Book traces journey of SIS Group, discusses its challenges post demonetisation

A new book discusses the journey of private security firm SIS (Security and Intelligence Services) across various sectors like security, facility management and cash logistics and the role it played after the demonetisation announcement - evacuating old notes to banks from ATMs and then refilling reconfigured and recalibrated cassettes in these machines with new cash.

In ''The S.I.S. Story: How an Accidental Entrepreneur from Bihar Created a Global Services Conglomerate'', author Prince Mathew Thomas captures the spirit of entrepreneurship from the era of Licence Raj to economic liberalisation to the present. The shaping of an industry, the forging of a unique work culture and the complex passage through professionalisation and generational transition - SIS has seen it all in its 50-year journey.

In 1973, inspired by socialist leader Jaiprakash Narayan, Ravindra Kishore Sinha, a journalist earning a meagre salary of INR 250, quit his job and set up SIS (Security and Intelligence Services), a private security firm aimed at helping ex-servicemen get employment as private security personnel. Today, SIS is regarded a multi-billion-dollar conglomerate and ranks among the top 10 private employers in India with more than 3 lakh employees, and over 22,000 clients across various sectors, including security, facility management and cash logistics.

On the evening of November 8, 2016, after Prime Minister Narendra Modi made the announcement on demonetisation during an address to the nation, SIS Group's Managing Director Rituraj Sinha, who was also chief of the Cash Logistics Association, got a call from a senior government official asking him to come to ammeting the next morning.

''Rituraj prepared a note to present at the meeting. It was on the role the industry could play in taking back the old notes. And how fast the whole exercise could be done with the new notes. He later presented the note to the Ministry of Finance, with Finance Minister Arun Jaitley in attendance. The government and the central bank acknowledged the suggestions made by Rituraj. And soon the directive came,'' the book says.

A war room was set up in Mumbai. It included representatives from the cash logistics industry, banking, original equipment manufacturers of ATMs and companies who managed ATMs. At that time, SIS managed about 15,000 ATMs and also had a fleet of about 3,000 cash vans.

The book then mentions the complicated situations SIS faced. ''Many of the Rs 500 and Rs 1,000 notes were soiled and damaged. Not all banks were ready to accept these. But the RBI came down upon the banks to accept them. Second, all the notes had to be 'evacuated' from the ATMs. For this, the machines had to be disconnected so that nobody from the public could operate them,'' it says.

But then, another problem cropped up. Banks refused to accept these notes as they didn't have the space to keep the thousands of bundles that came in. ''Instead, SIS decided to park these notes in its own vaults across the nation,'' the book says. According to the author, the only currency notes in circulation were of smaller denominations. ''If you withdrew Rs 500 or of Rs 1,000, instead of a single note, now you got five and ten notes respectively of Rs 100. This meant that the ATM cassettes, which could hold only so many notes at a time, were getting emptied in no time. That's when the government put a limit for daily withdrawal at Rs 2,000,'' he writes. Talking about another big challenge that the demonetisation drive threw up, he says, ''While it was novel of having thought about a new Rs 2,000 currency, its dimensions were different from the notes that were in circulation. Even the new Rs 500 note was of a different size. That mattered a lot in the logistics of managing an ATM as the cassettes are designed as per the size of the notes.'' So the cassettes in all the ATMs needed to be reconfigured and recalibrated. ''And this couldn't be done by the guards and custodians that companies like SIS usually deployed. It needed engineers. At the same time, given the safety and security aspect of an ATM, an engineer alone couldn't have been given access but needed to be accompanied by security. This added to the complexity,'' the book, published by HarperCollins, says.

Despite these challenges, SIS Prosegur managed to reconfigure and recalibrate 96 per cent of the ATMs in its contract within 10 days, it says.

The book says that demonetisation, interestingly for the first time, brought some bargaining power for the cash logistics industry in its negotiations with banks.

''On the whole, demonetisation was a coming-of-age moment for the cash logistics industry. SIS in particular, thanks to its own position in the industry and because of Rituraj's leadership, shone bright,'' it says.