The Olympics is just one enormous procurement case study waiting to be written up - I wish I had the time and also a financier.
I've discussed before the problems of manned security for the Olympics. The whole saga relates to 'back of an envelop' estimates of demand, and a provider who appears to have over-promised. I'm not going to repeat what you can read elsewhere but in a nutshell, to get round the problem extra cash has been found, troops are being called in to fill the suppliers shortfall and volunteers used, while G4S, the contractor, hastily leafs through its 'little black book' with a view to finding recently retired police officers who may be able to stand in. Of course that's only part of a bigger problem as there are displays of public disorder and rebellion at the Border Controls and there's an additional need for police support there too over the Olympics! It would be easy to draw out lessons from all of this but perhaps premature.
No, I want to provide a few words of caution to all my procurement mates who have responsibility for manned security - a health warning.
Let's assume a really good contract has been let by those at Locog. Let's also assume the contract requires G4S to deliver inputs (security personnel) as opposed to outcomes (safe games which could have been delivered with less personnel and more use of technology). If that's the case G4S could face significant contractual costs indemnifying Locog if the 'man hours' aren't delivered. Of course Locog may also have have given themselves the ability to source security staff elsewhere and charge the additional costs to G4S. Either way, the obvious answer is to call in trained and vetted security personnel working on other maned security contracts throughout the country or even from overseas (for example I notice it is G4S staff who delay me every week as I go through security at my local airport), offer them a bonus (i.e significantly more than the little above the minimum wage the industry is accustomed to paying), a free ticket to some of the events and a snazzy souvenir uniform (perhaps for resale on eBay) and hey presto, problem solved - or is it?
No, the problem isn't necessarily solved but shifted. We all know how hard it is to make sure security contracts deliver the personnel they're supposed to, particularly at night - moral hazard is all about how do you know someone will do what they say they will do when you're not watching over them.
So my suggestion is that procurement managers get assurances and put in place mechanisms to ensure that contracted personnel (particularly night staff and supervisors) will not be shifted to solve the Olympics problem. If the staff can be moved without any adverse impact, perhaps you have over manned. Just as easily, this may provide an opportunity to help the security contractor introduce longer-term reduced manning solutions which you can both benefit from.
I remember an old TV advertisement to the effect that 'Rufus didn't bark' - well, are you absolutely sure that Rufus will be on your site when those the contract cover is protecting you from choose to call? It will be interesting to see if there is an increase in regional breaches of security while the Olympics are on!
No, I want to provide a few words of caution to all my procurement mates who have responsibility for manned security - a health warning.
Let's assume a really good contract has been let by those at Locog. Let's also assume the contract requires G4S to deliver inputs (security personnel) as opposed to outcomes (safe games which could have been delivered with less personnel and more use of technology). If that's the case G4S could face significant contractual costs indemnifying Locog if the 'man hours' aren't delivered. Of course Locog may also have have given themselves the ability to source security staff elsewhere and charge the additional costs to G4S. Either way, the obvious answer is to call in trained and vetted security personnel working on other maned security contracts throughout the country or even from overseas (for example I notice it is G4S staff who delay me every week as I go through security at my local airport), offer them a bonus (i.e significantly more than the little above the minimum wage the industry is accustomed to paying), a free ticket to some of the events and a snazzy souvenir uniform (perhaps for resale on eBay) and hey presto, problem solved - or is it?
No, the problem isn't necessarily solved but shifted. We all know how hard it is to make sure security contracts deliver the personnel they're supposed to, particularly at night - moral hazard is all about how do you know someone will do what they say they will do when you're not watching over them.
So my suggestion is that procurement managers get assurances and put in place mechanisms to ensure that contracted personnel (particularly night staff and supervisors) will not be shifted to solve the Olympics problem. If the staff can be moved without any adverse impact, perhaps you have over manned. Just as easily, this may provide an opportunity to help the security contractor introduce longer-term reduced manning solutions which you can both benefit from.
I remember an old TV advertisement to the effect that 'Rufus didn't bark' - well, are you absolutely sure that Rufus will be on your site when those the contract cover is protecting you from choose to call? It will be interesting to see if there is an increase in regional breaches of security while the Olympics are on!
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