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The Security Industry Association (SIA)


 

In The Boardroom With...

Mr. Richard Chace
CEO and Executive Director
The Security Industry Association (SIA)
www.SIAonline.org


Update June 1, 2010

SecurityStockWatch.com: How does the security industry look these days?

Richard Chace: It looks a whole lot better than it did a year ago. We had a great ISC West in March. The show floor was jammed for three days, and, from everything I heard from exhibitors, those people were there to buy. I’m cautiously optimistic that security businesses will be looking at better-than-expected 3rd and 4th quarters in 2010 and even more improvements in 2011.

SecurityStockWatch.com: Does that mean the economy has recovered?

Richard Chace: I don’t think anyone can definitively say that, but I do think that we have turned a corner. The security industry is historically tied to the residential and commercial real estate sectors. Currently, there is a housing shortage since new construction ground to a halt in the past few years, so I would expect to see an uptick in the sales of residential security products by the end of the year as new home construction picks up. As far as the commercial sector goes, there is still an awful lot of vacant commercial space out on the market, and I sense that space will take some time to fill. Add to that the cost-cutting that businesses have been forced to undertake in recent years and many purchases like security have been sidelined for some time. However, I do feel that as companies become more reassured that the economy is recovering, they will begin to spend some of that cash they have been sitting on for the past few years. Once this happens, I would expect to see a nice steady climb in commercial sector revenues and orders over the next several years. Long and short, in a global economy we just need to be very vigilant about all of the factors that contribute to a recovery and not get too far ahead of ourselves.

SecurityStockWatch.com: How did SIA weather the recession?

Richard Chace: Like everybody, we had to make adjustments. We cut back on spending and did more with less, as they say, and came through it with a new perspective on how to be a more valuable business resource for our membership and the industry. I give a great deal of credit to the SIA Board and the Executive Committee, chaired currently by Gordon Hope of Honeywell, who provided great leadership in making sure that SIA did not respond to the crisis in a “knee-jerk” fashion. Instead, we rolled up our sleeves and became very focused and strategic, ensuring that every dollar spent was an investment in the membership and the industry. When business is slow and bottom lines are hurting, that is when our members need us most, and we responded accordingly. In a true measure of the value our members placed on SIA in this tough time, we just wrapped our membership retention initiative for 2010, and we are at 99 percent of our retention goal. I think that speaks for itself.

SecurityStockWatch.com: Has anything changed for SIA or the industry as a result of the financial crunch?

Richard Chace: We will never do business the same way again. The recession, I think, reminded us of things that we already knew, like how important it is to focus on customer needs. It seems obvious, of course, but it’s easy to get into the habit of doing things one way for years and years and never thinking beyond the two-year horizon. But it would be a mistake to stay focused on the financial issues of the past two or three years. The financial crisis was a catalyst that forced our industry to wake up and start looking at the ways we can more efficiently and strategically do business. It forced us to look more seriously at combining disparate, yet potentially complementary, product lines and services, either within a company or by using strategic business partnerships. It also forced a review of marketing and sales practices that no longer fit the new demands of a verticalized marketplace. More than ever before, the customer is in the driver’s seat and is making demands in ways we haven’t seen until recently. Consumers want interoperability, standards, networking capabilities … the list goes on. From a marketing platform, probably one of our biggest initiatives is changing the format of the fall ISC show in New York to respond to this changing market dynamic. What was ISC East is now ISC Solutions, and we worked with Reed Exhibitions, the show producer, to focus the event on the application of security technology. We’re partnering with vertical markets organizations to reach out to customers in the health care, government, education and retail fields and provide them with security solutions that will merge all of those innovative devices they see on the show floor into systems that meet their unique needs. But this is just one small step toward working to better serve security customers while also helping to more effectively define and manage the risks that those customers face.

SecurityStockWatch.com: What else does SIA have planned for the rest of the year?

Richard Chace: Well, as I noted earlier, we have a very robust and focused strategic business plan that we are following this year. However, while we are working to deliver on some strategic initiatives, we are simultaneously working to upgrade our IT and Internet infrastructure so that we will be better able to provide our members with access to market research and trend data. Our Research Department is releasing a web-based update to our Brazil Security Market Report that will be invaluable for any company looking to sell in that fast-growing market. This is a BETA test for how we will be providing all of our research products in the future. Our Education Department is conducting studies that will be used to provide definitive descriptions of the physical security and security project management sectors, and it is working with Reed to put together a new conference program for ISC West and ISC Solutions. The Government Relations Department is about to put on its annual Government Summit in Washington, D.C., in June with what may be the best speaker lineup we’ve ever had, and it continues to work on legislative and regulatory issues at the federal and state levels. The Standards Department is about to release revisions to the CP-01 false alarm reduction standard and is working with the federal government on its development of identity, credential and access management (ICAM) guidelines. And our International Relations Department has projects around the world that can provide new business opportunities for security companies.

SecurityStockWatch.com: What about in 2011 and beyond?

Richard Chace: Demand for our industry’s products and services is increasing at an unprecedented rate, and that creates both opportunities and challenges. We have the opportunity to give customers better, more integrated systems that will provide an array of risk management tools. But we, as an industry, are challenged, among other things, with creating the standards that will enable all of the components to work together, establishing the legal and regulatory framework in which they will operate and providing the training needed by the installers and maintainers of ever-more complex security enterprises. SIA is positioned to lead the industry on each of these fronts, to create the conditions that will set security companies and their customers up for success. We’re very humbled to be a part of this industry but even more humbled to represent the innovators and visionaries that make up the SIA membership.

 

SecurityStockWatch.com: Please provide an overview of your role at SIA.

Richard Chace: Well, first and foremost my duty is to the SIA membership and to execute the "will" of the SIA Board of Directors. While my official "job description" has me listed as the chief executive officer and executive director, responsible for our organization's strategic planning, business development and international outreach; I see myself more of an organizational steward, facilitator/coach and erstwhile industry docent. My role at SIA is to perpetuate and regularly articulate the association's strategic mission and vision and ensure that we stay true to our course while adapting to change along the way; I look out for the icebergs. None of what I do would be possible without collaborating with some of the finest association professional staff and volunteer leaders in the security industry. Together we deliver a range of programs, products, and services that advance our 400+ members interests and the interests of the broader electronic and physical security industry. These are initiatives that work to define SIA as a solid, well informed, industry advocate on Capitol Hill and throughout the 50 states; deliverer of leading-edge security market research; provider of high-end education and training; and developer of technical and interoperable standards.

SecurityStockWatch.com: Who are SIA members and what is their niche in the security space?

Richard Chace: Our membership is quite diverse. We represent a range of companies, from manufacturers/distributors to integrators, defense contractors to IT providers. All of our members are involved at some level and in some capacity in the electronic and physical security space. Our members primarily join because they find tremendous value connecting and networking with their peers, but they also recognize and like that our organization impacts government and public policy; that it offers a wide range of benefits that help grow their business, and that it stays at the forefront of industry movements. Additionally, as sole sponsor of the ISC Expos, the world's largest security trade shows and conferences, we ensure our members have access to top-level buyers and influencers.

SecurityStockWatch.com: You mention that SIA is sole sponsor of the ISC Expos. Can you talk about these shows and your relationship with these events?

Richard Chace: Through a strong suite of international trade events like ISC East, ISC West, ISC Brazil, and soon Moscow, we provide valuable business opportunities for tens of thousands of exhibitors and attendees alike.

In fact, industry professionals rate ISC West as the best security event in the nation. The show draws more than 26,000 security professionals -including a large number of senior level buyers from top companies like Amazon.com, Target, Bank of America, Norwegian Cruise Lines and the United States government. These organizations make ISC West an essential part of their security planning process.   

We also host a New Product Showcase at West to spotlight leading-edge security products and technologies. This year we have a record number of entries competing for top honors in categories like IP Products, Access Control, and Critical and Mass Communication Systems.  For companies looking to find the latest and greatest products at West, this forum provides a streamlined process to finding out what is new.  Security directors and buyers can also visit www.sianps.com and www.ISC365.com year-round to research emerging technologies.

Of course there are numerous security industry events that tailor to various niche audiences.  However, we are always mindful of our members' limited resources, time and bottom-line. Research shows that the ISC Expos and their wide appeal across a variety of industry segments both in the US and abroad fulfill many needs in one place and at one time. And so it's at these shows that we focus our time and resources.

SecurityStockWatch.com: Your organization has recently published an interesting series of emerging international Security Market Reports. Please provide a snapshot of these research reports.

Richard Chace:We have three reports focused on China. The China Security Market Report provides an overview of the general economic, social, and business environment in China, including a short-term forecast. It features a highly detailed analysis and forecast specific to the electronic security market. Our Shanghai 2010 World Expo Report analyzes business opportunities for the electronic security market as a result of the upcoming 2010 World Expo in Shanghai. The event expects to welcome more than 70 million visitors at a rate of 400,000 to 800,000 per day. Managing security for this crowd is of prime importance for obvious reasons. According to our research, planned investment for security products and technologies will be ten times greater than the past two expos. In addition, our 2008 China Olympic Security Update examines China’s investment in security products and technologies to safeguard attendees and athletes.

Our Brazil Security Market Report reveals that Brazil’s investment in security protection products and systems will grow by more than 16.2% annually through 2012, making this a highly lucrative market for U.S. security companies. Our report delivers a clear and concise picture of the government policies, market drivers and social factors influencing demand. We believe it is an essential strategic planning document for any electronic security company planning to enter this emerging market.

Upcoming reports will focus on Russia and India, and later this year we will release our U.S. Security Market Report which will quantify our industry's economic impact in the US. This report will be the first of its kind and should serve as a reference tool for just about anyone - investors, policymakers, senior executives at corporations, and so on. I'm very excited about the potential impact this report will have on our industry and we'll be sure to let securitystockwatch.com know about it prior to release.

All our research and international security market reports can be found on our site, www.siaonline.org.

SecurityStockWatch.com: Can you provide more details on your other research publications and products?

Richard Chace: Sure. Our Quarterly Technical Update delivers expert, in-depth analysis of a critical technology issue facing security industry stakeholders. We have explored issues like RFID, VoIP, and HSPD-12. Our Quarterly Research Update provides concise summaries of technology and security market trends by leading trade, business and financial analysts. In addition, the QRU includes the industry's only Security Business Confidence Index, a unique instrument which measures the trend over time of business expectations of 100-executives. And, SIA's Market and Policy Overview gives readers an inside track to the events and trends impacting the business climate. Synthesized from Stanford Washington Research Group's daily research and analysis, these electronic bulletins ensure members have timely access to critical market intelligence.

In addition, we recently launched our Product Trends Dashboard, a user-friendly, Web-based interface that allows members to identify market trends for specific electronic security equipment by technology, type of building project, and vertical market sector. By tapping into a real-time database of security specifications in construction plans, our members can find answers to strategic planning questions like: "What markets are showing the best results in Biometric Access Control?" "Is the market for Access Control as good in California as it is in Texas" "Is there opportunity in the Renovation market for Smart Cards?" and other real-world questions that influence business decisions.

SecurityStockWatch.com: You say that SIA is the industry advocate on Capitol Hill. What are your organization's legislative priorities?

Richard Chace: Our ambitious 12-point plan includes advocacy in a range of new areas for our organization including agriculture, trade, education and health care. Ensuring the safety of our nation's critical infrastructure is the prevailing theme. We will work to secure funds for our ports, hospitals, schools, public transit systems and rails to buy the smartest, most effective security solutions possible.

Agenda highlights include securing $3.3 billion authorized in the "Improving America's Security Act of 2007" for new public transit investments in access control, video surveillance, perimeter security, and fire suppression solutions. With more than 34 million Americans taking public transportation each weekday, we want to ensure that public transportation systems have the resources to prevent terrorist attacks such as those which occurred in London and Madrid.

We will advocate for $50 million in annual funding for the Securing Our Schools grant program and for passage of legislation providing financial assistance to colleges and universities for smoke detectors, fire alarms, and extinguishing systems.

This year also sees us collaborating with nontraditional interest groups such as the International Association for Healthcare Security & Safety (IAHSS). Together, we are working on a legislative proposal to promote patient and facility security at more than 5,000 hospitals nationwide. SIA supports authorizing $500 million for hospitals to use for investments in access control, video surveillance, perimeter protection, locking devices, and other security solutions.

We also are advocating for $200 million in Environment Protection Agency grants to secure more than 16,000 wastewater facilities across the country vulnerable to terrorist attack.

Our full legislative agenda can be found on our web site, www.siaonline.org.

SecurityStockWatch.com: What resources are available for the security community on www.SIAonline.org?

Richard Chace: Our site offers security professionals a wealth of valuable tools and resources including free Webinars on the GSA contracting process, IPv6 implementation, and business opportunities in select emerging markets. We have a series of white papers on issues ranging from Biometrics in the Workplace to PACS Migration to False Alarm Reductions. There’s also information on SIA’s Certified Security Project Manger certification, Central Station Operator Train-the-Trainer program, a new curriculum road map for planning a career in the security industry and various other educational and training resources. For those interested in standards we offer, for a small fee, technical standards that affect the industry. Visitors to our site can monitor state and federal legislation, and keep ahead of emerging issues and trends by reading our Quarterly Technical Updates, Quarterly Research Updates and Market Policy Overviews. Our Security Product Trends Dashboard, an interactive interface which tracks new product growth across the continental United States, is another great tool you will find on the site.

SecurityStockWatch.com: Any closing thoughts?

Richard Chace: We have a very loyal and diverse membership and are proud to have equally diverse industry and coalition partnerships. We are engaged, strategic and forward looking. Our membership and partnerships reveal one undeniable fact: now more than ever the security industry needs solid, quantifiable market data. That is why we strive to provide critical, current and useful information that high level management can use to make and validate their business decisions. We keep members informed of market trends and industry advances by delivering leading-edge news, information, data and analysis. This competitive intelligence helps our members build and sustain profitable, growth-oriented businesses… it helps you to navigate the icebergs.