Security provider Alsok eyes hi-tech solutions

Japan leads the world in robotic and drone innovation, and indeed Alsok is at the cutting edge of this innovation and the automatization of Japan’s security sector with such mechanisms as the Reborg-X or your big data analysis centers. Can you maybe outline for us how you’re utilizing technology to provide some of the world’s most advanced security?

Regarding robots for security purposes, this is not yet complete. In Japan, in the field of robotics, the most advanced are the robots for the manufacturing sectors, factories, for example FANUC. We have consulted robot manufacturers actually about our technology, and have come to the conclusion that it’s still quite difficult at this moment; we do not yet have robots that are able to judge the situation, and act and enforce decisions. This is going to be a very interesting topic in the future, and we’d like to study other developments, like with SoftBank’s new robots, and create a new sector, a new field of security. Also about drones, drones are already being put to practical use, but I believe that these will evolve further.

Finally, we believe that the raison d’etre of humans is that they’re able to use their ears, eyes and thought processes to contribute, so regarding this idea we’ve come up with various ideas, based on which we’re conducting some experiments with ICT vendors. Regarding what we call drone security management and how to protect all the people in a public space, we believe that ICT and further on IoT will become very effective, and we’re already working with people wearing wearable cameras, which we’re calling “Hyper Security Guards”. These are areas that we’re experimenting in. Actually, we’ve been doing some experiments about this, and I spoke at a conference in November with NEC about these matters.

We’re also considering using information collecting, using data collected from images, including face recognition, for example, to recognize the face of a terrorist. Not just the face recognition, but also the movements – the whole body and its body language to see if they’re acting in ways that are suspicious.

Another issue, on which we need to work with the police force, is when disaster takes place: how we are able to control the movement of masses of people. So this is another large issue to overcome.

I’m finding it very interesting to work on these issues with ICT vendors like NEC, and look forward to finding further solutions and working with them more, and hope that the results will be useful to the entire world.

Where are you focusing your energy for growth? Where do you see the most potential to grow your company?

There are two, one of which, in the past, the focus had been on how to avoid being attacked, or home security, but now that is moving into the realm of area and health. So that is an area of expansion that we’d like to take advantage of.

Related to this movement, we have acquired a nursing subsidiary and are expanding the area of long-term care. The Japanese government at the moment spends 10 trillion yen on this area, and that is expected to expand. So it is my hope that the private sector will be able to shoulder some of that.

We’ve been studying with our colleagues in the finance sector and insurance sector, and we believe that this area of long-term care is going to expand in the future and has great potential, so this is very interesting to us.

The second area of focus is regarding aging infrastructure and building new infrastructure. That is something that can happen expensively. But the other issue is how to take care of infrastructure of both the public and private sector that was built after the war, as 70 years have passed. We’d like to work on how best to inspect the current conditions of the infrastructure, and to renovate it to make it more sustainable.

These are urgent issues that the country is facing, so you can see that we’re trying to expand beyond just security, into the realm of providing safety. We also hope to not just go beyond the limited realm of security; we’d like to cross the border into providing safety through our care facilities.

You already operate in 10 countries. What are your further goals for global expansion? Where do you see opportunities for continued growth outside of Japan?

That is a difficult question. Since the 1980s, we’ve been sending personnel to Japanese embassies abroad, and in total we’ve sent 700 personnel. At the moment, there are over 50 around the world, mostly focused in the more, you could say, insecure nations.

As our personnel were dispatched abroad, when they came back to Japan, they brought back intelligence about those countries, which led us to want to further contribute to those specific countries. We’re also now focusing a lot on Southeast Asia, where we see significant growth, and personally I’d love to extend our operations to Europe and America as well. But what we need to do is to analyze and study what services we can offer, and aim not just to provide devices, but to provide services. Especially in the area of cash transportation, we are considering shouldering one part of the operations of financial institutions. I believe that the emerging countries are going to be our priority for the moment.

Regarding our overseas strategy, security is not an easy thing to export. With the TPP, there will be free movement of goods, but regarding services, it’s not as simple. There are issues of regulations about investment ratios in each country that must be overridden. Out of our operations overseas, Thailand is the only one where we’ve been successful on our own, and in the other areas, it is the local subsidiaries that are working, and we just provide the know-how and security equipment to them.

In Japanese companies, especially in factories, it’s common to exercise together in the morning, and in Thailand actually we do something similar. We ask the employees to reiterate our company charter in English and in the local language.

While Alsok enjoys a very strong brand here in Japan, as you grow internationally, how are you working to communicate the strengths of your brand to the international community?

Domestically, our competitors, Secom and ourselves, provide various kinds of services respectively, but with the upcoming Olympics, we’ll need to cooperate in our operations harmoniously. Actually, the system and how security is conducted abroad is different from system and security in Japan. For example, in Japan the clients will give us their keys to look after. This is not something that we imagine is going to be realistic abroad, so we have to look into different ways of doing things, and also I believe that it will be necessary to communicate the strength and high quality of our products.

I think this is quite similar to trying to communicate the strengths of Japanese cuisine to the world, for example. With food, it’s quite easy, because they can just taste it and see how nice it is, but I’m thinking that we’d like to find some way that the people of the world can also taste our services and products. Just as avocado sushi, which seems to be popular abroad, is not something Japanese, we’re hoping to tweak our taste in order to make it suited to the local area, and also have the local people feel that we provide reliable security. I don’t know if it’s going to be the best if we just limit ourselves to the security part of our operations, because in each country, the police system is different, and the authority that we have and we’re able to implement is going to be different. I believe it’s going to be necessary to make tailor-made security operations for each country.

Safety is also an area where we’re going to be able to differentiate ourselves from the competition. Worldwide, there’s actually only loose federations or associations, nothing really solid within our sector, and I’m actually the head of the All Japan Security Service Association. Because of that, I’ve also joined the Asian association for security companies, but it is quite a small-scale association with only 11 countries involved. Internationally there are other associations like ASIS (American Society for Industrial Security) and IPSA (International Professional Security Association). I’m hoping we can become more active in those kinds of associations by exchanging information within the sector in order to research exactly what is the extent the security sector can reach into – not including things like military security, but other kinds of security. We hope to do that in order to help out as many people as possible in the world.

I think it’ll really surprise readers to hear a security firm talk about sustainable social development and your desire to provide economic development through security and safety. How important are these concepts to the success of Alsok and your corporate culture?

It boils down to our slogan of our spirit of gratitude and gratefulness, Beyond Boundaries. First is our gratitude towards our clients, our customers; second is to our employees who work for us; and the third is gratefulness to the work that security provides for us. That is, security work is quite close to something that the public sector does, and in our work we protect our customers, and our customers are members of society, so we are in effect protecting the society itself. By doing these operations, we are able to receive income, which further allows us to do this significant work towards society, so we’re really thanking the system that is allowing us to do this kind of work.

If we continue in this vein, profit will follow naturally. I believe what’s most important for a business is to give tangible shape to this spirit, and actually in our sector, even when the economy contracts, because the crime rate tends to increase when the economy is not doing well, we receive more security contracts. And when the economy is doing well, there are more buildings being constructed, so there’s demand for us as well. We can always support society, providing security and safety, and providing a base for society. Even if our results may fluctuate from time to time, overall we can continue to grow. One issue that we’re facing with Abenomics is that there are not enough people.

What would you say has been the impact of Abenomics on the security sector or indeed on Alsok specifically?

Before I respond to your question, I’d like to just explain a few things. I worked in the Ministry of Finance for approximately 34 years, so I worked in the public sector, particularly on matters relating to bilateral and multilateral trade negotiations. It has been seven years since I moved to Alsok, and I succeeded Mr Atsushi Murai as the president of Alsok in 2012. Regarding my impression of Abenomics and its effects, it is quite significant that it allowed us to break away from the past two decades. Having worked in both the public and private sectors, I can say that it has had a very positive effect of brightening our country.

In these seven years, there have been two major events: the first being the financial crisis from Lehman Brothers, and the second being the Great East Japan Earthquake and tsunami. To speak about what a big impact the financial crisis had on our country, even companies like Toyota had experienced deficits, and our Japanese economy shrank significantly. This was coming particularly after almost 20 years of deflation as well.

At first, the Japanese financial sector thought that we wouldn’t be so affected by the financial crisis, because we already had a crisis 10 years before, but in reality, our economy did contract. Then, in 2011, on March 11 when we had the Democratic Party of Japan as the head, we experienced the earthquake.

At the time we experienced this disaster, the US government and other governments gave us great support, and also this event led to the formation of a new concept among Japanese people, the idea of bondage or ties between people being very important and working together in order to reconstruct.

Areas affected by the earthquake were in chaos. Buildings collapsed, the damage affected by the tsunami was tremendous, and unfortunately a nuclear accident occurred. In these disastrous situations, our company had dispatched the employees to secure these affected areas. I don’t know if this is the best way to put it, but I believe this disaster actually led to our company becoming more unified and trying to work together in order to achieve our objectives.

Regarding the macro policy, even during the Democratic Party of Japan’s administration, the demands for reconstruction became real. Then at the end of 2012, the Japanese election led to the administration of Prime Minister Abe coming into foundation. And so, the three arrows were born, the first of which is the monetary policy targeting 2% inflation, and the fiscal policy, which is related to demands for reconstruction as well as dealing with the aging society, and the third being the growth strategy.

Due to the decrease in oil prices, achieving the 2% goal is a bit difficult, but it is definitely true that we’ve been able to exit the period of deflation. For our security sector, it can be said that the various companies have increased their investments, which has led to more business for us. Amidst all that, in September 2013, in Buenos Aires, Tokyo was selected to host the 2020 Olympics and Paralympics, which was further good news, especially for our company as the Official Bid Partner.

The way I appraised Abenomics is that it broke through the two lost decades of Japan, both by macro policies as well as the decision of the 2020 Olympics and Paralympics being held in Tokyo. These two together has led to the vitalization of the Japanese economy.

For the security sector, first of all, the structural issues that the country is facing, the aging and the declining birth rate is one factor. Another factor, which has become more apparent after the recent earthquake is that the infrastructure of both the public and the private sector is becoming old and deteriorating, so just like people age, these infrastructures are aging as well, which has led to new demands on our sector.

This year you’re celebrating your 50th anniversary, and for the fifth consecutive year, you have posted record sales of 365 billion yen. What would you attribute this impressive growth to? Is this the redevelopment of the infrastructure that you’re speaking about?

Yes, including what I mentioned earlier, the demands coming from the hardware of society and the need for security for those areas. But also, a great part of our success can be attributed to the new demand created by the aging society and the seniors, and the demands for stronger home security. I believe these are the reasons for our success, and this is what I was aiming to accomplish as well.

Another thing I’d like to point out is that our company was founded in 1965, but the founder of the company, Mr Jun Murai, actually worked as the Deputy Secretary-General of the organizing committee during the 1964 Olympics. He was a bureaucrat in the Home Ministry and police, and he was also the secretary to Prime Minister Yoshida directly after the end of the war in 1945.

Our founder always felt the need to put his efforts into the reconstruction of Japan, which finally led to the culmination in 1964 with the Tokyo Olympics, which is 51 years ago now. He had a very strong feeling that he needs to contribute to the public good, so the next year after the Olympics, he started this company with 40 employees.

At the time, the capital of the company was 25 million, and we had a deficit of sales of 150 million yen. Since our founding, the company was focused on the B2B, and particularly the big companies, big banks. The B stood for businesses and banks. Alsok made a rapid progress through the development of Japanese economy, which now turned into a big company with over 30,000 employees. Recently, our company has been increasing in sales in Abenomics and the reconstruction from the earthquake disaster.

Alsok is an official partner of the 2020 Olympics, just as you were for the Winter Olympics in Sapporo in 1972. How important is this event for Japan?

First of all, 2020 is seen as a festival, but I think it’s not simply a festival, but an opportunity to show how Japan has changed after 20 years of economic recession, and then having experienced a financial crisis as well as the earthquake with the nuclear power plant disaster, even though the Fukushima power plant is now under control.

At the time of the Olympics in 2020, I believe our country will be the most aged society in the world, but I believe that the people will be able to see how our seniors are leading healthy and active lives, and we hope that this will be something that will be communicated to the world on this opportunity. I also think that this will provide us with an opportunity for ourselves to think about how we’ve changed and what position we’d like to take in the world in the future.

Back in the 1960s when we had our first Olympics, I was in sixth grade and Japan had transformed itself significantly at this Olympics. We were showcasing how we’ve transformed ourselves. Again, for this Olympics, since then our country has changed. But the world has changed even more rapidly, with China becoming a major power. This is a great opportunity to think about our place in the world now. And also to showcase to the world that we are the safest country in the world, where a woman can walk around between midnight and 1am without feeling in danger, as well as the fact that seniors, even people in their 90s, are able to walk about actively. We want the world to see this kind of Japan, and also hope that this event will become an opportunity for all the countries of the world to think about working together in order to achieve this kind of life. I believe that it’s important for a country to continue pursuing being an even safer country. And although it is the police force and maybe coast guard that will be the first groups that need to work on safety, I believe that we will need to play a significant role to support them. Also, we need to think about how to go beyond just security and to widen our operations and services.

I also need to point out that the 2020 Olympics will be surrounded by many risks, one of which is cyber security. Others are earthquakes, tsunamis as well as typhoons. So we need to foresee these risks and plan for these eventualities tightly within our planning committee, of which I’m actually a member of, and prepare ourselves. I think that the true power of our country will be shown when natural disaster strikes, and how we deal with that.

Another risk that we need to prepare ourselves against is the threat of terrorism.

In the run up to the G7, what message would you like to leave with these leaders about Japan?

As Prime Minister Abe said, Japan is back, and we need to think about how to stay on the cutting edge. I think that the important mission is to come up with how to construct a new kind of society that meets this era of such long life expectancy. I don’t know if I’m really in a position to give any kind of message to these world leaders, but I believe that the spirit of gratitude and gratefulness is something that’s necessary. I don’t know how leaders would think about this, but we all live in the small sphere that we call the Earth, and we must coexist. We can’t move anywhere else, so I think that the only way for us to proceed is to respect each other. Especially as someone in the private sector, I think the spirit of gratitude is something that I can contribute.