September - October 2014 by Loss Prevention Magazine

V13.5

LPPORTAL.COM | V13.5 SEPTEMBER - OCTOBER 2014

MAGAZINE

LOSS PREVENTION

MAGAZINE THE VOICE OF LOSS PREVENTION

THE EVOLUTION OF THE LP PROFESSIONAL WHAT WILL LP LOOK LIKE IN THE FUTURE?

THE EVOLUTION OF THE LP PROFESSIONAL

WHAT WILL LP LOOK LIKE IN THE FUTURE? INTERVIEW WITH U.S. ARMY BRIG. GEN. (RETIRED) BECKY HALSTEAD

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CONTENTS 6 PUBLISHER’S LETTER Hitchhiking Or Driving the Technology Superhighway? By Jack Trlica

8 ON THE WEB 10 RETAIL SPONSORS

The Evolution of the LP Professional

12 INTERVIEWING Preparing the Final Statement: Part 2 By David E. Zulawski, CFI, CFE and Shane G. Sturman, CFI, CPP 24 ACADEMIC VIEWPOINT A New Employee Theft Study By Richard C. Hollinger, Ph.D.

What will LP look like in the future?

By Jack Trlica and Jacque Brittain, LPC

36 PARNERING WITH RETAILERS A Joint eBay and Karen Millen Investigation By Zuzana Crawford, eBay

48 EVIDENCE-BASED LP Making an Impact Ten Years Going By Read Hayes, Ph.D., CPP

The First Person You Must Lead Is You

50 ASK THE EXPERT Video Surveillance Tools: Seeing the Big Picture With Mike Dunn, BSI

An Interview with Brigadier General (retired) Becky Halstead

58 CERTIFICATION Building Careers, Validating Expectations With Santo Zenone, LPQ, Gap Inc.

By James Lee, LPC, Executive Editor

60 SOLUTIONS SHOWCASE - USS - Tyco Integrated Security

Racial Profiling: We Can No Longer Just Turn Our Heads

62 CAREER DEVELOPMENT Mentoring the Big Jump By Jason Odell, CFI 64 ASSOCIATIONS IN ACTION ASIS International’s Retail LP Council By Keith Aubele, CPP, LPP

Retail’s response to recent high-profile accusations

68 INDUSTRY NEWS Weakening Consumer Demand Influencing Retail Results? By Robert L. DiLonardo

By Jacque Brittain, LPC, Editorial Director, Digital

Inspiring Integrity

CALENDAR

ADVERTISER DIRECTORY

VENDOR SPONSORS

74 PARTING WORDS Sitting Over Coffee One Morning By Jim Lee, LPC

How the dressbarn AP department supports the company mission

Interview with Brian Bazer, AVP of Asset Protection and Risk Management

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PEOPLE ON THE MOVE

70 DIGITAL DIALOGUE Cold Heads, Warm Hearts, and Social Media By Jacque Brittain, LPC

SEPTEMBER - OCTOBER 2014

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PUBLISHER’S LETTER

Hitchhiking Or Driving the Technology Superhighway?

e often talk about how the loss prevention role has evolved over the past decades from a silo-based, reactive security function to a much more wide-ranging, proactive team member in the retail enterprise. But where do we go from here? We posed that question to a large number of retail and solution provider leaders to solicit their thoughts on how the evolution of the retail environment will affect LP professionals’ role over the next several years. The feature article on page 15 is essentially a compilation of their insights and opinions. We have tried to report the common themes as well as the unique perspectives. If there was a consensus, it came down to technology—more specifically, the impact of data.

LP professionals should not simply hitchhike on the technology superhighway, but proactively help steer the direction and drive the solutions that will optimize retail performance in the coming years.

MAGAZINE

intimately involved, even if it requires forcing the issue within their corporate structure. It also means that current LP executives must school themselves in areas that may feel foreign and uncomfortable. This topic is intended to stimulate both individual self-assessment and industry dialogue in order to help ensure that LP professionals do not simply hitchhike on this technology superhighway, but proactively help steer the direction and drive the solutions that will optimize retail performance in the coming years. No matter how the LP role changes, one thing that will always be important is leadership. It’s a topic we cover often and in a variety of ways. This issue we have interesting insights from two very different perspectives. The first on page 27 is from retired U.S. Army Brigadier General Rebecca Halstead, who, among other firsts, was the first woman in the history of the U.S. military to serve as a commanding general in combat. Jim Lee (an Army brat himself) interviewed Becky, as she likes to be called, about her career and the leadership insights she learned along the way. If you wonder what wisdom a military leader can offer an LP professional, read the article to find out. The second is from Jason Odell, a senior field LP practitioner, who offers his advice on mentoring store- and district-level LP professionals as the make the “big jump” to larger roles (see page 62). His practical suggestions are worthy of consideration by anyone wanting to help others successfully climb the career ladder. These are just three of the many interesting, thought-provoking articles in this issue. There is something for everyone, whether you are store-level or C-level, retailer or solution provider. What do you think? We invite your thoughts and opinions. Please contact us at editor@lpportal.com.

The rapidly emerging technologies around Omni-channel retailing, mobile POS, e-commerce, RFID, social media, and countless others are both creating and requiring the access to and understanding of big data to implement a customer-centric retail environment, while protecting both the customer’s privacy and the retailer’s profits. This will require the current and next generation of LP executive to not only embrace technology, but become a skilled user and advocate for big-data applications across the retail enterprise. That means that LP can no longer relinquish Jack Trlica the company’s technology, data protection, and cyber-security efforts to their IT peers. LP must be Editor and Publisher

LossPrevention, LP Magazine, and LP Magazine EU are service marks owned by the publishers and their use is restricted. All editorial content is copyrighted. No article may be reproduced by any means without expressed, written permission from the publisher. Reprints or PDF versions of articles are available by contacting the publisher. Statements of fact or opinion are the responsibility of the authors and do not necessarily represent the opinion of the publishers. Advertising in the publication does not imply endorsement by the publishers. The editor reserves the right to accept or reject any article or advertisement.

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700 Matthews Mint Hill Rd, Ste C Matthews, NC 28105 704-365-5226 office, 704-365-1026 fax EDITOR AND PUBLISHER Jack Trlica JackT@LPportal.com EXECUTIVE EDITOR James Lee, LPC JimL@LPportal.com EDITORIAL DIRECTOR, DIGITAL Jacque Brittain, LPC JacB@LPportal.com CONTRIBUTORS Robert L. DiLonardo Dave DiSilva Read Hayes, Ph.D., CPP Richard C. Hollinger, Ph.D. Walter Palmer, CFI, CPP, CFE Gene Smith, LPC Shane G. Sturman, CFI, CPP David E. Zulawski, CFI, CFE CHIEF OPERATING OFFICER Kevin McMenimen, LPC KevinM@LPportal.com DIRECTOR OF MARKETING Merek Bigelow MerekB@LPportal.com DIRECTOR OF DIGITAL OPERATIONS John Selevitch JohnS@LPportal.com SPECIAL PROJECTS MANAGERS Kat Houston, LPQ Justin Kemp, LPQ Karen Rondeau DESIGN & PRODUCTION SPARK Publications info@SPARKpublications.com 704-844-6080 CREATIVE DIRECTOR Larry Preslar ADVERTISING

ADVERTISING MANAGER Ben Skidmore 972-587-9064 office 972-692-8138 fax BenS@LPportal.com EAST COAST REP Kristie Thymes 972-782-9841 office 972-692-8138 fax KristieT@LPportal.com SUBSCRIPTION SERVICES

NEW OR CHANGE OF ADDRESS myLPmag.com POSTMASTER Send change of address forms to Loss Prevention Magazine P.O. Box 92558 Long Beach, CA 90809-2558 LossPrevention aka LP Magazine (USPS 000-710) is published bimonthly by Loss Prevention Magazine, Inc., 700 Matthews Mint Hill Rd, Ste C, Matthews, NC 28105. Print subscriptions are available free to qualified loss prevention and associated professionals in the U.S. and Canada at www.myLPmag.com. The publisher reserves the right to determine qualification standards. International print subscriptions are available for $99 per year payable in U.S. funds at www.LPportal.com. For questions about subscriptions, contact circulation@LPportal.com or call 888-881-5861. Periodicals postage paid at Matthews, NC, and additional mailing offices.

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ON THE WEB

EDITORIAL BOARD

These days at LP Magazine are a whirlwind. And never is that more apparent than what’s happening on the magazine’s digital front. Take a look below.

Leo Anguiano, LPC Senior Director, Asset Protection Rite Aid

Karl Langhorst, CPP, CFI Corporate Director, Loss Prevention, The Kroger Co.

Jim Carr, CFI Senior Director, Global Loss Prevention, Rent-A-Center

Bob MacLea Senior Vice President, Loss Prevention, TJX

Francis D’Addario Emeritus Faculty Member, Strategic Influence and Innovation, Security Executive Council

John Matas Vice President, Loss Prevention, Investigations, & Technology, Macy’s

You Make Us Better

Our 2014 annual readership study launched in late August. In the first 24 hours we exceeded the total survey respondents from last year. Yes, an opportunity to win a $50 Visa gift card always helps, but it’s also a testament to the level of engagement from you—our readers— and the momentum we’ve generated this year. Thank you to all who have already completed the survey. If you have not yet completed this survey, please do. Go to surveymonkey.com/s/2T6VR6F.

#ICEBUCKETCHALLENGE

In case you missed it, LP Magazine—along with millions of our closest friends—took the Ice Bucket ChallengeTM to raise awareness for ALS. We challenged Powered by LP Magazine everyone named in the July-August issue to participate and, more importantly, donate to this important cause. To date, ALSA.org has received over $104 million in donations as a result of this epic social engagement. Thank you to the Loss Prevention Foundation, Loss Prevention Recruiters, Sysrepublic, Agilence, eBay, Alpha, our fellow team members, and many others who dumped and donated as a result our challenge. You may be over the idea of dumping a bucket of ice cold water on your head this Fall, but take a moment to donate to ALSA.org if you can.

Charles Delgado, LPC Vice President, Asset Protection, Meijer

EYEONLP

Patti Felz Vice President, Loss Prevention, Polo Ralph Lauren Scott Glenn Chief Security Officer, Sears Holdings Tim Gorman Divisional Vice President, Loss Prevention, Asset Protection and Business Continuity, Walgreens Barry Grant Chief Operating Officer, Canadian Images Bill Heine Senior Director, Global Security, Brinker International

Two Is Better than One

Sonya Hostetler Vice President, Asset Protection & Safety, Walmart Stores U.S.

At least we think so as it relates to the LP Magazine app and the version 2.0. The newest version of the app includes in-app videos, podcasts, bookmarking, more news categories, and links to the latest association conferences and events across the industry. It’s our way to get more relevant LP news to you—when you want it. The new version is available on both iPhone and Android devices. If you already have the app, it’s a quick update. If you don’t have the app, well then, what are you waiting for? Catch up! Scan the QR code here to find links to the version you need.

LinkedIn Group

Powered by LP Magazine LinkedIn is not only a place for networking and connecting with individuals across our profession, but it’s also a forum for group discussions. So, let’s get talking, sharing ideas, and collaborating. Our group, Powered by LP Magazine, is growing daily. Join in the conversation. We want to hear from you.

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SEPTEMBER - OCTOBER 2014

Chris McDonald Senior Vice President, Loss Prevention, Compass Group NA Randy Meadows Senior Vice President, Loss Prevention, Kohl’s Melissa Mitchell Director of Loss Prevention, LifeWay Christian Stores Dan Provost, LPC Vice President, Global Loss Prevention, Staples Tina Sellers Director of Loss Prevention, Delhaize America Mark Stinde Vice President, Asset Protection, 7-Eleven Paul Stone, LPC Vice President, Loss Prevention and Risk Management, Best Buy

Frank Johns, LPC Chairman, The Loss Prevention Foundation

Claude Verville, LPC Vice President, Loss Prevention, Safety & Hazmat, Lowe's

Gary Johnson Vice President, Loss Prevention, The Vitamin Shoppe

Stanley Welch, LPC Vice President, Director of Loss Prevention, JCPenney

Paul Jones, LPC Senior Director, Global Asset Protection, eBay

Keith White, LPC Senior Vice President, Loss Prevention and Corporate Administration Gap Inc.

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Join these great companies as an LP Magazine corporate sponsor. Email JackT@LPportal.com for more information. LP MAGAZINE | SEPTEMBER - OCTOBER 2014

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INTERVIEWING

Preparing the Final Statement: Part 2

n our last column we discussed the various types and uses for statements. Plus, we provided a general structure for the interviewer to follow while drafting the document. In this column we will discuss the contents of the statement and gaining the cooperation from the employee to write one.

A Moment Frozen in Time

A well-crafted statement freezes the moment of the admission or confession, providing the reader a snapshot into the mind of the guilty party. We should not be surprised someone might change his story when the reality of the consequences of his actions finally hits home. Now he stretches the truth, and the lies are formulated to try to take back the admissions or question their voluntariness. The statement stands as a moment frozen in time illustrating the voluntariness with the details substantiating the admission. The statement is the final component of the development of the admission reducing the confession to a permanent form. Many times the interviewer will have made contemporaneous notes of the subject’s admissions and the details surrounding them. These notes can be transcribed into the written report then destroyed, they can be maintained as part of the case file, or they can be part of the evidence against the subject. If there is any question about whether the associate will write a statement or maintain his continued cooperation, the investigator should bring another witness into the room to recap the subject’s confession. The investigator goes through the admission giving the subject time to expand on the topic before moving on to the rest of his statements in the presences of the witness. It is also useful to have the subject talk about how he was treated and the voluntariness of his admissions before moving on to the written statement.

Verifying the Notes

As an intermediate step before obtaining a written or recorded statement, it is sometimes useful to have the subject initial the investigator’s notes certifying to

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by David E. Zulawski, CFI, CFE and Shane G. Sturman, CFI, CPP

Zulawski and Sturman are executives in the investigative and training firm of Wicklander-Zulawski & Associates (w-z.com). Zulawski is a senior partner and Sturman is president. Sturman is also a member of ASIS International’s Retail Loss Prevention Council. They can be reached at 800-222-7789 or via email at dzulawski@w-z.com and ssturman@w-z.com. © 2014 Wicklander-Zulawski & Associates, Inc.

their correctness. These notes then become part of the evidence supporting the written statement. The investigator might suggest, “Here let’s take a look at my notes to make sure they are correct. Now you said...Does that seem right to you? Okay, then if you could just put your initials right there to indicate it is correct. Great, now here you said…” The investigator leads the employee through the notes asking him if the notations are an accurate reflection of what he said. If the employee agrees the notes are accurate, he is asked to put his initials next to each admission and then to finally sign and date the document. This intermediate step gets a pen into the subject’s hand and helps ease the transition to the written statement, using date, initials, and a the subject’s signature.

A Letter of Explanation

When presenting the idea of writing a written statement, it is useful to reframe the statement as a “letter of explanation.” This terminology seems less formal than calling the document “a statement,” yet it is an accurate reflection of the ultimate content. The letter of explanation can be introduced in the following way. Interviewer: “Okay, let me ask you this: Are you sorry about what happened?” Subject: “Yes.” Interviewer: “Great. Then I think you should have an opportunity to say you are sorry and make an explanation for what happened and why. I am sure you would be willing to do that, right?” Subject: “Yeah.” Interviewer: “Okay, here is a pad and pen. Today’s date is August 12th.” The subject now has a pen and paper and writes the date at the top of the page. In the event he does not write the date, the interviewer can point to the top of the page and suggest the date be placed there. The interviewer is not dictating the statement, but is helping to format the topic and admissions. In effect the completed statement looks like a narrative without the questions posed by the investigator. If the interviewer proposes to use a

SEPTEMBER - OCTOBER 2014

continued on page 14 |

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continued from page 12

question-and-answer statement, then the questions are listed prior to the subject’s responses.

The Body of the Statement

The body of the statement is critical, since it establishes the elements of the crime or policy violation and provides the substantiation of the subject’s confession. Generally, this portion of the statement begins with the total admission, such as “I stole $500 in cash and $850 in merchandise from Acme store 6526 during the last six months.” Including the word “stole” in the sentence provides the element of the crime of theft—the person took money and merchandise without permission and intending to permanently deprive the owner of its asset. However, this statement alone does not tell the full story of how the employee arrived at these amounts.

The final statement freezes the moment in time for a detailed examination of the employee’s attitude, truthfulness, and voluntariness of his admissions during the interview. The statement is like a period at the end of a sentence— without a period the sentence is incomplete. Without a good, complete final statement, the interview is incomplete. The next section of the statement addresses the calculations leading to the preceding admission and how they were determined. If part of the cash theft involved the use of fraudulent refunds, these can be identified and initialed by the employee then the appropriate details from them are included into the statement. Typically, one might include the refund’s date, identifying number, and dollar value. If the theft also included money taken directly from a terminal, the subject might be asked to identify the amount he stole using an over/short report. The employee can initial those amounts on the report that he stole. He then dates and signs the report, which will become part of the evidence supporting the written statement and admission. If the money was used for a particular purpose, this could be included in this section as well or detailed later in the statement. The more details about what the money was used for, the more likely it could be substantiated if necessary at a later date to further support the truthfulness

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of the document. For example, if the employee’s vehicle had been repossessed, it might be useful to know the bank, number of missed payments, and date of repossession. This is information known only to the employee, which increases the believability of the statement and that it was actually made by the employee. When the merchandise is detailed, there should be as much information as possible included to identify the item. This might include SKU, price, color, and any other identifying features. If there are inventory documents showing missing items, the employee could identify the items he stole, initialing them then dating and signing the document. The way in which the employee stole the items can also be documented and, if appropriate, a diagram could be produced to illustrate how the items were concealed and removed from the store. The diagram should be signed and dated by the employee like all the other supporting materials mentioned in the statement as supplemental evidence in the case. Should the employee offer explanations for case evidence, this can also be included in the statement as well. If the explanation is a fabrication, it should be included since this will speak to the credibility of the individual if it can be disproved. The employee can add explanations regarding why he became involved in dishonesty and his regret for doing so. He may also comment that the statement is the truth and was given of his own free will without any threats or promises being made to him. Finally, the statement is signed on each page and dated by the subject after initialing any scratch outs. The interviewer and witness also sign and date each page as well.

Outside Witness

Next, an outside witness can be introduced to hear the employee’s verbal admissions and review the written statement. It is useful to brief the witness in advance regarding what the employee admitted and help them with several questions to ask the associate during the recap. The interviewer can recap the associate’s admission when he returns to the room with the witness. Speaking to the witness, he reviews the confession allowing the witness to ask the prearranged questions and hear the associate’s responses. The interviewer may also ask questions about the associate’s treatment and truthfulness during the interview. If appropriate the interviewer may want to obtain additional statements from the witnesses about the interview process, employee’s admissions, and his treatment during the interview. Effectively, there are now three witnesses to the associate’s confession, plus a detailed substantiated statement to support a termination or prosecution. The final statement freezes the moment in time for a detailed examination of the employee’s attitude, truthfulness, and voluntariness of his admissions during the interview. The statement is like a period at the end of a sentence—without a period the sentence is incomplete. Without a good, complete final statement, the interview is incomplete.

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COVER FEATURE

THE EVOLUTION OF THE LP PROFESSIONAL WHAT WILL LP LOOK LIKE IN THE FUTURE? By Jack Trlica and Jacque Brittain, LPC

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THE EVOLUTION OF THE LP PROFESSIONAL

hat is the role of loss prevention? What may seem to be a relatively simple question has grown increasingly more complicated as various functions, philosophies, tasks, and responsibilities are debated by the LP community, those who we serve, those who support us in meeting our goals, and those outside the retail circle who draw their own conclusions based on what they see, hear, and experience. Often the dialogue can more accurately be described as discussions focused on the variables that distinguish a specific approach to the role, such as the methodologies of a particular retailer. Other times we fall back on the common vernacular—to reduce losses and shrink. But even this falls short of truly describing the role as it has evolved over the past decade. Sure, that answer is more advanced than what was valid in the past—to stop theft. But it still doesn’t accurately portray how far we’ve come.

in the retail industry. Yet the common assessment is that this is merely a glimpse of what lies ahead. Retail is rapidly evolving. The way that we shop, the products we buy, and even the way that we pay for goods and services is changing in ways that we never would have expected just a few short years ago. As the gap broadens between where we were and where we’re headed, our role will definitely continue to evolve as well. But how will it change, and to what extent? What, if anything, will be different? What steps can we take to lead the parade, rather than watching it pass us by? To help us find the answers, LP Magazine canvassed a large number of loss prevention executives, solution providers, and other thought leaders to garner their insights and opinions on the subject. We compiled those responses to provide both general consensus and specific views on the ways that they see the role of loss prevention evolving, some of the hurdles that we will face in the

as how to best leverage technology to combat shrink and loss from all sources. But the tools alone weren’t at the pinnacle in the minds of most respondents. Rather, it was our ability to adapt to technology that will have the greatest influence on our role. According to one retail leader, “The most significant changes will center on business intelligent tools and, more importantly, how loss prevention executives embrace and utilize them to impact additional parts of the business.” As these complex tools become more commonplace, LP practitioners must adjust, adapt, and develop to understand the utilization of these tools and the overall impact on the enterprise. Awareness isn’t enough, and legitimate efforts must be supported by training and education. This will allow LP executives to become even more actively engaged in impacting the profitability of their organizations. “The capacity for an LP professional to adapt to technology trends will define their career. Early

Technology is changing society, and society is changing retail. In general the rapid changes in technology are the primary driver impacting the role of the loss prevention in the years to come. This includes both preventing the exposures that new technology may present as well as how to best leverage technology to combat shrink and loss from all sources. More succinctly, the role of loss prevention is to enhance the profitability of our companies, just like every other role in retail. Most certainly, reducing losses and shrink was, is, and will always be a critical aspect of that role. But as the industry has continued to evolve into a wide-ranging profession, the role continues to develop as well; taking us down a more global path with broader responsibilities and higher expectations. Where we are today is only the beginning. The recent past has seen a massive wave of growth, changes, and challenges

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process, the skills and resources necessary to power the transference, and how that will drive the future of the industry.

The Impact of Technology

Technology is changing society, and society is changing retail. While there were many significant examples identified, in general the rapid changes in technology were seen as the primary driver impacting the role of the loss prevention in the years to come. This includes both preventing the exposures that new technology may afford as well

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adaptors will increase their value while laggards will struggle,” says another retail executive. The impact of technology will lead to reassessments of a variety of business functions. Technology will drive trends in areas such as mobile POS, emerging selling concepts, and business analytics. Intelligent CCTV systems with analytics technology will continue to have a bearing on how LP performs in the stores, but will take on additional value as part of other retail applications. Use of data and predictive

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THE EVOLUTION OF THE LP PROFESSIONAL indicators, cloud computing, and business intelligence will enhance processes as well as investigations. Many also believe that RFID will finally take on a bigger role in effectively managing inventories, from original purchase or manufacture until it ends up in a customer’s hands. This may also expand the role of LP into areas that until now were considered non-traditional, such as energy savings, SKU rationalization, accident reduction, and business continuity.

Omni-Channel Retailing

The emergence of Omni-channel retailing as a growth-driver will have a substantial impact on the role of loss prevention. As described by one industry leader, “As the retail industry continues to consolidate, increase in complexity, and expand Omni-channel solutions, the role of LP will change significantly.” Omni-channel retailing will enable customers to purchase what they want, when they want it, how they want to pay for it, and how they want it delivered.

There are some retailers who are thriving because they have been able to seamlessly offer an Omni-channel shopping experience. However, the move toward the infinite store is also creating new areas that need to be secured, such as networks and customer data. LP professionals are increasingly being asked to bring their specific skills into areas where they never participated before, causing a shift in responsibilities. As an industry, it is critical that we understand how these strategies are being developed. Many new supportive processes lack the backend systemic controls that prevent fraud. And the evolution of new applications and equipment can have a significant impact if not properly managed. “Retailers are going to continue to find creative ways to conduct business and sell to customers. Loss prevention will need to stay very close to these creative methods and retailing channels to ensure LP practices are appropriately woven into the strategies that our merchants and operators develop,” claims one retail leader.

A Wealth of Information

“When it comes to retail, data volume will become massive, and the speed at which data becomes available will increase exponentially and be instantaneous,” suggests a solution provider. “Success will be measured by how it is used by retailers for competitive advantage and higher store performance metrics of all kinds.” The dual role of increased data and analytics will create a shift in thinking that will change many roles in retail, including LP. The capability to access data and use it to build analytical solutions will drive higher performance for those retailers who manage it with the greatest skill. We are becoming a real-time world with less and less privacy. Everything we do in public—and even many of the things that we believe may be outside the reach of the public eye—has the potential of going viral and putting companies in the spotlight. This impacts policies and procedures related to customer service, store design, training initiatives, product protection, and other critical business functions. Any and all of these factors can

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Feature 1 THE EVOLUTION OF THE LP PROFESSIONAL directly impact the brand and influence the business. While IT has been the primary business owner in most retail companies, participants strongly believe that loss prevention must take on an expanded, more proactive leadership role to ensure data is secured and properly managed. “Breach avoidance and protection of consumer and company proprietary information will continue to be a focal point for retailers for many years to come,” says one retailer. Data breaches are costing companies in many ways beyond the immediate financial losses, to include litigation, brand protection issues, and additional sales impact.

of the LP program to one that is more holistic in its general approach. Mobile POS can change shopping patterns, impact sales management, alter register areas, and cause a number of LP concerns. The ability to order product in the store may alter stock levels and physical product carried in the building. All of these developments will require a more versatile and strategic approach in managing risk and loss. Also, the continued migration of shopping from brick-and-mortar stores to virtual shopping channels will continue to have an impact on traditional retail LP roles, requiring us to broaden our view to include more non-traditional or non-retail

way risk management is thought of today [managing insurance claims], but identifying potential risks to the business, then deploying countermeasures to minimize those same risks,” suggests another retailer. One solution provider agreed, stating, “Our research findings continue to indicate that there is significant traction available for all-hazards risk management in the leadership space. Many corporate risk mitigation elements, including asset protection, business continuity, compliance, crisis, critical incident, LP, risk, and security have grown organically. We are now witnessing a trend to align strategic initiatives.”

The dual role of increased data and analytics will create a shift in thinking that will change many roles in retail, including LP. The capability to access data and use it to build analytical solutions will drive higher performance for those retailers who manage it with the greatest skill. According to another industry leader, “Having the LP organization partnered with the IT security organization will be the most effective way to improve security of both the actual data and the physical devices that collect and manage the data.” This includes coordinating investigative approaches and law enforcement relationships in the event of a breach.

Store Controls and Product Management

“I believe that there will be a significant evolution of the bricks-and-mortar stores that will lead to redesign of every aspect of a physical store. It is already happening in many places,” projects one retail executive. With product moving through different channels, the protection approach, resources, and technology will need to adapt quickly. This will cause a migration

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environments. As companies design the store of the future, LP protection strategies will need to evolve with it.

New and Expanded Responsibilities

As the retail landscape continues to change, LP roles will likely evolve in other ways to meet the needs of the business. With Omni-channel retailing continuing to expand the types of fraud will continue to widen; and LP will need to adapt to better understand the entire supply chain operation, from systems to processes. Prevention and response to violent acts in retail unfortunately continues to be a growing issue. Whether it is workplace violence or concerns with potential domestic or international terrorist acts, these issues continue to be at the forefront. “I see the profession changing into a risk management role; not in the

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Skills Needed to Meet these Changes

The training and education curriculum of the future LP professional is going to be broader business-based. LP leaders will need to be strategic thinkers as opposed to tactical thinkers. There is a greater need to understand the broader context of the overall organization to identify the risks that affect the company. This includes the ability to hold a conversation with anyone in the organization about basic business principles, including sales, finance, inventory management, and technology. As one LP leader suggests, “Education will be key, whether through industry-based educational materials or through formal education and advanced learning programs.” Greater competition in the job market from more streamlined departments could also lead to increasingly visible skill gaps,

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THE EVOLUTION OF THE LP PROFESSIONAL suggesting that LP professionals must become more well-rounded business leaders. LP practitioners must get ahead of this change through increased education and skill sets. Overall business acumen is a talent set that the LP community needs to increasingly emphasize. We have seen a significant shift in the business acumen of LP leadership over recent years, but this will be far more critical as the pace of change in the business increases. By the same respect, with technology developing at such a rapid pace, strong and effective training programs are just as critical as formal education programs. This would include sensitivity training, negotiation and communication skills, social media skills, and may include other skill sets that we have largely downplayed in the past, such as active shooter programs and other initiatives. Businesses are increasingly looking for more value from their people. Knowledge is at a premium, and now more than ever before we need to learn as it happens. This also requires a diverse team throughout the LP organization that

Being “relevant” is no longer good enough. The role of loss prevention is essential to enhancing the profitability of our companies. Today and heading into tomorrow, the industry must become much more ingrained in every aspect of the business. With new technologies will come new threats. Keeping pace with change will help make us part of the solutions. can infuse different ideas and different solutions will make any team stronger and more productive. Traditional LP talent will become less marketable and in demand, while analytical capabilities, business acumen, technical skills, and problem-solving at a strategic level will be highly sought after capabilities and backgrounds. A very selective process with regard to the personality and talent

make-up of the LP team along with a diverse group of LP personnel that can bridge the digital and physical linkage will be essential.

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THE EVOLUTION OF THE LP PROFESSIONAL years, primarily with respect to exception-reporting, case management, CCTV, alarm, EAS, and the variety of other resources and systems that we use. But as the retail landscape evolves, the LP practitioner must further leverage technology in order to adapt. Industry leaders anticipate that IT liaisons, cyber-security resources, IT experts, data analysis experts, video analytics, data security, and other technical support positions are likely to be a growing part of LP departments moving forward. States one practitioner, “The future of LP is heavily immersed in technology on multiple levels. Tomorrow’s, and

For example, the creation of corporate command centers that enable content experts, such as loss prevention, business continuity, information technology, corporate safety, and field operations, centrally designed to monitor the company. Nontraditional roles may also be included, including meteorologists, sensitivity officers, communications specialists, and social media experts to name a few. This command center could combine a multitude of functions and company resources to increase efficiencies, improve productivity, and save expenses. Many also believe that we will see an increase in the chief

the “expert in everything” will fade along with the legacy “silos” that have long been the norm in many companies, giving way to matrix-style organizations with leaders who have a broader scope of expertise and experience. Everything starts with leadership. We must always be looking for ways to have a “seat at the table” in discussions involving multiple areas of the business. This same thought process really is applicable at all levels of LP leadership. LP directors and vice presidents need to take a strong look at their current LP team, identifying their next generation of leaders. As underscored by one LP leader, “If we’re not interested in learning more

There is a significant evolution of the bricks-and-mortar stores that will lead to redesign of every aspect of a physical store. It is already happening in many places. With product moving through different channels, the protection approach, resources, and technology will need to adapt quickly. This will cause a migration of the LP program to one that is more holistic in its general approach. quite frankly today’s, LP organization should have those on the team who fully understand and have a working knowledge of that technology.” By the same respect, hiring specialized subject-matter experts is not enough. There will be a growing expectation that all LP team members embrace technology and quickly adapt to the needs of the business. We need to have people who understand e-commerce and today’s technology from a cultural standpoint. Our teams must embrace and exploit the latest tools, such as smartphones, apps, tablets, and similar resources.

Centralization of Responsibilities

Some predict that we will move closer to centralization of responsibilities.

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security officer (CSO) or equivalent role in retail, which would fit into this type of model.

about how our team can help drive the business, how can we expect others to see us as leaders?”

The Leadership Approach

Advances in Tools and Technology

Participants in the survey agreed that a different leadership approach shouldn’t be necessary for one primary reason. As summarized by one retailer, “Simply said, leaders who aren’t currently modifying their approach based on new information and new technologies aren’t leading. Great leaders aren’t managing change, they’re leading it.” Leaders must possess the ability to work cross-functionally in harmony with the overall business plan. LP executives should be constantly looking for ways to add value. New roles essential to drive business will set the stage for diverse leadership approaches. The days of being

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“There will be some incredible advances that will cause us to rethink how we operate in LP. I believe that fundamentally, technology will be the foundation of almost everything we face going forward,” reflects a retail leader. These technological advancements should support a proactive approach to the industry as a whole. The volume and accessibility to data is largely believed to be a factor that will revolutionize the decision-making processes and strategies of the LP professional. Data will provide fact-based analysis needed to impact the business and mitigate business losses.

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THE EVOLUTION OF THE LP PROFESSIONAL Facial recognition and smart cameras could also be a game changer. All of these advancements will allow us to look at the entire process in an integrated fashion. LP can then lead the transition so we are ultimately protecting all of the assets of the new company. “The migration away from brick-and-mortar to cyber-shopping will dramatically impact traditional LP roles. Look at the growth of online shopping in the past ten years, and imagine it 10 years from now. Will some type of drone delivery be reality and perhaps criminals intercepting drones be a new mode for shoplifting and theft?” asks one retailer.

Strong Enough to Bend

By the same respect, the rapid pace of these changes also means that the development-to-implementation time is getting shorter every day. As a result, it’s important that we make decisions that are fluent and flexible. Our approach should include living

strategies that can be modified as necessary and do not become obsolete as the evolution continues. We can no longer rely on “the way it has always been done” to successfully achieve our objectives. For example, this means that when the company decides to implement mobile POS, we must work together to identify how to provide protection from the vulnerabilities that we face rather than resisting or opposing the change. We also need to focus on how to better use our LP technology to make the entire company more effective and efficient, such as through the use of our CCTV equipment to enhance customer analytics. Productivity and efficiency are critical as resources continue to be challenged, and we are in a much better place if we’re leading the way.

Partnering with Solution Providers

Collaborative thought leadership that helps us to better understand the

tools that are changing retail is an essential aspect of future development. As stressed by one LP professional, “Solution providers are critical to assisting practitioners on emerging trends. Those that proactively adapt to these trends will lead the industry, drive innovation, and add value.” Retail leaders believe that those providers who see the landscape and forecast where retail is headed will be the ones who will have the greatest long-term success. With the transition to more involvement in the IT aspects of the business, all current and emerging LP products should all be considered part of a technical suite of solutions. As a result, the ability to have solution providers who can help the LP practitioner to best use these resources, educate teams, and facilitate communicate with IT departments will be at a premium. “As solution providers, we need to be experts in next-generation technologies, as well as experts in next-generation loss prevention. We

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THE EVOLUTION OF THE LP PROFESSIONAL need to apply this expertise and continue to meet and anticipate the needs of our clients by providing them with tools that are cutting edge, and continually evolving,” advises one vendor executive.

Bridging the Gap

Unfortunately, many industry leaders still believe that there is a substantial gap between what retailers need, as opposed to what the solution providers believe they want. This was a common theme echoed by the retail practitioners. “I am continuously amazed at how little solution providers know about our business and the complexity of what loss prevention professionals deal with every day,” says one. “Solution providers are in general still trying to sell old technology and not

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of collaborative partnerships. Like any relationship, it takes effort by both parties. “We choose how we approach relationships,” says one solution provider. “We should look at everyone with a sense of value. Treating providers as partners [versus simply sales people] is the most important step.” “If retail LP teams and technology buyers are more open, then their problems may get solved faster and more creatively. Collaboration is a much healthier approach,” suggests another. Both retail leaders and solution providers must be willing to take the steps to broaden their understanding of this tidal shift in retail. But just as important is the need for everyone to be willing to reach across the table to work together and take action.

Our Biggest Hurdle

As we step forward into a new age of loss prevention, embracing change was easily identified as the biggest hurdle for industry leaders to overcome. Our ability to adjust and adapt during this revolution of retail and determining how loss prevention best fits into the company strategy will help us ascertain how we can deliver the most value. We have to be willing to step out of our comfort zone, expanding our education, experience, and leadership roles. We have to be able to stay in front of the business, driving core processes and developing new tools while continuing to support the company strategy. Being “relevant” is no longer good enough. The role of loss prevention is

Both retail leaders and solution providers must be willing to take the steps to broaden their understanding of this tidal shift in retail. But just as important is the need for everyone to be willing to reach across the table to work together and take action. spending enough time on integrating technologies to impact future trends,” offers another. “We are often presented with solutions that don’t fit the current issues we face,” states still another retailer. These comments represent a significant area of opportunity. Regardless of whether a solution provider believes that these comments are accurate, these are a common perception that was shared by the respondents. It suggests that LP leadership is looking for true partners are good educators and advisors, as well as students of loss prevention. As one might expect, there is another side to the discussion. Many of the solution providers surveyed feel that there needs to be progress made on both sides of the table in the development

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Have we truly taken the opportunity to fully understand and appreciate the other side of our partnerships? Taking the time to both share and listen will help complement the technology with effective protection strategies and better working relationships. This is critical for retailers in order to get the results that they are looking for. This is also paramount for solution providers in order to tailor their products and service offerings based on what’s truly needed to help take the next steps. For those already taking the necessary steps to set themselves apart, this should provide ample reinforcement that they are on the right track. For those who are struggling in these relationships, it should provide a strong suggestion as to why the difficulty persists. SEPTEMBER - OCTOBER 2014

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essential to enhancing the profitability of our companies. Today and heading into tomorrow, the industry must become much more ingrained in every aspect of the business. With new technologies will come new threats. Keeping pace with change will help make us part of the solutions. Budgets and limited resources will always be a challenge, but should not be an excuse. As margins and competition tightens, our need to show our versatility, creativity, and value to the organization must continue to expand. As it holds true in every area of the business, we must continue to reinvent ourselves. That is simply the nature of retail. The difference today and in the near future is how rapidly that change must occur.

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ACADEMIC VIEWPOINT

A New Employee Theft Study

hen I was a doctoral graduate student at the University of Minnesota during the late 1970s, I began conducting research on employee theft. At the time this was an area of criminology that was virtually unexplored. I found that it was very hard to study this subject then, since few retailers were willing to let a social scientist have full access to the records on this subject. Over forty years later, the scholarly literature on dishonesty in the workplace is still understudied and poorly understood despite the best efforts of a handful of researchers. As such, I am always on the lookout for new and cutting-edge research on this topic. This month I wish to share the results of a quality employee-theft study that was recently published as a doctoral dissertation. The author is Dana N. Baxter. She completed her research while studying under Dr. Dennis Giever at Indiana University of Pennsylvania. She finished her dissertation this past spring and graduated in May. She is presently an assistant professor at Davis and Elkins College in West Virginia.

Employee theft is one of the most rampant and costly issues faced by today’s public and private business owners. Recent research estimates that business crime costs the U.S. approximately $186 billion annually. The title of her copyrighted study is Who is Taking the Shirt Off Your Back? A Multi-Method Analysis of Theft at a Specialty Retailer. Baxter graciously has given me permission to share the major findings and excerpts of her study in this column. For those of you who are interested, her entire dissertation is available to read on the Internet at the following link: hdl.handle.net/2069/2170.

Purpose of the Study

Baxter’s study examines the causes and cost of theft, both internal and external, at one particular specialty retailer chain and offers an explanation of motivation for those caught committing internal theft. Historically, crime has been perceived as an activity of the nonworking or lower-class members of

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by Richard C. Hollinger, Ph.D. Dr. Hollinger is professor and chair of the Department of Sociology and Criminology & Law at the University of Florida, Gainesville. He is also director of the Security Research Project, which annually conducts the National Retail Security Survey. Dr. Hollinger can be reached at rhollin@ufl.edu or 352-294-7175. © 2014 Richard C. Hollinger

society. Some still may not even consider illegal actions that occur during the course of business to be crimes at all. Employee theft is one of the most rampant and costly issues faced by today’s public and private business owners. Recent research estimates that business crime costs the U.S. approximately $186 billion annually. Most individuals spend the majority of their adult lives at their workplace, which makes the study of occupational deviance and theft critical, because the inclination towards criminal activity does not disappear once an individual enters into the workplace. The purpose of this study was to provide answers as to ■ Who is being caught committing theft, ■ The characteristics of store locations that lead to loss, ■ How much loss is occurring annually, ■ The cost of internal theft, ■ What prevention techniques are being used in an attempt to control and prevent loss, and ■ The motivations to commit internal theft as provided by those individuals who admitted to fraud at the specialty retailer. The results of the study add to the current literature, inform future research, and guide policy changes within retailers in regards to total loss, employee theft, and what may be done to prevent it.

Three-Phase Study

This study was an analysis of three different forms of data from one specialty retail chain with 1,000-plus stores with an emphasis on the variables that predict loss in stores. Baxter collected data in three different phases from 2005 through 2012. The initial phase was a total population design where nine independent variables were examined in terms of their impact on both dollar loss and shrinkage percentage. The second phase was a nonprobability sample of case files of former employees who had been caught committing a form of internal theft. This phase also included a review of the confession statement provided by the employee at the time of their termination interview. Finally, Baxter conducted eight interviews with members of the loss prevention department to flush out themes about both external and internal loss and to garner information about the types of prevention techniques used at this particular retailer in an attempt to deter crime. Baxter examined the effect of store location, store location type, store location environment, cash-and-wrap location, and use of camera surveillance. In addition, she was allowed to

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examine the personal statements made by apprehended dishonest employees. The shrinkage for this chain was 1.62 percent, which was slightly higher than the national average.

Expectations vs. Findings

Baxter expected to find that employee turnover and manager turnover were highly correlated with shrinkage, but did not find that this was a strong relationship. Instead, she found that the highest losses were found in those stores with the largest number of managers. Clearly managers do not cause theft, but this finding indicates that theft is highest in the larger stores, especially in malls located in urban areas experiencing higher levels of social strain. High levels of loss were also noted in “lifestyle centers” located in the wealthier suburban areas. Many of these stores had more doors and cash-wrap locations, which allow quick exit from the stores adjacent to major highways. Alternatively, rural stores had lower levels of loss. Finally, only 20 percent of the stores had CCTV, which did not have a clear deterrent effect. Interestingly, the higher loss stores were more likely to have public-view monitors, which raise the question of their deterrent effect on shrinkage. When Baxter looked at demographic characteristics of the dishonest employee, not surprisingly, she found that males, younger, and low-tenured associates were more likely to steal. She states, “The majority of employees caught committing theft were male, young (18–25), marginal (sales associates), and short-term employees (employed for less than one year).”

Assessments of LP Personnel

Baxter was also given access to case reports and confession statements that were made by employees who were apprehended. In addition, she was allowed to interview loss prevention personnel to get their perspectives on the causes of theft. For example, one typical respondent wrote in the statement, “I knew I was worth more,” indicating that he or she was unhappy with their level of compensation for the duties performed. Another indicated that there was conflict with the management team at the store. These statements support the notion that marginal, young employees with short tenures are likely to express frustration with their compensation and benefits. Baxter wrote, “Some of the individuals from the loss prevention department, including the director, echoed this information. The respondents felt that younger individuals had a poor work ethic, believed that they are not being compensated fairly for the tasks they are being asked to perform by the organization, and that these same individuals are bringing college and credit card debt to the workplace. In order to compensate themselves for perceived injustices and to pay for these pre-existing debts, young people took short-term marginal positions and quickly began to steal. Other LP associates believed young people tended to steal for extra fun money, believing they would never be caught by the organization, while older individuals took money for gambling debts, divorce, and medical bills. Another LP respondent surmised that younger individuals commit theft because they are trying to maintain an image, and use the brand (and subsequent theft from the brand) to maintain

that image, whereas older individuals are taking because of necessity due to financial responsibility, drug problems, or debts. It is clear from the responses that most loss prevention personnel believe that younger individuals are motivated by fun, maintenance of an image, credit card debts, and a general contention against hard work.

Analysis of Confessions

Baxter found that a common theme throughout the reviewed literature, including from some of my research, was dissatisfaction among employees leading to a greater likelihood of theft. To my surprise, this was not a common theme in the present research project. Baxter reports, “Although a few individuals identified a level of dissatisfaction in their statements, the majority of respondents did not expressly state a lack of satisfaction with their workplace. In fact, a great majority of individuals expressed remorse for their actions and adamantly indicated that the employer was not to blame for their participation in theft.

“The results from this study could be used to create policies that greatly increase the effectiveness in the prevention of internal theft within specialty retail. This study could also provide tangible information for loss prevention personnel in specialty retail to use when establishing hiring practices, and when trying to work with human resources on improving the culture of the business.” – Professor Dana Baxter A few factors could explain this general lack of dissonance expressed by theft participants. It is possible that the employees at this organization feel that they are treated fairly and equitable, therefore making it harder to steal from the organization, or rather making it difficult to blame the organization for the pilferage. Another consideration for this lack of expressed organizational dissatisfaction may be that the individuals who were disgruntled did not compose statements for the loss prevention department. The demographic characteristics of those who chose to complete statements versus those who did not were similar, but one must still consider that the motivational differences for these individuals could vary.

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Instead of dissatisfaction, Baxter found that confessions contained a financial theme for theft. “The financial theme had six sub-categories for individuals who further elaborated on life details that led to participation in occupational theft. In addition to the statements, several loss prevention members also discussed the financial pressures that lead employees into theft from work. Some members of the loss prevention department felt that some individuals are motivated by a personal financial need, such as sickness, family issues, or even death….These individuals discussed life events such as siblings with drug addictions and parents who are unemployed and in need of extra help. Six of the letters were personal medical issues or family medical issues, such as overpriced medications, parents having cancer, and grandparents who have numerous medical conditions like heart disease and diabetes. One respondent explained the difficulties of life after the death of a grandparent. This grandparent had a lot of debt from medical bills, and this debt fell onto the grandchild. The suggested motivations of the loss prevention members do appear to coincide with the justifications provided by some respondents,” she wrote. “In general, these individuals did not appear to express remorse in their written statements at the time of the interview. One loss prevention department member felt that the employees just do not believe they will be caught committing these acts, so the benefit outweighs the cost in their mind. Sixteen of the employees caught for theft participation did indicate that their reason was simply an opportunity arose within the store, and they made the decision to take it. Employees saw various incidents within the store as an opportunity for easy money. Opportunities such as a deposit bag full of cash being left unattended or a reprint of a charge approval slip for a customer. Others may have had the opportunity present itself in the form of a manager or co-worker explaining how to commit fraudulent returns, or a friend pressing the employee into overriding prices on items to create larger returns. Once these initial opportunities presented themselves and the employee was not caught right away, they seemed to rationalize that the behavior was acceptable and continued to participate in the theft.”

Indications of Theft Motivation

Although the Baxter did not test any one specific criminological theory in this study, some of the motivations provided in the case-file confessional statements aligned with both the routine activities theory and techniques of neutralizations. The components of the routine activities theory can be seen in the motivations coded as opportunity. A few respondents really narrow down onto the elements in their letters needed for crime to occur per the routine activities theory. An example from one letter has a former employee describing his family’s poor financial situation creating a need for money (motivated offender), a management staff that often takes unauthorized breaks away from the store (lack of a capable guardian), and subsequently leaves their register keys with the sales

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associates to make managerial financial authorizations within the store (suitable target). While analyzing the statements for the motivations provided, Baxter also noted that numerous statements contained phrases and descriptions that could be categorized into some of the techniques of neutralization. The “appeal to higher loyalties” neutralization materialized in several different statements. One respondent explained that the refund fraud was not occurring because of a need for money; rather this associate was attempting to improve the conversion rates within the store and help out the management team in increasing numbers. The associate’s claim thereby rationalizes that the deception was all for the greater good of the store, not for personal gain. Several other former employees claimed in their letters that the theft was not occurring for their own personal gain, but rather in an effort to help out a friend or a loved one. Once again, these individuals are insisting that the theft was not for them or about them, but for the greater good of someone they care about. The “denial of responsibility” was also alluded to in multiple letters. A poignant example of this neutralization came from one letter in particular. The writer of this letter expresses right from the beginning that this crime is a result of the bad economy, citing that “desperate times, call for desperate measures.” This respondent continues on with the denial of responsibility by explaining that “my parents, when I was young used my social security number to get by either getting loans or filing their taxes.” The associate claims that by the time this infraction was realized, the debt was already piled up with no sign of relief. Now, the individual is unable to ascertain a loan either from a reputable bank or from a friend. Therefore, this individual is not responsible for their subsequent actions while at work; that perhaps there was no choice in the matter, making the theft inevitable.

Implications for Future Research

Baxter states in summary, “The data collected in this study has implications in both the world of academia and in the business world, especially within loss prevention departments of specialty retailers. This is a relatively under-studied topic in the field of criminology and has the potential to be explored in further detail. Hopefully, this study is the catalyst for further research into other types of employee theft, employee deviance, workplace cultures and norms, and workplace ethics.” She adds, “The results from this study could be used to create policies that greatly increase the effectiveness in the prevention of internal theft within specialty retail. This study could also provide tangible information for loss prevention personnel in specialty retail to use when establishing hiring practices, and when trying to work with human resources on improving the culture of the business.” I could not state this any better. Hopefully, the next time that you are approached to participate in an academic research study, the actionable findings of this study will clearly justify the involvement of your firm.

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INTERVIEW

THE FIRST PERSON YOU MUST LEAD IS YOU AN INTERVIEW WITH BRIGADIER GENERAL (RETIRED) BECKY HALSTEAD By James Lee, LPC, Executive Editor

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INTERVIEW EDITOR’S NOTE: Rebecca “Becky” Halstead is a retired U.S. Army Brigadier General. She is the first general officer from her graduating class, the first female graduate of West Point to become a general officer, and the first woman in the history of the U.S. military to serve as a commanding general in combat. Halstead founded STEADFAST Leadership, a consultancy focusing on leadership training and motivational speaking. She is the author of 24/7: The First Person You Must Lead Is You. Halstead is the featured speaker at LP Magazine’s annual editorial board meeting in Savannah, Georgia, in September. EDITOR: When you first hear about General Becky Halstead and all the firsts that she has accomplished, I think the initial reaction is that hers is a story about women getting ahead in the military and business—a gender diversity story. That’s partly true, but reading your book, diversity has a different meaning for you. What is that? HALSTEAD: I had a really great boss once

who told me, “Becky, someday you’ll be a general, and I’m going to give you one piece of advice. Don’t surround yourself with little Becky Halsteads.” At first I thought, now what did he mean by that? His point was that if I surround myself with people who think like me, who look like me, who have the same experience as I do, then I won’t have the strongest team. On a strong team, the best solutions come from diverse inputs, and that comes from people who have diverse experience. I always say that character has no gender. A leader is a person of character and competence. That’s fusion of heart and mind. That’s what’s on the inside. It has nothing to do with what you see on the outside. If that’s the premise, then when you talk about diversity, you can use metrics like male-to-female ratios, different religious preferences, ethnicity, but those are more along the lines of equal-opportunity-type metrics. To me, diversity is having a group of people who truly think differently. When it came to my having to make decisions, I usually got about twelve different opinions. My charge as the leader is to listen to those opinions and

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then use some discernment to figure out what my decision will be. And it’s not an easy position to be in because you’re never going to please everybody. But you have to do what you think is absolutely right. EDITOR: After your retirement from the U.S. Army, you decided to become an author, consultant, and speaker on leadership. Why do that when your background in logistics could have paved the way for an executive position in corporate America? HALSTEAD: My dad asked the same

thing. Why would I not seek a C-suite position when I had all the experience in supply-chain management and leadership at such a high level? It’s because I enjoy sharing my experience with other people, not in a boastful way, but in a way that could help others develop themselves as leaders. I think that we underestimate the power of sharing our stories. I’ve had people come up to me after I speak and say, “What I heard today was exactly what I needed, like the kick in the butt or the pat on the back, to get me going and get me off a dime.” If I can share with other people the lessons I’ve learned from almost three decades of military leadership, both the blemishes and the successes, and if those lessons help another individual find a better version of themselves, that for me is very, very rewarding. I love SEPTEMBER - OCTOBER 2014

The reason I say that we all have at least one person to lead and that’s yourself is because I’ve run into a lot of people who say that leadership doesn’t come naturally to them. They’re not comfortable with it. I’ve always believed that that was a bit of a copout. I think that people fail to own their decisions and their choices and they just say, “I’m not a leader.” But in reality, they are, because everyone has to lead themself.

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INTERVIEW

Most surveys say that the number one thing that people want to see in their leaders is integrity. That’s true, but the only way to have integrity is to be disciplined, because it’s too easy to not have integrity. It’s too easy to take a shortcut. It’s too easy to not quite tell the whole truth. Integrity can be inconvenient. It can be uncomfortable. But choosing this harder right is what we’re supposed to do as leaders.

to help people find a better version of themselves. I felt like I could do that in this capacity much better than being confined to just one organization. EDITOR: Switching gears back to your formative years, what was it like growing up? Were there any early childhood experiences that led to your decision to apply to West Point? HALSTEAD: I always say that I’m

just a country girl from a town with no traffic light. The town is called Willseyville, in Upstate New York, and there’s still no traffic light today. My dad worked for IBM, International Business Machines, although we referred to it as I’ve Been Moved because in the first eight to ten years of my life we moved four or five times. I have two sisters and one brother, and we were very disciplined. It was very important that we had responsibilities and were held accountable between church, community, school, and sports. I had a great love of sports. I was the athlete in the family, even at five foot one, but it’s very easy to be an athlete in a town with no traffic lights because the competition is pretty narrow. But I learned that I loved being on a team and leading the team. So I decided in high school that

I would go to Ithaca College and be a coach and teach physical education. But in my junior year in 1976 my mother was reading in the newspaper that the president had approved a measure allowing women to go to the country’s military academies. She told me, “I think this sounds just like you.” I said, “Mom, I have no idea what you’re talking about.” She says, “No, listen to this. I think going to one of these academies sounds just like you.” I call my mom the renaissance mom because there’s no way in 1976 that most mothers were looking for their daughters to go to military schools, and so I said, “Okay, if you help me with the application,” which was a very lengthy process of writing your congressmen and your senators and getting letters of recommendation, “if you help me with that process, I’ll try.” Honestly, I had no concerns about being accepted; I knew I wouldn’t be. I had read about these schools. The kids that go are number one or two in their class and gifted athletes. The competition is incredibly fierce. I figured I was just doing it to please my mother. It was with great surprise that in the spring of my senior year, I actually received an acceptance letter from the United States Military Academy at West Point. It was probably the first time in my life that I remember being genuinely, completely surprised. Then I quickly went to being very scared and anxious, but what are you going to do? I couldn’t turn it down at that point. So, off I went to West Point, quite scared, quite uncertain. And after getting there I wanted to quit every single day. It was a very tough environment, but one that really helped me and shaped me into the leader that I am today. EDITOR: How does that experience at West Point—the yelling, the tough love, the hazing, the strong discipline—how does that relate to how you’re talking about leadership to corporate America? HALSTEAD: I think it’s very transferable.

First, the most important thing is that you have to know your own strengths and weaknesses, and you need to have the ability to lead yourself before you can ever lead anybody else. A big part of that leadership is being very disciplined LP MAGAZINE | SEPTEMBER - OCTOBER 2014

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INTERVIEW and obedient and knowing how to follow the rules. In that crucible of West Point, that’s exactly what you’re learning. The number one most important thing that I learned there was discipline. Actually, I shouldn’t say I learned it at West Point because I first learned it at home, but at West Point it is non-negotiable. The leaders that had the most effect on me were the ones who would get very, very close to my face so that I could feel their breath on my cheeks. They would just lean into me and then give me a good dose of what life was all about. They had my undivided attention. But I think that tough love helped push me to know my limits, my strengths and weaknesses, and how to best apply those to be the best leader that I could be. EDITOR: In your book, you identify five simple leadership truths, the first of which is, “You have at least one person to lead, and that’s yourself.” Where did this come from? HALSTEAD: When I retired and decided

EDITOR: You say that when you lead yourself better, you lead others better. You also talk about “improving your foxhole every day.” What does that mean? HALSTEAD: The foxhole is a defensive

that I wanted to create this business of sharing leadership, I decided I probably ought to frame what my leadership model is. And it is genuinely mine. I wrote it. I created it. I shaped it. But it is based on all those years of military training and the models of leadership that I witnessed or studied or saw in action. I try to give credit to whoever might have taught me a certain principle, but these leadership principles are, upon retiring and reflecting over that 30-plus years, what surfaced to the top as being the most important. The reason I say that we all have at least one person to lead and that’s yourself is because I’ve run into a lot of people who say that leadership doesn’t come naturally to them. They’re not comfortable with it. What I’ve found, especially with people who I’ve led, is that when they have shortcomings or failures as a leader, they want to say, “Well, I’m just not naturally a leader.” And I’ve always believed that that was a bit of a copout. I think that people fail to own their decisions and their choices and they just say, “I’m not a leader.” But in reality, they are, because everyone has to lead themself.

fighting position. You look at your perimeter, and you choose the place with the best visual of the enemy, the best natural protection. Then you dig a hole, you reinforce it with sandbags, you take foliage and camouflage it. The idea is that you don’t want the enemy to see you, but you want to see the enemy. It takes time to convert that piece of dirt, but this is the temporary home you’re making that you’re relying on to keep you safe. So, you must make sure to pay attention every day. As a leader I would walk that perimeter and ask soldiers, “Show me what your lanes of fire are. How are you sure you’re not going to end up shooting your fellow soldier next to you?” And that’s very applicable in business. We sometimes overstep our lanes, and we don’t mean to, but we take out a peer by something we say or do. I love talking about that fighting position and explaining how we can use our resources, our policies, our compliance, our risk factors; all those things to improve that foxhole every day. Of course in the loss prevention business that means minimizing loss and maximizing gain.

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I think that more of us should think about the legacy that we want to leave, and the legacy that we are leaving. Because I think what happens is it makes you start to think about your values, and whether your behaviors are reflecting those values. Because if they are, you’re going to touch lives. And when you touch lives you’re going to make a difference. That brings purpose to your life, and what greater position is there to be in than to have purpose?

continued on page 32 SEPTEMBER - OCTOBER 2014

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Maybe you think, “I’m too tired. I’m not going to dig that hole. I’m not going to grab any sandbags.” Then you’re the weak link on that perimeter. If that’s where the enemy gets in, you’ve just let the rest of the team down. The other beauty of always improving your foxhole, of making yourself better, of leading yourself better, is that the team becomes the beneficiary. A better me is always a better we. EDITOR: One of your leadership principles is, “Have integrity. Choose the harder right over the easier wrong.” What does that mean to you? HALSTEAD: Most surveys say that the number one thing that

people want to see in their leaders is integrity. That’s true, but the only way to have integrity is to be disciplined, because it’s too easy to not have integrity. It’s too easy to take a shortcut. It’s too easy to not quite tell the whole truth. Integrity can be inconvenient. It can be uncomfortable. But choosing this harder right is what we’re supposed to do as leaders. You don’t have to go all the way to Iraq or Afghanistan to find combat. Combat can be found right in our own families, in our own communities, in our own businesses, and it’s called lack of integrity. Maybe it’s not as obvious or grievous as a mortar or an IED or a bullet, but people lose their occupations, businesses fail, and economies crash when leaders lack integrity. EDITOR: You talk about your parents teaching you two life rules. Rule number one, don’t quit. Rule number two, refer back to rule number one. What is the difference between quitting and making an adjustment to the journey? HALSTEAD: Quitting is when you just go, “You know what? It’s

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too hard. It’s too inconvenient. It’s too uncomfortable. It’s too tough. Maybe I really don’t need this.” So we just give it up and go someplace else—maybe a different job, a different career, a different marriage, whatever. My grandmother used to say, “You stand your tallest when you’re on your knees.” Most people who’ve been through incredible crucibles, whether it’s surviving an illness, losing a home, being abused, or taking a failing company to a thriving company; most people will say that by maneuvering themselves through the storm, they come out the other side a much stronger person. I had a chaplain once say that most of us pray for the storm to go away instead of praying to get through the storm. I think that’s the tendency. We just want it to go away. We do live in a society where, if it’s uncomfortable, we want to quit and do something else. On the other hand, think about professional athletes and artists. They don’t win races and break records or become concert pianists because they were simply born with talent. They train, rehearse, and practice hours and hours per day in order to get to that level. I tell people that I wanted to quit every day. Let’s make sure that’s out on the table. I’m not some superhero that just liked everything I did, liked everybody I worked for, liked all the environments I lived in. On the contrary, moving eighteen times in 27 years, I was in a lot of places that I don’t care to ever go back to. I worked for bosses that were very toxic. But I learned through all those things. If I had quit every time I wanted to quit, I wouldn’t have the experience that I have today to share with others. I think people don’t realize the journeys that they’re giving up by just quitting.

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INTERVIEW EDITOR: In discussing one of your principles, “circulate, communicate, and connect,” you talk about an occasion when your boss turned to you and said, “Becky, you are too defensive.” What was the context of this experience and what did it teach you? HALSTEAD: That boss started the

conversation by saying he rated me number one of all the people that he rated. “Becky, I really like the way you lead. I like what you’re doing. I like the impact your unit is having.” Hearing that, you just wait for the other shoe to drop. “But if there was one thing I would tell you that you need to work on, it would be that you’re too defensive.” I immediately recoiled and asked, “Too defensive, sir? What do you mean, too defensive?” He smiled and said, “You go think about it, Halstead. You’ll figure it out.” And my goodness, it was a turning point. In the different interfaces that we had, he might ask me a question about the statistics in my unit or my mission

plan, and I would get very excited about wanting to explain it to him. I’ll call it passionate. And my energy level got higher. I talked faster. I got a little louder. And I’ll stereotype a little bit, but when women do this with men, men kind of shut down. They just put their hands over their ears and go, “Oh my gosh, I don’t know what I just asked, but remind me to never ask it again.” The leadership point that I try to make here is that you have to be very perceptive. You have to be aware of your surroundings, because what might be passion for you is uncontrolled aggressiveness or assertiveness to somebody else. So I should have been looking at him to see how he was responding, because I’m losing my vote if he stops listening to me. So, I thought okay, he’s not the one who’s going to adjust here. I’m the one who needs to adjust, so how do I do that? I’m not going to change my level of passion, but I am going to change my delivery. From now on, I’m going

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to pause. I’m going to take some time to think about my response. I’m going to turn the volume down a little bit so that I’m having a conversation and not look like I’m getting out of control. This realization really helped me be a better leader and identify the same challenge that some of the people that I led had with this. I would be able to pull them aside and say, “Let me share a story with you.” And then they start to see themselves in that story. EDITOR: Give us an example. HALSTEAD: In Iraq I had an incredible

colonel who was the subject-matter expert on IEDs—improvised explosive devices. The challenge, though, is that every time we put him in front of threeand four-stars, he would get so passionate about what he was saying that he sounded defensive, just like my boss said about me. I could see the lights going out with the people he was briefing. I pulled him aside and I shared this story, and it totally changed the way he delivered to

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INTERVIEW the higher strategic leaders in order to get the resources we needed to do the job. I don’t think I would have been as cognizant of that and as smart about that as quickly as I was if I hadn’t experienced it myself firsthand. EDITOR: In your book you talk about the principle of leaving a legacy. How do you view the importance of a person’s legacy? HALSTEAD: When people introduce me,

they often read the first parts of my bio, and, of course, those accomplishments are exciting and it was fun being a part of them. But at the end of the day if you ask me what I consider my greatest achievement, it has nothing to do with being first or number one at anything. What gives me the most satisfaction, what minimizes my regrets when I put my head on the pillow at night, is knowing that there’s somebody out there who is a better leader, a better person, because I was in their life. And I call that a legacy. On any given day when I get an email from somebody I’ve served with

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who is sitting on a mountaintop in Afghanistan or working in business, and they say, “I wish you were here, ma’am, because I’d like to throw some questions at you. But you’re not here. So what I’m going to do is keep asking myself ‘What would General Halstead do?’” There’s no greater feeling than knowing that there are people who looked up to you, respected you, and want to lead like you. Even more satisfying is when they surpass you. I’ve had several leaders who I coached and mentored who now are wearing more stars than I wore. I love that. I’m proud of that. I think that more of us should think about the legacy that we want to leave, and the legacy that we are leaving. Because I think what happens is it makes you start to think about your values, and whether your behaviors are reflecting those values. Because if they are, you’re going to touch lives. And when you touch lives you’re going to make a difference. That brings purpose to your life, and what greater position is there to be in than to have purpose?

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PARTNERING WITH RETAILERS By Zuzana Crawford

A Joint eBay and Karen Millen Investigation

Crawford currently serves as an asset protection investigator on the eBay Global Asset Protection PROACT team. She is the point of contact for retail partners in the U.K. and beyond regarding investigations into criminal matters with nexus to eBay marketplaces, classifieds, and PayPal financial services. Her responsibilities include protecting the brand and users by detecting early warnings of bad behavior, mitigating risk, losses, and exposures by actively functioning as a problem-solving team member offering viable solutions to reduce criminal activity, prosecute criminals, recover financial losses, and develop and foster strategic relationships with internal business partners, law enforcement, retailers, manufacturers, and other regulatory agencies. Crawford has seven years of criminal fraud investigations experience within the e-commerce space.

our years ago any mention of the name eBay would cause consternation among many U.K. loss prevention managers because it was widely perceived as accepting no responsibility for thousands of euros of suspected stolen goods or suspicious merchandise that was on the auction site, unless the matter was an active case in the hands of law enforcement. This antipathy was also the view of the team at Aurora Fashions, the parent company behind international fashion brands such as Karen Millen, Coast, and Warehouse, which has 1,250 stores and concessions worldwide. Today, eBay’s Global Asset Protection (GAP) team based in the U.S. and Dublin, has helped reshape this perception and its own landscape of loss as it sought to shift its position from global marketplace to global retail platform acting on behalf of many of the brands that had suffered from suspicious activity on the site. The context for this rapprochement is economic, and in the interests of brand protection, eBay does not want “bad actors” on its site as they are not conducive to good business. So the GAP team has made a 180-degree change in its approach, and now proactively reaches out to retailers through membership of each of the eleven ORIS Forums, and offers training on its free-to-use suite of fraud tools as well as actively assisting in investigations brought to their attention. The outcome has been dramatic. Below is an example of collaboration between eBay and Karen Millen that resulted in a high-level prosecution earlier this year. The story is one of a thawing relationship between the retail community and eBay and a new, long-term spirit of collaboration between Alice Houston, senior investigations officer for Karen Millen, and eBay’s GAP team, including Alicja Smardz and myself.

The Karen Millen Investigation

Alice Houston has worked in retail security and investigations for fifteen years. She has been with Aurora Fashions and Karen Millen as an investigator since 2003 and was promoted to investigations manager in 2008. She is skilled at data analysis, building case files, and regularly conducts investigations and interviews of suspects in the U.K. and Europe leading to prosecutions. Alice Houston In this particular case the Karen Millen concession in a department store within the Lakeside Shopping Centre had

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a poor stock loss result, an anomaly that stood out because reports were accurate to individual unit, color, and size. Broken clothes hangers and security devices had also been discovered in some of the fitting room areas. The Karen Millen concession manager met with the department store’s security team who were shown a photograph of a suspect female who they believed to be stealing womenswear items.

“What we got out of this investigation was a new sense of trust and partnership with eBay as well as a strong working relationship with Zuzana and her team. We were delighted with the approach.” - Alice Houston, Senior Investigator, Karen Millen Houston began the investigation by liaising with the manager of another concession within the same store to learn about their stock loss and to establish if they, too, had noticed any suspicious activity. She learned that at the beginning of April 2013, the other concession had a green maxi dress returned from a genuine customer. This green dress had been bought in a concession in another town and then returned, but was never stocked in Lakeside, so it was distinctive in their concession. The Karen Millen manager particularly noticed the dress because she liked it, and later the same day, when she went over to talk to the other concession manager, she noticed the dress was no longer on display. It had not been sold, but had “disappeared.” Later that evening, the Karen Millen manager looked on eBay for the branded maxi dress because it was so distinctive. She found a seller who had listed the same green maxi dress that day, which caused her to review the other items for sale, which were mostly Karen Millen merchandise.

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continued on page 38 |

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The manager then compared the unaccounted for items from her stock loss result to those currently for sale on eBay, as well as analyzing all of the feedback available to view previous items sold. Many of the items had been photographed in front of a window with a distinctive picture on the wall. As she was scrolling through other Karen Millen items for sale, the manager found another seller using the same window and picture as a background for the sale of yet more stock. Both sellers had described the items in detail and were selling the stock for a fraction of the retail price. The manager was able to identify a large amount of stock missing from her concession that matched the items for sale—down to same sizes. Both sellers were selling items located in Chelmsford, Essex, which would make Lakeside their nearest Karen Millen concession. The Karen Millen concession manager immediately informed Houston, who contacted the eBay team directly. The eBay team provided a list of all items listed and sold by both sellers, which was compared line-by-line to the stock loss. They matched. Houston obtained the other concession’s stock loss result, which matched the eBay list as well. eBay then provided Houston the full account holders’ details, registered addresses, telephone numbers, and IP addresses. Houston visited Lakeside and reported the activity to the Police operating within the shopping centre. Police obtained warrants for the two addresses on the eBay accounts. Twelve officers visited the addresses, but found no stock. The Police then obtained the details of a third address and executed an emergency warrant to ensure no disposal of stock could occur. They arrived at the address and discovered a female suspect was home, but would not answer the door. The officers subsequently forced entry and recovered €7,500 worth of stock from a total of twelve retailers. They also seized computer equipment. The female homeowner was arrested on suspicion of theft and admitted her involvement. A male suspect was not home, but later went to the Police station to make a statement with his solicitor. He did not accept any involvement. The Police also took statements from each of the twelve retailers involved within the Lakeside shopping centre. In Spring this year, the female was found guilty and sentenced to a three-month custodial sentence that was suspended for 18 months, plus 120 hours community service. The court notes record this as “a serious, planned, and sophisticated business.” According to Houston, “What we got out of this investigation was a new sense of trust and partnership with eBay as well as a strong working relationship with Zuzana and her team. We were delighted with the approach.”

The eBay Investigation

When Alice Houston contacted eBay, the lead was immediately escalated to the PROACT team—Partnering with Retailers Offensively Against Crime and Theft. We conducted an in-depth review into the reported suspicious activity cross-platform and shared our findings with Aurora Fashions, one of the key retail partners who we have been supporting and working closely with for several years. They provided an evidential summary package and assisted not only with the identification of the exact suspects’

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location, but most importantly proved the linkage between them—a crucial piece of information that marked a breaking point in this criminal investigation. The provision of a strong evidential package consisting of information from both parties to the respective law enforcement agency enabled them to act upon it in a timely manner, the warrant was executed and the suspects arrested. Aurora Fashions’ investigator ensured that this information was communicated to us instantly, and all involved eBay and PayPal accounts were immediately suspended to prevent any further criminal activity from happening on our platforms and to protect our community of buyers and sellers. In addition to that, we contacted our partners at Barclays Bank and informed them about the suspicious activity, so that they could initiate a review at their end and take appropriate action. As a result, a substantial portion of the proceeds of crime transferred by the suspect from PayPal to their bank account was frozen, and the investigating authorities were informed of this immediately, so that they could make an informed decision regarding the best next steps. This has been a very interesting and at times dramatic case that clearly showcases that we are stronger together. It enables us to collaboratively disrupt serious criminal activity faster, better, and more effectively across different platforms, as well as operate closely with law enforcement. Ultimately, it means that we are protecting our genuine customers and nurturing partnerships with key retailers, helping to drive trust and safety on our platforms.

Positive and Exciting Initiatives

The past two years has seen many positive strategic changes and exciting initiatives for eBay’s GAP team, specifically as it relates to enhancing and growing retail partnerships across the U.K. and the rest of the European retail community. We have been sharing our vision and are fully committed to achieving quantifiable successes via mutual collaborative efforts with our retail partners. We believe our joint efforts thus far establish a core positive baseline and certainly align us towards measured steps ahead. As such, we are much better prepared and equipped to tackle the sophisticated criminal base of the modern e-commerce era. Some of the key initiatives include utilizing exception-based reporting as a proactive tool that truly provides early-warning indicators of suspect bad actors on our platforms; and leveraging usage of our state-of-the-art systemic interface portals initially designed for the law enforcement community with select U.K. retail partners. The dynamic relationships built on trust and partnership, such as the one showcased above; tools and resources created; and reporting and other key performance indicators implemented have certainly made significant progress in the reduction of stolen goods on the eBay marketplace, a trend that has been described by some knowledgeable LP professionals as “game changing.” As part of the global PROACT approach, we are committed to growing existing partnerships and developing new relationships across the U.K. and beyond. We are confident that it will lead to even better mutual investigative results and drive enhanced trust in our brands and, most importantly, our customer base. |

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Feature 3 FEATURE

RACIAL PROFILING WE CAN NO LONGER JUST TURN OUR HEADS By Jacque Brittain, LPC, Editorial Director, Digital

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“There are very few African-American men in this country who haven’t had the experience of being followed when they were shopping in a department store. That includes me.”

President Barack Obama

ow does it make you feel when you hear the President of the United States making these remarks? Is it an accurate statement? Is it a fair statement? Is it a reflection of one man’s opinion, or an indictment of the loss prevention industry as a whole? Regardless of your personal politics, a statement made with such conviction from the leader of our country sends a powerful message—and one that deserves our collective attention. But when the comments were made by the President and repeated over and over by the press following the Trayvon Martin verdict, the implications were accepted by the general public with very little push-back. Why is that? If it’s a valid assessment, why hasn’t it been addressed more aggressively? If it’s not a valid assessment, why haven’t we been more forward or vocal in our objections? More likely, the general response—or lack thereof—is largely a product of many factors that can complicate the subject and lead us down difficult roads. Have we done enough? Do we need to do more? It is a highly sensitive topic, but it’s one that’s not going to go away or can be buried in the sand. The entire subject of racial profiling is extremely volatile, and draws passionate reactions. Anger is a very common response, which is certainly understandable. It should come as no surprise to anyone that an innocent person shopping in a store would be infuriated if they learned that they were being observed, followed, or

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otherwise scrutinized based solely on their race or the color of their skin. It’s insulting and abusively judgmental. It’s simply wrong. Good people shouldn’t feel the weight of judgment based on ignorant perceptions. But that holds true regardless of the circumstances. It’s just as wrong if someone is discriminated against based on cultural differences, the way we dress, our age, gender, or any other characteristic that makes us unique and special as human beings. This is a perspective commonly shared and universally understood. But by the same respect, it also shows extreme prejudice to pass judgment on an entire industry or profession based on the bad decisions of a few misguided individuals. What truly makes the subject polarizing is when we’re given the impression that this type of profiling is accepted or commonly practiced. It is the insinuation that LP personnel are ignorant, uneducated and poorly trained. It’s a disregard for the legitimate surveillance and apprehension process, and the meticulous effort that goes into making SEPTEMBER - OCTOBER 2014

the process valid, objective, fair, safe, and accepted. To throw a blanket over an entire industry due to the foolish or misguided actions of a few individuals is completely unfair in its own right. It’s insulting, and an unmerited and uninformed indictment of what we do. So where does all of this leave us? We can agree that racial profiling is unethical and unacceptable. We can say that such discrimination is simply not part of any legitimate loss prevention program. We can rant that it’s insulting and unfair to suggest that this type of profiling is common practice. However, if that’s as far as it’s taken, these are just seen as hollow words. All it takes the foolish actions of a select few to scar an entire industry. Theft and fraud cost retailers tens of billions of dollars every year. Loss prevention is a legitimate and viable profession that is crucial to the success of the retail industry—an industry that accounts for trillions of dollars in sales, is essential to the nation’s economy, and employs more people than any other privately held group in the world. With that in mind, retailers can’t and won’t tolerate such foolish and irresponsible decisions. Society won’t tolerate these conditions. Customers are guests, and deserve the right to be treated fairly and respectfully when they visit our stores. We must not allow narrow-minded perceptions to taint our company culture or compromise the business in any way. We have to take a stand out of respect for our company, our employees, our customers, and our communities.

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RACIAL PROFILING So what do we do? Have we done enough to clarify our position and eliminate both the concern and the perception? There has to be answers. There has to be action. But there also has to be a plan that reinforces our position and fortifies the industry best practices that define any legitimate loss prevention program. As an industry, we need ensure that our position is crystal clear.

The Customer Bill of Rights

National attention was once again focused on the subject following allegations made by several African-American shoppers that they were racially profiled while shopping at prominent department stores in New York City. As a result of the controversy, Reverend Al Sharpton, the National Action Network, and other civil rights leaders met with a coalition of retailers, community groups, and the Retail Council of New York State in December of 2013 to discuss the subject and seek answers. Among the retailers involved in those meetings were representatives from Barneys, Macy’s, Saks Fifth Avenue, Bergdorf Goodman, Lord & Taylor, and The

Gap. One of the more prominent results coming out of those meetings was the drafting of a Customer Bill of Rights. The one-page document drafted by the Retail Council of New York State declares profiling is an “unacceptable practice and will not be tolerated,” and further identifies a commitment from the retailer “ensuring that all shoppers, guests, and employees are treated with respect and dignity and are free from unreasonable searches, profiling, and discrimination of any kind” in the stores. The agreement further states that employees are required to “respect the basic civil and legal rights of any person suspected” of a crime, and workers who violate their employers’ prohibition on profiling will be disciplined and could face termination of employment. Retailers have agreed to post the bill of rights in common areas of the stores, available upon request, and clearly placed on store websites.

Building the Document

Retail Council of New York State President and CEO Ted Potrikus, who was directly involved in the drafting of the document, provided LP Magazine with an insightful look at the construction of the Customer Bill of Rights. He described how the retailers involved in the process brought together their policy-and-procedure documents, which became the foundation of the project and largely contributed to the final result. “Across the board, all of the companies involved provided policies specifically prohibiting profiling. It was part of their operating policies. It resonated in their observation and surveillance practices. It was part of their training,” Potrikus said. “We were shown industry best practices, training, and education programs. It was all very impressive. They made some really solid points, and there was an overall recognition of the challenge. So many retailers have gold standard asset protection policies, and we took full advantage during the process.” Potrikus further shared that there was dialogue revolving around some of the prominent challenges facing

“In major cities like New York, blacks and Latinos not only worry about being ‘stopped-and-frisked’ by police, but they also fear the embarrassment of being ‘shopped-and-frisked’ in retail stores. In other words, minorities are sent a shameful message that no matter what they are doing, they are guilty until proven innocent. Imagine walking into a store, finding something you like and making the purchase only to be stopped, interrogated, searched, handcuffed, and locked in a cell simply because someone didn’t believe you could afford the item. It is unconscionable that in New York City—a city that serves as a beacon for diversity and inclusion— that so many of its inhabitants are treated as second-class citizens.” Reverend Al Sharpton LP MAGAZINE | SEPTEMBER - OCTOBER 2014

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Feature 3 RACIAL PROFILING retailers, such as organized retail crime (ORC) and the sophistication of the criminal element involved in various types of criminal activity. He added that this wasn’t lost on the audience. “I think that this entire process also served as an eye opener for the civil rights leaders as well as others that were involved; some of whom have specifically shared with me that they gained a whole new respect and appreciation for the complexity of the profession and the challenges for those involved,” Potrikus said. “By the same respect, I think the retailers learned a great deal as well, and gained a better perspective and a deeper appreciation of what these organizations are trying to accomplish. We set a strong foundation and some positive momentum that will benefit everyone moving forward.”

Unfinished Business

Sharpton hailed the “best practices” agreement—the first of its kind between community leaders and the retail industry—as a step in the right direction. However, Sharpton emphasized that the Customer Bill of Rights document is just the beginning of a process, not its conclusion. He said community groups would continue to work with retailers until they could “guarantee shop-and-frisk is something of the past.” Protrikus agreed, stating that “It establishes the level of expectation that customers can have when they come into the store, and the way

that they can expect to be treated.” However, he added that, “This is intended to be a living, breathing document. It has to be fashioned based upon the needs and environment surrounding the specific retailer, and modified when necessary to reflect the intended purposes and objectives.” For example, many retailers may not have security guards or dedicated loss prevention personnel in every store. Yet the general concepts should apply to every employee, regardless of whether or not they can apprehend a shoplifter. In those circumstances, the document may require some minor revisions, and the verbiage should be modified to better reflect that message. Amendments to the text would be fairly simple. While the agreement is a positive step, a Customer Bill of Rights isn’t in and of itself a solution to the profiling issue. Generally speaking, the concepts outlined in the document would be considered universally accepted industry best practices. The message is strong, the motive is pure, and the intent is clear. However, the document can’t, won’t, and was never intended to stand on its own. The Customer Bill of Rights is a statement of expectations, and a

commitment by the retailer to respect and follow the guidelines detailed in the document. It does not specifically describe how each company will address the subject of racial profiling, how the guidelines will be implemented and enforced, and what proactive steps will be taken to inform and educate the employee base. That in particular has been appropriately left for the individual retailer to determine a strategic course of action that will lead to the desired outcome. We may consider this and similar efforts to provide building blocks rather than definitive solutions. But as is often true with such projects, the exercise was just as important as the final product. The coalition involved in the process had a common objective, a collaborative strategy, open minds, and a positive approach. It was refreshing to hear words like “appreciation,” “partnership,” and “respect” coming out of the discussions. It can’t erase the limitations and bad decisions of a select few, but it can reflect the desire and determination of the greater good to influence change and overcome those shortcomings. This not only raises awareness of the problem, but also of the steps that have been taken to address the problem through the public voice, the business doctrine, and the collective action. You can review a complete copy of the Customer Bill of Rights by visiting retailcouncilnys.com.

“I am against discrimination of any kind, but if I make snap judgments, no matter who it’s towards, aren’t I committing the same sin as someone who profiles? I am no stranger to being profiled, and I truly empathize with anyone that has been put in that position. Hopefully this brings forth a dialogue to effect real change.” Musician and Business Mogul Jay Z 42

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RACIAL PROFILING

A Matter of Policy

Companies use policies to define the rules, principles, and protocols that will guide important actions and decisions. The policy is a statement of intent, that is designed to ensure that a position or approach held by the company is translated into the fabric of the organization and followed by the employee base. However, drafting effective policies requires more than simply putting pen to paper. Appropriate steps must be taken to ensure that the policy is clearly stated, communicated, understood, implemented, enforced, and thereby owned by the entire organization. Most retailers have a firm grasp of this process, investing in the resources and collaboration necessary to construct policies that hold value and meaning to the organization. Following the recent events in New York City, one particular media outlet suggested that “No retailer in North America has ever had such a policy [against discriminatory profiling].” Whether misguided, uninformed, or simply intended to get a rise out of readers, such comments are not only ridiculous, but reckless and disrespectful to the industry as a whole. When dealing with a topic of this magnitude, our collective voice should be focused on solutions rather than sensationalism; dealing with facts rather than short-sighted conjecture. Frankly, it impedes the efforts of the retail community and the progress that has been made. There are without question retailers across the country with specific policies that address the issue of discriminatory profiling. Many others address the subject in other ways, such as through their policies pertaining to observation skills, requirements for surveillance, and even customer service policies. However, it would be equally remiss to suggest there’s not additional progress that can be made to address these and similar concerns. Companies that don’t have specific guidelines should consider drafting and implementing policies that make their position absolutely clear. It’s also important to consider that our company policies are intended to be living documents so that they remain relevant and represent the culture, perspective, practices, and position of the organization. Reviewing existing policies and programs should be an ongoing process. Even when companies have pristine policies and principled intentions, every organization is still made up of individuals, and people make mistakes. We all have our own strengths and opportunities. People can show poor judgment. By the same respect, there are also those that simply have skewed perceptions and misguided perspectives. Our individual makeup can be shaped by any number of influences that can persuade our thought processes and power our decision making. This is why effective, well-written, and enforceable policies are so important. These are also some of the reasons why strong training and awareness programs so critical.

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The Power of Information

Discriminatory profiling is often fueled by ignorance, which is a nemesis faced in many of our personal and continued on page 44

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The Elements of Observation Behaviors: The way that we conduct ourselves in response to our environment; which include the actions, reactions, and manner of conduct that may point to theft and dishonesty. Indicators: Relevant information that reflects the intention or capability to follow a particular course of action, giving us grounds to believe that theft or other dishonest activity may take place. Means: The instruments by which an act can be accomplished or an end achieved, which include the resources and tools that support the ability to commit dishonest acts. Opportunity: Advantageous circumstances and the related prospects that support the potential or capability to commit dishonest acts. While not a clear sign of a person’s intent, these are the only acceptable criteria for placing someone under surveillance. It is the sum total of everything that you observe that should guide your decision making. professional challenges. However, identifying the problem can also provide us with a clear path to solutions. Ignorance, by common definition, is the state of being uneducated, unaware, or uninformed. By using the power of information, we can overcome many of the hurdles that stand in our way. Training and awareness programs are key aspects of most loss prevention strategies. We use them to show employees how loss prevention concepts can and should be embedded in their everyday responsibilities. We use them to help keep our customers and employees safe. We engage our employees with strategies that reduce losses and enhance profits. We also build upon fundamental training and awareness strategies to develop our loss prevention teams. Effective training and awareness initiatives drive our messages and instill a sense of ownership in the core competencies that define our loss prevention programs. This is grounded in many of our fundamental lessons, which infuse key principles and definitive expectations into the core of our training and development. Our commitment to these lessons provides a straightforward path for our teams, and a strong foundation to guide the decisions that follow. These same concepts must reach beyond the LP office and extend into the stores. Yet while the fundamental concepts of loss prevention may not significantly change, we are an integral cog in an evolving wheel; and therefore must continue to learn and develop in order to meet the mounting needs of the profession. Our training and awareness agenda must consistently reflect the primary messages and competencies that are essential to the industry. This is not an agenda that we can ever outgrow or

rise above regardless of our years of experience, level of expertise, or hierarchy within an organization.

Behavioral Detection and Prioritization

As part of this year’s National Retail Federation LP conference, Bill Titus, managing director, retail group at PricewaterhouseCoopers and former head of LP at Sears Holdings, and Read Hayes, PhD, research scientist with the Loss Prevention Research Council (LPRC), hosted a keynote session on the profiling debate. Titus began the session by clarifying a shared perspective on the subject. “Discriminatory profiling is absolutely unacceptable and absolutely wrong,” he stated. However, he also commented that while profiling has taken on a negative connotation and is now linked to discrimination, profiling in its purest sense is not necessarily a negative thing. When used correctly, it can be a legitimate and valuable tool. It is when profiling leads to a predisposition of bias that the practice becomes tainted and the purpose is lost. “It is our job to protect our company, our assets, our employees, and our customers. In the process, we’re looking for patterns and correlations that would indicate potential dishonesty. It’s how we bring our team in and how we train them that should determine the process and the outcome,” said Titus. Let’s take this concept in a forward direction. For example, the Merriam-Webster Dictionary defines profiling as “the act or process of extrapolating information about a person based on known traits or tendencies; specifically the act of suspecting or targeting a person on the basis of observed characteristics or behavior.” This, in fact, directly supports the “elements of observation,” a core loss prevention lesson and evidence-based approach that is founded on the concept of initiating our surveillances based upon the behaviors, indicators, means, and opportunity that reveal a potential

The Five Steps of the Apprehension Process Making The Apprension 5

Exiting

Continuous Observation

Concealment

Selection

Entering continued on page 46

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Feature 3 RACIAL PROFILING continued from page 44

for dishonest behavior. Biases and prejudice—whether racially based or otherwise discriminatory—have nothing to do with the surveillance and no legitimate bearing on the decision-making process. It’s not only wrong, but an abuse of our efforts and resources. Dr. Hayes then took the conversation to the next level. “We take in this information to make better decisions. But we’ve got to quantify that information and be very deliberate and targeted in what we do,” he said. “When we make errors in what we take in, we can make errors in our interpretation, which can lead to errors in our responses. What we do must be very logically-based and evidence-based.” Hayes stressed the need to focus on clusters of cues that fall in context with the particular situation being observed, and the totality of information must be considered. Based on evidence and logic, this also involves observing and understanding stable differences that are behaviorally based, drawing inferences

derived from experience, and prioritizing those differences based on the specific circumstances surrounding that behavior. “We refer to the process as behavioral detection and prioritization, or BDP,” he said. “This is a protocol that’s grounded in theory and supported by evidence.” “We should be very proud of the things we do to protect our companies, our customers, and to resolve dishonesty,” stated Titus. “We’d love to have your thoughts and input.” EDITOR’S NOTE: LP Magazine is a supporter of the LPRC. We encourage all retailers and solution providers to consider joining the research organization and use its resources and research findings to build better LP programs based on evidence-based best practices. To learn more, visit lpresearch.org.

Celebrating History

On July 2nd of this year we celebrated the 50th anniversary of the Civil Rights Act of 1964. Serving as the nation’s premier civil rights legislation, the Act outlawed discrimination on

the basis of race, color, religion, sex, or national origin, required equal access to public places and employment, and enforced desegregation of schools and the right to vote. The Civil Rights Act represents the desire of the American society to move forward and beyond the limited channels of narrow perceptions. While legislation alone cannot end discrimination or the destitution of closed minds, by opening the door to further progress we can then see the broader possibilities. As recent events have clearly shown us, there is still progress that needs to be made. Poor decisions, flawed thinking, and veiled intentions continue to obstruct the course. But we are moving forward, and we’re on the right path. Our common commitment may not be an end-all solution, but it certainly points the way. Have you done your part? Is your program grounded in the building blocks that support good decisions? Isn’t it time we knew for sure? We can no longer just turn our heads.

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EVIDENCE-BASED LP

Make an Impact Ten Years Going T

his is the tenth year that loss prevention and asset protection leaders have met to design and discuss research-driven loss prevention. The first Impact conference was the brainchild of ten LP vice presidents who wanted to make better-informed decisions. They wanted to better understand how internal and external crimes occur, and how offenders think. They wanted to get much better at what their retail organizations expected them to do. At the time this was somewhat new thinking in this field. But they recognized how critical life safety, corporate reputation, and crippling theft losses are. They also understood that benchmarking and networking needed to be more evidence-based. They needed to not just work together, but to work with researchers to systematically improve LP knowledge, processes, and tools.

Tenth Impact Conference

Here we are anticipating the 10th Annual LPRC Impact Conference set for October 13–15 on the University of Florida (UF) campus in Gainesville. Time goes by fast. And those ten original retailers have grown to almost forty. Total membership, including solutions providers and manufacturers, has grown to almost 100 corporations. The 2014 conference planning is led by Toys‘R’Us Vice President of AP Chris Gillen alongside other LP executives. The team has retailers presenting short, real-world case summaries of their evidence-based product and protective projects. Retailer, solution partner, and active offender panels will be used to explore critical crime and loss topics. University of Florida and other experts will be discussing cyber and non-cybercrime threats and research opportunities. The LPRC working groups will break out separately to cover recent research findings while planning for upcoming projects. A ton of science-informed learning is here for all. There are always ample networking opportunities, including at the University’s golf course on Sunday afternoon, the Monday evening LPRC Innovation Lab reception, and the historic Thomas Center dinner and music event Tuesday evening; not to mention lunches and breaks. I’d like to personally invite you to consider participating in the 2014 Impact conference. Please email operations@lpresearch.org for more conference information.

Parking Lot Crime Research Update 1

I’ve mentioned several times how important shopper safety and comfort is to good brick-and-mortar retailing. Shoppers should feel safe in your stores and parking lots even after dark. If they don’t,

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by Read Hayes, Ph.D., CPP Dr. Hayes is director of the Loss Prevention Research Council and coordinator of the Loss Prevention Research Team at the University of Florida. He can be reached at 321-303-6193 or via email at rhayes@lpresearch.org. © 2014 Loss Prevention Research Council

your sales go down or even disappear. Fear of crime is real and can be devastating to your business. To that end, the LPRC and UF have implemented a focused parking lot research and development protocol. Here is part of our project description: ■ Legitimate place users, including employees, customers, and others. ■ Crime types, including crimes against persons (assault, rape, robbery, other) and crimes against property (auto theft, burglary, vandalism, other). ■ External offender entry modes, including both pedestrian and vehicular access and attack. ■ Primary objectives are to shape place-user behaviors, including to convince would-be offenders not to enter the property and convince would-be offenders who have entered the property not to offend there. ■ Secondary objectives are to improve event handling both during and after an event, which can improve deterrence. This includes enhancing early event detection and quick response to mitigate crime intensity and damage, as well as enhancing crime event documentation for better conviction rates and protective effort improvement. In the next column I will discuss this project in greater detail. Also look for project findings and implications at upcoming conferences.

Working Groups Summit

People drive everything. At the LPRC our working groups’ productivity is directly correlated to the energy, planning, and actions of our retailer leaders and participants. To that end, over thirty executives recently conducted a planning summit in mid-August on the UF campus to enhance the process and output of all working groups. Several new initiatives resulted, and more people from more retailers are now working together in these important groups.

Social media continues to pull together and inform LP professionals. Our LinkedIn reach has increased to over 2,000 members. I invite you to join the LPRC LinkedIn group to participate in the discussion, as well as reach out to me personally so we can gather your thoughts and share our results. Our UF and LPRC teams are working to support the entire LP industry. Please let me know your thoughts and suggestions at rhayes@lpresearch.org.

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10TH ANNUAL LPRC IMPACT CONFERENCE The next gathering of the LPRC is scheduled for October 13 – 15, 2014, on the campus of the University of Florida in Gainesville. The impact conference is focused on communicating the results of the past year’s research activities as well as looking at those retail issues that warrant adding to the list of research in the coming year. The conference features presentations by both scientists and retailers who participated in the research. Top left, John Voytilla addressed attendees at the 2012 conference. Voytilla, chief security officer at Office Depot/OfficeMax, is the current chair of the LPRC board of advisors. A large portion of the conference involves group participation on specific topics of interest. This interactive aspect of the conference both stimulates participation by all attendees as well as facilitates the direction for new research by the LPRC. Bottom left, John Doggett, LPC, director of LP merchandising/ vendor shrink solutions and analytics of Lowe’s, presents the results of a smaller group discussion on RFID to the entire conference attendees. For more information about attending the upcoming conference or getting more involved with the LPRC, visit LPresearch.org.

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ASK THE EXPERT LP Magazine interview with Mike Dunn Mike Dunn is vice president of strategic services for Best Security Industries (BSI). With a background in computer technology, networking, and IP video, Dunn has also worked at Honeywell and Axis Communications and has designed security systems for several Fortune 500 companies, large education systems, transportation, banking, and government sectors.

Video Surveillance Tools: Seeing the Big Picture EDITOR’S NOTE: Video systems have become a mainstay for many loss prevention programs. As the technology evolves and business needs grow more complex, loss prevention leaders are looking for solutions that are both affordable and capable of meeting the escalating demands of the business. LP Magazine recently sat down with Mike Dunn, vice president of strategic services for BSI, to garner his expertise and insights on building effective video surveillance systems and how to get the most out of existing systems to help maximize retailers’ options and investment. What are the primary considerations when choosing between an analog versus an Internet protocol (IP) camera system? Before deciding on a video option, it is advisable to first understand how the technologies work, as the differences in both camera technologies and method of video transmission are critical to developing a well-planned video solution. The primary difference is in the way the video signal is delivered. Analog cameras turn video signals into a format that can be transferred over coaxial cable and received by a television or other receiver, such as a digital video recorder (DVR) where the image is digitized and stored. IP camera technology is much more advanced. It captures an image, immediately digitizes the video signal inside the camera and keeps the image digital throughout the entire transportation and viewing process. This process allows the IP camera to keep a higher base-level image over analog. Some of the primary considerations include the following: Image Quality—This would depend on how the system is being used. Resolution limits on analog cameras make them best suited for placement close to the area being monitored, whereas the advanced capabilities of IP cameras allow millions of additional colors at a higher resolution with crisper picture quality. Scalability—The ability of a system to handle a growing number of cameras in a capable manner will factor in many decisions. For example, most analog systems require DVRs that manage 16 or 32 channels, which may work well with smaller systems. But what if you have 17 or 33 cameras? This would require adding additional equipment at substantial costs. IP systems provide greater flexibility, allowing you to construct the system based specifically on what you need and offering more options if you wish to expand later. Intelligence—Today we want our systems to do much more than capture images. Some analog and most IP systems offer options that can add intelligence to live and recorded video. However, analog systems require additional hardware to accomplish many of these functions. Conversely, an IP camera is as much a camera as a smartphone is just a telephone, providing higher intelligence capabilities that can be built into the device.

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Edge Storage/Serverless Solutions—This would also depend on the size and use of the system. Analog systems require digital conversion and a method to store the video outside the camera, which requires the use of an encoder or a DVR. Smaller IP systems don’t necessarily require DVR equipment for 4-16 cameras, providing the flexibility to break free from the traditional setup of cameras and a DVR. Some IP cameras today can use their own built-in CPU and storage, recording the images directly on the camera. The customer can view HDTV recordings or live viewing from his smart phone or tablet leaving no physical “box” on site. Costs of software and additional equipment to manage the solution must then be factored in. Total Cost of Ownership—Analog systems are typically less expensive when initially installed. However, it is important to consider the total cost of owning your system. The size of the system, expansion costs, maintenance, intelligence solutions, and other advantages may provide direct ROI and substantially lower the break-even costs on IP systems, which should definitely be factored into any design. What if I currently have an analog system, but want the advantages of the IP system? Are there affordable solutions that don’t require me to buy an entirely new system? Hybrid systems (part analog and part IP) can be designed that allow you to migrate existing analog components into a modern IP-based system, providing productive and cost-effective options. For example, an IP encoder can be added that uses the current analog camera and converts its signal into an IP network device. When additional cameras need to be added, you then have choices so you can select the right camera technology based on the scene requirements. Your solution provider/integrator should be able to work with you to create and effective and affordable migration plan. When choosing a solution provider to help with this migration plan, what should we look for? First, you should choose a provider that is willing to work with open systems; someone who won’t simply tie all of their solutions to a particular brand rather than recommending best-in-class products and services. You should also identify providers who know or are willing to learn the culture of your company and the global needs of the business in order to design a solution that will solve specific problems. Finally, look for providers who are willing to work with and educate your team members on the products, and the best way to use these tools to get the most out of their investment. Building the partnerships and investing in total solutions helps build trust in the partnership and relationships that last.

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FEATURE

INSPIRING INTEGRITY HOW THE DRESSBARN ASSET PROTECTION DEPARTMENT SUPPORTS THE COMPANY MISSION

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oslyn Jaffe opened the first dressbarn in Stamford, Connecticut, in 1962 with the intent of serving the newly evolving generation of working women. Building a reputation for quality, style, value, and customer service, the dressbarn store count grew and in 2005 dressbarn acquired maurice’s. In 2009 they acquired Justice, followed by the purchase of Charming Shoppes in 2012. Today, the individual brands are organized under Ascena Retail Group, the leading national specialty retailer of women’s and tween apparel, with over 3,800 stores throughout the United States and Canada. As dressbarn grew over the years, there have been many changes. With the retirement of Larry Senn after thirty years as the head of loss prevention for dressbarn, LP Magazine editors sat down with Brian Bazer, the current AVP of Asset Protection and Risk Management, to discuss taking over the reins from such a long-term leader and how changing from a loss prevention to asset protection focus matched the evolving journey of the company.

How was it to step in after such a long-tenured leader had retired?

First of all, I was fortunate that Larry Senn and his team had built a solid program with a great foundation. I viewed my role as managing an evolutionary process versus a rebuilding process. It was important for me that the team realized that we were going to go on this journey together. I was not going to come in and change everything or bring in “my own” people. During our first meeting, we discussed what it meant to be on a winning team. We discussed winning teams that we had been a part of in the past and what made them special. We took the common themes from those experiences and defined what type of team we wanted to have going forward. As a homework assignment, each person had to think about how they connected to the newly crafted company mission statement—“Inspiring

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Brian Bazer is associate vice president of asset protection and risk management for the dressbarn division of Ascena Retail Group. Prior to joining the company in 2012, he was VP of asset protection at Advance Auto Parts. He has also held various loss prevention management positions with Best Buy, Musicland, and IKEA. Bazer is currently vice chair of the advisory board for the Loss Prevention Research Council. He earned a bachelor’s degree in administration of justice from Penn State University.

women to look and feel beautiful.” The team’s responses were synthesized down to the most common themes and our mission connection became very clear: We inspire women to look and feel beautiful by building an empowered, safer experience with integrity.

How did this connection to the company mission impact the department?

Once we had our statement developed, we threaded everything that we did through this lens. If it was in alignment with our new vision, then we kept it. Here are a couple of quick examples of how this played out. The department in the past had been secluded from the rest of the building, so we modified our work space to be more open and inviting. We conducted an open house event to bring people from other departments into our area, learn about what we do, and have some fun. We incorporated a quarterly “take a department to lunch” program to build cross-functional SEPTEMBER - OCTOBER 2014

relationships. We took our traditional institutionalized badge and updated it to be more stylish, changing the color of the badge to be more vibrant and consistent with the company brand, and empowered our associates to bring in their favorite picture to use. Also related to access control, there were some interior doors that were locked due to previous construction issues. We removed the access control from these doors so that associates could enter or exit the building in a timelier manner. From a store perspective, we changed how we think about store visits and our actions inside the store. We migrated from a case-audit mentality to a purposeful visit centered on education and recognition. We modified our “silent witness” program to emphasis inspiring integrity, building trust, and doing the right thing. We changed the title of the field role from regional loss prevention manager to regional asset protection leader. And, most importantly, we identified an opportunity to maximize relationships with field leadership by going from a geographically based coverage of multiple regions to partnering with field leadership in a one-to-one alignment with regional leaders.

What caused the department name change?

This was initiated by the department. When we looked at the things that we were doing and how the department was evolving, the team felt that the term loss prevention was reactionary and didn’t encompass everything that we were doing. When we think about asset protection, we talk about the proactive approach of protecting the company’s three most important assets—the people, the profit, and the brand. From a people perspective, the department took on additional responsibility for safety and risk management. Talking about the types of accidents that were occurring, how to prevent them, and working cross functionally to develop better tools and processes to reduce accidents was now part of what we did. Regarding profit, most people can relate shrink dollar

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EVERYONE ON THE TEAM HAS A VOICE, AND THERE IS AN EXPECTATION THAT WE USE IT. WE ARE RESPECTFUL WHEN OTHERS ARE VOICING THEIR OPINION, WHICH IS HARDER THAN IT SEEMS, BY NOT TALKING OVER EACH OTHER, ACTIVE LISTENING, AND THE USE OF PARAPHRASING AND FOLLOW-UP QUESTIONS. ALSO, THERE IS NO HIERARCHY WHEN IT COMES TO THE CONVERSATIONS. loss to profitability. We have taken it a step further by looking at any time as a company we do not realize full sale potential for an item to be profit loss. The department now has a strong focus on margin erosion involving coupons, manual discounts, and damage write-offs. From a brand standpoint, the department is involved with the brand committee working to help shape and connect the things we do with the brand.

How has the department evolved during this transformation?

Over the last two years, the department has developed a strong set of guiding principles that help

shape how we do our jobs. Following are our guiding principles. Assume Positive Intent. During conversations or actions, it’s easy to start thinking about what the other person’s motivation is. As a department we assume positive intent first and ask follow up questions to better understand what is going on. We leverage and emphasize a person’s or department’s strengths versus playing to their weaknesses. This has helped us navigate some tricky waters when situations stemming from conflicting interests arise. We start with the common goal, which is usually the best interest for the company, customer, and associate, and then we work our way from there.

Have a Voice. Everyone on the team has a voice, and there is an expectation that we use it. We are respectful when others are voicing their opinion, which is harder than it seems, by not talking over each other, active listening, and the use of paraphrasing and follow-up questions. Also, there is no hierarchy when it comes to the conversations. I have the same voice as others at the table when we are discussing the department. We have developed some facilitation techniques that help promote everyone being heard. During our yearly planning session, we use post-it notes to capture everyone’s ideas to achieve our goals. Each note is discussed, reviewed, and categorized. We then determine if it’s

The dressbarn asset protection department personnel include (standing left to right) Russell Del’Re, safety manager; Michelle Benjamin, POS analyst; Shawn Dempsey, manager AP and physical security; Reginald Berrouet, AP specialist; Judi DeJoie, senior AP manager; Donny De Paola, AP specialist; Michael Peteja, regional AP leader; Karen Clark, regional AP leader; Brian Bazer, AVP AP and risk management; Christie Delaney, regional AP leader; Solomon Mayo, Jr., regional AP leader; Korey Smith, director AP; Ciara Breen, AP summer associate. (Sitting left to right) Katie Wade, regional AP leader; Laurie Peer, AP administrator. (Not shown) Andrew Mayer and Samuel McLean, AP specialists. LP MAGAZINE | SEPTEMBER - OCTOBER 2014

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INSPIRING INTEGRITY

an idea we will go after or not. This helps temper those people who like to talk a lot in meetings and ensure that those who are quieter are heard. Rule #6. This comes from the book The Art of Possibility by Benjamin Zander. In simple terms, it means don’t take yourself so seriously. We realize that we can have fun and enjoy what we do and how we do it. A great example of this is our training videos. We have released eleven short training videos over the last two years. Each video is around five minutes in length covering various topics, such as dealing with a shoplifter, inventory management, and safety. The videos focus on something that is being done right to provide recognition, and we use humor to emphasis points. The feedback from the store associates has been extremely positive. I’m often surprised when I’m recognized from the videos, or when lines from the videos are quoted back to me. Treat Money as if It’s Your Own. I don’t micro-manage travel or expenses. Each person is given a budget for travel and recognition, and how they maximize it is up to them. Each quarter we review the departmental P&L and discuss things that are working as well as opportunities. Every once in a while, I do make sure that the team is eating healthfully on the road. As those of us who travel know, it’s difficult to maintain a healthy lifestyle when traveling. On Purpose Participation. If there is an event or activity sponsored by the company, our department is represented in some way. We participate in the educational courses, on company

committees, and in work-life balance activities such as softball and run club. This mindset extends to the industry as well, such as our involvement with the National Retail Federation, Loss Prevention Research Council, and Loss Prevention Foundation. Accountability. As a department we have a strong accountability model. First, we hold ourselves accountable for supporting our mission, living by our principles, and the results that we achieve. Secondly, there is peer accountability. We are there to support each other, including when results aren’t met or principles violated. With these two components of accountability for the team, very seldom does an issue come up that requires a supervisor or manager to get involved.

Are there other structures or processes that your team uses?

Every associate in the department has a departmental playbook. The playbook is divided into sections that include their job description, the company competency model and values, the yearly company and department plans, the company and departmental scorecards, an individualized development plan, and a place to put recognition received throughout the year. The first section is the job description. At a basic level every one of us wants to know what is expected of them. The next section is the company competency/value system. At dressbarn we are measured each year on “what” we do and “how” we do it. Similar to

our departmental guiding principles, the company values help shape our actions throughout the year. The next section is the company plan and the departmental plan. This section is the tactical plan that we are going to execute throughout the year. The plan is reviewed quarterly and updated as needed. After the plan, comes the company and departmental scorecards. On a monthly and quarterly basis we examine the key aspects of the business, such as our department P&L percent to budget. We examine the percentage completion of new store leader training and workers’ compensation results and cases, to name a few. Also included in the playbook is a section for meeting and call notes. We have a departmental call weekly and a quarterly meeting. Our weekly calls are meant to highlight key learning’s for the week, and how we have leveraged our applied learning’s from previous calls. The last section of the playbook is for recognition. We place the recognition that we get throughout the year in this section, which helps us during mid-year and year-end appraisal process periods to better articulate our accomplishments and the impact we are having on others.

What programs does your department have in controlling shrink?

Philosophically, I don’t believe that a company can control their way to low shrink. For me, it’s about building an enduring low-shrink culture that is in continued on page 56

AS A DEPARTMENT WE HAVE A STRONG ACCOUNTABILITY MODEL. FIRST, WE HOLD OURSELVES ACCOUNTABLE FOR SUPPORTING OUR MISSION, LIVING BY OUR PRINCIPLES, AND THE RESULTS THAT WE ACHIEVE. SECONDLY, THERE IS PEER ACCOUNTABILITY. WE ARE THERE TO SUPPORT EACH OTHER, INCLUDING WHEN RESULTS AREN’T MET OR PRINCIPLES VIOLATED. 54

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Feature 4 INSPIRING INTEGRITY

BY BUILDING A HEALTHY CULTURE WHERE PEOPLE FEEL LIKE THEY ARE PART OF SOMETHING LARGER THAN THEMSELVES, EMPOWERED TO MAKE EDUCATED DECISIONS THAT IMPACT THEIR STORE, AND UNDERSTAND THEIR ROLE IN THE CUSTOMER EXPERIENCE, THERE IS LESS LIKELY TO BE OPERATIONAL ERRORS, INTERNAL THEFT, OR EXTERNAL LOSS; NOT TO MENTION INCREASED SALES AND PROFITABILITY. continued from page 54

support of the larger company macro culture. The more controls that are put in place, the more likely associates and customers are going to try to find ways to defeat the controls. You get into this cycle of consistently trying to “one up” the other group. This cycle takes a lot of energy, time, and cost to sustain.

Conversely, by building a healthy culture where people feel like they are part of something larger than themselves, empowered to make educated decisions that impact their store, and understand their role in the customer experience, there is less likely to be operational errors, internal theft,

or external loss; not to mention increased sales and profitability. With that being said, we do strategically focus on two high leverage areas from a shrink-culture perspective—new store leader locations and high-shrink locations. We conduct a new store leader orientation for every new store leader

The Autumn Issue of LP Magazine EU Feature articles include: ■T op Ten Internet Threats to Retailers ■E mployment Advice for European Retailers ■T ackling Global Anti-Counterfeiting ■1 5 Years and 15 Best Practices That Can Help Retailers Sell More and Lose Less ■P lus much more

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Feature 4 INSPIRING INTEGRITY

within the first ninety days of service. The session is intended to emphasize the fact that our department is here for them as a resource. We want to demystify who we are and what we do, and let them know that it is okay for them to call us for support. We also discuss business metrics, review key policies and procedures, and provide coaching regarding back-office systems. After each new store leader orientation, the store leader is given the opportunity to take an anonymous survey providing feedback about the experience. We use this feedback to make the training content and our facilitation better. In partnership with our field leadership, each regional asset protection leader picks those locations in their portfolio of stores that impact their region the most from a shrink perspective. These higher shrink stores are placed in our ASAP program, which stands for Associate Shrink Awareness Program. The store leader of these locations develops a plan in conjunction

with the district leader and regional AP leader. The plan is unique to the issues of the store and outlines the commitments of the store, district, and regional leaders. Additional physical inventories are taken at these locations until the store has demonstrated a consistent shrink improvement.

came together to review the recent store physical inventory results, discuss key categories, and develop cross-functional ways to reduce loss.

What are the next steps in the evolution of the department?

I’m going to take a sport analogy from Gil Dennis, SVP of stores with whom I have a wonderful relationship. I would not be as successful as I am without his mentorship and support. He often says that his team is the offense driving sales and the customer experience, while my team is the defense driving bottom-line profitability. We work together and support each other’s plans and programs with our unique roles. And, in the end we are on the same team playing for the same outcomes. Next steps for our department are to continue learning and growing and to share our story to help positively drive the importance of leadership and culture building within our industry.

What have been the company benefits seen from the department changes and shrink focus?

Without going into specific company results, the relationship between the asset protection team and the field leadership team as well as the home office team has significantly improved. Loss control and risk strategy and policy-and-process improvements are designed and implemented cross-functionally. An example of this is a recent shrink summit that was conducted. Senior leaders from the field, marketing, merchandising, finance, store operations, and IT

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Certification column CERTIFICATION Interview with Santo Zenone, LPQ

Building Careers, Validating Expectations

he Loss Prevention Foundation (LPF) has often used this column to provide the perspective of today’s industry leadership on the value of certification. But what about tomorrow’s leaders? Do they believe that certification is helping them to advance their careers? If so, how is it helping them? We decided to reach out to some of those that have gone through certification to ask their honest opinions on the process, and whether they feel it is benefiting them in their professional development. LP Magazine recently sat down with Santo Zenone, LPQ, to get his insights on certification. Tell us about what influenced your decision to pursue certification. In early 2013 I learned that Vector Security was offering LPQ and LPC scholarships. After reviewing the course curriculum for the LPQ and LPC programs on the Foundation website, I recognized that there was a great opportunity to learn more about the industry. I saw that there were new things that could help move my career forward, and many lessons that would apply to my role in loss prevention. It was clear to me that the course would be great for my career growth and development. With Vector Security providing this opportunity, I decided to apply and was awarded an LPQ scholarship. I received my LPQ certification on April 2, 2013. Was the course what you expected? Parts of the course were what I expected, while other aspects provided learning opportunities that I didn’t expect. I anticipated that I would learn more about the loss prevention industry and the fundamentals of LP. But what I came away with was so much more. Although I had a strong understanding of the general concepts of loss prevention going into the course, it helped me to gain a better and more thorough comprehension of the role of LP and how it applies to the retail industry. It opened my eyes to information and possibilities that I didn’t expect. I was also able to share my own experiences during the course. Tell us more about the process. The way the program was set up made it easy for me to navigate through the course. I was able to work through the modules at my own pace, which allowed me to spend more time on areas where I wanted to focus extra attention. This really helped me gain a better understanding of the material. It was also great to have the review questions, as they reinforced the information that I had learned. As for the exam, there were plenty of locations in the greater Vancouver area that provided a quiet and professional setting.

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Santo Zenone, LPQ, is a nine-year veteran of the loss prevention industry, beginning his career as an LP agent for a contracted security company in greater Vancouver, British Columbia. Zenone has worked the last six years with Gap Inc. and is currently a district LP manager for Gap and Gap Outlet in Western Canada.

What information do you feel helped you the most? The course really strengthened my knowledge of communication, interpreting information, and how all of this fits into the bigger picture. This has helped me to have more effective conversations with business partners and deliver well-rounded feedback. This also includes improving the perception others have of me, and how my body language could affect the conversation taking place.

Certification has not changed my expectations, but only validated my belief in the potential opportunities and influence that loss prevention has within the industry. I would definitely recommend it to others. After completing the program, I have added more tools to my tool belt. This has helped me in my personal growth and strengthened the potential for a long and rewarding career in loss prevention. What other benefits have you seen from taking the course? Within one year of becoming LPQ certified, I was promoted to a district LP manager position. Going through the program has helped me to analyze situations and challenges at a higher level. I learned the value of building and strengthening partnerships, which has helped to develop rapport and establish better credibility with key business partners. This has allowed me to receive more buy-in, work on new ways of creating a positive impact toward my company’s goals, and have more constructive conversations with my direct supervisors and direct reports. I’ve become a well-rounded LP professional. It has furthered my skills and made me a better business partner in general. If you could offer one key takeaway to someone considering certification, what would it be? The certification process offers a professional advantage. It provides great learning opportunities. There are many takeaways |

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from a personal and career-development standpoint, but compared to other courses I’ve taken, the LPQ specializes in the loss prevention industry. It provided me with a more global context of the role, which I feel was the most beneficial for me. This has also helped me better understand the roles of my business partners, allowing me to become more supportive by tying their roles and their goals with mine to achieve better overall results. How has certification changed your expectations of loss prevention as a career? Certification has not changed my expectations, but only validated my belief in the potential opportunities and influence that loss prevention has within the industry. I would definitely recommend it to others. After completing the program, I have added more tools to my tool belt. This has helped me in my personal growth and strengthened the potential for a long and rewarding career in loss prevention.

Newly Certified

Following are individuals who recently earned their certifications.

Recent LPC Recipients Wayne Adams, LPC, Walmart Mattia Bartolini, LPC, Nike North America Jacklyn Cato, LPC, Cracker Barrel Old Country Store Matthew Christman, LPC, DICK’S Sporting Goods Lori Dearwester, LPC, Goodwill Industries of Sacramento Kenneth English, LPC, Walgreens LeVern Hayes, Jr., LPC, Navy Exchange Service Command Chris Hyde, LPC, Office Depot Paul Jaeckle, LPC, Walmart Kevin Kay, LPC, Navy Exchange Service Command Linda Keeps, LPC, Anchor Stone I.T. Gregory Lundell, LPC, Walmart J.D. Mauricio, LPC, JCPenney

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William McDermott, LPC, Cracker Barrel Old Country Store Will McDonald, LPC, Walmart Ryan Orlando, LPC, Walmart Gil Palomares, LPC, Lowe’s Phillip Rumsey, LPC, Walmart Paul Rumsey, LPC, Walmart Gary Smith, LPC, 7-Eleven Brandon Snyder, LPC, Raleys Joseph Spencer, LPC, Rite Aid Allen Still, LPC, Walmart Sue Waugh, LPC, Walmart Jeremy Williams, LPC, Walgreens Denise Wynn, LPC, TJX

Recent LPQ Recipients Randy Brown, LPQ, Big Lots William Campbell, LPQ, The Beer Store Andrew Follett, LPQ, Walmart Elizabeth Harcourt, LPQ, Bed Bath & Beyond Lynn Kirouac, LPQ, Publix Super Markets Samuel Maze, LPQ, Mississippi College Samuel Puccini, LPQ, 7-Eleven Richard Roman, LPQ, Fairway Market

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SOLUTIONS SHOWCASE USS

How LP Can Show the Rest of the Company a Few Tricks By Gerald Becker

t’s been the holy grail of security technology—the ability to unify all systems into one platform. As it stands, many LP teams use one system for video, a different one for access control, and yet another one for intrusion and fire alarm. One person has to administer three (or more) different platforms that don’t talk to each other. This is time-consuming, inefficient, and—the scariest of all—less effective than what the competition might be using. The promise of open architecture is to break down the barriers between different systems and allow data to be easily pooled into one central location. From there it can be disseminated to different stakeholders within the company, making the loss prevention team the unexpected hero for increased sales and efficiency company-wide.

New Industry Standards

To make this a reality, an industry group named ONVIF has been formed, led by the heavy hitters in security technology. The group first developed an IP-based security standard that allowed video cameras to be plugged into one system, regardless of the manufacturer. Then the same was done with access control. The recently introduced Class-C of ONVIF now allows for open platform integration of access control components from different vendors, and the ability to manage it all together with video. The open architecture movement has expanded from there, and the most nimble companies have already jumped on the opportunity to create solutions that few thought possible. Take IP video for example. Now you can open your NVR software and easily see all your store locations nationwide on a map. Select one location and see the floor plan with your cameras marked. Select the camera and see the live video feed. Then in the same software click on the Analytics tab, see the heat map of foot traffic in the store. Learn where your customers are pausing to look, and which displays they are ignoring. Now you can use security cameras to not just watch for theft, but to understand consumer behavior better in order to improve your merchandising and increase top-level revenue. The same analytics can be used by your operations team to schedule store employees more efficiently. If you see that on Tuesdays between 4:00 and 8:00 there is a spike in traffic, but on Wednesdays at the same

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time the store is quiet, your store managers can plan their team schedules accordingly. Your logistics benefit from the open architecture, too. If you are using a GPS-based tracking system, it can run on the same platform so you can easily see all your vehicles nationwide at any time. What about EAS? It, too, can be brought into the fold of a unified platform. You can now tie in the triggers from the pedestals to Gerald Becker is a widely alarm a camera to start recording. recognized expert on Intrusion and fire alarms can also be tied security technologies. He is vice president for into the platform. When the alarm is set off physical security at USS, you get alarm notification, video notification, the leading integrator video recording, plus access control reports of IP video and access control systems. whether any of its permissions were triggered or not. And you can see all of this in one neatly organized interface on your desktop or mobile device.

The Future Is Open Architecture

What are the obstacles to deploying a unified platform? It shouldn’t be the money, because IP systems have become more affordable and have an easily-proven ROI. The biggest obstacle seems to be the access to the right information. Simply put, many companies don’t know what’s out there. Of course, it doesn’t help that many vendors are still clinging to their proprietary, closed systems; fearful of what opening up could do to their bottom line. But the progress of technology points in just one direction. Closed architecture limits you to what you can do, while open architecture does the opposite. It unchains you from one particular platform, giving you unlimited options and the ability to keep adding new systems as technologies keep evolving. And that’s what’s most beautiful about it. Open platform is endless, scalable, and it’s—enterprise. Gerald Becker can be contacted through USS headquarters at 800-488-9097.

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SOLUTIONS SHOWCASE TYCO INTEGRATED SECURITY

LPV + DV2 = Performance By Ted Guzek, Vice President, North America Retail Sales

etail store performance is the goal. LP vision (LPV) and retail data (DV2) combine to increase performance. LPV is the LP professional’s vision that leverages technology and data more broadly. DV2 is retail data volume and velocity. This equation is our way of saying we believe the largest force that challenges the current LP role will be data. Our view is that when it comes to retail data, volume and velocity are the focus. The volume of data is becoming massive and the velocity at which data becomes available is increasing exponentially. Information is now at our disposal instantaneously. Success is now measured by how data is used by retailers for competitive advantage and higher store performance. New metrics of all kinds shift thinking and will continue to change the role of LP, and the high performers will be those who manage information with the greatest agility. Ted Guzek

The “LP team” is now the “performance team.” They know data, and they know how to use it. They embrace the higher stakes and the broader view of store performance. The LP role is now about timely prediction scenarios related to events, threats, and behaviors of shoppers and offenders alike. Three key considerations in the new art of LP will be broader LP vision, a sense of urgency, and a shift from “LP performance” to “total retail performance.”

LP Vision (LPV)

LP helps retailers understand the changing role of technology as it is happening, not after it happens. The new loss prevention is about a wider audience of retail stakeholders, including store operations, finance, marketing, merchandising, and others who collectively drive performance goals that are supported by better data and tools. LP leaders today know that the concept of technology being owned by one functional group is outdated. Technology does more today, so it stands to reason there are more stakeholders. A forward-thinking LP vision includes questions like “How can we connect more effectively with customers and define new value in the technology deployed?” Better data and better insight usher in the art of the possible. LP visionaries will see how their decisions, data expertise, and technology can change the big picture of retail performance at the bottom line and the top line.

A Sense of Urgency

LP professionals today have much in common with leaders like Malcolm Gladwell and Andy Grove because the idea that “only the paranoid survive” resonates with them. They are paranoid and obsessed about the future and the value of data in retail excellence. The status quo won’t get any of us to where we need to be tomorrow. The objectives around protect and secure will always be important, however, the way it is accomplished is already changing dramatically. Technology changes too quickly for any of us to move slowly, and LP sees collaboration as a healthier approach to problem solving. The LP leader who genuinely collaborates on data value solves problems faster. Call it “paranoid” or call it “urgency,” speed is the new currency, and in some cases leaders see their competitors making decisions much faster than they are able to do. So, some retailers will lead. Others will remain not quite paranoid enough.

Performance Is the End Game

The physical store (in a data sense) will quickly evolve to look more like the online store in that the information available about shopper behavior is vast. Real-time views of the total customer journey from entry to exit will uncover new evidence and opportunity to elevate performance.

LPV is the LP professional’s vision that leverages technology and data more broadly. DV2 is retail data volume and velocity. As physical stores are populated with low-cost sensors to leverage mobility, social media, and the need to understand customer behavior, LP will benefit from data streams that have never been seen. Harnessing this information means LP creates an advantage, and it means outperforming competition. The magic in this data is finding the discrete relationships that make decisions predictive versus reactive. LP professionals who effectively learn the art of data science will be best equipped to share value cross functionally so everyone performs. The “LP team” is now the “performance team.” They know data, and they know how to use it. They embrace the higher stakes and the broader view of store performance. In the end, higher performance ultimately means meeting a wider array of complicated customer demands. That means better customer experiences. We believe that’s what matters most.

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CAREER DEVELOPMENT By Jason Odell, CFI

Mentoring the Big Jump A

Odell currently serves as senior field asset protection manager covering the southeastern division for a large hardlines retailer. He leads a team spanning fourteen states and the Caribbean. With 19 years of experience in the loss prevention industry, Odell is recognized as a certified forensic interviewer (CFI) and is a member of the International Association of Interviewers. He is an alumnus of The Penn State University where he studied law and society. Odell can be reached by email at odelljason1@gmail.com.

Altitude Change

s leaders in the asset protection industry, we have the unique opportunity to mold our star performers from their current role to the next stage of their career. This jump in their responsibility can range from taking the journey from one store to their first multiple-store assignment, or from district to regional management. Our role in supporting this upward change is to prepare them for the vast differences they will face in their new position. Whether the changes are emotional, geographical, or functional, we owe our new leader the skills and insight to remain successful and build on the potential that brought them here. In most cases, our star is walking into their new role with limited opportunities to observe the behind-the-scenes functions that we sometimes take for granted. When our promoted leader first takes the reins of his or her new team, they are often blinded by the whirlwind of changes that are taking place in their new world. In most cases, they are too busy trying to keep up with their transformation to stop and learn how to deal with the significant changes they are enduring. Yet while these adjustments and life lessons are an important aspect of their growth and development, there are several things that we can do to mentor and assist in their journey to ensure that they are successful, and the stress of the changes are minimized.

With upward promotion comes a different level of thinking. Moving into a new role will also mean managing a different set of responsibilities. The thought process revolving around what is truly important will change and become more global. At a store or district level, AP professionals are flying close to ground level. The move to 30,000 feet can be significant, and quite often a new leader has not been prepared for this flight. Taking time to start the mental transformation will be important and will decrease stress once your mentoree gets in their new role. Take them out of their comfort zone as often as possible during the process. Your current star will thank you for it later. Report Analysis. If possible, assign higher-level reports to be reviewed, analyzed, and reported back on. This practice will provide many benefits down the road. We must teach our future leaders how to lead a team and course-correct a store without having immediate physical access to the location. Lead Store Visits. Have the mentoree lead store visits with you in other markets or stores they are not familiar with and have not previously visited. This not only gives them an opportunity to get out of their comfort zone, but also gives them a taste for the job prior to being thrown into the fire.

Communication

Prioritization

With job transition comes a change in communication. The new leader will be experiencing different kinds of discussions with a different level of leadership. Whether it is email, simple conversations, or conference calls, our mentoree should be prepared and know exactly what to expect. Here are some ways that you can help. Conference Calls. Once you’ve identified high-potential employees, allow your mentoree to run your conference calls on occasion. This helps with their confidence level and gives them a rhythm for their own calls when the time is right. Get permission for your student to listen in on other leadership calls. Whether it’s your supervisor’s calls or another member of leadership that they will likely interact with, listening in on these calls prepares them for what they will be dealing with on a first-hand basis. Email Communication. Send out practice emails that you typically get and respond to. This practice will help get them focused on the potential changes in upward communication. It might include anything from an email received from a vice president to one you simply make up. Have your mentoree respond to you and then set aside time to critique the response. This will improve their communication skills and might prevent a communication regret down the road.

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New leaders often struggle with prioritizing issues that need to be addressed. Fires can spread quickly and our mentoree will be trying to impress his or her superiors and business partners with every decision they make. The eagerness to please those important to us sometimes blindfolds the thought process, thus leading to poor and ineffective choices. This can also lead to trying to tackle too many tasks at once, which can further dilute our effectiveness. We need to teach our future leaders to prioritize decisions and projects to get the biggest impact with the least amount of time and effort. Teach the Numbers. Leaders should know where they stand in all areas of profit and loss at all given moments. This should be a consistent element of all of the various decisions that are made. Does it make us money? Does it prevent loss? Will it make the job easier? If it falls into one of these categories, our leader should take a deeper look.

Global Thinking

The decisions we make will often provide great benefits, but can also have the potential for adverse effects on our entire markets. New leaders often make situational decisions in one location that eventually bleed over to other markets. Additionally, such decisions must also

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consider the needs, culture, and strategy of the entire business to best serve the organization as a whole. These from-the-hip decisions can cause headaches that take multiple actions to undo and can tarnish the reputation of the new leader. A decision as simple as removing one SKU off the sales floor due to external theft concerns can not only affect sales and profits in the store, but also bleed to other stores and other markets replicating the mistake. Teaching our mentoree to refrain from making these quick and rash decisions and keeping a focus on the bigger picture will allow our new leader to make better decisions and eliminate pain-points with our business partners. Practice Exercises. Put your mentoree through a series of exercises and scenarios that will allow them to think about the decisions before they are thrust into the role. Your experience as an effective leader should give you plenty of scenarios to work with.

With upward promotion comes a different level of thinking. At a store or district level, AP professionals are flying close to ground level. The move to 30,000 feet can be significant, and quite often a new leader has not been prepared for this flight. New Market Visits. Have your mentoree visit other markets with you. This experience will give them an alternate view of the world we live in and dial in the larger perspective that is needed to successfully manage multiple markets. The contrasting picture will also open their eyes to the pitfalls of reacting too quickly.

A Clear, Concise Plan

Moving upward into a new role requires pinpoint planning to make the necessary changes seamless for the new leader and their team. Ensure your mentoree understands the significance that the change can have on their business partners and how this might impact their teams. Proper planning starts with understanding what needs changed, then devising a plan that will tactically and strategically implement the changes to get the most desired results. Slower Is Faster. Many new leaders start changing simply for the sake of change. The best advice I ever got from a mentor was that sometimes slower is faster. Teaching the planning process will ease a tremendous amount of pain for the duration of their career. Planning Practice. Have your mentoree construct their own plan for your area of responsibility using reports and information that can be made available to them. This will allow you to see their thought process and give them practice without consequences. Who knows, you just might see your market differently after the exercise.

Organization

One of the most important changes that should be taught is the personal organization that is required to make the big jump. Keeping

up with calendar invites, staying current with email, returning the 57 phone calls that were missed during a flight, ensuring that all work is turned in on time, and being where you are supposed to be when you are supposed to be there is something that you have mastered. It will be new set of skills for your mentoree to learn. This is critical for professional success. Providing sound advice and direction to help them manage through the organizational needs of the position will pay huge dividends for them in their new role, and for the rest of their career.

Partnerships

Effective leaders in asset protection understand that powerful things get accomplished when we build strong partnerships with our business leaders and our team. Careers can be built or destroyed by the partnerships that we gain or lose. Our mentoree needs to understand that trust and mutual respect will drive the partnerships they enter into. These important relationships are built over a period of time and need consistency to bloom to their maximum potential. Proper communication will establish the foundation of these partnerships when the correspondence is open and timely. Teach the Same-Day Rule. Our new leader should make a consistent habit of responding to emails and voicemails on the same day they are received. This can make for some long days initially, but the benefit our new leader reaps from this habit will far outweigh the upfront cost. Business partners will admire the dedication to the role, issues will be handled promptly and respect will be gained during the process. Reveal the Agendas. Partnerships cannot survive without trust. If our business colleagues uncover hidden agendas, that trust can be damaged. Our new leaders need to understand that premise and be honest about their intentions with all aspects of the business.

Influencing Change

Considering the fact that our mentoree is successful in their current role and being considered for more responsibility, they most likely have developed a strong acumen for managing through influence. Oftentimes, we have few people reporting to us, and we must rely on influence to carry out our objectives. This skill becomes more difficult to master as we move up the ladder. Navigating these waters can be challenging and discourage the new leader. Shared Vision. Leaders, new and experienced alike must create a shared vision with our business partners. This shared interest will provide a vested interest in the outcome for all parties. Everyone Must Benefit. Teach your mentoree that small sacrifices lead to big wins. In order for new initiatives to take flight, everyone must benefit. The customers, the organization, the stockholders, and the business leaders must all gain something. If not, the change will be met with opposition. Understanding where the opposition will come from will allow them to cater the change prior to initiating the adjustment. Helping your team reach their full potential and arriving at the next level is an important role that you play as a leader. Reach out to your mentoree’s weaknesses and make their strengths even stronger. Decreasing the stress level on their initial career move will make them more comfortable, better decision-makers, and stronger leaders. Teach them to succeed, and your career will grow as well.

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ASSOCIATIONS IN ACTION By Keith Aubele, CPP, LPP

ASIS International’s Retail Loss Prevention Council

ased in Alexandria, Virginia, ASIS International is the preeminent global organization for security professionals. It is a mission that takes thousands of volunteers to execute while developing critical security processes, providing professional education and career development, and serving as both a voice and a resource to those in the field of professional security. In existence since 1955, ASIS International is a proud organization with a clear and concise mission statement: “Be the recognized leader, advancing security worldwide and promoting excellence and leadership in the security management profession.” I am a member of ASIS International and have been for several years. I also hold the Certified Protection Professional (CPP) designate from the organization. As a long-tenured retail loss prevention executive with both Walmart and The Home Depot, my security education and network expanded exponentially once I was introduced to ASIS and its expansive membership. I also rely on my ASIS International peers to assist me whenever I have specific challenges, needs, or security questions, or to provide solutions and/or resources to solve the problem.

Aubele is chair of the ASIS International Retail Loss Prevention Council. For the past twelve years, he has served as president and CEO of the Retail Loss Prevention Group (RLPG) based in Bentonville, Arkansas, providing senior advisory to leading retailers and select solution providers along the retail vertical. Aubele’s retail career began with Walmart Stores culminating as director of LP. While at Walmart he was field promoted by founder Sam Walton and was one of three executives to develop the very successful Walmart Neighborhood Market concept. He then became the global VP of LP for The Home Depot. While there his team took shrink to the lowest in company history and added over 600 million dollars to the bottom line through critical process change. He holds a master’s degree in business from Troy University, a BS in criminology from Missouri Southern State University, and is a six-year veteran of the U.S. Air Force.

The significance of the council is our focus on making an impact in the reduction of loss and risk to retailers. We also provide education and tools that are on display at the ASIS annual seminar and exhibits conference, held in the fall of each year. This year ASIS International will celebrate its 60th Annual Seminar and Exhibits between Sept 29th and October 2nd in Atlanta, Georgia. The Retail LP Council will be presenting a session entitled “Critical Issues in

ASIS Council Platform

An interesting component of ASIS is their investment into the council platform. Because there are so many varied security dynamics, ASIS has developed twenty-nine distinct and unique councils to address each and every security practice in place today. Ranging from defence and intelligence to fire and life safety, pharmaceutical security, supply chain and transportation, utilities security, military and law enforcement to school services security, the councils are made up of top-performing professionals in each of these security fields and are dedicated to furthering the practice and the profession. I have served as the chairman of the Retail Loss Prevention Council for the past two years, surrounded by some of the most talented retail loss prevention and asset protection leaders in the world. Our council membership is constructed of twenty-five members, fifteen of which represent retail companies. One member is a well-recognized research scientist in the field of retail loss prevention. Another represents law enforcement in the area of organized retail crime (ORC). And the remaining members represent various support functions for retail security and asset protection. It is literally a “Who’s Who” of retail leadership.

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ASIS Retail Loss Prevention Council members staffing the council booth at the Food Marketing Institute Asset Protection Conference earlier this year included (left to right) Dr. Read Hayes, Research Scientist, LPRC; Council Chairman Keith Aubele, CPP, LPP; David Levenberg, President, Center Security Services; Kathleen Smith, Vice President of LP, Safeway; Mark Gaudette, CPP, Director of LP, Big Y Grocery; and Steven May, President and CEO, LP Innovations.

Retail Loss Prevention and Asset Protection.” Essentially it is a panel discussion focused on three critical issues facing retail loss prevention and asset protection today. It is these three issues I would like to discuss further, providing additional insight into what our council and its members focus on and have become proficient at in practice.

Issue 1: Organized Retail Crime

This significant issue continues to cost retailers millions and millions of lost revenue and bottom-line profits. The National Retail Federation estimates that ORC results in more than $30 billion in

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losses for retailers in the U.S. each and every year, and that figure is growing. ORC is a strategically structured crime organization. At its core is a very efficient series of layered networks, all working in harmony to accomplish one goal—to steal large quantities of merchandise from retailers so that they can be resold or repurposed in exchange for cash, drugs, arms, or other sources of value for the organized crime unit. The lowest level in the ORC crime syndicate is the booster. Boosters are shoplifters. The term booster originated from a previous time when “booster boxes” were commonly constructed and used by shoplifters as a tool to effectively steal valuable merchandise without detection. Boosters can be broken down into three categories. The level 1 booster is typically a person who is a drug user that needs to supply his or her habit on a daily basis. These individuals receive on average twenty cents on the dollar for every item they steal. The level 2 booster is working in a team environment and usually travels out in expansive areas crossing state or jurisdictional lines in the process. These boosters usually make twenty-five cents on the dollar for their stolen items. Finally, the third and most dangerous booster is the professional. These individuals spend all of their time stealing, inflicting the most damage to a retailer. Hauling in twenty-five cents or more per item, the professional is king in this illicit industry. Once the items are stolen, they have to be processed and sold. That is where the fence comes in. The fence represents the retail division of the ORC network. They take the items, clean them of any identifiable traits that may lead back to the original retailer that sold them, and box them for shipment and sale to their customers. Whether it’s a flea market sales strategy employed by the ORC group or online outlets are used, the group sells the goods to suspecting and unsuspecting customers. Sometimes the ORC group will even set up a brick-and-mortar store and open shop. On other occasions they may utilize a vast distribution network, flooding merchandise out to the masses at discounted prices. The ASIS Retail Loss Prevention Council works to help educate retailers on ORC activity and eradicate some of the vulnerabilities that exist within retailers today. We also work to bring retailers and their investigative teams together on large scale ORC operations. Kathleen Smith, vice president of loss prevention at Safeway, a large grocery retailer in the United States, is a member of the council and has partnered with companies such as Albertsons, CVS, Rite Aid, Target, Von’s, Walgreens, and Walmart to shut down ORC operations. Fighting organized retail crime requires an ongoing effort. The council is responsible for keeping up to speed on the latest techniques, processes, vulnerabilities, operations, and movement of major ORC groups. We offer education, assistance, and communication in dealing with this issue.

Issue 2: Technology

While technology has provided many advantages to the retail industry, it has also led to many potential risks. While this may sound like a simple statement, it’s actually rather complex. Cyber theft and crime is in the headlines each and every day as a result of

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security breaches at retail point-of-sale locations. As well, internal technology tools are available to help retailers impact loss and shrink. The council is always reviewing risk and searching for solutions to mitigate this risk. Let’s highlight a few of the focal points relating to technology. LP and IT Partnership. There has never been a better time for retail loss prevention professionals to work closely with their company’s information technology (IT) teams. This partnership helps to ensure that each and every tool is in place to secure the internal and external network, and protect against data loss and breach. It is critically important that loss prevention professionals secure access to store data points and POS systems within our brick-and-mortar locations. As has been demonstrated, thieves often corrupt data points by entering a location and downloading or manipulating POS or data tools inside the store. Vigilance is critical to providing a front-line defence for this type of technology breach. Tools. On the other side of the technology equation is the myriad of technology tools available to retailers that serve to better manage operations, improve shrink performance, and ultimately impact the bottom line in a positive way. The council will often share experiences with these disparate technology tools to offer insight and valuable perspective on how to better deploy technology for greater impact. Navigating the technology jungle is not for the faint at heart. If the wrong solution is deployed it can cost time and money, and we all know that these resources are in very short supply.

Issue 3: Scientifically Qualifying Investments

As retailers, we are constantly at a crossroads in regards to budget, need, risk mitigation, headcount, impact, and priority, just to name a few. How do you process all of this information and make educated decisions on where to spend your resource dollars, how to spend those dollars, and what the intended return on investment (ROI) will be? How do you set up your priority list based on value and impact rather than simply choosing the flavor of the month? You do it with the support of science. Today’s LP business is no longer a “stick your finger in the air to determine wind direction” profession. We are members of multi-million, and in some instances multi-billion dollar, organizations that are responsible for a division that directly impacts the profitability of these behemoths. That isn’t something you take lightly. The ASIS International Retail Loss Prevention Council is leading the charge for this change in dynamic. One of our council members and key partners is Dr. Read Hayes, research scientist and director at the University of Florida and leader of the Loss Prevention Research Council (LPRC) based in Gainesville, Florida. The LPRC is a group of retail leaders who take a scientific approach to loss prevention and asset protection solutions and processes. Nothing is left to chance, and their efforts have forged some of the most innovative and successful tools in the industry. As you can tell, the ASIS International Retail Loss Prevention Council keeps busy focused on a number of initiatives. Our objective is to be a resource in a world needing resources and to be of assistance to those who need us most. For more information on ASIS International, visit asisonline.org

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INDUSTRY NEWS

Weakening Consumer Demand Influencing Retail Results?

ales growth is the life blood of retail. Since WWII, commerce has been stimulated by the robust spending habits of the American consumer, fueled by the proliferation of new retail businesses and satellite locations. After all of these years, retail executives in all functions still succeed or suffer from results reported as a percentage of sales. Ever hear the old axiom “sales volume cures all ills?” Recent U.S. retail news was pockmarked with disappointing quarterly results from unexpected quarters, especially within the discount end of the spectrum. Rent-A-Center reported that sales revenues dropped by over $30 million in its core U.S. segment in the fiscal quarter that ended June 30. Same-store sales in that segment dropped 4.7 percent. Family Dollar Stores announced a 1.8 percent decrease in comparable store sales for its fiscal quarter ending June 1. The company also plans to close 370 underperforming stores before the end of the fiscal year, and that the net new-store growth would be barely positive. Howard Levine, CEO of Family Dollar, said it succinctly in his comments from July’s earnings conference call. “Our core low-income customers continue to deal with elevated unemployment levels, cuts to government benefits, and volatility in energy prices. They are tightly managing their spending as a result.” Sales growth remains generally positive for moderate to upscale retail. The focus on Internet-based direct sales has helped immeasurably. However, consumers are “trading down” from their normal shopping venues in order to find better value, deep discounts, or everyday low pricing in order to spend less money. Disappointing sales in the discount segment should get our attention. Aside from places like the dollar stores, Goodwill Industries, and the Salvation Army, there just aren’t any cheaper places to shop. Is this an indication that the American consumer is running out of cash and available credit? Such a constriction of demand-driven spending hasn’t been witnessed in our lifetimes. The median income, adjusted for inflation, for an adult American is now lower than it was in 1973. This is a serious erosion of purchasing power. The problem isn’t confined to retail, either. Would you believe that IBM has had nine consecutive quarters of sales declines?

Spending on Essentials

The Gallup organization conducted a comprehensive survey, titled “Consumers Spending More, Just Not on Things They Want.” They found that consumers were spending more on essentials, because prices have risen. The American consumer, they opined, is “straining against rising prices on daily essentials to afford summer travel,

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by Robert L. DiLonardo DiLonardo is a well-known authority on the electronic article surveillance business, the cost justification of security products and services, and retail accounting. He is the principal of Retail Consulting Partners, LLC (retailconsultingllc.com), a firm that provides strategic and tactical guidance in retail security equipment procurement. DiLonardo can be reached at 727-709-6961 or by email at rdilonar@tampabay.rr.com.

dining out, and discretionary household purchases—the kinds of purchases that ordinarily keep an economy humming.” Following is more from the Gallup survey. The top of the spending list: ■ Groceries—59% spent more, 10% spent less. ■ Gasoline—58% spent more, 12% spent less ■ Utilities—45% spent more, 10% spent less ■ Healthcare—42% spent more, 8% spent less ■ Household goods—32% spent more, 5% spent less ■ Rent—32% spent more, 9% spent less The bottom of the spending list: ■ Retirement savings—18% spent more, 17% spent less. ■ Leisure activities—28% spent more, 31% spent less ■ Clothing—25% spent more, 30% spent less ■ Consumer electronics—20% spent more, 31% spent less ■ Travel—26% spent more, 38% spent less ■ Dining out—26% spent more, 38% spent less

Negative Impact of the Current Job Market

Contrary to what one might read in the popular media, the current job situation in America remains troubling, especially in the lower and middle classes. More and more people must cobble together two part-time jobs instead of one good full-time job. Unfortunately, full-time jobs are still scarce and the cost of essentials is rising. David Stockman, economics blogger and former head of the Office of Management and Budget under President Reagan, noted that the level of full-time, family-supporting “breadwinner” jobs in the U.S. economy is still 4.4 percent below the 2007 peak. Millions of working-age people are still sitting discouraged on the sidelines—the labor force participation rate is 62.8 percent, matching the lowest level since 1979. People in marginal or part-time jobs are unlikely to drive consumer spending. In a recent interview with Reuters, Bill Simon, the president and CEO of Walmart U.S., said, “The hiring rebound reported by the U.S. Labor Department is not translating into increased customer spending in Walmart stores; the U.S. economy is ‘not getting any better or worse’ for Walmart’s core customers; and that the response by Walmart’s core customers to the ‘difficult’ economic environment is ‘not the best thing in the world for a retailer.’” The readership of this magazine works in a broad spectrum by retail vertical market. Each of you has had your own experience since the recession began. The sales volume axiom has worked for many years. Let’s hope things turn around sufficiently, so it remains a truism into the future.

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PEOPLE ON THE MOVE

Daniel Rojas was made an Area LP Manager for 24 Hour Fitness.

CALENDAR

Dennis McDavid was made a Regional AP Manager and Jennifer Shaffer was made an AP Analytics Manager for Regis Corporation.

September 8 – 10, 2014 Consumer Returns Westin Galleria, Dallas, TX consumerreturnsusa.com

Rod Holm is now Senior VP of Business Development for Best Security Industries.

Will Baker is now a Zone Director, and Damond Windham is now an Area LP Manager for Ross Stores.

Kennedy Adom, MBA was appointed Senior Asset Protection Analyst for Big Lots.

Thomas Franzese was appointed Regional LP Manager for Save Mart Supermarkets.

September 9 – 10, 2014 International Supply Chain Protection Organization Annual Conference Texas Scottish Rite Children’s Hospital Conference Center, Dallas, TX iscpo.org/conference

Stephen Brader was made a Regional LP Manager for The Children’s Place.

Adam Wollman was appointed District LP Manager for Sears Holdings.

Walt Merchant was made a District LP Manager for EXPRESS.

Bob Fairchild was appointed Regional LP Manager for SpartanNash.

Jim Faulds is now a Regional LP Manager for Best Buy Canada.

Tom Provost was appointed Director of Corporate AP for Follett Higher Education Group.

Pete Danner is now a Regional LP Manager for Sterling Jewelers.

John Pettit is now a Northeast Regional LP Manager for Forever 21.

John Pool was appointed Group Manager, Corporate Security Intelligence for Target.

Dave Shaffer, CFI, LPC is now an Area AP Manager for Francesca’s.

Dean Hendricks is now a Corporate Investigator for TJX.

John Bellefeuille is now Director of LP for Giant Tiger Stores.

James Pac is now a Regional LP Manager for T-Mobile USA.

Richard Aviles is now an LP Manager for Hermes of Paris.

Jorge Ramirez is the e-Commerce Fraud Administrator/Analyst for TOMS.

Matt Johnson was made a District LP Leader for JCPenney. Joy Baucom, MBA is now Global Manager of Security and LP Operations for Levi Strauss & Co.

William Ferguson is now a Market AP Manager for Walmart.

Sharon Oliver was appointed Regional LP Manager for Limited Brands. Robert Rice was appointed Principal Consultant for Loss Prevention International. Lucio Botello, MBA is now a Senior Manager of AP for Northgate Markets. Tom Mace was appointed VP of Sales, Service, and Operations for Office Depot. Nicole Campion was made Market LP Manager for Old Navy. Suzanne Castillo, CFI was appointed Associate Director of AP Operations for Ralph Lauren.

To stay up-to-date on the latest career moves as they happen, sign up for LP Insider, the magazine’s weekly e-newsletter, or visit the People on the Move page on the magazine’s website, LPportal.com. Information for People on the Move is provided by the Loss Prevention Foundation, Loss Prevention Recruiters, Jennings Executive Recruiting, and readers like you. To inform us of a promotion or new hire, email us at peopleonthemove@LPportal.com.

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September 10 – 11, 2014 Retail Council of Canada Retail Loss Prevention Conference Toronto (ON) Congress Centre retailcouncil.org September 18, 2014 Retailers Association of Massachusetts New England ORC Symposium and Tradeshow DCU Center, Worchester, MA retailersma.org September 18, 2014 NYC Cyber Security Summit New York Hilton Midtown cybersummitusa.com September 29 – October 2, 2014 ASIS International 60th Annual Seminar and Exhibits Georgia World Congress Center Atlanta, GA asisonline.org October 10 – 13, 2014 Coalition of Law Enforcement and Retail (CLEAR) 5th Annual Training Conference San Diego (CA) Marriott Mission Valley clearusa.org October 13 – 15, 2014 Loss Prevention Research Council 10th Annual Impact Conference University of Florida, Gainesville lpresearch.org November 19 – 20, 2014 ISC East Javits Center, New York City isceast.com January 11 – 13, 2015 National Retail Federation 104th Annual Big Show Javits Center, New York City bigshow15.nrf.com March 9 – 12, 2015 Food Marketing Institute Asset Protection Conference Peabody Hotel, Memphis, TN fmi.org

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DIGITAL DIALOGUE By Jacque Brittain, LPC Brittain is editorial director, digital, for LP Magazine. Formerly a director of learning design and certification, Brittain managed the development of the LPC and LPQ certification programs in collaboration with the Loss Prevention Foundation. Prior to that he was vice president of operations for the industry’s largest executive search and consulting firm. In his thirty-plus years in the LP industry, he has helped build and enhance many learning initiatives and provided career counseling for thousands of industry professionals. Brittain can be reached at jacb@lpportal.com or by phone at 704-246-3143.

Cold Heads, Warm Hearts, and Social Media

he nature of our role in loss prevention forces us to focus on many of the negative aspects often associated with social media. From the malware that slows our computers and corrupts our systems, to the spiders that grab our information and track our habits, to the criminal elements looking for ways to steal identities and breach company servers, we regularly face the worst of the digital community. When not focused directly on the sludge of society, we often center our attention on looking for strategic means to reveal and battle these adversaries, protecting the precious resources that sustain our customers and support the business. But there are also many positives that genuinely deserve our accolades and appreciation. Information that once took an eternity to gather is now right at our fingertips. Opportunities to communicate that could only be imagined only a few short years ago are now commonly used to reach those that share our lives—whether friends, family, or business partners. We’ve opened the door to countless possibilities that touch the way that we conduct business, buy and sell goods, perform job responsibilities, and generally build our personal lives and professional careers. But there are other advantages as well, and those prospects are equally deserving of our thoughts and attention. Bringing all of us together to overcome some of our greatest challenges is certainly one of those benefits.

neuromuscular diseases worldwide, and people of all races and ethnic backgrounds are affected. Over the past several weeks, the Ice Bucket Challenge™ has quite literally “soaked” the nation. Everyone from athletes and celebrities to politicians have poured buckets of ice water over his or her head and challenged others do the same or make a donation to fight ALS within twenty-four hours. Just since the end of July, the ALS Association has received more than an astonishing $108 million in donations from the cold heads and warm hearts of these wet benefactors. Contributions further the mission to find a cure for ALS, while funding the highest quality of care for people living with the disease. “We have never seen anything like this in the history of the disease,” said Barbara Newhouse, president and CEO of The ALS Association. “We couldn’t be more thrilled with the level of compassion, generosity, and sense of humor that people are exhibiting.While the monetary donations are absolutely incredible, the visibility that this disease is getting as a result of the challenge is truly invaluable.” As one might expect, the loss prevention community has been actively involved in these efforts. LP Magazine’s EyeOnLP has traversed the country looking for loss prevention practitioners and solution providers who are issuing and accepting the ALS Ice Bucket Challenge. EyeOnLP was there to watch Executive Editor Jim Lee, LPC, along with Editor and Publisher Jack Trlica call out their challenges, and many others have followed suit. To watch Jim and Jack take theirs and see some of the others who have accepted the challenge, visit the EyeOnLP page at lpportal.com. There are many tremendous causes that are deserving of our efforts and attention, and we should never lose sight of the possibilities that we can overcome and the things that we can accomplish when we work together. To learn more about ALS or make a donation, visit alsa.org. We encourage all of our readers to step up and take the challenge. Yes, we’re calling you out. Are you ready to get wet?

Accords Reached in New York

LP Magazine’s Jim Lee and Jack Trlica challenge LP industry professionals in the ALS Ice Bucket Challenge.

ALS Ice Bucket Challenge

Amyotrophic lateral sclerosis (ALS), commonly known as Lou Gehrig’s disease, is a rapidly progressive, invariably fatal neurological condition that attacks the nerve cells responsible for controlling voluntary muscles. It is one of the most common

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Significant attention has once again focused on separate claims of discriminatory profiling that surfaced late last year. Those incidents have resulted in recent settlements with the New York Attorney General’s Office, to include substantial financial resolutions as well as progressive measures intended to improve training, enhance awareness, and prevent similar issues moving forward. “Recent allegations of racial profiling at some of New York’s most famous stores stand as a stark reminder that

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the protections afforded by the Civil Rights Act of 1964 are still needed today,” Attorney General Eric Schneiderman said in a recent press release. “And that equal justice under law remains an American ideal we are striving to attain.” Barney’s New York agreed to pay $525,000 to settle lawsuits following allegations last fall that two African-American customers were falsely accused of credit card fraud in Manhattan, and that black and Latino customers were the subject of discriminatory profiling in the stores. The incidents sparked a series of protests, national attention from civil rights leaders, and calls to boycott the company. Under the terms of the settlement, Barneys also agreed to make several additional changes, to include retaining an anti-profiling consultant, establishing new record-keeping requirements on investigations conducted by loss prevention employees, and developing anti-profiling training for both loss prevention and sales employees. “Barneys New York has prided itself on providing an unparalleled customer experience to every person that comes into contact with our brand—open and welcoming to one and all,” Barney’s CEO Mark Lee said in a statement. “We are a truly progressive company that has absolutely no tolerance for discrimination of any kind, and believe this agreement will help build on that commitment and further strengthen our organization in the years and decades to come.” In related news, Macy’s has also agreed to pay $650,000 to settle allegations of racial profiling at its New York stores. The Attorney General’s Civil Rights Bureau opened an investigation last year after receiving several complaints from nearly two dozen African-American, Latino, and other customers who alleged they had been wrongfully stopped or detained by the retailer’s employees. As part of that agreement, Macy’s will designate an independent expert on anti-discrimination laws and racial-profiling prevention, employ a full-time security monitor who will internally monitor Macy’s loss prevention policies and practices, offer enhanced training and education for employees, and develop additional measures aimed at preventing discrimination against customers. “To be clear, our company’s policies strictly prohibit any form of discrimination or racial profiling, and any occurrence of such behavior will not be tolerated in our organization,” the company announced in a formal statement. “We at Macy’s are committed to fulfilling the ideals of diversity, inclusion, and respect that our company aspires to achieve—every day, in every store and office, with every customer and associate.” In addition to the specific measures taken by each retailer as outlined in the settlements, both companies have met independently with civil rights leaders and were active participants in the coalition that resulted in the Customer Bill of Rights. For more on the subject, see the feature article on profiling found on page 39.

Legomania

Following the huge success of The Lego Movie, it should come as no surprise to anyone that there would be those who would attempt to capitalize on the blockbuster movie.

The movie has made more than $258 million since its debut in February according to Box Office Mojo. The toys also generated $1.1 billion in profits in 2013. That success clearly did not go unnoticed in the world of organized retail crime (ORC). The theft and resale of Lego products seems to have emerged as one of the premium crimes of choice for ORC groups across the country. A pair of back-to-back incidents this summer highlighted the flourishing trend when Phoenix police arrested four people involving $40,000 in Legos stolen from various stores, followed by the recovery of $200,000 in Lego sets from one of the suspect’s homes. The very next week a Long Island woman was arrested with $59,000 worth of the toys and was found trying to sell 800 stolen Lego play sets online. The Lego sets stolen are typically those designed to build larger Lego projects and are often valued between $99 and $500 in retail stores. What’s more, many of the sets are considered highly collectible and can greatly appreciate in value over time, which only further underscores the potential profits associated with the thefts.

Theft, Drugs, and Rock & Roll

Police arrested a man for shoplifting razor blades at a Beverly Hills pharmacy on July 26, yet somehow it took four weeks and multiple inquiries to confirm that the man they had in custody wasn’t a famous rock musician. The man, who identified himself to police as Scott Weiland, the former frontman and singer for The Stone Temple Pilots, was jailed and charged with burglary and possession of a controlled substance after methamphetamines were also found in his possession. According to TMZ, they reached out to the Los Angeles Sheriff’s Department, who did in fact confirm that Weiland had been arrested. When TMZ released a report nearly a month after the arrest, the actual Scott Weiland posted a video from a recording studio assuring the world that he wasn’t in prison and that someone was obviously impersonating him. After Weiland posted the video, TMZ naturally called police to find out what was going on. However, police once again persisted that they did, in fact, have Weiland in custody. It wasn’t until an FBI fingerprint analysis was later conducted that they admitted the mistake and correctly identified the alleged perpetrator. It’s unclear why it took more than a month for arresting officers or anyone involved with the case to attempt to get proper legal identification or reach out to the real Scott Weiland or his legal representatives.

Contributors

As a final note, we are seeing some terrific articles being submitted by our readers for publication amongst our various channels. These articles provide great perspectives and tremendous insight into the stories that are of most interest to the LP community, and we very much appreciate your contributions. Do you have an article that you’d like to submit? We’d love to hear from you to discuss the possibilities. Contact us at editor@lpportal.com.

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PARTING WORDS

Sitting Over Coffee One Morning R ecently I was sitting having coffee with three industry executives. One was an accomplished senior LP executive for a major retailer, another was a senior officer for a major solution provider, and the third was an entrepreneur and founder of a vendor company. It was a pretty robust group, all of whom had firm convictions on retail loss prevention and the people in our industry. While we all brought very different backgrounds to the table, there were some basic ideals that we had in common. Each was proud of their accomplishments as well as the successes of those who have worked for them. Each was curious about the opinions of the others. In each I could sense that their career journey had been far more important than any potential destination. We discussed many issues and shared our opinions on a variety of topics. Here’s a sample for your consideration.

Comparing One Era with Another

Some would say Woods is better than Nicklaus. Some proclaim Ruth as the best of all time. Others maintain Edison and Ford were greater than Gates and Jobs. What say you about today’s LP professionals in comparison with 25 years ago? Today we clearly have far better technology, far better access, and an abundance of information. Some might suggest that this gives today’s executives an advantage. Others might argue that is based on tools rather than talents. But how we lead and manage our people might provide the best means of comparison. Look at today’s leaders. Do those they worked for 25 years ago deserve any credit for helping them climb the ladder? If so, then let’s see how our current leaders do with mentoring tomorrow’s leaders. That seems like a fair comparison to me.

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Jim Lee, LPC Executive Editor

Heard It Said that Vendors Need to Do Better with Their Retail Relationships

So tell us retail executive, what can the vendor do differently or better to build or keep a relationship? Here is the plain, simple truth. In most cases, we have choices. Sometimes it’s price. Sometimes it’s the style of the vendor. Sometimes it’s based on the trust and integrity of the vendor. (Wait. Does that mean sometimes it’s not?) Sometimes it’s a lack of awareness that there were possible alternatives. But it’s always based on selecting a product that’s best suited for my company.

And Vendors Feel that Retailers Need to Be More Open with Them

A retailer says, “Let’s get together and talk,” and then doesn’t reply to emails or return phone calls. Why is there a disconnect? Is it the quality of the product, the wrong solution, the price, a lack of relationship, or something else? A little straight-forward dialogue would be the best and most professional way to treat a vendor, don’t you think?

The Retailer Doesn’t Want to Become Complacent

Things are going pretty well. Business is good. Management is pleased with the shrink performance. Unfortunately, that type of thinking can be a trap. “If it isn’t broken, don’t fix it” may be the wrong way to look at something. Maybe it’s better to take the approach, “If it isn’t broken, break it.” Look at the surprises that have come our way. If we sat down and made a list of all the things that could go wrong, would we be pleased with our plans and preparations to manage them? When we don’t hear complaints or unhappiness from our LP team, does that mean they’re all pleased, or does it mean they’re afraid to speak up? Have they accepted their own complacency? We have to find objective ways to learn from our people how they are really doing. SEPTEMBER - OCTOBER 2014

That same concept applies to vendors as well. They, too, can become complacent with how they are managing the retailer relationships. Don’t make the sale and walk away.

The Entrepreneur Piped up That Developing New Relationships and Mentors Have Proven Successful

Sometimes we fool ourselves into believing that we don’t have time to work on new relationships, and that yesterday’s mentors will be right for us tomorrow. Too often I’ve had casual conversations with a retailer or vendor and not really stopped to listen. Without truly listening, how can we develop a respectful and educational relationship? Whether or not it leads to any new business, it may be very enlightening on any number of levels. The term “mentoring” can get tossed about too loosely, as if it’s just a natural occurrence. I think in today’s world, if you just have one mentor you’ve missed the boat. Cross-functional mentors, vendor mentors, peer mentors, non-retail mentors, and others can help you achieve success and internal happiness.

Sometimes We Need a Little Self-Evaluation and Self-Motivation

We all agreed that each of us is capable of making mistakes, and occasionally the fault is our own. Self-evaluation and a willingness to look within ourselves to find solutions is an important part of being a leader. All of us have our own opportunities to learn, grow, and improve. When, where, and with whom should the buck stop? Incidentally, I informed all three that they would find the interview in this issue with General Becky Halstead interesting as she addresses these very issues (see page 27). We ordered a second pot of coffee, and the four of us continued on. To be continued.

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We need to elevate our store performance

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LP can lead this conversation

Smart EAS, analytics and RFID improve our visibility LP technology does so much more now

The tech is smarter, which means better information

And better information means better customer experience

Industry roles are changing as fast as the technology is. We’ll help you think like a Chief Visibility Officer. From the big picture to a million minor details, your job is all about visibility. Creating a secure shopping environment. Managing loss prevention. Tracking millions of pieces of inventory – from the manufacturer to the shopping bag. And doing it all in one of the fastest-changing environments in global commerce. That’s why we like to think of people like you as Chief Visibility Officers – with an eye on every aspect of the industry, and the goal of improving customer experience through effective security practices backed by genuine Sensormatic® EAS technology. At Tyco Integrated Security, we get how important that is – and it’s why we work with 80 percent of the world’s Top 100 retailers on smarter ways to advance their business security. We’re more than a security company. We’re your Tyco Team.

To download our latest White Paper, visit TycoIS.com/LP 1.800.2.TYCO.IS / Safer. Smarter. Tyco.™ ©2014 Tyco. All rights reserved. Tyco and the product names listed above are marks and/or registered marks. Unauthorized use is strictly prohibited.

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V13.5

MAGAZINE

THE EVOLUTION OF THE LP PROFESSIONAL WHAT WILL LP LOOK LIKE IN THE FUTURE?

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September - October 2014

Articles inside

CERTIFICATION

ASSOCIATIONS IN ACTION

PUBLISHER’S LETTER

DIGITAL DIALOGUE

PARTING WORDS

CAREER DEVELOPMENT

INDUSTRY NEWS

EVIDENCE-BASED LP