State of the industry

State of the industry

A review of SA’s private security industry in 2019 and expected trends for 2020

By Ingrid Olivier, editor, Security Focus Africa

“ Comfort is not the road history has marked out for us. There is a Chinese (attributed) curse which says ‘May he live in interesting times’.”

“Like it or not, we live in interesting times. They are times of danger and uncertainty; but they are also the most creative of any time in the history of mankind. And everyone here will ultimately be judged… on the effort he has contributed to building a new world society and the extent to which his ideals and goals have shaped that effort.”

Those words were spoken by Robert F Kennedy during his ‘Day of Affirmation Address’ at the University of Cape Town, South Africa, all the way back in 1966 when he was a junior United States senator. Fifty-four years later, his speech (considered by many to be one of his best) is still relevant as we find ourselves in the midst of interesting, dangerous and uncertain times.

Many of the legacies of 2019, both good and bad, are expected to continue into 2020, not only a new year but a new decade that many hope will be a turning point for the country in a hundred different ways.

That the lights stayed on over the festive season was largely due to seasonal industry closures, which means load shedding – and possibly a junk status downgrade – is on the cards again. The country’s energy crisis is going to be one of the major challenges facing South Africa in 2020, believes Dr Stuart Theobald, chairman of research and consulting firm Intellidex. In an article titled “Here’s our view on what to expect next year” (13 December 2019), he writes that Eskom and the public sector wage bill are both “crucial to the longer-term outlook for our country. Depending on how they are managed, the mediumterm scenarios range from dismal to reasonably positive.”

On the back of another poorly performing quarter, which Dr Theobald attributes largely to load-shedding along with “fundamentally weak drivers of economic activity”, South Africa heads into 2020 with “extremely weak business and consumer sentiment levels.

“The year ahead has the potential to fundamentally change this,” he adds, “But it will require leadership, decisiveness and, most importantly, actual implementation by government.”

South Africa is a unique and diverse country with a rich mineral base, an impressive constitution and bill of rights, and a courageous, resilient population. It’s also a country beset by rampant crime, despite its private security industry being one of the world’s largest: according to PSiRA (Private Security Industry Regulatory Authority), there are currently 2 365 782 security officers registered, of which more than 498 435 are employed by just over 9 000 registered and active security businesses.

That’s in stark contrast to the police force, which numbers 1 officer to 383 people according to BusinessTech – “far removed from the international standard of 1 to 220.”

Going forward, the private security industry will be dealing with a number of mission-critical issues.

Wage negotiations After months of negotiations between the private security industry’s business and employee representatives, a unanimous wage agreement was finally reached on 25 November 2019. Says Wahl Bartmann, group CEO of the Fidelity Services Group: “The challenge during wage negotiations is, of course, finding a solution that balances what the industry as a whole can absorb, while at the same time being cognisant of employees and their expectations. We try as an industry to avoid any form of industrial action which places the security of our customers and our own employees at risk. This year the parties to the wage negotiations, under the auspices of the National Bargaining Council for the Private Security Sector (NBCPSS), concluded a unanimous agreement on 25 November (effective) for a three-year period (and with) the addition of a Security Officer Premium Allowance and a Hospital Cover Employer Contribution, which will be paid equally to all grades of security officers and in all areas.”

In 2020, this agreement will be incorporated into the first main agreement of the NBCPSS, submitted to the Department of Labour, and then extended to the entire security industry. The date for the implementation of the increases will be decided by the Department of Labour, says Mr Bartmann, noting that until then, Sectoral Determination 6 for the private security sector will remain in full force.

“We believe the agreement that has been concluded is a positive outcome, which benefits everyone (and) we are satisfied that the best interests of the industry, of businesses and of employees, have been served.”

Technology: what happened in 2019 and what’s coming in 2020

Self-monitoring South Africa’s security industry is one of the oldest in the world, says Wahl Bartmann, and is uniquely distinguished by its crime profile and socio-economic landscape.

It’s a mature market in an emerging economy, with a value proposition that continues to diverge from global offerings due to local requirements. While the residential security market’s primary value proposition remains focused on professional alarm monitoring with robust armed response methodologies, Mr Bartmann says technology and hardware are important as enablers for monitoring and response.

To this end, Fidelity ADT is “fast adopting global trends in new technology through leading-edge hardware and communication platforms, artificial intelligence (AI) and user connectivity” to provide critical extra layers of security that go beyond the usual offerings”.

“The high penetration of mobile phones and access to data has meant that the global trend towards self-monitoring, as an additional value-add to professional monitoring in South Africa, has become a functional reality,” he continues.

In the last 18 months, Fidelity ADT has launched five solutions for clients that enable them to control and monitor their alarm systems from their mobile phones.

“This family of Fidelity ADT-connected mobile apps includes SecureWatch, SecureGuard, SecureHome and SecureConnect, and they cover most alarm types with varying degrees of sophistication from basic functions such as arm/disarm, to integrated CCTV and control of devices that turn lights and appliances on and off.

“Over 10 000 South Africans currently manage their alarm systems remotely from their mobile phones and the trend continues to increase monthly,” Mr Bartmann says.

Alarm systems in South Africa have traditionally communicated with professional monitoring centres via radio frequency (RF) and GSM communicators, he points out.

The introduction of the Internet of Things (IoT) network in South Africa has opened up new possibilities in the security industry and created a feasible communication platform for security products that provides far richer data from panels in a manner in which RF was not able to do, and a lot more economically, too.

People will now be able to ‘see’ their communications devices online, and check out GPRS positioning and data usage, which will make it possible to analyse behavioural trends and improve the customer experience in terms of managing their security systems.

“With the availability of Big Data (high volumes of data gathered from IoT devices), we are also able to start applying intelligent algorithms to determine risk and manage the risk pro-actively, which is collectively known as Artificial intelligence or AI,” says Mr Bartmann.

“To take it one step further, we can also apply learning algorithms that learn as behaviour changes. In this sense your connected alarm or CCTV system always stays current and for the first time you have a security system that is truly ‘futureproof ’.”

More stability and functionality Mike Myers is the CEO of Mobi-Claw911, a company that coordinates criminal, fire and medical emergency services for clients throughout South Africa. Aside from its existing mobile app, clients will shortly have access to a new remote device, he says.

This is in line with new, more efficient technology that makes emergency apps more stable and adds functionality. What’s interesting, he notes, is that Apple is becoming a lot stricter in terms of app and service compliance. Making it harder for apps to list in Apple stores will reduce the proliferation of apps unable to provide the necessary emergency services when panics are activated, he believes.

Also trending in security technology are new hardware devices intended to take cellphone reliance out of the equation, he says. It’s expensive to do properly, though, and standard off-the-shelf hardware and software won’t cut it. To make these devices effective, the software has to be adapted to the South African emergency environment, he maintains, adding that the Independent Communications Authority of South Africa (ICASA) registration will play a major role in terms of preventing the market from being flooded with cheaper substandard hardware.

Cybersecurity Says John Mc Loughlin, CEO of J2 Software, an African securityfocused technology business: “The world of cybersecurity is evolving at a rapid rate – it is simply impossible to follow every single new trend, and this will not change going into 2020. Cyberthreats are growing exponentially, and it is critical that every business, no matter their size, has a manageable cybersecurity program in place to prevent compromise. A cyberattack can be devastating and it really is in your best interests to do everything you can to protect your brand and prevent losses.”

“Rather than focusing on what the next big thing is or what’s hot right now – make sure you work with an established partner that will work with you to improve your cyber resilience. When you increase your cyber resilience you make sure that you have the ability to effectively respond to cyber-attacks,” he continues.

Going into 2020 he says J2 Software will continue building on proven security methodologies and introduce additional layers of defence that are effective and practical. “We have just launched our 3rd Party Account Takeover service to protect against email interception, a service that complements our existing managed cybersecurity portfolio.”

Crime trends In terms of client activation trends, MobiClaw-911 is seeing an increase in crime across the country, says Mike Myers, and specifically an increase in violent crime in KwaZulu-Natal.

Cybercrime is also spiking, according to John Mc Loughlin, with syndicates increasingly targeting South African businesses. “We kicked off more investigations in the last three months of 2019 than we did in the entire 2018,” he says.

A trend that’s likely to continue its upward trajectory as a result of businesses either not having sufficient cybersecurity in place, he says anti-virus programmes and firewalls are good but not enough. “Without visibility of your entire digital footprint and the ability to detect changes and anomalies, you will never get ahead of the game,” he warns.

While residential crime in 2019 remained “relatively stable” and cash-in-transit (CIT) attacks dropped, Fidelity ADT has seen increases in house robberies and vehicle-related theft (theft from and theft of motor vehicles). Wahl Bartmann says there was a noticeable shift in the trend as the year progressed, probably in part due to economic pressures but also because of consumer complacency with residents leaving gates and garages open or not activating their alarms.

Another worrying trend is the increasing level of violence in residential “follow homes”, he adds, voicing concern about “the unacceptably high levels of crime in our country”.

A new criminal modus operandi has also surfaced in the country’s banking sector. That’s according to Susan Potgieter, acting CEO and Kevin Twiname, Head of Service Delivery at SABRIC (South African Banking Risk Information Centre), a non-profit company formed by the four major banks to assist the banking and cash-in-transit (CIT) sectors combat organised bankrelated crimes. “Elderly people are being targeted by criminals who con them into withdrawing their savings in exchange for a job,” they tell.

The modus operandi sees a criminal approach an elderly person at an ATM. He tells them that his boss is recruiting pensioners as drivers and asks if they have a driver’s license and a bank account. He then says his boss needs to check their bank balances as he cannot employ them if they have money in their accounts. The elderly person is encouraged to withdraw all their savings and they are then robbed.

Sabric also reports a sharp increase in “vishing” incidents where criminals phone bank customers, lead them to believe that they are speaking to the bank or a legitimate service provider and use these social engineering tactics to coerce them into disclosing their confidential banking information.

Looking back on 2019…

Wahl Bartmann: “As a business and an industry, we have seen a lot of innovation in terms of new technology and products becoming available for consumers. Fidelity Services Group, as an example, has expanded its bouquet of services to include vehicle tracking and recovery through SecureDrive and has also branched into fire prevention and cleaning. Fidelity Fire Solutions was also one of the first fire repellent solutions in South Africa to receive British Standards Industry (BSI) accreditation.”

“Another big stand-out for us has been our involvement in the successful industry wage negotiations and our partnership with AgriSA which is making positive strides in reducing the unacceptably high number of rural attacks at farms.”

“ Most recently we were also very proud when Fidelity Services Group was awarded a certificate of excellence by Impumelelo Top Empowerment Companies in recognition of its commitment to transformation.”

Mike Myers: “The increase in crime is definitely a worry and no doubt related to our economy which is an even bigger concern. New and very effective crime fighting technology is becoming available at a rapid rate. Although mostly expensive, if this technology can be implemented into the different segments of security and integrated into SAPS (South African Police Service) we could see the benefits.”

“We as a nation were hoping that we would see our economy start making headway in the right direction which never happened. As long as our economy remains in the state it is we will continue seeing crime rise. A state of emergency should have been implemented and used to combat crime on every level.”

John Mc Loughlin: “There are still simply too many businesses who do not take cybersecurity seriously. Some pay lip service, but most don’t do anything. The ransomware attack on CityPower Johannesburg is just another warning to government and corporates that they are not immune to cyberattacks. This attack caused blackouts across the city as cybercriminals took control of the city’s power servers which prevented residents from purchasing electricity. CityPower Johannesburg successfully restored its encrypted servers within hours of the security breach being identified. However, this should serve as a warning to other service providers that ransomware could easily debilitate a city. Depending on the severity of the attack, it could take days, weeks or months to recover critical data. Hackers are working to gain secure data all the time, it doesn’t matter what industry. Cybersecurity is a moneymaking business and will continue to grow. Everybody is a target and it also doesn’t matter the size of the business.”

Hopes and concerns for 2020 for both the private security industry and South Africa…

Wahl Bartmann: “We hope to see our economy stabilise and would like to see more opportunities for job creation. There is a definite correlation between unemployment and high levels of crime. We also would like to see more of the big crime syndicates being apprehended and arrested. There has been encouraging progress this year, but it is important to maintain pressure on these syndicates who destabilise our communities. And also to see a reduction in banking crime by leveraging on our strategic partnerships.”

Mike Myers: “More integration and cooperation between the government and the private sector. When this becomes a reality, we will start seeing a difference (but) all too often these sectors work against each other which only weakens our fight against crime. Together we are stronger. Our hope is also that the economy starts taking a turn for the good and that job creation becomes a reality.”

John Mc Loughlin: “Companies need to make real progress in terms of security, not simply tick a box on an audit requirement. This is only possible by obtaining valuable input into the security operations of your business, by increasing visibility and by increasing your capability to identify and respond before you are in the news. Relying purely on network monitoring works in a perfect world, but we work in an imperfect world. Users make mistakes, click on links, download software they shouldn’t and are given far more access than they require – simply because there are inadequate controls and no monitoring.”

“Despite declining business confidence in the ability to manage cyber risk, business leaders are now clearly recognising the critical nature of cyberthreats and are starting to identify and embrace best practices to mitigate risks. Cyberrisk has moved beyond data breaches and privacy – there are now sophisticated attacks that are disrupting entire countries, industries, businesses and supply chains. This is costing the economy billions and affecting businesses in every sector. Unfortunately, cyberrisk cannot be eliminated, but it can be mitigated and managed. The savviest businesses are building cyber resilience through comprehensive, balanced cyber risk management strategies rather than concentrating solely on prevention. These more complex approaches account for the need to build capabilities in understanding, assessing and quantifying cyber risks in the first place, as well as adding the tools and the resources to respond to and recover from cyber incidents when they inevitably occur.”

Last word South Africa has repeatedly shown the rest of the world that it has what it takes to triumph over adversity. In President Cyril Ramaphosa’s words, we have much to be proud of – but we also have a long way to go. In his newsletter dated 16 December 2019, the president referenced the SA Reconciliation Barometer Survey 2019, saying most respondents believed that (further) reconciliation was impossible in the face of unaddressed corruption, political divisiveness, poverty and genderbased violence, among other issues. True reconciliation was more than just social cohesion, he said – it extended to political and economic transformation, too, hence the need to restructure the economy to benefit all. “In this sense, reconciliation is a very practical undertaking,” he averred. “It is about the work that needs to be done to unlock investment in our economy, to reduce the cost of doing business and to promote growth. It is about the urgent measures we need to take to ensure a reliable supply of electricity to homes and businesses. It is about ensuring that our scarce water resources are preserved and equally available to all. Reconciliation means that we should continue to use the capability of the state to improve the lives of the poor, to have a tax regime that is progressive and public finances that are responsibly managed.” To quote Dr Theobald, strong leadership, decisiveness and actual implementation by government are what’s needed to turn 2020 into a positive year. Let’s hope.