The world revolves around money. No doubt. It's logical then to assume that managing money is a critical skill. One that can make or break any career.
And yet, basic money management is a glaring gap in the skill-sets of most EP operators and managers. Whether we are talking about the decision-making around daily expenditures, the tracking and reporting of receipts, or the higher level program budgeting, the need for good judgement and practice around money is critical.
For better or worse, it is a basic assumption that an EP operator understands money. When you are hired for a job, you may have an orientation to your company's culture and policies where you'll likely receive a pdf copy of the 10 page expense SOP's that govern the 'do's and don'ts, which you will sign your acknowledgement of and never look at again. Beyond that (unless you've been blessed w/ a thoughtful manager or leader), you likely won't hear a whole lot of in terms of guidance about your reporting and spending of your company funds. That is until you break with policy, or find yourself in hot water over your spending or reporting.
As an EP Manager, I had to spend an inordinate amount of time dealing with the spending habits of my teams. Why? Well, because while my folks may have hundreds of hours invested in shooting training, or evasive driving, many of them had really never learned basic money management.
It would be great to include industry budgeting, expense reporting and best practices in standard EP curriculum, as those are skills that will be used no matter where you are employed. I can assure you, that while an EP operator may never need to pull a weapon on the job, it is guaranteed that they will be spending corporate funds and filing expense reports.
Yes, it's not sexy. But it is a skill that will allow you to keep your job and perhaps move up, or else go down in the flames of embarrassing poor choices and habits. I've had to let a number of folks go because of the way they spent funds (oftentimes applying the taste and expense of their principal, to their own expense habits), or else due to poor record keeping and overdue reports.
If you were to ask higher-level corporate or private EP businesses about the top 3 reasons EP operators lose their jobs or just don't succeed, I would be willing to bet that you would hear some version of these reasons:
1. Spending/Finance Policy Violations
2. Company Culture/Bad Fit
3. Bad Attitude/Disciplinary Issues
In my experience, poor decisions around spending and tracking money will buy you a one-way ticket out the door, with the entire finance and business support units in your company cheering your departure. Often EP operators have a tough time adjusting to corporate culture, where it is not just them as an individual operator anymore. When you are working within a company, you are beholden not just to your immediate manager, but also to the other business supports that help keep the ship afloat. Finance Departments. HR Departments. Legal Departments, etc.
If you have a tough time managing your personal finances, you better go educate yourself before working in this industry. Even if you are working as a contractor, you will find that you can't get paid if you aren't able to submit clear and reasonable expense reports. You will also find that if you have the champagne tastes of your principal, while your Manager has repeatedly reminded you of your team's 'beer budget', that you won't last long on that particular team.
And Managers, I would pose the same challenge to you. If you don't have a solid grip on your team's finances, you will find yourself on the slippery slope out the door, as ultimately you are accountable for the performance metrics that your organization has set, and I would venture to guess that the majority of those metrics are related to your budget and finances.
As many of you know, having a bad credit report can impact your ability to secure financing. It can also impact your ability to work in this industry. In fact, I'd argue that we need to look more closely at the personal financial hygiene of our applicants in this industry. If someone has a habit of 'bad habits' around money, then do you really want to trust that individual with your precious resources and reputation?
I once came onto team that had a guy who was known for his expensive watches and high dollar suits. Fine. The guy had good taste in fashion. But his good taste in clothing did not extend to his knowledge or habits in terms of spending in a work environment. Where the other team members would do burgers and sandwiches, this guy consistently did filet and Kobe beef. When it came to choosing a car to do his advance, it would be the Escalade, not the Maxima. Are you seeing a trend here? Well, I sure did. Despite numerous conversations and letters of warning, this guy's habits won out, and it cost him his job. Not worth it.
In the EP world, everyone needs a clear understanding of basic money management, as well as of the expectations of their employer as it relates to the use of company funds. A lack of understanding or refusal to adhere to program expectations, can quickly derail the entire EP program.
It's up to management and leadership to convey this to the entire team, but it's for the individual team member to understand and adhere to.
Why am I writing this and why should YOU care?
Finance/money management are among the primary reasons that a lot of individuals don't make it in this industry. Here are a few specific areas that plays out:
1. Travel Expenditures
The worst trap or mindset to have in EP/CP is to begin to believe that your travel expenditures, i.e. hotels, meals/food, transportation is a perk to your job and part of your actual compensation, or else just justified by virtue of the 'high net worth' person you are working for. Wrong!
If you find yourself hanging out with teammates and starting to hear, "Hey we deserve this/that", or "our Principal always eats here/buys this, so we might as well too". Run and get away, as this mindset will always end badly!
There is an insidious propensity in the EP world to assume that somehow your spending habits while on a job, are somehow entitled to reflect the tastes or quality of the purchases of your principal. No my friend. Just no.
This one line item (travel) is very BIG to companies and clients. Overall travel costs can affect the department budget, and can cause THE CLIENT to second guess their own program in it's entirety, if it is not being managed properly. Also, the travel line item is an easy red flag for your finance teams to notice and ask you to curtail.
I've never worked for a client or company that did not closely monitor travel expenditures, and then utilized this information to gauge their overall trust and perceived competency of their protection team. Nothing can upset a company or client more, than feeling like they are being taking advantage of by their own protection team.
One of the biggest misconceptions in our industry is, "Oh, he or she's a Billionaire and won't even care or won't be aware of it" or "our company doing so well, they won't care or even look". Wrong answer! I can tell you from experience, that Billionaires do not become that way by wasting money, and they pay a lot of money for their teams to manage and track their assets. Your spending habits will NOT go unnoticed.
Your travel is about service to the Client and NOT about YOU! A lot employees hear this, and know this, but just don't GET IT.
I used to always tell my team, "if you and your family want to continue to enjoy a great job and good compensation for your services, don't let something as silly as the urge to buy drinks and eat expensive steaks take that from you". Choose the soda and hamburger instead! Enjoy a long career...
Don't live the high life on your employer's dime while on a job. When you leave home on a protection detail, you need to be frugal with your company or principal's money so that you can get back home, and spend your own money on the perks you enjoy. YOUR money. This is the sure fire way to keep your job and still enjoy the finer things in life.
Don't expect your employer to support your 'champagne dreams and caviar lifestyle', just because they happen to live that way themselves. You are not their friend. You are not their buddy. You are providing a service to them. They are your employer. Make sure you keep that in mind as you make your purchasing decisions!
2. Compensation (Corporate Employee and Contractors)
Overall team and individual compensation is one of the largest components in a department or business's overall budget, and is reviewed and negotiated on an annual basis by management.
Compensation is one of those contentious things that no one likes to talk about, until an operator/agent individually wants more money. Then it's like a burned-in shadow on your TV screen, everything you try and watch there-after causes the shadowing to be right there at the forefront. The perception of fairness in compensation has a huge impact on morale. I'm sensitive to this, as not feeling fairly compensated for your work undermines trust, and can be a cancer for a team.
The challenge is however, that even on mediocre or low functioning teams, perception is not always reality. Sometimes members will still feel like they're under-paid and be very vocal in this perspective; and sometimes that belief is misplaced. Trust me, good leadership can see this and knows who performs at a high level. I've observed a number of instances, where the poorest performing member of a team was the one who was always complaining about being 'underpaid'. I always wished they would spend as much energy doing their job as they did worrying about their paycheck.
Think about building a professional sports team. Are all the players compensated at the same rate? Absolutely not! They are paid what they are worth, and what the team and market believes they will bring to the organizations success. Try building an NFL team and pay the QB the same as a Guard, or where everyone makes the same amount. They would end up with NO marque players and lose, every game!
Just know and understand how compensation affects the overall winning or success of your EP/CP team, and know that if the team succeeds, SO DO YOU. Yes, we all want to be fairly compensated for our efforts, but there are many moving parts that contribute to compensation decisions. Don't let emotion drive your actions on this one, as there is a long-game aspect to pushing for a raise.
When the Principal is happy and pleased with their team, it sure makes it a lot easier to ask for more compensation for YOU or proportionally for the entire team.
3. Budget and Big Picture
This piece is primarily for owners and managers, (but good for operators to think about). It's up to you to ensure that your team is aware of your budget and goals. If not, even if they are doing their best to have good spending and reporting habits, they may be missing out on the overall goals that you have as a department or team. I'm not a believer in using information as power when it comes to a department budget. That's a recipe for miscommunication and trouble.
I've worked for managers in the past that have said things like, "let me worry about the budget". And this is true to a certain point. However, managers who say things like this tend to use their budget as a tool to control their guys/gals by dishing out just enough of information but never really explaining ANYTHING.
A strong manager is going to explain what the overall budget parameters are, and what this means in terms of operations. This can be as simple as sitting down with the entire team and explaining specific budget line items (i.e. Cell Phone, Dry Cleaning, Cash Expenditures, Gear/Toys) or just financial metrics around operations cost and expectations that the team will be judged on throughout the year.
The Leader or manager needs the entire team understand this, so that their folks can help do their part in managing the overall budget.
If your team is aware of the parameters, and they are working with you to manage your budget, then everyone can likely enjoy some possible extra compensation and some new toys or gear like SAT phones and GPS's cool guy stuff (assuming you do did a good job managing your budget during the year). Perks are certainly possible, and fun for everyone to enjoy, but you can only get them if your team is performing.
So yes, money makes the world go round. And exhibiting good judgement, attention to detail and discretion when it comes to the daily and mundane, as well as the programmatic and big picture will certainly help you go far in the Executive/Close Protection field. What have you found to be the biggest challenges in terms of managing expenses, either on the ground, or within a corporate culture? I'd love to hear your thoughts on this, and if you have some best practice ideas, please share!
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