The Ultimate Guide to Profiting From Cloud-Based Access Control
Discover the many benefits of access control as a service (ACaaS), as well as how to design, configure, commission, price, market, sell and maintain offerings.
Things turned upside down March 11 when the World Health Organization officially declared COVID-19 a pandemic. Businesses around the globe shuttered and went into hibernation and only those providing essential services remained open with specific requirements for operations during the coronavirus.
Luckily, security companies were included on the list of the Department of Homeland Security’s (DHS) Essential Critical Infrastructure Workers, making it possible to continue to serve their customers.
End users and their workforce began operating remotely and many facilities needed to adjust to this new normal of doing business. Here’s a real conversation from a CEO to a facility director just prior to the shutdown: “We are going into virtual mode by 5 p.m. today. Make sure the facility is locked down from that point on. Only allow essential personnel into the building, when permission is granted from leadership. Access will be granted only by security. I want reports run daily and audits on every operator.”
Security dealers and integrators already offering hosted/managed access control services were in a good spot to assist the end–user customer as they shifted to changing work scenarios and modifications to facility access.
If you haven’t made the transition to access control as–a-service (ACaaS) there’s a good chance you’re now re-evaluating your approach to managed services and the advantages it brings you and your customers, especially in remote monitoring and management.
The pandemic magnified the criticality of leveraging Cloud computing for ACaaS, as well as the inherent benefits to both the installing company and the end user.
Below, we’ll take a closer look at how moving the access control infrastructure to an as–a–service model allows organizations to achieve benefits such as scalability and flexibility in implementation, seamless integration, high availability and resiliency, and advanced cybersecurity in the Cloud.
Benefits of the Cloud
For systems integrators, ACaaS gives them the ability to provide a unique value proposition in remote managed services, security and reporting. It’s a platform that evolves with their needs and those of their customers and allows them to easily add services, devices and integrations.
Even before the pandemic, those who favored implementations in the Cloud were realizing its distinct advantages in administering security at the protected premises. Hosting in the Cloud means no physical on-premise servers, ultimately relieving IT personnel of having to maintain, update, patch, backup and manage communications between port openings.
Remote Managed Services
Here’s a quick list of some of the remote services and RMR possibilities with ACaaS:
- Remote diagnostics/maintenance on hardware and device monitoring
- System reprogramming, upgrades and software updates
- Template maintenance (access levels, door groups, badge types, schedules, holidays)
- Print services (badge design, creation, printing)
- First response for door alarms (forced, held open/propped)
- Database management (add/delete/suspend cardholders and credentials)
- Workforce credentialing and visitor management
- User mobile app connectivity; access, manage and control from anywhere with push-notification alerts, lockdowns, exception reporting
- Integration of new field hardware such as surveillance, audio or other devices
- Manual and scheduled reporting and data on access activity
- Report creation, review and generation (daily, weekly, monthly)
- Audit review and compliance reporting
- Help desk triage
- After-hours remote support
Cloud hosting also reduces the carbon footprint with less reliance on hardware, while improving efficiencies with real-time updates, redundancies and lower maintenance costs.
It gives security companies the ability to manage, administer and remotely maintain, service and program the access control system through a single Cloud management interface — building managed security services along the way.
All this results in a lower total cost of ownership and predictable operating costs versus a large capital expense, or CapEx, something that’s highly sought after by facility owners and C-suite executives as they plan and manage IT refresh cycles that now range from three to five years.
The Cloud infrastructure benefits are well documented and even U.S. government agencies are adopting a Cloud-first mentality, pushing for an upgraded and modern IT infrastructure and the acceleration of Cloud-hosting as part of a new national Cloud Smart strategy.
The reality is the pandemic has highlighted the importance of Cloud computing and, if business leaders had not been convinced of its benefits before, they are likely to be now.
A move to Cloud-hosted managed services brings the holy grail of recurring monthly revenue (RMR), which experts agree results in a company that commands a higher valuation. And for those customers who are well-serviced in partnership with their systems integration company, the results are a long–term client that understands the value and can’t be without the efficiencies it brings.
There are no hard and fast rules or formulas in offering ACaaS, but it’s a different approach and mindset as opposed to one-time, project–only revenue or “one-offs.” With ACaaS the systems integrator isn’t providing hardware as a primary business — but instead a variety of services.
It’s a partnership and business relationship that provides the user the means to control the workforce population or provide reporting, data and compliance.
It’s problem solving and resolution — and requires a seamless customer experience for the user in order to be successful. Like other technology implementations, access control design, configuration and installation depends on the hardware, number of readers, the installation of other peripherals and the overall size of the system.
It’s the marketing and sales compensation that takes on a different look and approach with ACaaS in order to be successful.
Some companies live and breathe a managed services approach, staying mindful of changing customer needs. For Dover, Del.-based Advantech, the focus is on services and not simply reselling technology.
“As a company, we are focused on services. We aren’t reselling someone else’s product; we are reselling our services. We’re using a product to help us deliver those services but the offering is nothing without us,” says Dave Sweeney, CEO, Advantech. “The customer needs help and we are the conduit to provide it. We have found a ton of success with the end user when we focus on explaining our level of service and the assistance that comes with it.”
Sweeney says customers and prospects understand the scenarios they may face, like an emergency when they require response or need someone to log in to correct a keystroke error. Even in a system wholly managed by the user, Advantech still provides ongoing support.
“It’s not uncommon for us to have to log in and correct a problem and that’s fine. A customer who pays for a service and receives a high level of value from the service on a monthly basis will be a longstanding partner in business. You have to provide the value. Most customers are smart and will be able to justify a monthly expense if there is perceived and realized value. We provide the service and the value on a monthly basis to continue to earn the revenue and trust of the user,” Sweeney notes.
Advantech’s model is to have a variety of services for the customer. “Every customer has different needs so there’s no one–size–fits–all. We can provide central station intrusion and video monitoring, fire alarm inspections, health monitoring of Ethernet security devices, device uptime and reliability. We provide managed access control services and can make changes and modifications to the customer’s system. We provide a traditional service plan and a break-fix service plan,” adds Sweeney.
Incentives for RMR Sales
With ACaaS most security integrators pay commission differently for RMR as opposed to a one-time sale, and incentives are key. They may offer, as an example, five times the RMR to the salesperson upfront, using the same payout percentages, versus one time on a server-based application.
Or, the integrator may pay double commission on RMR (upfront and one time) or, there may be payment to the salesperson every year on renewal.
Advantech has a commission structure that reinforces its business objective of growing its managed services offerings. The importance of RMR to the sales team is communicated and reinforced with the commission structure in ACaaS. “Our team members are incentivized to sell recurring revenue and managed services. We know we will better serve the customer with managed services and they will be more satisfied if they apply those services. If you only incentivize on installation dollars you won’t get the same commitment from sales personnel,” Sweeney says.
“The recurring revenue is very important to our business and we have compensation plans that reflect that,” says Eva Mach, president and CEO of Pro-Tec Design, based in Minnetonka, Minn. “Our sales team is paid double the normal commission rate for the monthly RMR for a period of three years.”
Pro-Tec, which is a 100% employee–owned company, has a go-to-market philosophy that focuses on providing open platform systems, ensuring maximum flexibility and long-term value.
“The hosted access control solution we provide checks those boxes , plus offers scalability, disaster recovery and redundancy in the Cloud. Traditionally, on the initial installation, we do onsite programming because it has worked well with our high-touch business model. That may change in the current reality of social distancing, but again, that is the beauty of hosted and managed systems — you can change your approach as conditions demand,” Mach says.
Atlanta-based iS3 Tech Services takes a similar approach to compensating personnel for hosted/managed access services, paying sales commission on a percentage for each year of contractual RMR, explains Mike Harrison, managing partner.
“The commission amount paid is based on the booked margin. In most cases we have seen other security companies pay just a single percentage during the initial sale and for only the first year and nothing after even when renewed. Our sales staff is encouraged to remain engaged with the client for those renewals and this is how we are able to help with additional services. Being paid each year allows our sales staff to benefit from having long–term RMR accounts.”
Focusing on ACaaS Services Value
Technical Systems Group (TSG Security) believes there are compelling benefits to the user for choosing ACaaS, according to Mike Traniello, vice president and co-owner of the Rochester, N.Y-based integrator.
“TSG Security’s goal is to help customers make the best selection of systems and technology. We don’t subscribe to a one–size–fits–all mentality and work to provide the appropriate level of education to customers so they understand the benefits offered by both ACaaS, hybrid and traditional on-premise systems. We have used total cost of ownership [TCO] tools to guide customers on system selection. For many customers, the TCO assessment tends to favor an ACaas approach.”
Traniello says the benefits that tend to “resonate the highest with customers” include:
- Mobile convenience – The ability to perform access control management functions remotely such as unlocking a door, initiating a lockdown and adding/deleting cardholders.
- Simplicity of system maintenance – Most customers lack the IT resources (or focus them on other priorities) to properly maintain an access control system, such as installing patches, managing servers and performing backups. As a result, the security system itself becomes vulnerable to attacks. Deploying ACaaS eliminates these maintenance tasks and in many cases, provides a much higher level of system redundancy than most customers choose to establish on their own.
- Quick deployment – ACaaS can be installed much quicker than typical on-premise systems with lower investment in hardware/software.
- Improved system security – Providing remote capability in traditional systems requires opening ports in the firewall. Well-designed hosted systems only allow communications initiated from the control panel, closing vulnerabilities from unwanted inbound communication. Additionally, the investment of companies like Amazon Web Services (AWS) and constant updating of infrastructure software further strengthens system security — a significant advantage of ACaaS versus systems that require on-premise version updates.
“Typically, our pricing includes an investment for the installation of the hardware panel, readers, etc. on site and then separate annual/quarterly fees to cover the hosting and system maintenance,” adds Traniello.
As the pandemic unfolded across the globe, it became clear that remote monitoring and management of systems and services was a necessary adjunct to our new reality of doing business. ACaaS yields direct advantages to the end user and greater profitability to the systems integrator who can embrace change and position the company for future success with tangible and predictable RMR.
5 Key Takeaways
Challenge yourself to move to ACaaS with these five tips:
- Change Your Mindset: Integrators must continue to adapt to changing technologies that are useful and increase efficiency.
- Compensation Plan: Provide the proper incentives for the sales team to encourage the sale of ACaaS (commission on recurring revenue).
- Sales Training: Thorough and well-developed training is essential to ensure that your sales team is well versed on end-user benefits, lower total cost of ownership and OpEx versus CapEx.
- Operational Processes: Remember, implementing ACaaS is a process and should not be treated as purely adding a new product.
- Choosing the Product: Pick the right technology that is flexible and allows you to obtain the business model you or the customer are comfortable with (i.e. hosted services, shared services and/or full management).
Paul DiPeso is Executive Vice President of Feenics.
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