Feral Jundi

Saturday, July 9, 2011

Company Spotlight: G4S, The World’s Largest Private Security Company

These two deals I posted below are separate interviews, but they give you a good idea where G4S is standing right now. This company is amazingly large and successful. Not only is it the largest PSC in the world, but this company is the world’s second largest employer, right behind Walmart. That is impressive.

The thing I clued into is their business in the Middle East. That Saudi Arabia and the UAE were their top customers. The trend here, is these countries are serious about their security, and threats against oil and business are what drives this interest in security.

Mr. Buckles, whom used to work for Avon as an analyst, also mentioned in the interview the key to success for the company and why he stuck around:

‘The sensible one is that Securicor had a policy of developing internal talent and offering prospects for rapid promotion. But there was also the offer of a Ford Escort. A company car for a young guy was very attractive,’ he says. By 2005, he headed G4S. ‘The rules of best practice are the same for all businesses, including supplying security,’ he says.
‘Take staff with you by rewarding achievement, identify new markets, manage risk while taking up opportunities, understand your customers and have a strong culture of ethical dealing. Applying these principles has been key for me.’

That is an interesting list, and many of these ideas are just another way of saying ‘take care of your people’ and ‘customer service and satisfaction’. But he also focused on managing risk, which is cool. G4S has certainly gobbled up many companies in a short period of time, and because of the current global chaos and government austerity moves, their timing has been excellent. In other words, they positioned themselves with enough services to take advantage of increased security related opportunities. They have also been profitable during a time when many companies in the world are hurting.

And to further the theme of taking care of your people. When G4S goes into a new region, like Latin America, and they become the best paying gig in town, then of course that company becomes the popular choice of the locals. I guess they have learned the lesson of ‘pay better than the next guy, if you want to attract the best’. Which is great, because if you pay peanuts, you will get monkeys. Paying better and good training are both key aspects of keeping your folks happy, along with providing excellent leadership. Here is the quote:

Unlike most FTSE 100 chief executives, Buckles, 50, has responsibility for staff working in high-risk situations, so how does he handle the stress?
Looking relaxed at G4S’s headquarters in Crawley, West Sussex, he says: ‘The best training is provided and every assignment is assessed for risk and ways of minimising it. Pressure comes with the job, but I’ve been in the security business long enough to know the importance of teamwork and good communication to ensure we are on top of every contract.’
G4S revenues rose by 4.7 per cent in the first three months of the year, driven by the emerging markets of Africa, Asia and South America, where demand is rising for expertise in areas such as moving cash, guarding airports and providing personal protection.
In some developing countries we are seen as a stronger force in terms of training and pay than local police and a better option for providing security,’

The mention of South America also coincides with what the Small Arms Survey mentioned about Latin America. That PSC’s there are the most armed in the world, outside of the conflict zones. Security is huge business in Latin America, and especially because of the drug wars and poor economy. Speaking of which, G4S is also active in Iraq and Afghanistan. So they are definitely intertwined in many aspects of the industry.

Of course there are also incidents where G4S has had some hiccups. This is the extreme challenge of the ‘head knowing what the tale is doing’ within such a large company.  For a smaller security company, the ability to manage and watch each contract is a little easier than for a large mega-corporation to do so. Given that set of circumstance, G4S has done remarkably well. That doesn’t mean they haven’t had their share of issues come up, but still, for it’s size and exposure to risk, it has navigated those issues very well. Ask yourself how much negative news you hear in the media about G4S, compared to other much smaller companies, and you can see what I mean?

Finally, the one thing that I think is really important to emphasize, and some companies have a hard time understanding this. You can assemble a great team, pay them well, be an outstanding leader for them, etc., but if you don’t have some kick ass marketing and sales personnel hunting around for new contracts and actually winning them, then the company will not expand and get more revenue. Why is that important? Well, in order to pay those great salaries, offer good training, and attract kick ass leaders, then you need some cash coming in. Malcolm Gladwell identified these folks as the ‘salesmen’ in his book the Tipping Point:

Chapter 2: The Law of the Few: Connectors, Mavens, and Salesmen
The attainment of the tipping point that transforms a phenomenon into an influential trend usually requires the intervention of a number of influential types of people. In the disease epidemic model Gladwell introduced in Chapter 1, he demonstrated that many outbreaks could be traced back to a small group of infectors. Likewise, on the path toward the tipping point, many trends are ushered into popularity by small groups of individuals that can be classified as Connectors, Mavens, and Salesmen.
Connectors are individuals who have ties in many different realms and act as conduits between them, helping to engender connections, relationships, and “cross-fertilization” that otherwise might not have ever occurred. Mavens are people who have a strong compulsion to help other consumers by helping them make informed decisions. Salesmen are people whose unusual charisma allows them to be extremely persuasive in inducing others’ buying decisions and behaviors. Gladwell identifies a number of examples of past trends and events that hinged on the influence and involvement of Connectors, Mavens, and Salesmen at key moments in their development.(from wikisummaries)

 These salesmen are a vital component of any company. To put a former security contractor or a military guy in such an important position is a nice gesture, but if they do not have the talent to do the job, then you will not get the contracts. What you really need is a professional with a gift, who can ‘sell snow to an Eskimo’ as they say. (like maybe an Avon salesman? lol) It also reminds me of a quote that Donald Trump made recently about negotiators. Here it is:

“You know, I can send two executives into a room. They can say the same thing. One guy comes home with the bacon and the other one doesn’t. And I’ve seen it a thousand times. It’s the messenger.”

The question a company should ask is do they have the right messenger, negotiator, or salesman to win that contract for the company and increase that company’s standing in the market? And to bring this back to G4S, they obviously have some very talented people working on this for them. –Matt

NICK BUCKLES INTERVIEW: I deal with trouble in Kabul, Baghdad …and Wimbledon
By David White
18th June 2011
As the world’s top tennis players and half a million fans prepare for the glamour and glory of the 125th Wimbledon tournament starting tomorrow, their safety will be in the hands of Nick Buckles.
‘There will be 700 uniformed staff to search vehicles and bags, check tickets and provide on-court protection and escorts for players,’ says the boss of G4S, the world’s biggest private security company.

(more…)

Wednesday, February 16, 2011

Maritime Security: ICS Changes Policy, Backs Private Armed Guards To Beat Pirates

     Polemis said the decision had been made during a meeting in London last week because “many shipping companies have concluded that arming ships is a necessary alternative to avoiding the Indian Ocean completely, which would have a hugely damaging impact on the movement of world trade.” 

     This is big folks.  News like this can invigorate the demand for armed private security on boats and really fire up this aspect of the industry.  Which is good, because there are a ton of capable veterans/security specialists out there ready to jump on this stuff.

    Hell, with most of these maritime contracts being very short in duration, I could see guys actually planning to do a contract here or there just for a change of pace from Iraq or Afghanistan.  But on the down side, these short term contracts are what turns off some folks.  Meaning sometimes guys like stability within their contract, and they like to hang their hat on a good gig for awhile.

     And for the guys that are truly experienced and qualified to do this stuff, they will require a price to match or exceed what they would be earning for their efforts in Iraq or Afghanistan. The quotes I am hearing for pay for these types of gigs is kind of low if you ask me. Like I said, if the industry expands and there is a high demand for qualified individuals, the companies/clients will have to pay the price.  Because in this industry, you get what you pay for.

    What will really be exciting is to see what companies rise to the top as the best private naval companies? It will really be interesting to see how this private navy backed by JLT turns out?  Perhaps these talks are connected to the efforts of this insurance company and we will get some more scoop on their operations in the near future?

     Either way, I am glad to hear that the ICS (which represents around 80 percent of the world’s merchant fleet) has changed their minds and listened to reason in regards to armed guards on boats. It is the right thing to do and this industry will certainly do what it can to meet their needs. Plus, the economics of continuing to pay ransoms and fueling a piracy industry or the amount of time and money lost by re-routing ships in order to avoid this piracy scourge is also a huge factor in making this decision. –Matt

The Voice of International Shipping

The International Chamber of Shipping (ICS) and the International Shipping Federation (ISF) are the principal international trade association and employers’ organisation for merchant ship operators, representing all sectors and trades and about 80% of the world merchant fleet.

15 February 2011 – Shipping Industry Changes Stance on Armed Guards

ICS – whose Executive Committee comprising representatives of national shipowners’ associations from over 30 countries met in London last week – has decided to clarify its stance on the use of private armed security guards to defend merchant ships against attacks by Somali pirates. ICS members have also identified a vital need for the military to disable the hijacked ‘motherships’…

Best Management Practices to Deter Piracy in the Gulf of Aden and off the Coast of Somalia

Website for ICS/ISF here.

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Shippers back private armed guards to beat pirates

Feb 15, 2011

The International Chamber of Shipping (ICS) has changed its policy on private armed guards, and now accepts operators must be able to defend their ships against rising pirate attacks, the chamber said on Tuesday.

The ICS, which represents around 80 percent of the world’s merchant fleet, has so far discouraged its members from the use of private armed guards on its vessels.

“ICS has had to acknowledge that the decision to engage armed guards, whether military or private, is a decision to be made by the ship operator after due consideration of all of the risks, and subject to the approval of the vessel’s flag state and insurers,” the Chairman of the London-based ICS, Spyros M Polemis said in a statement.

Polemis said the decision had been made during a meeting in London last week because “many shipping companies have concluded that arming ships is a necessary alternative to avoiding the Indian Ocean completely, which would have a hugely damaging impact on the movement of world trade.”

(more…)

Sunday, September 26, 2010

Afghanistan: Gunmen Kidnap Development Alternatives Inc. Contractors

Ziayee said the woman was wearing a burqa when the party was last seen at around 10.30am travelling through the district of Chowki. He said that she was “kidnapped by the opposition” after a brief fight with local police, who gave chase into the mountains.

An official with the Kunar criminal investigation unit said local insurgents were responsible, led by a man called Mullah Basir and an associate called Qari Ruhullah. At midday, a group of 12 senior elders from the area were sent into the area where the hostages were believed to be to try to secure their release. 

*****

     I do not know any other details other than what has been reported.  My heart goes out to the friends and families, and I certainly hope the kidnapers do not do to these folks like what happened earlier this year to the medical team. DAI has not had very good luck these days and perhaps they should reevaluate their security protocols?

     If there was only one security guy for this entire party then I don’t call that very smart. Low profile is a great method of travel, but obviously this team was busted off the get go as having a British contractor in it. Perhaps someone sold them out or they got careless? Either way, tough deal and I hope they survive. –Matt

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Afghanistan: gunmen kidnap Briton and three co-workers

British woman and Afghan colleagues part of convoy intercepted by insurgents in Kunar province

Jon Boone in Kabul and James Meikle

Sunday 26 September 2010

A British woman working for an American company and at least three Afghan co-workers have been kidnapped by unidentified gunmen in Afghanistan. They were in a two-vehicle convoy intercepted by insurgents in Kunar province.

Neither the Foreign Office in London nor Washington-based Development Alternatives Inc (DAI) would confirm the woman’s identity, but DAI, a contractor with the US Agency for International Development (USAID), said it was working “on a suspected abduction” and would be issuing a statement. The FO said relatives had been told and appealed to the British media not to name her.

(more…)

Friday, August 20, 2010

Afghanistan: Taliban Attack Afghan Guards In Deadly Raid

     This sucks.  Rest in peace to the fallen and my heart goes out to the families and friends of these Afghan guards. My only comment on this is that I am sure there will be many lessons for this security company, and they will certainly be re-evaluating the defense of their main camps.  But from the sounds of it, the Taliban conducted a classic raid designed to turn a surprised force inside out. These things take guts to perform, and require planning, surprise and violence of action to be effective. It sounds like they had that in this attack. (Running over fleeing unarmed guards with their cars though?)

     The other point to bring up is this whole deal about companies using subcontractors who refuse to use local workers for projects in that locality.  Boy, that is rule number one in a new area you plan on doing construction or other types of work at, and that is always hire local.

     If you hire the locals, they are more likely to protect their cash cow job, and drop some hints that maybe the Taliban (their cousins and uncles) might want to attack that day or night.  Or the work force just doesn’t show up one because their cousins and uncles said not to go to work that day.  Using locals for work projects is the way to go, and the project lead on this should have known better.

     It would also help if the reconstruction team that handed out the money for this road project, also paid attention to what villages might be pissed off if they built a road through their area, and was not included in the project.  Or at least throw in a school or whatever to appease them, while making the case of why a road would be a good thing in their area. It sounds like no one talked these folks, to include the government or the reconstruction team for that area.

     The other option is that maybe these locals did talk with everyone, and because they were Taliban supporters, they will never be happy about anything the government or reconstruction teams tell them. –Matt

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Taliban Attack Afghan Guards in Deadly Raid

By ALISSA J. RUBIN and SHARIFULLAH SAHAK

August 20, 2010

KABUL, Afghanistan — Taliban fighters in a rural area near the Helmand River staged an audacious nighttime raid early Thursday, swooping down on several hundred sleeping Afghan private security guards who were securing a road construction project, and killing at least 21, according to guards who escaped.

The attack was striking not only for its scale and viciousness but because it took place in the Helmand River Valley, where thousands of British troops have been stationed for the past three years and where now American troops have entered to try to rout the Taliban.

News of the Taliban raid emerged Friday, as Senator John Kerry, Democrat of Massachusetts and the chairman of the Foreign Relations Committee, met with President Hamid Karzai for the second time in four days to discuss corruption among members of the Afghan government, some of whom have been implicated in several major cases. Support for the nine-year war, and for Mr. Karzai, is ebbing in the United States, while Gen. David H. Petraeus, the top American commander in Afghanistan, has signaled that, if anything, the troops would need more time on the ground to accomplish their mission.

(more…)

Monday, August 9, 2010

Iraq: Al Qaeda In Iraq Offers Cash To Lure Back Sahwa Fighters

    Nowadays, the government pays the salaries of its estimated 650,000-strong police and army on time, including the estimated 20,000 Sahwa fighters who have been assimilated into the security forces.

    But the remaining fighters on the government payroll go without their checks, in some cases for as long as three months. The government cites lack of funds or bureaucratic snags for the delays.

    Another Sahwa complaint is that the government detained scores of its leaders on terrorism charges last year. Although most detainees were released — often because of U.S. pressure — the arrests were seen as a humiliation. 

*****

     You know, I don’t blame these guys for being pissed off.  These were the saviors of the surge, the Sons of Iraq, the Anbar Awakening!  But then we go and allow Iraq to screw it all up and treat these guys like dirt.  Yet again, the market of force dictates.  If you don’t pay your people as much or more than your competitor in pay or benefits, or treat them poorly, then you will lose that contractor/soldier to your competitor who understands these very simple business principles.

     Now there is always the idea that Sahwa guys are using this as a means of leverage. Nothing like a so called ‘statement’ from AQ that they are trying to lure people away with better salary, to put a little fire under Iraq’s ass about paying these guys.  But I tend to go with the option that it is true, and that AQ is recognizing a deficiency within the Iraqi government and trying to exploit it. (go figure)

     There is another reason why we should pay attention to this.  I don’t care what anyone says. If AQ is even able to get a hundred guys back on their team, that is 100 booger eaters we will have to deal with as the war transitions into this new phase.  That means more mortar and rocket attacks, more IED’s, more assassinations, and everything else you can think of that AQ loves to do at their parties.

     The other thing to remember is all of these Sahwa fighters know exactly what the Iraqi military is capable of now. There has been plenty of time for them to observe and feel this stuff out as guards.  They also wouldn’t have the US to worry about because of this congressionally mandated troop presence in Iraq of 50,000 folks.  All AQ has to do is put the word out and pay the Sahwa tribes a decent wage, and tell them how cool they are with a couple of ‘hey buddy, we will be your friends.. wink, wink’.

     Not only that, but these Sahwa fighters are also dealing with the Plomo O Plata Effect as well.  AQ has certainly been assassinating these guys, and providing plenty of plomo or ‘lead’ for the tribes to think about. Pffft. –Matt

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Al-Qaida in Iraq offers cash to lure former allies

By HAMZA HENDAWI

August 7th, 2010

BAGHDAD — Al-Qaida in Iraq has begun offering cash to lure back former Sunni allies angry over the government’s failure to give them jobs and pay their salaries on time, according to Sunni tribesmen and Iraqi officials.

The recruitment drive adds to worries that the terror network is attempting a comeback after the deaths of its two top leaders in April and is taking advantage of a summer of uncertainty. The political stalemate in Baghdad is entering its sixth month after inconclusive elections, just as the U.S. military is rapidly drawing down its forces.

Al-Qaida’s strategy is to provoke the Shiite majority into launching revenge attacks — a development that could re-ignite open warfare, split the Iraqi security forces along sectarian lines and cement al-Qaida’s leadership role among Sunnis.

But if the extremists are unable to win back their former Sunni allies, it would be difficult for them to rebound as a significant threat — though al-Qaida could continue to be a deadly nuisance for years to come.

Al-Qaida’s overtures in recent weeks are notable because its militants have killed hundreds of former allies over the past two years, setting off blood vendettas between the Sunni extremist group and others in the Iraqi Sunni community. Many former insurgents also disliked al-Qaida’s imposition of a strict interpretation of Islam in areas under its control.

But tribesmen said the need for cash to feed their families is pushing some lower-ranking former al-Qaida in Iraq members to rejoin the terror group — and that al-Qaida’s presence is growing in Anbar province west of the capital.

“The government must help us counter the resurrection of al-Qaida in Anbar,” warned Mahmoud Shaker, an influential tribesman from the province’s Habbaniyah district.

(more…)

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