By Arko, Robert L.
Security Management , Vol. 36, No. 7
The use of contract security can decrease liability and bolster the bottom line.
With the current economic uncertainty, corporate executives in commercial and public service organizations are looking for innovative and creative methods to increase profitability. The driving force, of course, is the balance sheet.
Two steps to corporate survival are to reduce expenses and risk exposure. Although most are public benefit organizations, mass transit systems face the same economic pressures as public corporations and privately owned businesses.
In any enterprise, two issues of mutual concern are protecting assets and revenues and preserving the corporate image. The mass transit industry is perhaps the most vivid example of the corporate struggle to survive in today's economy. Business leaders and government officials throughout the nation are looking toward privatization of services as one of the answers for economic survival.
There are many economic advantages to using contract security in the mass transit industry. One of the most important benefits, albeit indirect, is that using contract security, unlike proprietary security, permits the company to insulate itself from liability.
Reputable contract security companies carry their own liability insurance, as well as workers' compensation and other protections, which, in many states, are included in state licensing laws. The client's vulnerability to liability is reduced when security is provided by a reputable contractor. Another benefit may be a reduction in the company's liability insurance premiums.
Other advantages that are not directly economic can accrue through the use of contract security. For example, contract security has become a viable alternative to relying on public policing. Also, law enforcement personnel have an increasingly favorable attitude toward their counterparts in the private sector.
Some changes that have occurred over the past two decades to increase respect for private security include better education and more experience among private security managers, field supervisors, and security officers. Many universities and colleges now offer undergraduate and graduate degrees in industrial security. This engenders greater respect for private security not only by the police but also in the corporate environment.
When discussing corporate creativity and the strategy of cutting overhead costs to improve profitability, the mass transit industry is a model of creative planning.
The mass transit industry, especially in the United States, is looking closely at the success of the Metropolitan Atlanta Rapid Transit Authority (MARTA) as an example of the economic gain and the operational advantages that can be realized by using private contract security to fulfill corporate needs.
In a mass transit operation, the security of peripheral and ancillary facilities -- such as buildings, yards for rolling stock, and parking lots -- must be considered in addition to the security and protection of computerized systems, railroad and bus stations, and passengers.
Contract security officers can play a major role in the transit industry by creating a high perception of safety through their visibility to the public and employees of the transit authority. Astute transit system managers realize that freedom from fear on the transit system translates to increased ridership and revenues, which are precious commodities.
Faced with an economy that demands operational cost-effectiveness, transit system planners and transit authority managers must weigh the advantages of contract security in their efforts to improve patron perceptions of safety. User attitude toward personal safety usually drives ridership and, in the long term, affects revenues.
The choice of what contract security company to use is dictated by the number and degree of advantages offered by each company. …