For years thought-leaders in the security industry have talked about ‘return on investment’ (RoI) as a critical part of the decision-making process when specifying a video surveillance solution. One issue with security is that unless you can quantify potential losses over a period of time, it is nigh-on impossible to calculate any RoI. Will this situation change with the rise of business intelligence? Benchmark considers the role of management-based services being delivered by security solutions.
When IP-based solutions first appeared in the security sector, many of the new companies that entered the market came from the IT and its peripheral sectors. Once they arrived they went searching for market analysis reports, research and historical data, sales figures and trading reports, all of which are common in the IT world. Of course, no such data existed, predominantly because manufacturers and distributors simply would not reveal any such information.
Historically, the CCTV MDA (manufacturers and distributors association) did manage to get all of the significant players around a table, but meetings generally descended into debate about who would and who would not supply figures. Eventually, the initiative petered out without ever generating any meaningful reports.
Because of the lack of market analysis, the incoming IT-centric businesses set about commissioning their own reports, but the credibility of these was flawed as there was no genuine historical data for comparison. One aspect that these newly commissioned reports focused on was return on investment (RoI). Again, while RoI was big in IT, security simply couldn’t pin down credible figures, and for a very good reason.
Whilst some applications can gain an accurate picture of on-going losses and measure results against these, the majority of security applications are protecting against the unexpected, often with unqualified risks or no quantifiable loss. The result was that RoI hadn’t become a significant consideration of many security end users.
Since those times technology has significantly changed, and systems are capable of delivering far more in terms of benefits and efficiencies. Not only has video surveillance evolved from a reactive passive tool into an proactive dynamic option for those seeking security, it can also enhance site management, introduce efficiencies to industry and commerce, support marketing and sales operations, streamline everyday business tasks and deliver real-time reports that aid businesses’ everyday operations.
These tasks, often loosely referred to as ‘business intelligence’, do certainly add RoI to video surveillance. It could still be argued that security itself doesn’t fit into the RoI model, but with business intelligence, we’re not solely in the security industry any more!
A range of possibilities
Video-based business intelligence can deliver user benefits across a wide range of applications. It is vital to assess the business case when offering such functionality, and this should include understanding the value that an end user places upon any additional features and functions.
Benchmark is aware of one integrator who lost a lucrative portion of a contract. After winning the security element the company was approached to add business intelligence to the system. Their quote was significantly lower than a tender from a building management company, but the end user simply did not believe the task could be achieved for such a low cost.
Afterwards the integrator admitted that he didn’t fully understand the value of the service to the user, and so had quoted low thinking a higher and more realistic figure would have been rejected.
Many integrators and installers tend to think in terms of security alone, but to successfully sell business intelligence requires a switch to thinking more like the customer and appreciating the value of the added benefits.
It is important to realise the scope of business intelligence when considering its inclusion in a system. This point is underlined by Ashwin Amarapur, Director of AllGoVision.
Amarapur states, ‘Even though video content analysis is used in security monitoring, there is huge application area in business intelligence, where the analysis of video highlights useful trends that help businesses to make better decisions.
‘Video analytics applied where people are entering or exiting an establishment can count visitor footfall. This data can be broken down into different time intervals for detecting visitor surges and peaks. Comparison reports enable a time-series analysis of the data versus historical statistics.
‘The principle of counting can be applied to gather additional useful information. For example, counting was deployed in a pilot project for a well-known coffee shop chain in India. The retailer’s sales and inventory data for the beverages didn’t match, so an object counting feature was customised to count the number of cups served over the counter. This enabled tracking of sales, and discrepancies with inventory data could be analysed against the movement of products at point of sale.’
Amarapur continues, ‘Counting applications can go further in multi-section service centres. Customers in the lobby can view an electronic screen where occupancy is denoted. The level of occupancy can indicate which sections have the fastest service times. For parking areas, real-time occupancy and availability can be displayed based on vehicle counting. For large open areas or areas with no defined entry and exit points, crowd counting can provide occupancy levels in a defined zone.
‘For queue management, ingress, egress, queue length in real-time and average wait time can be measured.
‘Heat and flow maps give an insight into customer movement densities and directional trends for a space, such as a shop floor. Overhead cameras track customer movements and the analytics creates a colour-coded map to denote areas with detected levels of customer movement. The flow map shows how customers move throughout the area, highlighting different product segments or sections of the store as percentage shares.
‘From the user’s perspective, these tools help in layout studies to improve movement efficiency or to identify and remove bottlenecks. The information can also be used to identify revenue generating areas, allowing high value products to be strategically placed for effective promotion.’
The business case
Whilst it is important to comprehend the diverse applications that business intelligence can serve, establishing an RoI remains pivotal to driving sales for the technology. It is vital that installers and integrators look not only at the technology, but also the financial return for the user, whether that be through savings or business efficiencies.
Rustom Kanga, CEO at Iomniscient, states, ‘Usually, when an organisation implements a surveillance system, it is an expense item; a cost which the organisation feels they have to bear to minimise risk. But it does not have to be that way.
‘Adding analytics converts the system from one that is only useful after the event into one which can help manage an event. Smart analytics can actually generate a positive and tangible return on investment. There are many examples of customers making or saving money form their analytics systems.
‘One local government organisation was receiving complaints about slips and falls at the rate of five per week. Typically they would offer compensation to avoid litigation. With an analytic-based system in place they were able to identify and deal with incidents immediately. This significantly reduced payouts as well as insurance premiums.
‘In another case, a shopping mall used its security system to calculate dwell times of shoppers. Based on this they could better understand the travel and spending patterns of shoppers within their facility, and used this information to attract new retailers. The data also justified a premium price for some locations in the mall.
‘Finally, a commercial building managed to reduce staff in a continuously manned control room by using an automated response system, where the nearest first responder was directed to any incidents that required their attention. The officer nearest to an incident received information and directions on a smartphone. The phone effectively became a mobile control room. This resulted in savings in manpower and real estate, as well as significantly improved efficiencies.
‘Organisations have to make sure that their surveillance system is not a sinkhole for investments. They must use it to save or to make money.’
Often the retail sector is cited as a commercial sector that has much to gain from the use of business intelligence.
Kevin Waterhouse, Executive Vice President of Global Sales, VCA, states, ‘The development of IP networked surveillance devices which incorporate DSP chipsets with the processing capacity to run on-board applications presents new opportunities to the security industry.
‘Analytics software can transform the effectiveness of a surveillance system by providing a powerful exception reporting tool to help identify suspicious activity. It can also add non-security benefits. Retailers in particular can benefit from people counting that can provide an understanding of why one store is performing better than others, and identify if specific marketing activities or promotions have been effective.
‘The availability of affordable, easy to configure and simple to use video surveillance cameras equipped with video analytics software has opened up the opportunity for retailers to gather reliable and verifiable data which can contribute to a greater understanding of the behaviour and buying patterns of customers.
‘Doing more with less staff, increasing customer satisfaction by minimising delays at check-outs and identifying the best times and locations for product promotions are just a few of the goals which can be achieved with very little effort.
‘Every retail business will have a different set of operational requirements and challenges, but large multiple chains in particular are likely to employ highly experienced marketing and merchandising executives. These teams will want as much data as possible at their disposal to analyse the results of activities.
‘Store entrance and walk-by traffic can provide data on the potential number of customers entering the store. Analytics also allow users to analyse customer flow and traffic trends and evaluate the impact of advertising and promotions. Operational benefits include improved staff planning and an assessment of optimal opening hours.
‘Retailers also have the ability to compare sales conversion rates, evaluate and optimise store layouts via heat maps which show customer activity hotspots, plus analysis of queue times.
‘The retail sector has much to gain from the metadata that affordable edge-based analytics solutions can deliver. Understanding the buying behaviour of customers has never been more important, with traditional retailers facing fierce competition from online outlets. Retailers that give consumers the choice can take advantage of video analytics to monitor and measure the impact of on-line promotions on the number of people that enter their stores.
‘The increasing integration of diverse technologies will create opportunities for analytics that would have been unimaginable just a few years ago. It is claimed that a key benefit of embracing IoT (internet of things) is the interaction of different products and systems without human intervention. This should be achievable within a security environment, but only if high rates of detection can be assured. A well designed detection and monitoring system can deliver on both counts when supported by analytics.’
These thoughts on the viability of business intelligence to retailers are further echoed by Glen Higson, managing director of Bi3, who adds, ‘Business intelligence will continue to grow as a key factor in the decision-making process for retailers who require more detailed and sophisticated information about customer numbers, the levels of spend and buyer behaviours.
‘A requirement is how this data is collated and viewed, given that the information is being produced from diverse devices across multiple locations. Often, web-based open platform reporting software is needed to provide retailers with the ability to view bespoke reports.
‘Overall, retail intelligence offers the opportunity of a new market for integrators. However, it is not for all and requires an understanding of retail-specific issues in order to provide return on investment solutions. It also requires thought about how the data is stored, distributed and viewed.
‘The trend for data mining is further enhanced when it is widely available, managed properly and maintained correctly.’
In order to distribute video for business intelligence, installers and integrators must ensure the video and metadata – and the generated reports – can be easily accessed. This isn’t always straightforward when the business intelligence is generated by a security system.
Karl Pardoe, regional sales manager, March Networks, states, ‘The massive amounts of data captured by surveillance systems, enhanced through analytics, has enormous potential for business intelligence. The development of business intelligence in the cloud offers fast time-to-delivery and improved agility for users.
‘When it comes to security, the necessity for video puts a slightly different slant on the situation. Companies want to combine business intelligence with video surveillance in order to manage security challenges while also monitoring business trends.
‘The cloud does have the ability to support business intelligence, and analytics can be applied to locally stored video, with selected excerpts sent to the cloud for analysis. It also enables mobile access to locally stored video data, meaning security professionals can use the security system while colleagues in other departments are using the same video for reporting and analysis.
‘The biggest challenge is the bandwidth capacity required to upload video captured by multiple cameras. While bandwidth speeds and accessibility will continue to improve, the trend towards 4k and 7k cameras may counteract that. That said, some organisations are already using VSaaS to reduce the computing and management resources required to process analytics, and that doesn’t always require full-scale cloud storage.
‘If installers are advising on business intelligence in the cloud, it will work, but until the bandwidth challenges can be overcome, combining this with surveillance is not advisable for most mid- and large-sized enterprises with multiple locations and demanding video requirements.’
Benchmark has previously discussed this issue with many video providers. The cloud certainly makes sense for the distribution of business intelligence reports, but not for the surveillance video itself. However, those that utilise the business intelligence reports won’t be security people, and their interest lies in the data, not the images.
The implementation of business intelligence can add value to surveillance systems, and introduces RoI in the right applications.
Business intelligence can ‘piggyback’ surveillance. However, many tasks will require dedicated cameras, and reports must be sharable with individuals who may not have (or need) access to the security system itself.
The reality remains that end users will increasingly want to leverage their video for multiple tasks, and the ability to do so could become a proviso of future contracts.