Feral Jundi

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…)