example, historically Agilent HR would work with an in-house security manager to resolve HR issues that had a security-related element. As we’ve transitioned into a strategic supplier model, we’ve had to help functions such as HR understand that they may not have an internal security resource at the table. Instead, this resource could very well be an external provider who would be working on the security department’s behalf. The same sort of issues applied with our travel partners, legal, internal audit, and so forth. That’s a challenge that any security department must anticipate if it is going to make this type of change.
Another challenge in bringing in a supplier for key positions is that it can create a situation where we may be tempted to exercise more control than we should. It’s important to stay focused on measuring the outcomes, not the methods. That is why performance measures are so important.
Key performance indicators (KPIs) and quarterly business reviews (QBRs) are increasingly used to assess suppliers’ administrative and tactical effectiveness, and we value these tools at Agilent. In fact, when we were finalizing our contract terms, we included KPI’s as part of the agreement and tied compensation to their achievement.
For example, we stipulated that some functions, such as response to an emergency, were key performance indicators, and we included a “fee-at-risk” clause whereby negative performance in any of these categories would trigger a potential “rebate” from the supplier. Likewise, we agreed that the supplier should benefit from any cost-saving measure that it initiated and that was ultimately implemented by Agilent.
We do both monthly and quarterly business reviews. Our monthly KPI reviews provide a worldwide roll-up view of the supplier’s global performance, and the QBRs provide the same on a quarterly basis. For the QBRs, we have senior vice president-level participation on both sides. While we are reviewing past performance, our focus is always forward-looking, with the emphasis on continuous improvement.
The model has worked better than we had hoped. Now, with only one call, I have responsive experts in the security field available to me at any location in the world where Agilent operates. I have a provider that partners with our internal IT folks and watches over the health and functionality of our worldwide security systems. I have professional staff in our security operations centers and at many of our lobbies. I have a partner whose performance is measured against the same metrics that I am measured against. I have a model that provides the right balance of risk in protecting a global company while adhering to forecast costs.
Moreover, we achieved a 10 percent reduction in worldwide costs for security services within the first 90 days of making the switch. Overall, the return in both dollars and quality of service has more than compensated for the challenges entailed in making the change.
Barry Gentry, CPP, is the global security manager and chief privacy officer at Agilent Technologies where he oversees various corporate security programs, including contracted guarding services, world- wide security systems deployment, travel security, and investigative functions. He is also a former assistant regional vice president for ASIS, Region 4. Prior to his career at Agilent, he worked as an information technology manager, and he spent 10 years in the criminal justice field.