This article originally appeared in the March 2022 issue of Security Business magazine. When sharing, don’t forget to mention Security Business magazine on LinkedIn and @SecBusinessMag on Twitter.
The same considerations that inspired B2B giants like Microsoft and Adobe to change their delivery model are poised to take over the physical security industry.
Hosted software and subscription services for project management and safety management – everything from computer-aided dispatch and emergency management to building information management and building automation – are bringing diverse stakeholder groups to the buying process. Many of them are not only familiar with hosted subscriptions but they have come to expect a hosted option as an alternative to the traditional approach of physical security.
Hosted systems are a new model for the security industry, but the benefits are clear for both systems integrators and their clients. Clients can often benefit from lower up-front fees, while systems integrators gain a more stable and predictable income. Clients benefit from a flexible system that can be upgraded as needed over time, while systems integrators can offer new services as technology advances. Both stand to gain from the transition from a fee-for-service model to a relationship based on mutual understanding and trust.
As the purchase process and technical integration of these systems come together, security systems integrators need to consider a new business approach. Here are four key reasons to adopt a Security as a Service business model:
1. SaaS improves an integrator’s business valuation.
Reconfiguring your business model to support subscription services may seem like an intimidating administrative hassle, but the payoff is worth it.
Offering long-term contracts for hosted services provides an integrator with a stable and predictable monthly revenue stream that helps complement revenue from project sales. Costs associated with customer acquisition and setup are reduced while enabling similar revenue streams. This can give an integrator the freedom to expand service offerings beyond system maintenance and troubleshooting. Work to close the consumption gap and cross- or upsell for values greater than what maintenance alone might bring in.
Having a solid stable of clients delivering recurring monthly revenue also has another benefit: RMR increases the valuation of a business. Whether an integrator is looking for growth financing, planning for the future sale of the business, or are looking to reinforce financial footing, there is no question that it helps to have a constant stream of repeatable and reliable income.
2. SaaS extends your value proposition.
Selling and deploying a security system is just the beginning of the client relationship. The real value of the systems integrator shines when they can leverage their hard-won expertise to help customers improve not only security and resiliency, but also improve their operations. Integrators can charge customers more if they can prove they can help save a customer time and money.
The customers who collectively make the purchase decision generally buy a security system once. No matter how savvy the user, it is the systems integrators and their trusted software partners who do this work every day – and possess the knowledge and expertise that comes from having built systems that protect hundreds of thousands of customers daily.
Hosted systems provide benefits relating to consumption and maintenance that allow for the transformation of the relationship with a customer from one that we have seen become transactional or commoditized, to one that enables you to monetize your expertise beyond your ability to repair cameras, wire doors, or update software.
It is the kind of value that is not easily replaceable and that sets an integrator apart from competitors, creating differentiation so they do not only have to compete on price.
When integrators work with a unified, open-architecture SaaS security provider, system upgrades are simpler, and it enables the option to add to the service over time as new technologies emerge and as a client’s needs change. These benefits enable the integrator to spend time developing greater expertise about a customer’s processes.
Use this newfound knowledge and time to tailor services towards potential productivity gains for a customer and turn them into additional sales. Integrators should be able to position themselves as a trusted advisor more so than a vendor or service provider, making sure customers get the most out of the technology that is available, and that they have already purchased.
3. SaaS helps a customer stay in front of the technology curve.
In a cloud-based system, fixes and upgrades are pushed continuously by the software provider as soon as they are ready for release. The integrator can control whether updates and upgrades are pushed to a central location for validation before broad release.
Deployment time can be much more flexible, and there is no need to go from machine to machine to update each server or device individually. It is a much more fluid and nimble approach that also enables rapid break/fix response and facilitates system resiliency.
In addition, it is much easier to practice good cyber-hygiene on hosted systems. System hardening, cybersecurity configuration, and data management are critical but time-consuming, and keeping on top of the latest threats is a job itself. With hosted solutions, the manufacturer helps alleviate some of this burden.
4. SaaS enables right-sizing as needed.
The rapid expansion of IoT devices at palatable price points has a significant impact on network, storage and bandwidth needs. While servers, switches and workstations can provide high value on an integrator’s top-line revenue, they also make bill of materials longer, increase labor costs, and for many, bring about unexpected service and maintenance costs for electricity and HVAC.
In the cloud, clients can buy bandwidth as they need it, so they do not need to invest in excess storage and processing power. Additionally, the infrastructure maintenance and its associated costs are shifted to the cloud service provider.
The good news is that it does not necessarily need to be an either/or solution – many customers find that a hybrid system, with both hosted and on-premises pieces, is the most practical and cost-effective solution for their needs.
How to Choose a SaaS Manufacturer Partner
While it may seem easier to keep the status quo of cash cow clients, companies are increasingly looking to take advantage of the benefits of hosted and hybrid systems. In a growing number of companies, the responsibility for purchasing security systems no longer rests solely on a security or facilities team. Increasingly, stakeholders from IT and senior management – even marketing – are involved in making the purchase decision.
In most cases, these stakeholders come to the table already familiar with the mechanics of SaaS. Systems integrators who do not adjust to respond to this demand risk being left behind.
Luckily, integrators do not need to make this transformation on their own. Quality cloud software partners are available to support them and can help evaluate whether a fully cloud-based or hybrid model is the best solution for a particular customer.
Unification helps customers move away from the traditional approach of having multiple independent systems, and instead provides a user interface that displays all possible physical security functions as one seamless experience. An ideal partner will also allow an integrator to choose the cloud deployment that works best for a particular client by providing the option of selecting either a true cloud system with no servers on-premises or a hybrid model that helps clients move to the cloud at their own pace.
Select a partner who’s got both your and your customers’ back. One who not only has a proven track record of building cyber resilient solutions with multiple lines of defense, but who also emphasizes risk identification and mitigation, promotes transparent communications, and works exclusively with a network of trusted partners.
Jennifer Elliott is Director of Channel and Sales Enablement for Genetec. Request more info about the company at www.securityinfowatch.com/10213771.
