There is a revolution happening in the video surveillance industry, and it’s not about fancier cameras. It’s about the next frontier of business intelligence. Video is the most powerful and direct source of business intelligence data, and it can be used not only for loss prevention, but also for insight into marketing, operations, human resources, and many other departments. With online video surveillance software, leaders across the organization can gain unfiltered visibility into daily, store-level events, allowing them to instantly make strategic, profit-driving decisions.

Loss prevention specialists have a unique opportunity at this moment of transformation to become profit creation champions within their organizations and be recognized as leaders. For example, one champion received the company’s President’s Award (out of over 7,000 employees) specifically for her work deploying online video surveillance services and driving profitability improvements across the organization. Another was one of only 5 people out of over 25,000 to receive the company’s highest possible individual annual performance review score for his work deploying and managing online video, driving meaningful profits to the bottom line.

Making this transformation requires a paradigm shift in the way people think about video surveillance, from the traditional loss prevention orientation to realizing that visual data is actually a powerful business intelligence tool that can impact behavior across the entire organization. This shift in thinking is reflected in a transition from calculating the Total Cost of Ownership (TCO) of a video system to considering the Return on Investment (ROI) that the system can actually generate. Rather than a cost that the organization must bear, video should be a tool that the organization uses to increase revenues and profitability.

Learn more about how to drive profits through using online video as a business intelligence tool.

It’s tough being a small business. The deck is inherently stacked against you. Resource constraints in terms of time, money, and man power force your hand day in and day out when making tactical decisions.

And it’s tough – borderline counter intuitive – to spend money on technology to get ahead. The right technologies need to be viewed as an investment – they will increase your efficiency and efficacy – providing a return (ROI) and thereby increasing your chances at running an on-going viable business.

A couple of days ago Market Place (APM) had a piece on Technology’s Haves and Have Nots. The piece basically outlined how small business owners are way behind in adopting technology that will help them run their companies better and how it is necessary for small businesses to embrace the technologies that will lower the barriers for their customers to find them and ultimately purchase from them as opposed to their competition.

Managed Video (MVaaS) is such a technology for small businesses – especially small retailers and restaurants. Managed Video provides business owners an omniscient view into their operations. It’s not about being Big Brother; it’s about perspective, literally. It’s about understanding who your customers are (demographically), how they interact with your merchandise and your staff, how they flow through your store. If you believe in being analytical, MVaaS gives you the ability to supplant gut-based decisions with data-based decisions.

MVaaS is an “approachable” technology for small businesses. There’s no IT involvement to get set-up and viewing video is as easy as opening your email in a web browser. And an affordable monthly subscription means you don’t have to come up with a big cash outlay to get up and running.

So in an economic environment where it is tough to get by, you need any sensible advantage you can get your hands on. Embrace technologies that will help you. View it as an investment, not an expense. And prosper.

Innovation is more essential than ever in today’s competitive global economy, but many organizations have traditionally been reluctant to take the potentially expensive risks involved with making a disruptive change. However, with cloud computing and online software as a service, innovation has become increasingly affordable and accelerated. “Cloud computing enables companies to quickly acquire processing, storage or services as needs dictate,” explains Joe McKendrick in a recent blog on Forbes entitled Cloud Computing Now Makes it Easier and Cheaper to Innovate. “They can just as quickly shed those resources when a project is completed. As a result, companies with more advanced cloud sites are able to rapidly move through experimental or prototyping stages.”

A great example of an online resource that companies can use to rapidly innovate and gain insight into their business is Managed Video as a Service or MVaaS. Based on the Software as a Service (SaaS) model that Salesforce has made so popular, MVaaS is not only affordable: it actually increases profitability by 10-15% by putting easy-to-use, online video data into the hands of the entire organization, providing valuable insight into operations, marketing, and more.  Rather than the old Closed Circuit Television (CCTV) model of recording video on site and then reviewing it only when something unusual happens, MVaaS enables thousands of users within a company to utilize  remote surveillance to better understand and improve the day-to-day, store-level operations of their business. With automatic alerts, integration with business data tools like the Point of Sale (POS) system and powerful exception reporting capabilities, not only does MVaaS enable businesses to increase profits, the service also helps reduce theft, better manage human resources, identify training opportunities for staff and ways to make operations more efficient, enhance marketing in store promotions, and improve security.

In short, this new way of managing video has the potential for impact across all aspects of a business, enabling better service and operations, and could be applied to many industries. The service can be rapidly deployed and customized for each client, providing the ability to quickly verify the return on investment. “The ability to quickly test and deploy new innovations is available to all types of businesses,” continues McKendrick. “Add the ability to provision those workloads to on-demand cloud resources, and a huge weight — in cost and risk — has been lifted off innovation. Technology is transforming innovation at its core, allowing companies to test new ideas at speeds—and prices—that were unimaginable even a decade ago.”

MVaaS is an excellent example of a cloud-based service that offers an accelerated opportunity for businesses to innovate and improve rapidly across the entire organization. Through connecting the concepts of video surveillance, business intelligence and SaaS, MVaaS has transformed surveillance from a reactive industry based on hardware upgrades and dusty tapes in boxes to a proactive tool based on rapid scalability, automatic software updates and data storage in the cloud. Rather than thinking of video surveillance as insurance, companies can now use it to directly increase profits and improve performance. The future looks bright for MVaaS and other cloud-based industries, which is exactly the kind of innovation that our country needs to strengthen the economy overall for the next generation.

At its lowest level in over a year, the Restaurant Performance Index reveals a gloomy outlook for business conditions in the months ahead. According to a recent industry article featured on Hospitality Technology, “restaurant operators remain generally pessimistic about the direction of the overall economy in the months ahead. Only 18 percent of restaurant operators said they expect economic conditions to improve in six months, compared to 17 percent who reported similarly last month. Meanwhile, 31 percent of operators said they expect economic conditions to worsen in the next six months, matching the proportion who reported similarly last month.”

Despite this challenging environment, we can offer a proven solution that will help the industry reverse the declining trend. Managed video offers a service that delivers store level, top line revenue improvement.  MVaaS enables operators to manage exceptions and drive marketing and sales improvements that are proven to result in increases in transactions and $/transaction.  MVaaS solutions, like those from Envysion, also help businesses make operations more efficient, enhance and improve training for staff. Envysion enables businesses to drive 10-15% improvements in profitability by putting easy-to-use, video based intelligence into the hands of the entire organization. Rather than the old CCTV model of recording video on site and then reviewing it only when something unusual happens, Envysion applies the Software as a Service (SaaS) model to video to enable thousands of users within a company to utilize remote surveillance to better understand and improve the day-to-day, store-level operations of their business.

Even without any increase in customer visits or spending patterns, restaurants that use managed video to prevent loss and improve operations see a dramatic increase in profits.   Join, or check out, the growing list of organizations like Chipotle, Qdoba, and Einstein Noah who have experienced profitability increases.

Saw a banner ad the other day that reminded me that Envysion thinks differently than the majority of incumbent video providers.  The ad was for one of the leading IP camera manufacturers – it had a very simple tagline: “IP cameras drive increases in sales”.

That kind of statement not only is silly, (how can a camera by itself without anyone using it increase sales), but also demonstrates that the industry still has a technology, not user or application focus.  People can use cameras, whether they are analog or IP, to better understand what is happening in their business.  The thought is that they can then make better decisions with this new knowledge that will enable them to improve the way they operate.  For this to be true, business people have to look at video, see something that is interesting, be able to learn from it and then take action on that insight.  The camera is one piece of the solution, but the key to delivering the value is the person that is to use the technology.  What are they trying to learn?  What tools do they need to learn it? How can you make the learning more proactive and more efficient?  How do you help them communicate the lessons through their organization and make them actionable?  Any increase in sales, or any other improvement, would be driven by the user and this whole process and system, not by a specific camera.

So back to the ad. IP cameras drive increases in sales.  The intended message, given it was an IP camera manufacturer’s ad, must have been that IP cameras, more so than analog cameras, help users increase sales.  What is it about IP cameras that makes this true?  Are they claiming that because of the higher resolution found in many IP cameras that suddenly people make better decisions?  Maybe – but the video provider should be explicit about the impact for the user and how they are going to use that increased resolution to learn something that they otherwise couldn’t and how that will translate into increased sales, not on the fact that it is an IP vs. analog camera.

I see this same thought process with many companies that are promoting MVaaS services.  They implement some form of web-based or hosted video and then make claims about how it will enable you to improve your business and generate a compelling ROI.  MVaaS is a service delivery method, hosted video is an architecture – if you don’t use them differently than you would traditional video, then you may save some money on the cost side but you won’t get anything more material out of them than you did your old video solution, certainly not an increase in sales.  The technology is the enabler, how you use it is the difference maker.

At Envysion we have a differentiated technology that helps us create tremendous value, but the value is delivered by focusing on the user and how this technology can change the way they impact their business, providing them with new insights that they couldn’t have gotten before.  The customers getting the most value from MVaaS don’t care whether the video is hosted or distributed or a combination, whether some or none or all of the cameras are IP – all they care about is whether they can easily get to the insights and do something with them.

The video market as a whole will increase dramatically once more vendors start to focus on the user and how to help them drive value instead of promoting technology for technology’s sake.

Benchmarking is a valuable Loss Prevention tool. Related to Chasing Your Tail – looking for your worst offenders across any metric – benchmarking strives to bring all your locations, employees (or whatever else you may be measuring) up to the level of your top performers – your benchmark.

Benchmarking is a method used to develop a standard to measure performance against. Based on the key metrics or KPIs which you use to determine how well your business is running, breaking down any of these given metrics by location or employee to tease out your leaders and who are your laggards. Then, extending beyond measurement, looking to the leaders who make up the benchmark, study them, learn their qualities that make them the crème de la crème and try to emulate those qualities in the under-performing locations and employees. Finally, on an on-going basis, re-measure to gauge improvements.

To effectively benchmark your locations or employees, you need to:

• Know which metrics you wish to benchmark on
  • These metrics need to be measurable and will likely need to be normalized
  • They also need to be in-line with your company values

• Know how many locations to include in the benchmark
  • Ranking your locations on a metric – include the top 5-10% of locations or employees
  • Compute the mean or average across the top locations and employees on the given metric – this will give you your Standard which you will want to strive to achieve with your other locations and employees

• Study your top locations and employees, the leaders, and study your the laggards
  • Use video to observe operations. What are the qualities of your leaders that you want your laggards to emulate?
  • Develop a plan – changes to implement amongst your laggards – and execute

• Follow-up
  • After having implemented changes, re-perform the measurement against the benchmark. How are your laggards doing? Have they improved?

At the end of the day, benchmarking is about being introspective and striving for more with an attainable goal.

Exciting times for MVaaS over the last couple months.  Not only are we seeing great customer traction and wins overall but specifically exciting to see a number of wins across some new segments (recent Envysion Announcement on Cinemark) like cinema.  While it is likely intuitive to some that video based business intelligence fits for just about every operator it is still exciting to see completely new segments realize the potential of putting a transformational video tool into the hands of employees across the enterprise.

For cinema, much like for retail, restaurant, and c-store customer segments, the story is about leveraging MVaaS as a productivity tool that can easily and rapidly tranlate video based business intelligence to profit impact.  Within a cinema environment opertors can get unfiltered visibility to concessions, ticket transactions, line times, and key entry/exit points.  Marketers can get visibility to customers, promotional materials, discount transactions etc.  For our announced cinema customer the bottom line impact was both measurable and significant. 

We look forward to the coming weeks as we see more segments embrace MVaaS solutions.  And also to the Managed & Hosted Video Summit which will provide a great forum for both providers, customers, and partners to describe how managed and hosted solutions across the ecosystem are making bottom line impact and transforming the video surveillance space.

In a recent post, LP Innovations coined the Predictive Loss Indicator as an ROI metric by looking at how much would have potentially been lost had a troublesome employee not been detected through, for instance, and exception based reporting (EBR) or otherwise, and continued on, undeterred. I like this approach as it creates a quasi reverse opportunity cost through which to gain visibility into tangible cost savings.

LPI goes on to say that this indicator may be limited based on the fact that information used to compute the metric is gleaned from the problem employee. Think: “Did employee who stole from me also lie about how much and how long they’ve been stealing???”

Attributing factors to ROI can be a complicated task. This, in part, is due to the fact that many benefits from EBR, video systems, or combined EBR + Video (such as our MVaaS solution), are intangible. Having deployed a incremental piece of LP technology, deterrence alone can produce a huge ROI, then streamlining your job to only identify those who won’t be deterred.

We work with customers to compute ROI by looking at a baseline for store locations prior to installing our system and then reviewing the performance going forward. Furthermore, we use control locations to adjust for extraneous factors such as seasonality, geographic and economic factors, and so on, in order to isolate the effect of the our MVaaS solution on our customers’ ROI.

The ROI customers’ realize from a technology such as MVaaS is important. We find that we typically deliver cost savings upwards from 1% of revenue back to the top-line – that’s real dollars and cents.

Amidst a stream of weird and weirder Charlie Sheen news Monday, the tabloids reported that a surveillance tape of Lindsey Lohan allegedly stealing a necklace has sold for over $35,000. My first thought upon hearing this was “What idiot would waste that much money?” However, it did get me thinking about the value of video surveillance – even if you’re never find yourself in the middle of a celebrity theft trial.

To illustrate my point, let’s work through an example MVaaS customer scenario. To keep the math simple, I’ll use round numbers and make some assumptions.

Envysion has found that our MVaaS solution typically drives a minimum of 1% of net sales to our customers’ bottom line. So if a restaurant owner with $1.2 million in annual sales purchases a MVaaS platform, we’d expect to see a $12,000 income improvement annually or a $1,000.

Monthly Income Improvement = 1%(Net Sales)/12 = $1,000

Now imagine if our restaurateur owned 5 or 10 or 1,000 locations, and the value of video surveillance really adds up.

Not sure if you saw the Sandhill Cloud write up on 2010.  One of the areas that caught my eye was the commentary that SaaS companies had proven enterprise scale  and enterprise readiness.   The author cites a number of examples including SuccessFactors closing a deal with 2M seats and Saleforce now having 90,000 customers, the majority of which are enterprise customers.

I would also point to MVaaS as another SaaS flavor that has been proven as large Enterprise ready.  Over the last couple years at Envysion we have focused a fair bit on large enterprise customers.  We think the rich value prop and differentiation of our service fits well.  Importantly as well from an ‘scale and readiness’ perspective we’ve shown over the last few years that we can effectively onboard large customers with 100′s or 1000′s of sites, 1000′s of cameras, and 1000′s of users onto our platform without issue.  

Based on market feedback and discussion with prospective customers it would appear that we are starting to overcoming the legacy of FUD created by competitors and analysts and addressed concerns that Enterprise customers may have had with regard to cloud services.  That of course is not to say that some don’t still have preference to own and control their software.   And we would always expect an enterprise customer to do diligence and kick the tires, but we spend much less time today on concerns with the cloud and a lot more time on ROI and value delivered.   Which of course are great and exciting conversations to have. 

More to come on the topic from our end.  Thoughts from others on Enterprise readiness?