CONTRACTED VS. IN-HOUSE SECURITY

Contracted vs. In-house security

Contracted vs. In-house security

Introduction

It appears there has been a paradigm shift in the thinking of many corporations, Fortune 500 companies and smaller firms alike. This shift is to “core competency” and involves outsourcing support functions not associated with a company's core business. This move towards core competency is especially prevalent in the area of personnel-related support functions, which includes security.

Why is this shift occurring? There are two primary reasons.

1) Increase in Competition

With more and more companies competing for market share and doing so with enhanced technology, it is imperative to have a workforce that is almost exclusively focused on improving a company's core business offering. For example, a computer chip company probably won't improve its position in the computer chip market due to the efforts of its in-house security officers. Top managers are deciding to utilize reputable contract security firms to be their security experts so they can focus their personnel on being computer chip experts.

2) Increased Cost/Liability

Payroll taxes and fringe benefits have skyrocketed to a national average of 48%. As our society becomes more and more litigious, the risk of liability from inhouse personnel-related issues is steadily increasing. Areas of risk to consider include: Workers Compensation, unemployment, discrimination, sexual harassment and general liability. Lawsuits are costly and time-consuming. Due to this ever-increasing expense and risk of greater hidden cost, companies are choosing to protect themselves by outsourcing functions like security.

What Stops Some Outsourcing Conversions?

Many Directors of Security fear that switching to a contract provider will mean they are of decreased value to their company, and could potentially lose their jobs. However, a shift to contract security can have the opposite effect. Security Directors who outsource their security program often find they no longer have to spend long hours dealing with the ...