Business opportunities behind security threats

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To many parties, security procedures applied during the recent visit to Jakarta of U.S. State Secretary Condoleezza Rice were excessive. Even Foreign Minister Hassan Wirayuda said he was surprised upon seeing a photograph showing how uniformed and fully armed U.S. militarymen were involved in the security measures applied when Rice visited a Muslim school in Central Jakarta last month.

Like it or not, security is still a main concern of a state, including the United States, a country highly concerned about terrorism and bombings. It is undeniable, however, that bombings and acts of terror in a number of places have not only scared the public but have also made people realize that security threats are ever-present in their daily lives. Indeed, although the police are now greater in number and have become more skillful in their capability, security risks in Indonesia remain high. Our business world is still fearful of bomb threats, robbery in the street, protest rallies, holdups and so forth.

Security is obviously expensive because what is at stake is not only your life but also your wealth. The price will become even higher if no consideration is given to security matters. Craig Foster, country manager of PT Hill Konsultan Indonesia, a consulting company dealing with security affairs, says that major or multinational companies operating in Indonesia are concerned about the security of their assets.

That is why security services are finding golden business opportunities. Thanks to all these security threats, security management services have in the last few years raked in high profits. Since 1999, the National Police, the institution responsible for overall security, has allowed the private sector to set up companies that provide security services to companies or individuals. Previously there were only 10 companies licensed for this purposed, but today over 200 local private companies offer security services in Indonesia.

“The market for the outsourcing of security services in Indonesia is indeed expanding,” said an executive of a security company.

As corporations focus more on their core business, he predicted that more and more clients would choose to meet their security service needs through an outsourcing company rather than employ their own security personnel. The reason is that hiring another company to meet their security needs keeps costs down. Besides, in the hands of professional personnel, security within their compounds will be of better quality. When a company hires outsourced security personnel, it can cut costs by 10 percent to 20 percent.

That’s why companies providing security services, like Cisco Mas, for example, are very much sought after. Cisco Mas, a joint venture company established by Singapore’s Cisco (51 percent) and Sinar Mas (49 percent), provides not only security equipment but also security escort services, particularly for those intending to carry large amounts of cash. Clients are generally companies in the banking or retail sectors. Usually they need this particular service when they collect cash, fill automated teller machines (ATMs) or carry out other activities that require an escort service.

Cisco Mas, which is under the supervision of Singapore’s Home Ministry, employs specially trained security personnel or makes use of security officers and policemen with specific skills. Each time they escort clients, they use a special vehicle that has a safe. Even in the worst possible situation, the assets remain secure.

Aside from Cisco Mas, Securicor is also worth mentioning as Indonesia’s most prominent security service company today. Securicor, the parent company of which British, provides three main services in integrated security, namely cash management services, guarding and an electronic security system.

To expand its electronic security system marketing network, Securicor Indonesia is developing a dealership program as a business partnership program in the marketing of a security system called Control Monitoring System (CMS) for houses, factories and small-scale enterprises. The CMS is an alarm system with a remote panel provided with a sensor to detect movement and a panic button. It is connected around-the-clock to the control system of Securicor, which in turn is monitored 24 hours a day, seven days a week.

Meanwhile, PT Indolok Bakti Utama, a company selling security equipment and providing security services, has also built up a clientele. Set up in 1972 as part of Gunnebo AB, a global company in the International Security Group, this company makes available trained personnel capable of providing extra security to clients. Aside from being manned by highly skilled personnel, Indolok Security Patrols are also provided with state-of-the art equipment, including 24-hour monitoring controlled from its head office and backed up by security patrols.

In fact, said Lea K. Indra, marketing manager of PT Indolok Bakti Utama, security has a wide scope. The security of an office, for example, differs from the security of an office building. Indolok, whose main clients are made up of foreign embassies and major companies in the oil and mining sector, provides integrated security solutions, starting from a company’s outermost perimeter to its innermost part, namely starting from the road area in front of an office up to the office gate, the door to the building, the lobby, the lifts and the offices. Security is also provided for other rooms, such as the data or document storage room, server rooms and so forth, including the emergency exit and stairwell as well as the parking area.

The examples above refer to areas that can be covered. The equipment or system used to cover these areas differs, depending on the purpose of a particular security service. Do you wish only to monitor people coming in and out or do you want to restrict access only to particular people? Are you preparing against someone or something entering your office or are you preventing someone or something from getting into your room?

“Office security is very broad in scope. A bank may also have a bomb blanket to reduce the impact of a bomb explosion, besides a CCTV and an alarm system, for example,” Lea said.

It is true that there is a general security system but in reality each client has their own requirements. Take, for example, a downtown lawyer’s office. The requirements of this office would differ from those of coal mining company in a remote area.

Obviously security has become a major concern. The threat of terrorism, a cause of great concern these days, has helped spur the development of security service businesses. Worldwide, the security service industry enjoys a growth of 7 to 9 percent a year. This development is seen not only in terms of visible security services but also in respect to continuously developing security equipment technology.

This trend is witnessed not only in the international arena but also in Indonesia. Following the bombing at JW Marriott Hotel in Kuningan, Jakarta, in August 2003, and bomb explosions on two different occasions in Bali, nearly every office building and hotel now has standard security equipment such as a metal detectors (hand-held or fixed at the gate) and CCTVs (installed at strategic locations).

In other words, the security equipment business and security services are booming. It is true that competition in this particular business has become ever keener and only by well-prepared companies will prevail. Much more important than the security equipment sold will be the services provided with this equipment. Likewise, in the security service business, much more important than the quality of the security personnel deployed will be a more comprehensive handling of a client’ security-related problems. (Burhanuddin Abe)

The Jakarta Post
April 11, 2006