Security Magazine

September 27, 1999

SECURITY AT THE MILLENNIUM

Standard security practice mandates that an organization’s assets cannot be adequately protected without knowing what risks will be faced. Future risk dictates every market that will then protect an organization’s assets (people, information, property or reputation). This standard security practice also urges a continued future risk assessment process to support the deterrence, detection, denial, response to, and/or recovery from foreseeable risks. Markets will therefore be driven by future risk.

In the 1950s, 1960s and the early 1970s, business felt that the investigative and protection skills of law enforcement and in-house security forces were what were needed to fulfill their agenda. The Rand Report and the LEAA's Study titled "Private Security" were landmark reports that, to a large extent, criticized the security industry. Then in the early 1990s, the Hallcrest Reports (I & II; Butterworth-Heinemann) spelled out the failings of the law enforcement community and private security to work together in achieving their objectives. The growth of the security industry during the 1970s and 1980s, both proprietary and contract services, was enormous. It was during this period that vast technological improvements in security markets evolved.

The 1990s persisted with growth and change. With it came "downsizing," "rightsizing," and "re-engineering." The information age and the economic boom it has created have widened the gap between the haves and have-nots. There is enormous pressure from those having little or no security blanket in our society to express their anger and frustration. Violence in the workplace has become a dominant U.S. threat. There was a time when business only had to cope with the competitive pressures from other domestic companies. The world has shrunk and most industries now face global competition. Businesses are not only concerned with the ethics and mores of a domestic environment, but must now deal with the values of a dynamic world market. Vast new technologies in communications have placed enormous pressures on businesses to protect their data and the assets that pass through these technologies. Not only are informational assets exposed to traditional foreign and domestic intelligence threats, but they are also vulnerable to those committed to a violent and destructive agenda. Fraud and violations of corporate trust continue, but are only exacerbated by the window of opportunity created by new technologies. All of these and other future risks as well as vicarious liability, sanctions from the Federal Sentencing Guidelines and the new proposed guidelines from OSHA (safe workplace) have set the stage for a new breed of corporate security executive. This new executive must be capable of stewarding asset protection as well as other organizational missions. Future markets must therefore reach these new executives.

It is now 1999 and the new Millennium is fast approaching. Corporate America has still not placed asset protection on its top burner. Undergraduate and graduate business schools still energetically resist adding asset protection and related curricula to heighten a student's awareness of future risks. Business students are entering the marketplace never having any studied appreciation for the many facets of future risk and their impact upon an organization’s competitive position, profitability and yes, survivability.

Security @ The Millennium takes aim at these important objectives and provides an essential market overview as to what the next millennium will produce. Are you looking into the future?

The Report

In the most comprehensive study of its type, an article in the October issue of the Journal of Law and Economics (University of Chicago Press) says that crime costs $4,100 per person, or $1.7 trillion in 1997 dollars. The report, researched and written by David Anderson, an economist at Davidson College in North Carolina, covered such details as police and private security expenses, corrections costs, expense of crime-related injuries, amount of theft. Anderson says that criminals annually steal $603 billion in assets while also creating an additional $1.1 trillion worth of lost productivity.

Average Shoplifting Loss Per Incident:

1998. 1997

$60.74 $58.43

Of Restaurant and Fast Food Employees, Average Loss Per Employee:

1998. 1997

$218 $96

Employee Theft: How Employees Look at Themselves:

13% Dishonest; Will Undoubtedly Attempt Theft

21% Basically Honest; Will Never Steal

66% Will Steal If Others Do Without Repercussions

Source: Analysis by The Security Group, Cahners Business Information, of a study of 500 employees nationwide by Michael G. Kessler & Associates, Ltd.; the 1998-1999 Retail Theft Trends Report, conducted by Loss Prevention Specialists with a funding grant from Sensormatic Electronics Corp.; and the Fourth Annual Survey of Restaurant and Fast Food Employees, administered by NCS information services company.

Author - Ira A. Somerson