Recently a strike by an auto parts supplier caused the shutdown of the minivan plant in Windsor, Ontario. Was this part of an overall strategy leading up to tough labour talks with the Big 3 in 2012 or a case of union member’s expectations not matching what could be offered. Based on comments in the media by Chrysler’s CEO Sergio Marchionne, it appears labour talks could be challenging. The question is will the union go on strike and risk potential future investment or find a way to secure a new deal. In the past, large automotive firms did not develop large scale contingency plans to stand a work stoppage by union members. Is this about to change? The past has proven that some checks and balances need to be in place for the unions not to find themselves in the same situation they faced in 2008 with the collapse of the industry. Previously management simply avoided large scale work stoppages in favour of reaching a deal. Will 2012 see management take a more aggressive stance to ensure long term sustainability? If a more aggressive stance is going to be considered, contingency planning will be critical to ensure all risks are considered and possible mitigation strategies put in place.
Why is the sourcing department looking for something different than corporate security when a RFP process has commenced?
Many times we receive RFP documents for strike related services. Upon reviewing them, it is determined the request does not meet the client’s needs, should they face a labour dispute nor will it allow decision makers to arrive at an informed decision on a suitable vendor. Recently we received an RFP asking us to provide security coverage to 14 different sites without any detail on the sites. In addition there was no consideration for investigators. The RFP was only for strike security guards. When speaking with sourcing personnel, they indicated that they only needed guards and felt 1 per shift would be adequate despite the fact some locations had 200 to 1000 employees. When corporate security was contacted, we were advised that during the selection process they could speak to vendors. Corporate security would have been saddled with why there wasn’t adequate security and how come there was no video evidence to support an injunction had a dispute occurred; putting the project out of control and well over budget. Sourcing needs to ensure adequate cost controls are in place. However they shouldn’t be driving the strategy and dictating requirements without input from key stake holders. I recently was asked to review security operations at an ongoing dispute. RFP process had selected a low cost local vendor that commenced services with minimal coverage. During our review, most entrances had 6 to 8 security guards and no investigators. Costs had exploded and the client still was having difficulty managing the work stoppage. What they needed were 2 investigators and 2 guards at a far lower overall cost, while providing more effective coverage.
Personnel tasked with developing contingency plans need to involve sourcing at the onset and ensure decisions are made based on best practises and not the lowest price. In the end, the lowest price almost always results in much higher costs when proper planning and risk assessments have not been completed.
Growth of Contingency Planning Indicate That Fewer Companies Fail to Plan
By Jim Rovers, National VP Crisis and Disaster Response
While prominent labour disputes continue to capture Canadian headlines, there has been a significant decline in the number of strikes, especially in recent years. According to federal government statistics on days of work lost, the level of strikes today are only around one-seventh of the 1970’s average. Why this labour success story? Certainly there may be many social, economic and political reasons, but one contributing factor is certainly better risk management. More and more companies and executives have stopped being ‘caught off guard’… and have finally woken up to the tremendous benefits of long-term contingency planning.
And it goes beyond labour disputes and plant closures. To defend against workplace violence, floods and natural disasters, smart companies have become proactive in working with security experts to get defensive measures in place to ensure their business is not crippled when the unthinkable occurs.
Risk management and continuity planning, in fact, has become big business – and has saved billions for many companies, not to mention rescuing a few from certain demise. After all, it only takes one incident – and operations could be shut down immediately. Even worse, if there is no plan and matters go to court, union officers will have a field day showing that the unfortunate company did not take the proper steps to protect their employees and business. The damages to a company’s brand and reputation can be so serious that it can lead to complete business shutdown within 2-3 years – or even less.
Planning is an In-Demand Niche
Unsurprisingly then, planning today has been a successful offering for corporate security companies like ours. And yes, it is a great career choice for police and security professionals looking for a strong niche. Planning is a service in high demand — and we have always provided it in-house with top experts, many of whom have been in our employ for many years. It is an area that requires highly skilled specialists able to apply both security smarts and analytical skills to protect the interests of businesses across the nation. We continue to recruit talented individuals into this area today to meet new demands.
What’s Involved in Contingency Planning?
So what does an AFI continuity planner actually do? We sit with the company (months in advance of any negotiation) to set a deadline and work back to develop a step-by-step timeline. A key consideration is ‘how can staff be treated best?’ In other words, we see a big part of our job as making sure the company is doing things properly and fairly when it comes to their workforce.
Our planners and risk experts get to know the individual client’s business, industry, labour climate and unique risks. In the pre-planning stage, we will manage a site audit and survey of all corporate locations and also develop a budget and an outline of what is needed to keep operations running, whether it’s securing offsite facilities (like warehousing and storage) or procuring transportation and manpower – in each case, taking into consideration unique industry and geographic factors.
The plans we develop highlight the realistic expectations of operational capacity during a work stoppage. We factor in all the potential requirements, including highly skilled & trained security officers, videographers, injunction investigators, transportation and logistics equipment and other necessary resources (most of which, incidentally, we provide ourselves in-house).
And it must be mentioned that any effective plan should be in place at least 6 months prior to scheduled labour negotiations.
Manufacturing Plant Crisis Shows Value of Contingency Planning
Without proper contingency planning, a labour dispute can hit hard and devastate a company. As an example of how this can happen, let’s look at one critical situation from January 2008.
‘Un-Anticipated’ Plant Closure
In January 2008, a major manufacturing company in Ontario suddenly announced a plant closure. Management called for an immediate lock out, asking employees to vacate the plant. There was no clear plan of action, communications strategy, nor a complete understanding of the ramifications of this drastic action.
Upon receiving the news, the employees immediately occupied the plant. They ceased operations, took control of the equipment and the building. Management contacted the police for assistance…but police refused to get involved.
AFI was called in to intervene. We secured the perimeter, addressed the employees and immediately commenced gathering evidence to support a court injunction. Once sufficient evidence was gathered, we attended court, provided the necessary evidence and helped the company obtain a court order barring employees from the property. Armed with a court order the police were able to proceed in asking the employees to leave the facility or face potential charges. The employees complied, while our staff monitored the orderly departure. Our objective was to ensure no damage to property occurred and that everyone departed safely from the facility. Once this was achieved the site was turned over to management to resume operations.
Reputation Damage and Other Non-Recoupable Losses
This unanticipated crisis significantly cost the company: bad press, legal fees, lost revenues, stakeholder distrust – and major damage to their global brand and reputation. Sadly, with advance planning in place, none of this would have happened!
Exciting Work Experience – Before or After a Career in the Police Force
If this all sounds like a great challenge – it is. The specialized professionals and planners on our corporate security teams love what they do, and for a good reason. It is incredibly stimulating work that is different every day. Our experts include retired police officers who use experience they gained on the force and apply it to our business and helping our clients. We are also a great base for those aspiring for a career in law enforcement. After all, we present an incredible opportunity to get training, learn on the job and rub shoulders with those who have been on the front lines and doing it for years.
Do Your Homework
So in a sea of corporate security firms, how do you separate the wheat from the chaff? It’s a question we might pose both to security professionals looking for employment and companies seeking expert contingency planning services. Look for a strong industry track record, a history of no incidents and excellent in-house capabilities; that is, a company that does not subcontract and has all their own experts and resources. We certainly deliver in these three areas, with our own guards, specialists, training & equipment in place –and a spotless industry reputation. Through our planning and response services, we are proud to have rescued many high profile companies from financial ruin and even obliteration.
Whether you are seeking a career in contingency planning – or looking for a good company to provide it – it’s always beneficial to set your strategy, timelines and do your homework. After all, when you fail to plan – you plan to fail!
In recent years numerous unions have lobbied the government at both a federal and provincial level in hopes of getting legislation to ban the use of replacement workers. Most firms when developing labour dispute contingency plans understand the complexities of utilizing replacement labour and the long term impact to relations with their union. However, they find themselves in a difficult situation. If they elect not to operate and meet union demands, they become uncompetitive in the global market place. Worse yet, if they fail to meet their client obligations because they don’t continue operations, their business will be lost to competitors and will close.
Unions believe that allowing the use of replacement workers shifts the balance of power to management and results in longer strikes. The fact remains that both sides have equal power under current laws. The union can withdraw services and management can continue to operate.