Terrible: Security Companies Hire Execs Outside Of The Industry

I think it's a terrible idea but worth discussing.

Sometimes companies get a person from outside of the industry, who has been successful in telecom or IT or finance, etc. over 20+ years and then put them in a leadership position.

Problems with this:

  • No domain expertise so very difficult to make correct decisions
  • No personal relationships so very difficult to have influence or get help (especially problematic in sales)
  • Incapable of guiding or helping their reports with industry specific issues
  • Worse, their reports will know more than they do, hurting morale and performance

I have seen this cause havoc across numbers organizations - both manufacturer and integrator.

What do you think? Vote inside:


I think it's a bad idea and I can speak from experience.

In a past position a former employer of mine brought in a guy from the lighting industry to oversee our department (I was inside sales at the time focusing on webinars). My primary purpose was to provide webinars for integrators interested in our cloud-based product, follow up on opportunites, and make sure our CRM (Salesforce) was constantly updated with the latest contact/opportunity info (# of doors, # of locations, est close date, etc)

I was being considered for a promotion at the time. Instead of watching one of my demos to see how I pitch to prospects he asked me to pick a topic and put together a powerpoint presentation just to test my presentation skills (I chose the history of the automobile 1920s-present). The only barometer of my performance he had were post-demo survey responses which I sent to every person I did a webinar for. Thankfully, the surveys of my performance were glowing.

I can safely say I learned nothing about the industry from this guy and I went from being a proud company advocate to being miserable working for someone I knew I could learn nothing from. I had three times the product knowledge of my supervisor and no mutual respect.

I can safely say reporting to someone who knows less about the industry than you is a recipe for disaster. Within three months of hiring this exec from outside the industry I took a new job back in my home state and was 10x happier after leaving.

Undisclosed A: sounds to me like your supervisor got tired of your immaturity and inability to show up to work on time. Maybe a little less time on Facebook, fantasy football and gossip and you'd still be there. Good luck selling ads for IPVM...I mean, whatever you do.

That you responded like this shows your immaturity as well, Undisclosed G.

Maybe a little less time on... gossip.

I think it can easily go either way, but with Surveillance and Security trending towards much more of an IT focused industry means it does make more and more sense to bring in outsiders.

I have worked in IT as a System Engineer for 10+ years and recently(6 months ago) was brought onto a team supporting a nationwide installation of 10,000+ cameras, 150+ Servers, physical access, and a few other related systems.

The Surveillance industry as a whole has surprised me as the large companies making software seem to just now be figuring out what everyone else knew 15 years ago. These are areas where a combining of talent and knowledge from the IT side specifically can lead to a lot of positive results.

The industry feels similar to healthcare 7-8 years ago. Most records were stored in paper charts, interoperability was non-existent, and they were very resistant to change. When modern IT standards and executives were brought in and upgrades started to happen. Capabilities leapt 40 years forward and while it was a painful process, in the end we not have a much better system overall.

This all being said; the wrong person being brought in, from the current industry or otherwise, can lead to an awful environment and have negative impacts. Most people definitely have something to bring to the table if given a chance though and a new perspective is frequently helpful...

B, thanks for the feedback. To be clear, I am talking about execs specifically. Non-execs have a significantly easier transition.

Is there anything about the security industry that makes it even more challenging than in other sectors? Say a security guy going telecom?

Also, though they are not transplants per se, what about the typical exec team at startups, like Dropcam or August lock, who are coming from more of a social media angle? Are they doomed to blunder as well, as they increasingly venture into the domain of traditional security?

The security 'business' is weird, in that buying decisions are rarely based on ROI or TCO and it is often more of a 'grudge' purchase / cost center. That makes it confusing to outsiders.

But I think the bigger issue is universal. A security exec going into telecom would need quite a while to learn who's who and what's there, invariably struggling for a long time. Of course, that would be much less likely to be even tried because security carries less corporate prestige than most other industries (save wastewater).

Citing Dropcam is a bit skewed. How many other startups did not make it and are not remembered? Also, Dropcam choose an entirely different business model so security expertise had little importance. 3VR is a better example of a company who struggled with these dynamics.

My position as a senior engineer in new product development for a leading CCTV manufacturer gave me an up-close-and-personal experience with this issue when the company hired a new VP of Sales & Marketing from outside the industry... from way outside the industry... from Coca-Cola. The rationalization that the company offered at the time was "sales is sales... if he can sell Coke he can sell anything".

Not only was this outsider given control over the sales and marketing decisions, he was given the power to direct the course of new product development because his skill and 'research' would tell us which products would be the most desirable and most profitable in the marketplace.

There was a meeting with upper management and senior engineering where he was supposed to give his decisions on which product developments we would pursue for the next year. When the VP of Engineering asked him what he wanted, he said "Tell me what you can make and I'll pick the products I want.." Unfortunately, he wasn't joking. The entire room sat in stunned silence for a good minute or more before the VP of Engineering spoke up and tried to move the meeting forward.

That meeting was a turning point. Word spread like wildfire through the company. The best and brightest employees started leaving the company within weeks. The guy from Coca-Cola had an employment contract and stayed there for 3 years. The company is no longer an industry leader and is still struggling to recover.

That's one of the best / worst stories I have seen on IPVM. Thanks for sharing!

Many senior executives that enter the security/surveillance space from other industries seem to have a hard time wrapping their head around just how fragmented our industry is in terms of who has market share.

I sure that John knows the numbers better than I do, but it seems like even the "dominant" companies in our industry today still only have a tiny fraction of the overall market. Big name marketing executives are sometimes brought in from consumer products companies claiming that they can make their new employer "a market leader" and, more often than not, fall flat on their face.

As I understand it, the reason that GE exited the mainstream security/surveillance business was because they couldn't dominate this industry like they did so many others.

"hard time wrapping their head around just how fragmented our industry is in terms of who has market share."

When I talk to investors, this is one of the most common questions to be asked. To outsiders, it is a real head scratcher, as if, "Sure this industry has been fragmented forever, but in the next 5 years, the company I am investing in is going to roll it all up."

The problem is that the 'instincts' one develops outside this industry becomes a vice coming inside. It's not simply a matter of 'new perspective' or 'willing' change, there are deep structural reasons that keep the industry so fragmented.

I agree that overall it's a bad idea. The problem can be minimized if you have other top execs in the company with more experience to help guide and cross-check the non-industry execs.

At higher levels in almost any industry half of your value comes from networking. The issue is not just that an outsider needs to learn new trends and terms, they also effectively know nobody. There is an old saying, "You spend the first half of your career building your network, and the second half monetizing it."

Frank DeFina's "Supper Club" thing is a good example. He can go to various security companies and spoon-feed the same herd of security industry "editors" (I use that term loosely) whatever content he wants. But drop Frank into a role at Oracle and nobody would show up for his dinner invite.

It's not just that the people are different, the expectations are different as well. A free dinner might be very enticing to one editor, but to an editor in a different industry that has a stack of free iPads, Laptops, and business-class travel vouchers laying around their office a nice dinner carries no sway.

I've seen outsiders come in to security companies in sales and marketing roles that have an approach like they can take a process, pitch, or methodology from someplace else and just apply that template here and expect good results. I have not seen or heard of many cases where this worked unless that person was also willing to stop and analyze things and figure out what translates and what doesn't.

Maybe not a high level exec but a RSM is no newbie, right?

Look at the current Job opening at Axis for a Midwest RSM.

What You’ll Need…

  • Bachelor’s degree or equiv. electronic trade training
  • 3-5 years’ in sales driven position
  • Strong technical background

Valued, But Not Required…

  • Work with cameras and computer networks
  • Design application capabilities
  • Retail experience a plus
  • Integration experience
  • Axis Certified Professional

For comic relief look at this odd paragraph

We encourage our employees to work hard, and play harder; whether it is a game of darts or ping pong on your break, a pickup game of basketball during lunch, or socializing at the summer outing, Axis employees are always outgoing and lively.

We allow and promote independent thinking; we seek to act as one, to be always open, and to think big!

Uncredited copy, but my guess is G. Orwell.

"We allow and promote independent thinking; we seek to act as one"

That is classic. Axis has many positive qualities. Independent thinking for its employees is not one of them.

As for an RSM, it is a fairly low-level position and is frequently staffed by younger / inexperienced people. There are exceptions, of course, but you are not going to get many heavy hitters to take the territory of North Houston as the example you provide indicates.

North Houston is Shell and many of the offshore guys. Looks like they want an entry level oil and gas rep.

Your Axis reference is right on the money. Where other manufacturer representatives know the industry, Axis has these "kids" coming in not understanding what it takes to be a systems integrator, what it takes to make a living in this industry. Like one other person said, if an individual can sell coke then I guess they can sell a camera. In a market where there are countless camera manufacturers and where the top five all make great cameras it now goes beyond the product and more into relationships, contacts and yes pricing.

I regularly deal with new guys coming in from outside the business - often from consulting backgrounds. I've seen enough of them come through now; & can put my standard greeting on an index card:

Welcome to an industry which is creaky, cantankerous, often irrational, highly personality-driven, and yet profitable. I've been at this for 16 years and I have only barely begun to figure it out. You're probably smarter than me, but you won't get it in a week or two, trust me."

"You're probably smarter than me, but you won't get it in a week or two, trust me."

So you're saying three weeks!

A while back 3VR hired a hotshot marketing exec from the tech space, who a few months after coming into the industry proceeded to lecture me about how I did not understand the industry. Three months later, she left.

That's an extreme case and many do not come in with such an arrogant attitude but even coming in with a genuine desire to understand the industry it is not easy nor quick.

That is a great and succinct characterization.

John - I voted Neutral because this could be a good idea, but it's rarely executed wisely. Capturing creative ideas from outside of security can be very beneficial, but everyone has to be aware of the four bullets you state above - leadership, direct reports, and the "outsider".

I've seen this idea fail when leaders don't consider the challenges or appreciate their magnitude, or when leaders make this decision because "our industry is full of a bunch of ..." If Michael Jordan is available but you need a center, then play him at center. If a superstar from another industry comes along - grab him/her. However, appreciate the risks you're taking and put a plan in place to mitigate those risks.

Chris, here's the Jordan analogy I feel is more apt:

That Jordan even hit .202 was amazing and an accomplishment, considering he hadn't played baseball since he was a kid.

But even a great, highly motivated, athlete like Jordan can't switch professions and dominate immmediately.

"Phil Jackson was hired as the head coach of the Denver Broncos today. GM John Elway declared, "What we really need is an outsider who can ask questions us football people have never considered. Knowing the domain one works in is overrated, as Michael Jordon's successful transition to baseball proved to us all." ipvm.com/onion

Classic!

Ask anyone who knows anything about the history of Mosler . . . Copiers (Pitney-Bowes) to bank security. Hmmmmm . . .

Panasonic did this ... and may still. The end-user facing sales teams (or ASMs) were led by execs who had been successful selling outside the security domain -- ruggedized PCs, cell phones, telecom, etc. These execs would be responsible for multiple products that may or may not complement each other -- CCTV, AV, Ruggedized Computers, Media Grade Cameras, Scanners.... blah blah. I never really thought these execs brought anything to the table other than a rigid accounting of the opportunity pipeline and over-used quotes from popular business books ("Dare to be Great!"). The execs did not really understand the system architecture I was selling into, and they had zero connection to the domain itself. I never invited them to consultative, end-user meetings since they served no purpose in the discussion. My favorites were very "hands-off" meaning they took my pipeline reports and consolidated the report into a larger report and handed it off to the big boss... that was the extent of their interaction with their security offerings.

Panasonic - If you liked working at Motorola, you'll love working here!

see how well it worked when GE started buying companies from the electronic security industry

It worked out great for GE. I converted my last Casi hold out account over to another access system last year.

It would be interesting to compile a list of non-industry execs at various security companies and chart that person's performance and the companies' overall performance.

"chart that person's performance"

Oh that would be interesting, probably cause a riot, but interesting. Given the personal negative ramifications to doing so and the risk for errors, we would not do that.

However, given our interaction with lots of execs and feedback from many of their peers, outsider execs are consistently low performers, who either (1) are passive, minimizing both contribution and errors or (2) are aggressive, and cause lots of problems. Eventually, if an outsider exec lasts long enough (2 or 3 years) they start getting good but the first year or two are typically minimal to negative contributions.

The security industry is dominated by white men. Perhaps hiring from outside will allow a greater chance for women and minorities to get involved in the security industry. As we all know, the security industry is growing very quickly and serves a very diverse set of markets. Couldn't hurt to have a diverse workforce to meet those changing needs.

I'm all for diversity, but not at the expense of industry experience.

Then how do we break the cycle of non-diversity? Anyone who rises through the ranks in the security industry is statistically more likely to be a white man, based on the fact that there are more men in the industry. So how can a woman or a minority rise through the ranks to lead a company when they are not given the opportunity from the bottom up? Do you suggest that white men need to hire more women and minorities for lower-tier positions within the security industry?

"The security industry is dominated by white men."

To be more accurate, leadership positions are dominated by people from the same ethnicity as the company is from.

Want to be a big shot at Samsung Hanwha, Hikvision, Dahua, etc.? Being white is not a plus. Want to be a key guy at Genetec? Start speaking French. Want to be a leader at a Scandanavian company? White's not enough - Scandanavian club.

Any company interested in Americanizing their brand will hire white American men. If you look at Hikvision's LinkedIn page, for example, 12 out of 13 employees listed at the director level are white men.

And they guy they report to? The guy who is in charge? Not white

Same thing for most any non-US manufacturer. US 'Directors' are, in reality mid-level managers, who almost always report to an exec who is the same ethnicity as the company's origin.

our industry is incestuous, it is so small and we all know each other. If someone new breaks in we are in shock, best person for the job regardless of color, gender or background

"our industry is incestuous, it is so small and we all know each other."

I agree with that generally.

To that end, that is why I think startups are so important. This allows new people, teams, ideas to break the conservative conventions of this industry. Unfortunately, there have not been many major new startups in the pat 5 years.

not only that when you know something you stay in it, I would love to see new people enter our industry but w/o experience it is tough to break into, it is different than IT so they are having trouble coming in plus the licensing is an issue too. I see industry people branching out on their own but doesn't always add new people unless their relatives join

All true, but still doesn't address the gender issue.

Agreed, it does not address the gender issue. Given that the industry is largely tolerant of woman as props (i.e., 1, 2, 3), the industry has a long way to go and no easy solution.

Btw, related to this topic, Pelco now has an Indian chief, and females VPs of sales and marketing, so there's at least one clearly very diverse example.

Pelco now has an Indian chief...

Which tribe? ;)

I guess it doesn't matter much, as long as he can make it rain.

I've known plenty of ethnic or women who are in high positions of leadership within the integration industry, less that are in the manufacturing side (though there are a few).

Scott,

Care to list some examples of women who are in high positions of leadership on the integration side? Because I can only think of maybe 1 or 2 and I like to think I know a lot of people in this business.

On the distribution side, Scansource has a good number of women in high up positions of leadership including Christie Hamberis their VP of Merchandising.

Overall, like John mentioned, I feel it is tied to the ethnicity the company is from.

I dont have a massive list and the integrators aren't massive - and I don't have the time to go digging for the ones I can remember but not place their names either)

Comtel Systems http://www.comtelsys.com/ has had a female VP for years ($20m) and the company I work for has a female controller - hoever now that I think of it, there is a strong drop off in the technical side of females.

Care to list some examples of women who are in high positions of leadership on the integration side? Because I can only think of maybe 1 or 2 and I like to think I know a lot of people in this business.

At the risk of sounding politically incorrect, is it possible that a reason there are less women in the industry is because less women find physical security as interesting as other, better paying professions?

Do you know many women who are eager to get to into the Physical Security business, but back off because they feel they will be discriminated against?

If more men are drawn to the field than women by their own choice, should we do whatever we can to generate more interest from them? To what end? Until the workforce is split 50/50, in every profession?

I don't doubt there are women who have had a harder time than their male counterparts in the business due to only their gender. And anytime that someone less qualified gets more pay or promoted over someone more qualified, the industry takes a step backwards.

So we need to do everything in our power to fairly reward the talents and contributions of all those in the industry.

But, I think that automatically assuming there is gender discrimination because of a lack of females in the industry at large, may overlook that there may a lack of interest in the field to begin with. I know that is probably not the right thing to say, but it's a possibility I find hard to dismiss.

NOTICE: This comment has been moved to its own discussion: Do Women Find Physical Security Less Interesting Than Other, Better Paying Professions?

CEO of LenSec is a woman, and she's one of the smartest people I've ever known. Seriously - she is genious level, hard working, and incredibly dedicated. LenSec is a manufacturer, but they are also a bit of an integrator.

This goes along alot of what I was saying earlier. In my experience - the ones that really move ahead in the security industry are those who are very technical as well as being people persons. The non-technical people are often passed off as idiots (and the mistakes alot of them make often prove this) and the technical people that aren't people-people are often regarded as arrogant pricks.