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ENTERPRISE TRANSFORMATION AWARD

Watching out for the next high-tech solution in security

Enterprise Transformation Award winner Ademco Security Group has leveraged on technology and is going the extra mile to beat bigger competitors.

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Ademco has recently invested in two blockchain startups. "I'm a firm believer that blockchain is going to be the future of security in one form or another," group managing director Toby Koh predicts.

CLOUD and wireless systems are almost as common these days at the workplace as filing cabinets and fax machines once were. It was a different story 10 years ago when security provider Ademco Security Group adopted them.

The firm was the odd man out and Toby Koh, the man behind it, was the laughing stock in the security industry. "They said Toby has lost his head," he recalls with a laugh.

Today, with Ademco's business success and near-universal acceptance of cloud and wireless technology in the corporate space, the homegrown firm is seen as a pioneer in the security sector in many ways - and a model for transformation.

"We really changed the industry by going wireless," Mr Koh says. "Big companies have tried to do the same thing, but failed. So we're the only provider able to provide island-wide coverage."

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When floods in Orchard Road crippled the cellular network there some years ago, alarm signal transmissions in most buildings were disrupted. But the alarm signal transmission through Ademco's wireless mesh network stayed uninterrupted.

HIGHER LEVEL OF SECURITY

"So (the wireless system) provides a much a higher level of security for our customers," Mr Koh says.

Ademco, which bags this year's Enterprise 50's Enterprise Transformation Award, was incorporated in Singapore in 1977 as Ademco USA's regional headquarters. T C Koh, its first managing director and Toby's dad, bought it out in 1985 and Ademco became a Singapore-owned company.

That year the firm rolled out a 24-hour central system and installed the first alarms in Housing and Development Board lifts in that decade. It also floated the idea of providing fire alarm monitoring services. Singapore's fire service was then handling its own calls. The privatisation of this service, which Parliament had to approve, has freed the fire service to focus on fighting fires.

"We lobbied the fire department (which was using Ademco equipment) to let the company do the monitoring," says Mr Koh who is now Ademco's group managing director. "We told them that with technology we can do things the 'smart' way."

Ademco is one of four companies responsible for fire monitoring in Singapore today, with about 65 per cent of the market share. The firm also takes care of security alarm monitoring for 3,000 buildings here, including banks and warehouses.

All thanks to Ademco's 24-hour command centre in Outram Road, where its employees keep track of the goings-on at thousands of locations in Singapore. The centre includes an in-house data centre.

The firm has its own generator housed in a purpose-built room for backup in case of a power failure, which will disrupt its operations. There's also a separate data and disaster recovery centre in the eastern part of Singapore.

Mr Koh, then only 24 years' old, joined Ademco in 1995. The young man started to steer the firm more toward the high-technology path.

AUTONOMOUS PATROL ROBOT

In 2002, Ademco launched Singapore's first internet protocol-based alarm transmission system and, in 2018, it brought in an autonomous patrol robot. Mr Koh says the robot, a four-wheeled contraption, is especially suited for patrols in unmanned areas or during the night. It will be the answer to Singapore's shortage of security guards.

Despite efforts to improve the skills and working conditions of security guards, Mr Koh says the basic nature of their job remains the same. "So long as people - property owners and managers - still deploy security guards in the same old fashion, there's not going to be any improvement."

Robots can take over the mundane patrols, allowing the security guards to take on "higher value added work" like investigating alerts, according to him. He points out that robots never get bored or tired and, fitted with the appropriate sensors and software, do a better job than humans in the late hours in low light conditions.

Mr Koh moved his firm from hard-copy reports to a fully digital system in 2010 for greater efficiency. Hard-copy paper work was central to Ademco's operations. When its employees attended to an alarm call, a report would have to be filled out and the client had to sign off. The report then had to be manually entered into Ademco's computer system.

Mr Koh adopted an off-the-shelf customer relationship management software and equipped his operations team with tablets. The upfront cost of going digital can be daunting, particularly for an SME, he admits. Workers will also not readily accept the change.

"You've to be prepared to invest," Mr Koh says. Convinced that digitisation would be good for Ademco, he "basically forced it through" in the face of resistance. Thankfully, the frontline staff - the technicians and engineers - were keener on the move.

"It helps them," Mr Koh says. "They don't have to come back to the office to file reports, they can just send it from the site."

In transforming Ademco, he says "the human factor is probably the biggest challenge". "You're going to have the naysayers." The solution lies in education, according to him. And it helps that his firm has a culture that's "very Asian family focused but (follows) large MNC best practices".

"We've gone through all the economic cycles but we've never laid off anybody before - not once," Mr Koh says.

Education applies as well to getting customers to buy new technological and innovative solutions for their security needs. "It's all about education but, first of all, our proposal has to make sense and is compelling. Nobody is an irrational customer. Nobody buys a technology or solution from us just because he likes my face. At the end of the day, it's the value we can provide and how we can educate and convince the customer that our solution works for him."

Mr Koh says Ademco spends a lot of time understanding the customer's problems. "In fact, we identify problems that they might not even realise. The only thing is whether the customer is prepared to do the hard work to change his internal process, to convince his management to approve the change."

Ademco doesn't simply go out and sell its services; it engages the customer as well. "We are not box sellers," Mr Koh says. "If a client says he needs 50 security cameras, a lot of security companies will just give him the price. Our approach is more like 'Why do you need 50 cameras? Do you want to focus on people going in? Or going out? Is it a pilferage problem?' "

After sitting down to find out what the client's challenges and requirements are, Ademco then starts to customise a security system for him.

Staying ahead of the innovation curve is arguably a matter of survival in the security business these days. Crime and theft have grown increasingly sophisticated, putting the industry constantly under pressure to shape up or ship out.

Mr Koh says it's no longer enough to just plonk security cameras for surveillance. Technology such as video analytics that can flag irregularities as well as facial recognition systems are now being deployed to better protect people and assets.

To keep Ademco's eye on the ball and remain on the forefront of security technology, Mr Koh has set up an in-house development and design division in 2007. "We put the firm's best engineers there and we invested over 10,000 man-hours yearly looking into new trends and technology."

Ademco has also recently invested in two blockchain startups. "I'm a firm believer that blockchain is going to be the future of security in one form or another," Mr Koh predicts.

The technology is still new and, he says, Ademco doesn't have "the right eco system" to build a blockchain team. "So, the next best thing is we go invest in a blockchain company so that at a suitable time when we're clear of the direction of blockchain in the security industry, we will have the talent there already."

The growing convergence of physical and cyber security is a trend which Ademco is also studying and the firm is looking to expand its offerings to include cyber security services.

Ademco has chalked up double-digit growth every year in the past decade. "Last year we did S$42 million in sales," Mr Koh says. "This year we will breach S$50 million."

It has a strong client base that cuts across sectors ranging from business, education, banks, government, retail to critical facilities like homeland security, casinos and energy plants. The expanding customer profile runs the gamut from Exxon Mobil, HP, IBM to Amazon and Unilever.

Ademco's leverage on technology has provided it a level playing field to compete with the giants in the industry, such as ST Engineering, Honeywell and Tyco. Thus, it was able to clinch the tender for Resorts World Sentosa (RSW) some years ago.

In the project, the local firm delivered state-of-the-art technology that extends across high security solutions as well as operations and management efficiency. Ademco leveraged the same smart card technology which is used to restrict access to particular venues to create an automated uniform collection system for RSW staff, eliminating the long queues for the 18,000-strong RSW workforce.

Ademco hasn't arrived where it is today by only simply riding on technology. It has also demonstrated a talent for integrating technologies to offer sophisticated and customer-centric services. And the firm has gone the extra mile by taking a holistic approach and adding values to the services it offers.

Ademco sees itself as offering not just security solutions, but also provides an overall boost to the operational efficiency of its customers. For instance, recently discovering that an Indonesian client was still issuing paper coupons to workers to redeem their meals and using punchcards to clock the workers in and out, Mr Koh offered to incorporate these functions into the smart cards which Ademco was supplying to the customer for security access.

This has made it easier for the customer to audit staff meals and save the need for printing and cutting paper coupons.

"Our integrated security platform is now used for HR, payroll, safety and operational efficiency. . . It's value-adding to what our clients initially thought they would require," Mr Koh says.

A GOOD RETENTION STRATEGY

This has also turned out to be a good retention strategy. "It's no longer just the security director who has ownership of our solution," Mr Koh says. "The HR director will also have an interest in keeping us because it's also tied up with the HR system. Then you have the warehouse guy. He needs our intelligent video to make sure the forklift people are not speeding. The ownership of our solution is now multiple-department which makes it a lot more difficult to kick us out."

According to him, this total approach is one of the factors contributing to Ademco's client retention rate of over 90 per cent.

Ademco's overseas ventures have also played a big part in its growth. Striking out of Singapore had started out in a tentative, almost reluctant fashion, Mr Koh recalls. "There wasn't really that thought: 'Let's go out of Singapore'. We were actually led by our customers."

When clients went abroad, they had requested Ademco's services in their overseas locations.

Ademco initially provided the services on an ad hoc project basis. Then some clients wanted Ademco to have a formal entity on the ground in order to award projects. So, in 2010, it finally made the leap and incorporated in Malaysia and in the Philippines.

Ademco has since expanded into Indonesia, India, China and Vietnam. And, departing from its initial reluctance, it has made achieving a presence in all Asian-Pacific countries in the next few years a main priority.

"Ultimately, we aim to be a true pan-Asian security solutions provider," Mr Koh says. "Singapore is just too small, so more than 50 per cent of our turnover this year is going to come from outside Singapore. We're also trying to diversify our risks in the various countries."

  • The E50 Special Recognition Award -- Enterprise Transformation is supported by the Future Economy Council