Contracted vs. In-House Security Paper - Essay Example

Running Head: Contracted vs. In-House Security Contracted versus In-House Security: A Comparative Study This paper is written to present a comparative study between a contracted type of security versus in-house security. In the process, it aims to determine which type is most appropriate in a chosen organization utilizing cost-benefit analysis. Introduction Organizations which are diversely structured exist for various goals and clientele. With resources that vary from small business capital to large conglomerates, the requirements for security management is contingent upon management’s preferences. However, with rapid technological development, coupled with current trends in the market, an organization is faced with evaluating a multitude of factors before deciding with security service is appropriate for their needs. There are two types of security services which are currently being offered: contracted security and in-house security. This paper is written to present a comparative study between a contracted type of security versus in-house security. In the process, it aims to determine which type is most appropriate in a chosen organization utilizing cost-benefit analysis. Comparative Factors Employment: As the name connotes, in-house (or proprietary) security service means the security officer is an employee of the organization. In contrast, a contract security, the security officer is employed by the contractor and thereby, “a generic contract is designed to meet the needs of the client or the organization” (Blake). Training: Since the ultimate task of security management is to ensure the safety and security of the organization, regardless of the type of security service, training is of utmost importance. According to Blake (par. 2), “with the proprietary service, the client can devise and implement a security-training program specifically designed to meet unique site requirements. The client is also aware of the qualifications of the trainer and the adequacy of the training presented. As new or altered training matters are identified, the client can immediately conduct necessary training.” In contrast, “contract services normally conduct training at their facility without oversight by the client. The training may range from “read this” for 20 minutes and claim eight hours of training. Other firms use commercially produced videos that at best are very generic in nature. Few contract firms have a testing program to determine material comprehension by the potential officer. Site-specific training is frequently on-the-job training with another officer of undetermined professional qualifications and on-site experience. Follow-on and periodic training is frequently ignored or of little value.” (ibid. par. 3) Hiring Practices and Qualifications: With in-house security, the security officer meets the recruitment and screening qualifications of the organization who is also the employer, in this case. Therefore, the organization has direct accountability to make the necessary background investigations, ensure complete employment applications, examine the compliance to certification requirements and licensing. Contracted security, on the other hand, varies on the degree of regulating and monitoring minimum standard requirements depending on different states. “Background investigations, when conducted, are normally rudimentary in nature. Employment applications are frequently incomplete or incorrect and partial information provided.” (ibid. pars. 6 & 7) Supervision and Management: The ease of supervision and management under in-house security service is more reliable and constant due to the employer nature of this arrangement. As such, compliance to the responsibilities being undertaken is easily monitored and evaluated. This case is not necessarily practiced under contracted security service. Blake averred that “even with a contract security service, vendor and client management supervision must be constant to ensure compliance with contract requirements. Reliance on the vendor for all supervision and management can easily result in unacceptable service and direction.” (par. 11) Cost – Benefit Analysis In proprietary or in-house security service, “the traditional advantages of an in-house security officer force most often stated are: (1) there is an expectation of permanency, stability, quality, and loyalty; (2) training can be held to uniform standards consistent with organizational requirements; and (3) individual performance and evaluation in accordance with prescribed policies and discipline can be controlled and administered by company management. Another proposed benefit of an in-house security officer force was that in many states an industrial protective force could be commissioned with special police authority that gave them the power to detain and arrest persons engaged in criminal activity on company property.” (Blake par. 31) There are disadvantages to this type of security service, to wit: (1) In-house security costs more than the officers’ wages – the costs also include benefits, taxes, vacation time, sick leave and uniforms plus many intangible costs such as unproductive management time.(Lanfranchi); (2) the risk of employment claims from in-house personnel is steadily increasing. Areas of risk to consider include workers compensation, unemployment, discrimination and sexual harassment. (ibid); (3) Companies in every industry are facing more competition and it is imperative to have a workforce that is focused on improving a company’s core business offering. Personnel-related support functions such as security services typically fall outside of a company’s core business. (ibid.) In evaluating contracted security services, organizations usually opt to outsource due to the following advantages: (1) cost control is a serious issue for most institutions and a primary reason for outsourcing (Bigger & Bigger 2007); (2) they want to concentrate on their core mission and no longer wish to digress from their business to deal with such issues as housekeeping, landscaping, or security (ibid); and (3) personnel actions and issues are taken care of by the company awarded the contract. Issues such as payroll, time keeping, labor relations, benefits, disciplinary actions, etc., are handled by the contractor, alleviating the administrative burden on the organization (ibid). On the other hand, the disadvantages associated with contracted services are as follows: (1) contract services may have problems assimilating the corporate culture of the client (Blake); (2) staffing and scheduling problems are solved using unconventional means. “In practice, the replacement is often drawn from the available personnel who have never been assigned to the particular client location. This can result in the placement of an inexperienced officer whose performance, unless very closely supervised, may cause more harm than the absence would have.” (ibid); (3) “contract security firm representatives usually use a reduction of cost as a major selling point for their services. This argument can be misleading, and on occasion an organization that accepted the organization’s contract service for this reason, selected a contractor on a low-bid basis. This can prove disappointing and misleading because the level of service may be reduced to compensate for the lower price.” (ibid); and (4) hesitation to utilize a contract security company can also be due to the perception of a decrease in quality (Lanfranchi). Type of Organization versus Security Type Given the factors that influence the selection of one security type over the other, it is relevant to consider that from among the different types of organizations, “a government entity may have a greater degree of “governmental immunity” with a proprietary security force where there is more direct control of activities and personnel” (Blake). Other organizations like banks, universities and shopping malls are better off with contracted security because of the following reasons: (1) primarily, these organizations will be able to focus on their core mission (which of course, is not security management); (2) it is less costly; (3) they would be relieved from attending to security issues regarding administration of personnel; and (4) the expertise, training resources and experience a contract security firm provides is an invaluable benefit. As averred by Forbes & Blake, “through the outsourcing venture, business risks are shared. The outcomes expected from the vendor can be quantified to establish realistic benchmarks for program success. Goals are identified and remuneration is contingent upon goal accomplishments. If benchmarks are not met, a financial cost may accrue to the vendor through lost incentives or agreed penalties. If benchmarks are surpassed, financial gain is the reward. Profitability of both parties is influenced by goal setting and remuneration packages.” This means that with contracted security, organizations enumerated above have lesser risks in investing on security personnel due to the expertise that contractors accord. In the end, their bottom-line would be more positive with this type of service rather than the proprietary type. Conclusion Security management is a very critical function that every organization should seriously invest in. With alternative options available for organizations to source their security services, it is imperative to recognize that their supervision and management always play in important part in making this function a success. For businesses who would be most benefited from contracted security, Forbes & Blake presents an appropriate conclusion to this discourse, to wit: “Successful selection of your security consulting and service vendor comes from the ability to create a continuing partnership based on trust and mutual respect for the other’s business. Above all, the vendor absolutely must identify with and support your business culture. For some security vendors that is a tricky and almost impossible task. Only those who observe and practice business priorities as a precursor to security priorities should be considered as your long-term outsource partners.” In the end, whatever type of security service an organization opts to utilize, the most important factor to consider is management’s commitment to supervise security function to ensure that they continue to contribute to the attainment of the organization’s goals. References Bigger, A.S. & Bigger, L.B. (2007).Contract vs. In-House Staff: Finding the right source for custodial and maintenance operations. The Bulletin. Volume 75, Issue 3. Retrieved on June 15, 2009 from Forbes, D.E. & Blake, W.F. (undated). Outsourcing: More For Your Security Dollar. Blake & Associates, Inc. Retrieved on June 15, 2009 from Lanfranchi, M. (undated). Contract vs. In-House Security: Working with the Experts for Specialized Services. Retrieved on June 15, 2009 from Read More