adminPatrick Bhunu
A SIMPLE online definition of a business organisation is a group of people working together in pursuit of the same commercial interest. It is without doubt that the commercial interest that everyone craves for in business is profit. In order to achieve a profit, businesses usually have defined and laid down structures that give clear roles, positions and responsibilities to individuals within the company.
One of the positions within the organisational organogram that I wish to talk about this week is the security function. In my first contribution to this column, I briefly gave a general outlook of what security in business organisations entails. It is one of the critical functions in meeting the organisational objectives, but is it really getting the recognition that it deserves?
Perhaps the most important question that needs to be answered is as to whether security really adds value to a business organisation and if it does, which many others and I believe it does, is there a way to demonstrate this value?
Different organisations have different perspectives about the security function and this usually depends on the nature of the organisation and the environment in which it operates in. Environment in security terms mostly refer to the risk environment. It is the risk environment in which an organisation operates in that determines how the senior management views the role of security.
I remember some years back when I attended a seminar on internal controls and fraud detection, the general consensus among the security professionals who were in attendance was that some, if not most, business organisations still view the security function as a separate function of the business — it is still peripheral.
It is, however, my belief and conviction that security should be co-ordinated with other departments because it impacts on all aspects of the business.
Security is a very important part of any business which should not merely be viewed as a cost to the bottom line. It is actually a worthy investment which contributes to profit at the end of a period.
Taking for instance, a manufacturing company, there are risks at each and every stop and the security function comes in handy in assessing and managing such risks in the production chain. Risk is simply a possibility of a loss or injury. It therefore implies that security should not only be compliance driven but business driven.
Organisations, during their strategic planning, need to include the security function in every facet from the procurement of raw materials, processing, storage of finished products, distribution, handling of finances, resources and so many other areas where there may be leakages, fraud, embezzlement, abuse of resources, among others. Depending with the organisation, it is a security function to identify and assess the possibility of risks in all areas. It is also a security function to put in place measures that deal with the expected and even unexpected risks. Such an important function cannot, thus, be marginalised to the role of merely a protective agent.
Most senior managers in organisations are concerned much about the value that they get in numbers and figures. As long as one can quantify a value that the organisation derives from a particular area or department, then it would be business as usual. The security function by nature may not necessarily be easily quantified in terms of cost savings or profit margin contributions, but it is both a business enabler and profit contributor. The security function ensures that the company operates in an enabling environment that ensures high productivity, revenue growth as well as improved corporate image and reputation.
No-one would want to invest their money in an organisation with very high risks of leakages, fraud and abuse of resources, to mention but a few. Even some insurance companies would charge high premiums to companies that always encounter losses as a result of weak security systems. For example a company that reports fraud cases more often is bound to pay higher premiums than a company that falls victim to fraud once in a while. This shows how important it is for management to create links between how an organisation carries out its business and its ability to include security and risk issues in its strategic objectives.
Organisations that have embraced the role played by security as a value adding function into their business models have actually realised significant business growth. They have always stayed ahead of risk situations, they perceive risks before they occur and they also provide solutions before the risks manifest. This is how proactive every organisation should be.
Often times I have heard people saying they cannot stay in certain suburbs because the crime rate in those areas is very high. Likewise, risk considerations should made when setting up businesses. There are areas that have high risk of, for example, pocket-picking, shoplifting, theft from motor vehicles. Obviously one has to consider the safety of their business, safety of clients, safety of suppliers and other stakeholders. This is where the security function should be incorporated among other such functions as marketing, finance, distribution and others, and not to be considered as an afterthought when the damage has already been done. Even those in architectural designing consider the aspect of security and risk when designing structures and this only shows how valuable the function is.
It is actually more costly to always react to situations where the security function has been left out in the cold because directors and senior managers viewed it as a service function instead of applying it as an enterprise risk management process involving strategy setting across the organisation.
As I conclude, I would like to encourage business organisations to consider security as an important function of the business and not as merely an after-thought function. Organisations that invest in security are more likely to enjoy the benefits through enhanced productivity and profitability.
Loopholes cannot be closed by investigations but they are closed before they even start to leak. Otherwise there will be no reason for closing the stables after the horses have already bolted out. Reducing losses by integrating security into the processes is indeed a profit contributor.
Till next week. Enjoy a peaceful holiday.
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