Dirk van der Vaart on His Agenda for GardaWorld’s US Arm and Security Sector Trends

Der Vaart_Dirk Van_smallDirk van der Vaart took the role of president in April at GardaWorld Government Services — the U.S. subsidiary of global security services contractor Garda World.

The 20-year defense and security market veteran’s background includes executive roles at GLOBAL Integrated Security and Raytheon, as well as service in the Coast Guard Reserve and intelligence community.

ExecutiveBiz recently spoke to van der Vaart for an in-depth conversation on his first three months at GWGS and the trend of consolidation in the GovCon and security markets. He also offers advice for those who transition to industry from government service.

ExecutiveBiz: Describe your priorities at GWGS since April of this year.

Dirk van der Vaart: Since assuming the role of president at GardaWorld Government Services, my top priorities have been typical of any incoming executive. The number one priority is to look at the business forecast and ensure that our current budgets as well as financial projections are in line with the ever-changing business forecast.

Part and parcel to that is relooking the strategic plans that had been done a year ago. In this business, change is the only constant. The world has changed over the last 24 months and we are updating the business plan, re-forecasting accordingly and realigning budgets. In addition, we are constantly making sure that our policies, procedures as well as the systems that support our back-end business comply with government regulations and standards.

Primarily, our cost accounting, pricing and cost estimating systems needed updates and tweaks to make sure that we are staying compliant with the CAS Standards. Another priority is to make sure that from a talent perspective, we“˜ve got the right team in place and that we are attracting the best and brightest our industry has to offer. I spend time looking at the team and making sure we're staffed correctly for the size of business we are.

We look at our recruiting objectives and numbers to make sure we have adequate systems in place to support the ever-growing battle for talent.

On the operations side, the priorities are to delight our existing customers by making sure that we are executing very well, delivering high customer satisfaction and looking at ways to grow organically our programs, projects and contracts and also to look at new customers and make sure that our deployment processes are constantly being reviewed and tweaked for optimal performance, which gives us the ability to market to new customers and segments.

Most of our work is done overseas and in a very complex environment, so the challenge is getting people and things into very difficult places. The U.S. government is our only customer and everything we do is in response to an RFP or request for quote from them. Another priority is to make sure that our proposal development process and business development teams are both adequate and capable of producing on a highly repeatable basis.

ExecutiveBiz: What trends are you watching the most in the global security market?

Dirk van der Vaart: There's quite a few we watch closely and I specifically keep my eye on. Right now, number one would be consolidation. Within the risk management and security services industry, we see a lot of mergers and acquisitions taking place. A lot of traditional pure-play security providers are in an acquisitory mode and want to add more capabilities.

Security services firms are looking at logistics or transportation capabilities and other areas of manpower or staff augmentation. There's also a lot of executive movement taking place right about now so I always look to see where my peers are headed, who is changing seats and what's going on. From an industry-wide perspective, I tend to look very carefully at how security is being acquired and the buying trends from our government customers.

During the wartime years, security was treated very much as its own service and you usually had a lot of contracts and IDIQ vehicles that dealt exclusively with the provision of security and security-related services. Now we're seeing that trend reverse a little bit. More and more, security is seen as part of other large contracts where it is not the predominant service.

It is an add-on capability to something that requires a larger prime to look after its own security. That is reflective of a broader trend we are paying attention to: the commoditization of security services. At one time, mostly due to the perceived higher threat during wartime, security was at an all-time premium. There is an unfortunate linkage between reducing the wartime ops tempo and the perception that the threat must have gone away.

Security is treated very much as a commodity in many recent MAIDIQs. Security is being perceived as not much different than copier paper, office furniture or other supplies. This commoditization effect obviously has a downward pressure on rates and revenue. That is something that we are combating as a whole in the industry. We are making the case that the threat is even more persistent and insidious today than it was a decade ago.

Therefore, security needs to be treated at the appropriate levels. Lastly, reading the newspapers and headlines, Iraq and Afghanistan have declined as the primary markets for security services. In the past probably upwards of 60 percent of revenues related to security were being earned in Iraq and Afghanistan. That trend is certainly no longer true because of the withdrawal of the majority of U.S. troops and cessation of combat activity.

Consequently other geographies like Africa, parts of the Middle East and Latin America emerging as the hot focus for security contracting.

ExecutiveBiz: Which security market areas is GWGS looking to grow or is interested in?

Dirk van der Vaart: Based on those trends in the industry, GWGS has been structured to look at the classified side of the business more than anything else. The intelligence community and that grey-to-black zone, where U.S. and DoD meet, is not only growing but offers some unique opportunities for us and the type of firm that we are.

We focus on classified services related to risk management in complex environments and diversifying beyond just the provision of armed guards and close protection details. Getting to some market adjacencies is of particular interest for us. We are looking at ways we can leverage emerging technology into the risk management practice, such as data analytics.

Persistent threat monitoring is an area of service that we are actively investigating and developing capacity in right now. Without going into too much detail, specialized support services on behalf of the classified DoD and intelligence customers is a growing area for us. We provide these services exclusively in complex environments ““ post-conflict, destabilized and other areas where existing governments are under stress or non-existent.

ExecutiveBiz: Discuss how you helped lead an Israeli startup. How do you apply this experience to your current role?

Dirk van der Vaart: I worked a number of years for an Israeli company that developed a very unique tactical radar system for combat, search and rescue, police, and law enforcement use. At the core of my tasks was to learn the product and the technology and help the company establish a U.S. presence and enter the U.S. market with their product. After spending a fair amount of time in Israel, I helped establish the U.S. subsidiary and launch the U.S. business.

There are a couple of things I learned during that time that are very applicable to my situation today in our industry. First, Israeli businesses in general and particularly in the defense sector have enormous risk appetites. They are willing to take on levels of risk that the majority of U.S. businesses would never consider.

They are willing and able to engage different kinds of customers ““ third world, emerging markets, developing market customers as well as employ different contract modalities and compete where the bid and procurement process may not be as clear, defined or transparent as they are in the U.S. They do business in parts of the world where for US business traditionally it has been very difficult to understand the contracting environment.

The Israelis are very aggressive in getting into those areas. I learned to adapt U.S. business practices, mindful always of the FCPA and other laws that we have to comply with, but learning how to be a more flexible from a contract modality, financing and execution phase. I also learned to bring the discipline of risk management and mitigation to the business.

Doing business in complex environments and high threat areas, one must have a disciplined and defined risk mitigation process and to fully understand categorize, measure and control risks. I gained a lot of experience there and brought that to this business.

Second, it is typical of Israeli companies and startup companies to have a high degree of intellectual curiosity. They are very attune to their own product and market niche, to what's going on in the broader market around them and in the adjacent markets.

Here at GWGS, we couple that with entrepreneurial flair while always considering new ways to spin our offering, new customers we might approach, and new strategies that we might develop surrounding our offerings.

Starting that US subsidiary from zero or scratch was at the pure building blocks level. Basically I was one guy to build the team, set up the business entity and put in place all the things that go along with it. I had to learn a lot of those processes from startup. I bring a lot of that to GWGS. While GWGS is part of the broader global enterprise that is GardaWorld, in some ways we are a bit of a startup.

The legal entity, which is established as a proxy company for FOCI mitigation, has only been around for about two years. GardaWorld has been a leader in the security industry for over 30 years, so I have the advantage of being backed up by a very disciplined, established and successful global enterprise. I feel like I'm in the best of both worlds right now ““ I'm in a startup environment and part of a very large multinational and highly successful enterprise.

ExecutiveBiz: What advice do you have for those who transition from the government or military service into industry?

Dirk van der Vaart: Speaking specifically to the defense sector, the defense industrial base and the subcategory of security and risk management business, we need good people. We are eager to receive those coming out of the military and governmental service. The security industry can be a bit of a conundrum for those exiting government at the more senior ranks, an SES-type person or GS-15, GS-14, O6 or General officer in the military.

I would say don't sell your experience short. On the other hand, while industry appreciates the time, effort and longevity spent achieving those ranks, rank doesn't always necessarily convert immediately to the equivalent business-savvy. For the senior jobseekers, be very honest in your self-assessment. Don't sell yourself short but don't also assume that you know everything there is to know about being on the other side of the fence.

There is a lot of nuance to being a contractor that you probably didn't experience when you were in your government seat. Focus on translating your government or military experience into terms that business can relate to.

What size of budget did you manage, to the extent that you had any control over finances? How did you improve the budget? How did you get more money? How did you reduce costs? How did you improve processes or procedures within your assigned area of responsibility? What kinds of teams did you build? How did you go about gaining consensus?

Translating the nitty-gritty of what you did in the government seat into that kind of language makes it more digestible and easily translated into an equivalent contractor position. Coming out of the government, you often have the benefit of a lot of internal government training courses, mid-career courses and career specialty courses on standards and certifications.

Make sure that you bring those out and to the extent possible, familiarize yourself with the civilian equivalents of those. For example, I would point out the Project Management Professional accreditation as a very important standard in our industry today. Many government executives and mid-range government folks come out of the government having received a lot of internal training that is in fact equivalent to things like PMP.

I would encourage prospective military and government folks to look at those kind of civilian standards and compare them to what they've learned and been trained in. This would start the conversation with civilian recruiters off on a good foot. One big notable difference for me when I came out of government service was the change in pace, particularly decision cycles.

On the business side, things happen on a daily or weekly cycle in terms of financial and revenue projection as well as business development and new business opportunities. Decisions get made within hours, or days at best. This is considerably more fast and furious in some ways than what I was used to in federal service. Obviously some of the military guys are used to very long hours and days and crazy ops tempos.

Usually when the world reads about significant geopolitical event in the headlines, it has already impacted the security contractor community typically hours or days ahead. We feel the impacts and deal with consequences ever more so in the security industry where we are at the forefront of where the threat is.

If you are coming out of a traditional government career, be ready for the fact that the pressures for performance are very different in private industry and the time cycles are very compressed, so it tends to be a shock for some folks. We are eager to attract government and military talent. The industry has matured a lot in the last decade of war-time footing.

Things today are very different and we value the perspective that a government or military person can bring to the table as well as all the skills that they have been imbued with as a result of their service. It is a great arrangement for us. I would tell prospective job seekers that the market is wide open right now. There are a lot of good jobs to be had in this industry.

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