Training and its inherent value

The Chartered Institute of Personnel and Development’s (CIPD) 2004 Survey predicted that training budgets were set to rise. A true prediction for the security industry, certainly, but the $64,000 question is: ‘By how much, exactly’?

The survey also suggested that a third of private sector training managers expect their budgets to increase in the next 12 months. Apparently, 81% of all those organisations questioned now have a training budget in place, indicating an acceptance that training means business! Encouragingly, 32% of those who provided feedback for the CIPD stated that their employees are averaging more than five days’ training per year.

The evolution of the security industry has been debated many times. What does the future hold? No-one really knows the answer to that question. With Security Industry Authority (SIA) licensing in play, what will hopefully be a short to medium-term pain for many security companies should eventually turn into longer term benefits. Those benefits must include increased margins, reduced staff turnover, an enhanced quality of on-site officer and (arguably most important of all) structured career paths for individuals.

It’s fair to say that good businesses succeed by defining and then implementing key strategies. Alas, as an industry we – in the collective sense – have been neglectful of the sector in which we work and that we represent. It is service providers who have driven down margins to their currently unacceptable levels, not the customers. We all seem to agree that margins for contractors are too low, but why is that? Read the previous sentence again!

Reduction in service

For years, security companies have competed with each other in a cut-throat market, offering reduced margins year-on-year until they reached the current situation and began to wonder how much lower they could go.

Simply put, margin erosion will inevitably translate into a reduction in service provision somewhere along the line. Whether that be in the shape of reduced supervisory visits to site, less client visits and meetings with the customer and a reduction in training. Heaven forbid that ALL of these areas will be targeted such that a given contractor can make some kind of return on its efforts.

What is not often recognised is that training and staff development can increase margins. How? Simple. Show an interest in the staff, provide them with a thorough induction to the company, its ethics, values and client base and make sure that training is progressive.

During the past few months I have heard individuals bemoaning the additional training needs of the industry, and how costs are going to spiral to unaffordable levels. I make no apologies for not agreeing with that premise. Training is a central tenet of customer service. It is not an optional extra. It’s an essential.

Why is training essential?

Training is essential for a number of reasons. Obviously, in 2005 it has become a central remit of the SIA’s path towards industry regulation. Yes, costs may increase by up to 25% by virtue of the fourth day of training now required. This percentage applies to those organisations who currently fulfil the industry’s minimum training requirement of three days. Alas, with the majority of organisations that is where training ends. It’s often the case that no staff development programmes are in place. I’m not going to criticise such organisations, though, as this happens for a number of reasons (lack of resources for trainers, facilities and the available materials being one of them).

In my opinion, SIA licensing is providing the industry with a golden opportunity. Like many others, I believe that the industry should be seen as a career. Whether that be a first, second or third career. Career progression, though, does not occur without training, whether vocational or classroom based. On the whole, as an industry we have been neglectful of individuals’ career progression paths. Due to the perception of the costs involved, perhaps?

Different train of thought

How about using a different thought process? In other words, what would the cost be of NOT providing training and career progression that meets the needs of individual and employer?

That cost will vary from one organisation to another, of course. However, my calculations suggest that it would be £1,000 per individual. This figure includes the cost of licensing, the four-day training programme, payment (at the national minimum wage level) for that four days of training, uniform costs, the cost of the interview stages and the financial outlay associated with vetting and screening.

In Year One of employment this equates to 8% of gross basic wage, based on the national minimum wage (currently £5.05 per hour) and the 48-hour working week. Thinking of the cost across two years, it equates to 4% per annum. Surely by this stage a staff development programme of some sort should be implemented and underway?

It would be realistic to assume that, over the second two-year period of employment, staff development costs would be £1,000 per employee. 5% per annum over three years of investment. Not the largest of capital outlays in view of what the potential reduction in staff turnover could be.

Thinking back to the first £1,000, it starts becoming expensive when staff turnover increases. Security companies must have strong human resources procedures in place in order to monitor (and highlight the reasons) why staff leave.

Why do security operatives leave the industry? Unfortunately, there is not enough time, paper or space available to answer that question here! Several reasons would include the poor management of resources, and the aforementioned lack of development initiatives. That can be reduced through structured planning and training.

The cost of outsourcing

To its great credit the SIA is looking at the issue of staff development, and the strong suggestions are that this will be focused on work-based vocational training. Looking at the cost of outsourcing, it is perceived by some within the industry that it is an expensive way to train. I have to disagree, not because it is our business, but because the figures don’t lie!

The message to contractors is a very important one... Can you afford not to develop your staff? From the client perspective, they might begin to demand that such programmes are in place in order to ensure quality service delivery over longer periods of time.