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Employee Motivation & Retention in the Private Security Industry

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Author: Jeffrey Zisner, CPP and owner of AEGIS, a Los Angeles Security & Investigations firm

INTRODUCTION

Since the events of September 11, 2001, the private security industry has seen explosive growth. The need for qualified and reliable security personnel is the greatest it has ever been. “The global security industry is a market in excess of 100 billion dollars made up of tens of thousands of businesses engaged in the protection of assets and prevention of loss. Industry analysts believe the security industry will grow at double-digit rates over the next five years.” (Security Growth Conference) With such a rapid expansion, the amount of trained and professional personnel must increase accordingly. It is this increase coupled with client expectations, low paying contracts, employee motivation issues, and high turnover rates that degrades the quality of the work performed, leaving assets that are supposed to be protected very vulnerable.

PURPOSE OF THE RESEARCH

The increased use of un-motivated, often unskilled security guards poses a safety concern for clients and the general public. Using these guards is a clearly identifiable bad business practice for security companies. The employee’s continuous search for a “better” job collapses the industry on itself in a perpetual circle of sub-par service and low paying contracts. The purpose of this research is to identify the major and minor causes of the degradation of the security industry and to make recommendations on how to fix it.

SCOPE OF THE RESEARCH

This research investigates the causes of client dissatisfaction, employee motivation and retention problems, and their effects on the private security industry. It also leads to logical conclusions on how to resolve these problems. Most of this research was conducted with the typical security guard in mind, however agents working in more involved levels of close protection may benefit as well.

SOURCES AND METHODS OF DATA COLLECTION

The primary method of data collection was interviews of security company owners, field supervisors, and current employees. The secondary method of data collection was various Internet resources, employee retention and motivation texts, and trade publications.

OBSERVATIONS & RESEARCH

The research conducted for this report falls in four distinct but related categories. The first is the lack of state mandated security guard training. Second are the high expectations of the client paying low security hourly rates. Third, motivational and ethical issues managers must resolve with their personnel to provide quality service. Last, the high turnover rate of a mercenary “like” force quitting jobs, often without notice.

MINIMUM SECURITY GUARD REQUIREMENTS

According the California Bureau of Security and Investigative services, the minimum required training to be hired as a security guard qualified to carry a firearm, baton, mace, and handcuffs is 36 hours. In comparison, a Los Angeles Police Officer capable of carrying and using the same equipment in the line of duty is trained 340 hours.

CLIENT EDUCATIONAL ISSUES

Throughout the gathering of data for this report, the echo of the client being the number one issue became deafening. Security contractors continuously get inquiries from potential clients “shopping” for a deal. Too often, the client wants it done cheaply and the contractor responds with a low rate to win the contract. This leads to the old adage, “You get what you pay for.” According to Sammuel Marotta, detail leader for The Steele Foundation, “They expect the world for $16 per hour and good personnel simply aren’t interested. Companies are forced to hire the untrained immigrant population where $7.50 per hour is attractive.”

The client ultimately is responsible for the services they are sold but become angry when those services don’t perform at peak level. The reality is that the guards are usually performing their personal best. What can a client logically expect when paying such low hourly rates? The client’s mentality is all security guards are similar and therefore they expect a trained protection expert capable of quickly and accurately assessing a situation and responding in a professional manner. In reality, they have a warm body in a uniform with one day of basic training who is really only as effective as the previous knowledge they brought with them onto the job.

“One of the key principles of quality is that customers are not just buying a product, they are buying an experience.” (Pacetta 184) Security cannot be looked at as a product, but has to be looked at as an experience because the standard of service varies from firm to firm. The typical hourly wage for a professional unarmed security guard starts between $20 and $25 per hour. It costs on average one and a half times the hourly pay of a security guard to keep them employed. That includes taxes, overhead, and insurance, which is extraordinarily expensive. On a side note, imagine being the insurance company writing a policy for a company to supply firearm, baton, and mace toting personnel who suddenly find themselves in a position of power with a total 36 hours of training. That means a contractor will have to bill at minimum $40 per hour. More often than not, the clients are not willing to pay for professional services. They pay $15 to $18 an hour translating to hourly wages of at most, $10. “You’re not going to find the same talent to work for that low pay. You’re left with high school dropouts who might have a GED if you’re lucky.” (Thomas)

JJ Sutton, the owner of Foremost Response, Inc has developed an approach to raising billing rates. He simply does offer a lower caliber of service. “We are able to teach our clients that if security is important to them, that they get a greater return on their investment by paying higher rates. Over time they actually see a great savings from a quality and professional service.” This approach forces clients to look at security services much like an insurance policy. Minimum coverage won’t get them very far when even a minor problem occurs.

EMPLOYEE MOTIVATION & RETENTION ISSUES

What is one of the biggest categories of problems facing American business people today as they struggle to remain competitive? It is not the scarcity of resources, outdated technology, high inflation, or even a dwindling pool of qualified workers. “According to a presidential task force that investigated the question, the greatest problem facing the business community today has to do with personnel and specifically, the question of motivation.” (Homes 13)
Good employee motivation is a precursor to high retention rates. An unmotivated employee is more likely to look for a new job faster than a motivated one. Therefore, lack of employee motivation needs to be addressed before lack of retention.

The worst-case scenario for a company and its employees is when a company begins to not cover its costs. The company, out of desperation, accepts low paying contracts. They must adapt their workforce to match those contracts leading to a serious and outright depressing fact. Employees are subconsciously encouraged to perform in a mediocre manner, at best. A manager left at a company recently forced to downsize said, “I expected the misfits to go, not some of our most talented people.” (Quick 159) This is because a restructuring offers a company a chance to terminate both inferior employees and quality employees who have become more expensive than the new budget can handle. This restructuring occurs again and again as employees approach either end of the spectrum. A continuous cycle of hiring, firing, and transitioning negatively effects employee motivation and morale.

Other causes for decreasing motivation are also a direct result of senior and middle management decisions. Aside from the obvious low wages, not being mentored by a supervisor, being promised promotions, not being paid on time, inadequate training to properly do the job, and being kept out of the circle of information.

Angry, disenchanted, and unmotivated employees only cause problems for a security firm. At one point or another, nearly every field supervisor, operations manager, or company owner has gotten a call from their client saying, “I was wondering when the security is going to show up.” Recently, a security firm in San Diego, California had such a colossal problem with unmotivated staff showing up late or not showing up at all for work that they were forced to send a field supervisor to pick up guards at their homes and drive them to work. (Marotta) Furthermore, ethical issues arise once the employees get to work. In the past, guards have been caught stealing client and/or vandalizing company property, sleeping during a shift, and even handing out personal business cards trying to steal contracts by undercutting their employer.

When employee motivation hits rock bottom, they start looking for a new job. “People get into this business to put food on the table and quickly move on to something that pays better… like flipping burgers at McDonald’s.” (Gorgone) What managers and owners don’t understand is that although proper hourly wage is important, employees aren’t solely motivated by their paycheck. Eighty nine percent of managers believe the key to keeping good people is with money, but according to a survey, the top three reasons employees stay at their job is: career growth with the opportunity to learn, exciting and challenging work, and feeling like they are doing meaningful work that makes a difference. (Kaye 6/9)

The immediate supervisor can make or break employee retention. The supervisor, with the help of upper management, has the opportunity to be a mentor, give positive feedback, and provide opportunities for career growth. Career growth may include be a lateral move to a different job, a vertical promotion move, or additional training to transition a career.

Only when all else fails should employees be looking for another job. When that happens, especially in specialized positions, employers become desperate to avoid loosing quality personnel. The one way to immediately keep top workers is by offering a benefits package that matches those of the larger companies including health, vision, and dental benefits, 401(k) match, and paid tuition for career advancement. Trying to get people to stay just by giving them more money is a three to six month Band-Aid at best. You can’t use compensation as a retention tool on its own. (Henricks 74/75)

Company owners and executives thinking in terms of monetary value grossly underestimate the current value of their employees. A seasoned and skilled employee is a precious resource that can help maintain contracts, keep other employees motivated, and preserve a high level of service. The mentality that a company can save money by hiring new employees is generally a myth. “It costs between 70 and 200 percent a person’s annual salary to replace them,” (Kaye 13) not including the new employee’s salary, which is can be higher than the previous one. In the end, it makes more financial sense to keep current employees motivated, productive, and happy. Finding new employees every few months can become costly, cumbersome, and ultimately see to the failure of a security firm.

CONCLUSIONS

1. Basic security training is not enough effectively call one’s self a professional.
2. Owners/managers are not trained business people. Most are retired law enforcement or military, so many don’t have the skills to run a business, but are excellent field assets. It is their responsibility to hire and surround themselves with business consultants and professionals.
3. Companies are forced to supply sub-par staff because many clients have not been educated that a better staff will actually save them money in the long run.
4. Employee motivation is influenced by wage/salary, benefits, and morale.
5. Many supervisors, managers, and executives do not provide morale boosters or positive reinforcement for their employees.
6. Hiring bonuses invite employees to change companies frequently.

RECOMMENDATIONS

1. Companies need to only offer a trained and professional staff to their clients. Providing low tier, low paid staff drags down the industry.
2. Companies need to conduct payroll accurately and as scheduled.
3. Companies need to provide as much information as they can about every job. Security people hate surprises. (Bergling)
4. Company management need to make their employees feel appreciated. That may include awards for good service, continuing occupational training, and varying of assignments.
5. Companies need to be realistic in their promises. Benefits, 401(k) match, educational reimbursement, training opportunities, and the possibility of promotion need made clear to employees before they start work. Employees with a reasonable expectation of what they will receive will work to achieve realistic goals.

APPENDIX

Personal Interviews:

Bergling, Erik: Managing Partner, Kingsley Bergling Risk Management Services

Gorgone, Tom: Dean of Security & Investigation Academy of Court Reporting
& Deputy Commander, Victory Security, Inc.

Marotta, Sammuel: Detail Leader / Sony Detail, The Steele Foundation

Sutton, JJ: Certified Protection Specialist, Certified Anti-Terrorism Specialist

Thomas II, Renny: Managing Partner, Elite Protection Unit of TNT Executive Services, LLC.

Survey Questions:

How does employee turnover affect your business/job?

How can the high turnover rate in the security industry be solved?

Do you believe there is an employee motivation problem in the security
industry?

Give one detailed example when employee motivation issues caused a
serious problem for your business or team.

Have you ever felt a lack of motivation on the job and if so, why?

How can employee motivation problems in the security industry be solved?

WORKS CITED

Bergling, Erik. Personal Interview. 15 November 2007

California Bureau of Security and Investigative Services website. 2007 revision. The California Bureau of Security and Investigative Services (BSIS). 22 November. 2007.

Gorgone, Tom. Personal Interview. 15 November 2007

Henricks, Mark. The Long Haul. Entrepreneur April 2006: pg. 72-75.

Homes, Roy H. Common Sense: Management & Motivation. Lancaster, Pennsylvania: Starburst Publishers, August 1993.

Kaye, Beverly and Sharon Jordan-Evans. Love ‘Em or Lose ‘Em: Getting Good People to Stay. San Francisco, California: Berrett-Koehler Publishers Inc, 1999.

Los Angeles Police Department website. 2004-6 revision. The Los Angeles Police Department (LAPD). 22 November 2007.

Marotta, Sammuel. Personal Interview. 15 November 2007

Pacetta, Frank and Roger Gittines. Don’t Fire Them, Fire Them Up. New York, New York: Simon & Schuster, 1994.

Quick, Thomas L. The Quick Motivation Method. New York, New York: St. Martin’s Press, Inc, 1980.

Security Growth Conference website. 2004 revision The Security Growth Conference. 22 November 2007. <; www.securitygrowthconference.com/>;

Sutton, JJ. Personal Interview. 23 November 2007.

Thomas II, Renny. Personal Interview. 15 November 2007

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