Binder (Tech Systems): If nothing else, these vendors offer a glimpse of the near future. We see a lot of very cool technologies, but the real world application for the technology isn’t always apparent. The most important question often is, “What problem does it solve?” If the answer is that it is a true, realistic solution, and it fits nicely within one or more of our vertical markets, we look further. If not, we wait.
With respect to the new technologies, it is a risk with small companies offering something new. Reasons include the fact that these companies are often under funded, which means they may go as quickly as they came, or they may be acquired, which can sometimes leave an integrator without an ongoing support channel. Nothing is worse than selling a client a new technology and then not being able to support it. Generally speaking, if the new technology has merit, established manufacturers tend to bring their own version to market shortly after the initial offering, so it sometimes pays to wait for the more stable scenario.
Peterson (HID): Confusion caused by new vendors is not new to the security industry. Past examples include: PC-based access control, integration of ID management with access control; RFID asset tracking; video integration with access control; and emergence of digital video recording. Introduction of products based on new technologies initially causes some level of confusion while the market works to find the salient issues that allow effective evaluation. The challenge presented is to understand the technology that allows effective product evaluation.
Gompers: Does ROI or cost justification play a significant role in the sales and solutions process? Is ROI or cost justification for the security industry needed? What can we learn from the IT space or building control space?
Binder (Tech Systems): ROI is the business hot button these days, but it doesn’t appear to be promoted in the security industry nearly as much as in other markets. Most salespeople I know, on both the manufacturer and the integration side, seem to be a bit unclear about how to present a compelling ROI case during the sales process.
Certainly it is always a plus to be able to convince a potential client that their purchase will be an investment that will pay for itself over time. However, the cost-benefit analysis is a bit more arbitrary in security, where “benefits” may or may not be measurable, depending on the application. IT and facilities management can more easily measure benefits in lower staff costs, utilities savings, etc. However, it wasn’t so long ago that these spaces were also viewed as cost centers only, so the security space can dig a little deeper to find convincing ways of making the ROI case. In fact, it will probably become a necessity in the very near future.
Peterson (HID): Cost justification and calculating return on investment have always been effective sales tools. Traditionally, physical security system ROI was somewhat hard to determine; unless, of course, calculating for retail or gaming industries where shrinkage and/or loss can be easily measured. Security in itself has been somewhat like selling insurance; with the level of loss mitigation somewhat of an educated guess. Convergence of physical security onto the IT network however, provides a new opportunity to show a quantifiable ROI.
Today’s IT departments touch almost every aspect of an organization’s business in some form or another. IT departments are often tasked with accomplishing mission critical goals with minimum budget and resources. So providing cost justification is business as usual within the IT industry. Some fundamental (an obvious) cost savings exist where the network infrastructure can be used for security equipment communications, but there are other significant “total cost of ownership” savings that could be realized through convergence onto the organization’s network. IT organizations can leverage their enterprise software licenses, and corporate hardware purchases for security applications; saving initial investment dollars. Ongoing service and support may provide a savings as a level of system support can be handled internally in lieu of outsourcing service and support. Data from security applications may be used for other non-security business uses to monitor employee production, resource allocation and improve existing processes. At which point, security systems, and more importantly the data they provide, become more than simply risk/loss mitigation tools and provide a tangible business benefit; and perhaps even a profit center.