IP Network Solutions
Physical security information management (PSIM) is a high-end solution primarily implemented for homeland security, critical infrastructure clients such as large power plants, ports and transportation centers, as well as other highly secure, labor-intensive organizations. The objective of PSIM is to tie together access control, video surveillance, intrusion alarm, building controls and other subsystems under a single interface for unified, streamlined detection and response.
In recommending, selling and implementing such solutions, integrators face the challenge of justifying the systems’ substantial expense by offering prospective clients quantifiable estimates of expected return on investment (ROI). In the following pages, SDM discusses with manufacturers and integrators the kinds of information integrators need to make such an ROI estimate, and how they might be able to calculate ROI.
UNDERSTANDING PAIN POINTSWhen approaching the issue of ROI, it is important to view PSIM as a solution sale, not a product sale, says Rafi Bhonker, vice president of sales and marketing for New York City’s Orsus, a provider of situation management software.
“Unlike the ROI of a voice processor, which is very easy to determine, is very generic and has a very clear ROI, with situation management it’s difficult,” he says “The integrator was accustomed in the past to selling a DVR or a camera, and that’s it. Now you have to take a different view of what the customer needs.”
What the customer needs is a platform that addresses specific “pain points,” that will differ in each client’s organization, Bhonker says. Eliminating those pain points brings reductions in cost that are all part of PSIM’s return on investment, he notes.
One pain point may be the cost of training operators, who â€” when they join their organizations â€” must learn to navigate existing systems. A PSIM platform providing a common operating picture with icons of cameras, fire detection, specialized sensors, access control and tracking devices eliminates need to learn all of those systems. “In that sense alone, you’re gaining ROI in avoiding some training of operators,” he says.
In addition, a PSIM platform that incorporates preprogrammed response actions to incidents such as hazardous chemical spills addresses another pain point, the need to have individual operators memorize a variety of differing responses. “You really need to know what the pain point is in the organization,” Bhonker says. “If it’s an organization where the turnover is very high, then ROI is going to come much faster.”
Another example of an organization’s pain point could be a high number of false alarms, and the costs associated with responding to them. PSIM systems can prioritize an event such as a door being forced open during a period when detectors indicate activity in the building during non-working hours. “Now it’s a high probability this is not a false alarm,” Bhonker says.
“By being able to prioritize these events, the severity level of the event can be ascertained and money can be saved on avoiding false alarms. If you have a high-security environment where a first responder needs to respond to every alarm, then there’s a cost that can be quantified and factored into the ROI equation.”
Yet another pain point may be high communications bills. By making the investment in a PSIM platform, companies become more efficient and can reduce communication costs, another quantifiable expense to be factored into ROI, he says.
Finally, the ROI calculation also should take into account another very common occurrence within organizations. After investing heavily in, for instance, an access control system, the company makes a decision that it must move to a different type of access control system. The trigger for this event in many organizations is a merger or acquisition, which often requires consolidating different systems.
Such an event often necessitates an expensive “rip-and-replace,” Bhonker says. But by investing in a system platform, that migration can involve a gradual phasing out of one system and moving to another over time. “That’s a heavy ROI,” he says.
All this said, there is no equation for proving the return on investment of an expensive PSIM system, Bhonker adds. Instead, the integrator must build a business case based on pain points specific to each organization.
HOLISTIC VIEW OF OPERATING COSTSAdopting a different approach to the issue of ROI is San Jose-based enterprise software manufacturer Quantum Secure. According to president and CEO Ajay Jain, an ROI calculator appears on the main page of its Web site.
“If there is no tangible ROI, we’re wasting our time, and the customers are wasting their time,” he says.
“The ROI story and the business case justification associated with that is so compelling that in nine times out of 10, that prospect is converted into a customer.”
When discussing the return from PSIM with prospective customers, many of those clients aren’t familiar with the operating costs they are expending on disparate operations that might be tied together through a PSIM solution. Quantum Secure must compel them to look into their global operating costs in a holistic way, Jain says.
The firm’s integrators are asked to collect the following information from clients:
A global understanding of their physical security infrastructure.
An analysis of how disparate or fragmented the infrastructure is, in terms of the number of DVRs, biometric devices, CCTVs, etc., the client has.
An examination of the compliance challenges they may face in attempting to comply with regulations from the FDA, DEA, HIPPA and Sarbanes-Oxley.
An analysis of both logical access management and physical access management to determine whether or not they operate in a similar manner. The goal is to streamline operating costs and risk management, Jain says.
“The integrators should go out and really look into the customers’ eyes and compel them to vouch for these answers,” he adds. “That’s the information part of it. Once they realize there are problems in any one of those four areas, the natural next step is to understand the points on return on investment.”
The integrator can suggest writing custom applications to manage all four areas, at enormous cost for each. Or he can suggest installing a PSIM solution, which can lead to the same results at a fraction of the dollars spent using the other option.
An integrator can go to the company’s Web site, www.quantumsecure.com, and perform the ROI calculation. The result is a five-year cost-benefit analysis based on direct cost savings, which also includes a view of lost productivity costs as well as risk costs. “Most of our customers easily realize the ROI in under a year,” Jain says.
Another approach to ROI is to examine numbers flowing not just from security but also operational savings, says Marc Petock, vice president of global marketing and communications for Richmond, Va.-based Tridium, known for software frameworks, automation infrastructure technology and device-to-enterprise integration solutions.
“The way [an integrator] can calculate it is, first, you’re able to do more with less,” Petock says. “Second, he’s able to offer a more comprehensive system that really makes the whole security solution do more, adding value by controlling the operational side of the building as well as security.”
Still another perspective is that offered by Jennifer Martin, Denver-based manager of worldwide channel programs for Mountain View, Calif.-based Pixim, an imaging sensor manufacturer. Her company’s imaging sensors that go into video cameras “have an excellent ROI story” that’s just part of a PSIM solution, she says. “The integrator should discuss the separate subsystems and any components that provide a superior return on investment as part of the overall solution,” she notes.