Blake & Associates, Inc.

The primary objective of any business is to make a profit. Therefore, identifying a return on a financial investment is the basis for the business decision to spend or not spend financial resources. For many items it is easy to identify the return on your investment. For example: new technology can be purchased with an identifiable investment return of increased production with a reduced per item cost.

Some investments vital to successful business operations cannot be quantified in dollars and cents. However, there is a return on your security investment that allows accomplishment of business objectives that can ultimately be quantified in financial terms.

The return on investment in a comprehensive safety and security program is one that cannot be identified on a financial statement. On the other hand, this investment makes possible other investments than can be evaluated in financial terms. For example, a viable loss prevention program will result in reduced theft and increased profits. The value of a loss prevention program cannot be expressed in dollars and cents but not having to replace stolen equipment will increase profits.

The foundation for the return on your security investment is the mitigation of risks through the use of cost-effective preventive measures. The following are some examples:

Risk Assessment Programs
Security Program Objectives	Investment
No major business disruptions	CCTV surveillance, timely police or security officer response – physical interception of the threat, crisis response and disaster recovery plan

No individual being taken hostage on the property1	Controlled access, live surveillance, deterrent security officer presence, security awareness program, policies and procedures
No serious workplace assault on an employee or other person, including during non-business hours	Controlled access, live surveillance, security officer deterrent and response, security awareness program, policies and procedures
No crisis of confidence on the part of employees	Comprehensive and visible security program and systems
No protracted evacuation of the building	Live surveillance monitoring of risk areas, fast trained response, prevention procedures
No significant reduction in freedom of access for visitors to the building	Security officer visibility, security monitoring equipment
No unnecessary alienation of legitimate users of the building through “knee-jerk” reaction	A planned, comprehensive and “occupant friendly” security program
No loss of life because of poor threat recognition	Planned, audited and periodically updated security measures
No failure to provide a prompt and efficient emergency response	Coordinated emergency services planning, safety/security training, live surveillance and efficient communications
No excessive consequential cost incurred through inadequate emergency planning	Forward planning to cope with incident aftermath
Investigations
Quality personnel with high degree of personal integrity	Initial and periodic background investigations to verify applicant and employee information
Elimination of theft of business products and assets2	Coordinated actions between auditors and investigators to identify theft losses and their cause, asset inventory and control program
Amicable resolution of internal disputes in accordance with corporate objectives	Development of factual and impartial information to support human resources policies

No business transaction or acquisitions with unqualified businesses or individuals	Coordinate due diligence investigations by auditors and investigators to verify business credentials

There is a significant non-financial return on your security investment. This return results in increased morale, confidence in business leadership, increase in profits, and the ability to meet corporate objectives. The non-financial return further supports the financial advantages attributed to other investments.

1 The worst case scenario depicts a catastrophic event such as the “domestic terrorist” bombing of the Alfred Murrah Federal Building in Oklahoma City on April 19, 1995. Six months after the bombing, researchers from Washington University’s School of Medicine in St. Louis, together with the Oklahoma State Department of Health interviewed 192 survivors, randomly selected from a register exceeding 1,000 names. They subsequently reported that 45 per cent of these survivors had experienced psychiatric problems, and 34 per cent suffered from post-traumatic stress disorder. In addition to survivors suffering psychiatric disorders, such dramatic events are known to inflict crises of confidence among emergency services staff, rescue workers, people employed elsewhere within the same organization, and other observers of the aftermath. The inability of many to continue their normal working routines brings with it a significant and commonly protracted cost impact. For this reason alone, comprehensive incident prevention and mitigation measures offer a clear return on investment.

2 A RAND study sponsored by the American Electronics Association (AEA) and the International Electronics Security Group (IESG) places theft of high-tech products and components from U.S. manufacturers and their customers at more than $5 billion annually. The study estimates that direct losses due to theft from high-tech manufacturers and distributors totals $250 million per year and that indirect costs, such as loss of business and insurance, total more than $1 billion per year. Theft of high-tech products from manufacturers could cost another $4 billion, resulting in a total estimated loss of over $5 billion annually. Another finding concluded that companies that made the largest investments to reduce theft saw the largest reduction in theft.