Jeff Bezos’ 5 tips to grow your security company
1. Bezos takes decisions for the long-term
Jeff Bezos plans for the next 10 years. For example, Blue origin and Amazon’s move from books to other products were both 10 year decisions.
The Blue Origin team were assembled over a 10 year period.
Long-term not short-term decisions make a security company grow
The security market consists of contracts that last around only three years. Therefore, the direction of the business can be driven by the latest win or loss. Plans that extend beyond these short term horizons are what Jeff Bezos spends time on.
Here are some 10 year strategic options to make your security company grow.
Make your security company the most cost effective solution. Win new business by keeping costs down to an absolute minimum. For example, agree fixed prices with suppliers and in return give them more new business.
LiDL is a cost leader. They serve the food sector by offering a very low price. (Did you know LiDL are so cost conscious they do not even advertise on Google pay per click!)
Serve one security sector with a specialised offering. For example, a security company built to meet the needs of the maritime and freight industry.
Holland & Barrett offer focus to their customers by stocking an extensive range of health food.
Offer a security company different to others. For example, one that only employs guards who are all graduates or from the services.
My Local Bobby is good example of a differentiated security company. They provide public space security, employing ex-police officers.
Attribution By ROSSBEEF89 – Own work, CC BY-SA 4.0, https://commons.wikimedia.org/w/index.php?curid=75869577
Farmdrop differentiate themselves by delivering fresh product from farm to fork (your doorstep).
2. Bezos is obsessed with the customer
Jess Bezos has a ‘customer gene’. Therefore, he knows what people want and in what order.
For example, Bezos knows shoppers value price, availability and convenience. That is why Amazon wins.
Over the last 150 years shop keepers lost sight of what people value. Shops such as Top Shop and Debenhams thought people were loyal to their brand. But they were wrong. People go to shops because they want a product and not to visit the shop.
Debenhams is one of many shops that failed to invest enough in e-commerce.
How does customer obsession grow your security company?
A security tender is one way to get to know your customer. But it does not tell the whole story. Because customer needs are complex.
For example, your customer the head of security, is not the only decision maker in a tender. Because they exist within a wider risk management team. For instance, intelligence, enterprise risk, health and safety.
Bezos is like a therapist, he has an unusual ability to understand his customer.
Two customer needs
Customers have two needs, declared and undeclared.
Declared needs are easily communicated and therefore appear in a security tender. But an undeclared need is much harder to communicate.
For instance, 20 years ago customers not did tell Bezos: ‘I am unsatisfied with shops. I want better availability, price and convenience.’ The customer appeared satisfied. But Bezos knew he could better fulfil their needs.
A customer will not tell you what they really need. (If they did then one customer survey would be the answer). Therefore, it is your task to truly understand your customers needs.
Understand the customer’s undeclared needs and you will have the fastest growing security company.
3. Bezos is comfortable with making mistakes
People often think only new businesses make mistakes. But Bezos has made lots of mistakes at Amazon. Thus, he is clearly comfortable with mistakes.
Remember the Amazon phone mistake?
Attribution: By Romazur – Own work, CC BY-SA 4.0, https://commons.wikimedia.org/w/index.php?curid=43266844
Usually successful businesses discover something people like and make more of it. Over time they make it faster, better or cheaper. Therefore, they become expert at doing one thing well.
But Bezos is different. Because he does lots of things. Bezos always tries new things and learns from the mistakes.
Grow your security company through mistakes
It may sound odd but Bezos believes mistakes are key to a successful business. Because mistakes precede innovation.
AWS: Amazon Web Services are a large part of Amazon’s profits. Lots of mistakes came before this. We label successful mistakes ‘innovation’.
Measure your security company’s appetite for mistakes. When was the last time it made a mistake and then talked about it openly? How often does your security company experiment?
Most people fear making mistakes. Therefore, they try nothing new. If you want your security company to grow you must make mistakes.
4. Bezos treats Amazon like it is always Day 1
Bezos does not want Amazon to stand still or become complacent. Accordingly, he regularly reminds his staff at Amazon that is always day 1.
Day 1 is the first day in a company’s life. As a result, it is vigilant, agile and takes nothing for granted. Bezos fears day 2. He describes day 2 as a period of stasis, inactivity and decline.
Does your office feel like day 1?
Is your security company growing in day 2?
For Bezos no company grows in day 2. How long has your security company been around? Does it grow and does it operate like it did on day 1?
When a company is new then it is easy to do new things. Because there is nothing to lose. But with time a company builds wealth and habits. It becomes set in its ways.
On day 1 you would ask questions such as:
- Where do we operate?
- Who do we serve?
- Why do we serve them?
- What is the security company growth rate?
- What is the fastest growing security company?
When was the last time your company asked these questions?
If your security company does not ask these questions then it is in day 2. As a result, Jeff Bezos would not be happy.
5. Bezos tells shareholders to wait for a return!
Amazon is well known for not giving any money back to its investors. Because when it makes money it invests it back into the business. This money helps Amazon pay for its mistakes, produce innovation and be even better. As a result, Amazon’s competition gets a double whammy.
First, Amazon’s competition do not reinvest their profits. Therefore, they have less money to invest in innovation. Second, because Amazon innovates it makes even more money. This in turn is reinvested in more innovation. As a result, Amazon has a compound profit effect.
Amazon now has an ‘innovation moat’. This is a gap its competition cannot cross.
A security company’s growth relies on investors not taking out profits. This helps the company build an innovation moat.
Is your security company growth held back by investors?
Does your security company invest its profits or do investors take it all?
Often private security companies forgo taking money out of a business. As a result, they perform better than public security companies.
Conclusion – Bezos’s 5 tips to make your security company grow
Would Jeff Bezos make your security company grow? Probably.
According to Bezos you will be the fastest growing security company if you follow these 5 tips:
- Persuade investors to leave you profit for innovation. Do this by showing your investors you have…
- 10 year plan
- Freedom to make mistakes
- Customer obsession
- Day 1 culture