March - April 2016

March–April 2016 | V15.2 LOSSPREVENTIONMEDIA.COM

LOSS PREVENTION MAGAZINE THE AUTHORITY ON ALL THINGS ASSET PROTECTION

Analytics Where Big Data Is Taking LP and the Retail Enterprise

PROFESSIONAL DEVELOPMENT AND CAREER GROWTH FINDINGS OF PWC’S RETAIL INDUSTRY SURVEY OMISSIONS AND BIAS IN MAKING A MURDERER

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Table of Contents 6

EDITOR’S LETTER

The Future of Retail Loss Prevention

By Jack Trlica

8 ON THE WEB 10 R ETAIL SPONSORS 12 INTERVIEWING

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Analytics

Take Some Notes

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

Where big data is taking loss prevention and the retail enterprise

24

By Chris Trlica, Contributing Writer

ACADEMIC VIEWPOINT Outplaced: Committing Loss Prevention Suicide?

By Richard C. Hollinger, PhD

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FUTURE OF LP

EMV: Not the End of Fraud, but a Helpful Tool

By Tom Meehan, CFI

Changing Roles and Challenges in Loss Prevention

38

STRATEGIES

Grasping the Future and Today: A Balancing Act

By Steve Sell

48 PERSPECTIVES

Retirement and Thanks

An interview with four senior executives on professional development and career growth

By Claude R. Verville, LPC

50

By James Lee, LPC, Executive Editor

CERTIFICATION

Helping Loss Prevention Professionals in Their Time of Need

By Gene Smith, LPC

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Rethinking Loss Prevention and Shrink Management

EVIDENCE-BASED LP Watch Trends to Plan for the Future

By Read Hayes, PhD, CPP

54

PARTNERING WITH RETAILERS How eBay Works with Law Enforcement

By Dave DiSilva

Findings of PwC’s 2015 retail industry survey

By William “Bill” Titus and Suni Shamapande, PricewaterhouseCoopers

63

SOLUTIONS SHOWCASE

65

MY TURN

- BSI - Sysrepublic

Data Analysis: The Key to Good Loss Prevention and a Great Career

By Eric Mickelson

68

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71 PEOPLE ON THE MOVE 71 C ALENDAR 72 ADVERTISER DIRECTORY 73 VENDOR SPONSORS 74 PARTING WORDS

The omission of critical facts creates bias

The Audacity

By Jim Lee, LPC

By David Thompson, CFI, Wicklander-Zulawski & Associates march–april 2016

In Terms of Professional Development, Relevance Is a Product of Evolution

By Jacque Brittain, LPC

Netflix’s Making a Murderer

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Editor’s Letter

LOSS PREVENTION MAGAZINE

The Future of Retail Loss Prevention

T

his is the time of year when loss prevention executives often bring their field team into corporate headquarters or a destination location to review the past year’s results and discuss the objectives for the coming year. It is both a celebration of the team’s and individuals’ successes, as well as a critical examination of opportunities missed.

Those of us at the magazine are privileged to sometimes be invited to attend these meetings. It is a wonderful opportunity for us to observe the interactions of a loss prevention organization. It is also an opportunity to meet and interact with the people on the front lines of our industry. Over the past three months I’ve attended several such meetings. I want to share some of my observations as someone from the outside looking in on these organizations.

My first takeaway is how grounded and competent the vast majority of the professionals are in our industry. Whether they are young in the industry or grizzled veterans, most of the individuals working in the field or on corporate staff are enthusiastic, focused professionals. I’ve been associated with the loss prevention industry since the early 1990s. It was my observation then and reinforced now that individuals in loss prevention are doers—people who get things done and done the right way. Perhaps it’s the personalities that are attracted to our industry; maybe it’s the roles they play in the organization. For whatever reason, most LP professionals meet and often exceed in the tasks they are given.

Another observation is that the leaders of these organizations are great mentors and managers. I see that in their

strategic thinking and alignment with their corporate objectives. It’s obvious in their direct reports as well who are not just good soldiers for their executive, but also good generals in their own right managing their individual teams within the organization. Most of the pyramid heads I observe are a far cry from being dictators.

Instead they lead by example with compassion and positivity. You see it in the interactions they have with individuals throughout the team and the look in the eyes of a district manager or corporate analyst when they talk face-to-face with the executive.

As strong leaders who oversee organizations that get things done, it is no mystery why loss prevention executives are gaining more and more responsibility within the enterprise. Not too many years ago, these organizations were simply “the guys who catch shoplifters” or “the people who come into the store to fire someone.”

My, how that has changed. Now these organizations are often managing inventory, safety, compliance, risk management, logistics, and increasingly data and information security.

These observations combine to give me a very positive view of the future of our industry. We have strong, forward-thinking leaders as well as energetic, credentialed, accomplished professionals at all levels of the organization who will one day lead their own multifaceted teams. The future of retail loss prevention is bright indeed.

Jack Trlica Managing Editor

Loss Prevention, 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 MANAGING EDITOR Jack Trlica JackT@LPportal.com EXECUTIVE EDITOR James Lee, LPC JimL@LPportal.com EDITORIAL DIRECTOR, DIGITAL Jacque Brittain, LPC JacB@LPportal.com MANAGING EDITOR, DIGITAL Kelsey Seidler KelseyS@LPportal.com CONTRIBUTORS Dave DiSilva Read Hayes, PhD, CPP Richard C. Hollinger, PhD Walter Palmer, CFI, CPP, CFE Gene Smith, LPC Shane G. Sturman, CFI, CPP Bill Turner, LPC Claude R. Verville, LPC 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 CREATIVE DIRECTOR Larry Preslar ADVERTISING MANAGER Ben Skidmore 972-587-9064 office, 972-692-8138 fax BenS@LPportal.com EAST COAST AD 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 Loss Prevention aka LP Magazine aka LPM (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 circulation@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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Leo Anguiano, LPC Senior Director, Asset Protection, Rite Aid

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Frank Johns, LPC Chairman, The Loss Prevention Foundation Mike Lamb, LPC Vice President, Asset Protection & Safety, Walmart Stores US

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interviewing

Take Some Notes

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

W

e all have jotted down some notes regarding a conversation—something we wanted to remember or just a simple to-do list. Most of us have never had any training in taking notes, but instead just kind of developed our own style that sort of seemed to work. Universities recognized that students had little or no training in note taking, so they helped by developing note-taking systems and strategies to help the fledgling freshmen. Interestingly, we have been using these strategies for years without knowing that the universities had established some formats. A simple Google search will turn up a number of college training programs that you might find interesting.

When listening to an educator, the student attempts to determine what are the most important points in the lecture to help decide what will be on the upcoming test. Interviewers are looking for clues to help identify whether the person is truthful or untruthful, withholding information, or where additional details might be uncovered through their questioning.

If there is critical detail that must be captured during a subject interview, a recording is the best way to make sure each word is captured. There may be instances where this is impossible or against policy, which makes note taking a critical component of capturing the information.

In a criminal investigation one of the first areas that will be explored by the interviewer consists of biographical information relating to the subject. This area of discussion will assist the interviewer in establishing the subject’s behavioral norm in areas where he is likely to be giving truthful information. This portion of the interview helps the investigator become accustomed to the subject’s demeanor, voice patterns, and speed of delivery.

The interviewer easily controls this section by primarily asking closed-ended questions to elicit specific information relating to the subject’s background. In our interviews, we often use a preprinted

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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. © 2016 Wicklander-Zulawski & Associates, Inc.

form to capture this basic information before moving on to the next phases of the interview.

Note taking is unlikely to be an exact transcription of the conversation, even when the witness is also taking notes. Note takers can generally write twenty-five to thirty words per minute, while the speaker is talking at 110 to 160 words per minute.

Clearly, contemporaneous note taking will not capture a verbatim response from a subject unless the interviewer continually interrupts the narrative to transcribe everything said. If capturing everything said during the interview is important, the investigator should consider whether or not the conversation should be recorded. Plus, interrupting the story will impede the individual’s recall of the event.

Preparation

Preparation is a key consideration for any interview.

Establishing what information the subject might possess and having some idea what the elements of the particular crime being investigated are will help formulate the topics that are necessary to cover. Preplanning for the interview can help organize the topics necessary to be covered and even their potential order of importance. Think of the preplanning as a classroom exercise where the syllabus and reading materials provide the general topics likely to be explored during the educator’s lecture. Knowing this information would allow the listener to use an outline type of format to take notes during the class.

After the interviewer has established rapport with the individual, he prepares to move into the untainted narrative portion of the subject’s story or alibi. This untainted narrative is the first time the story is offered, and it is likely to lack the detail and depth required by the investigator. This first telling is what the subject feels is important, and this is likely to provide the beginning of a timeline of events relevant to the investigation.

If the person being interviewed is a subject-matter expert concerning business events or processes, then the investigator is looking for background information to compare against what he is told by upcoming interviewees. Some investigators rely on a witness to take contemporaneous notes of the conversation.

While this can be effective, we believe an investigator should take his own notes relating to the conversation to assist in recall and evaluation of the subject’s story. continued on page 14

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Note-Taking Format

Our general practice is to use a legal pad for note taking. This provides a relatively large surface to write notes, and the pages remain in chronological order unless removed from the tablet.

Moving from page to page, it is wise to number each subsequent page, so the investigator can be certain of their order. On the first sheet of the notes, we put the subject’s name, date, and the location of the interview. In addition, if there are multiple individuals involved in the story, we assign them a shorthand notation to identify them. For example, subject number one would be identified as S1-Tom Jones, S2-Terry Smith, S3-Tom Barker, and so on until everyone has been assigned a number. This allows the investigator to quickly identify the party being spoken about without confusion.

So the investigator might write S1 arrives 8:55 a.m., and we would immediately know that this is Tom Jones, rather than Tom Barker.

Shorthand

Developing a short hand of commonly used words and phrases will also help to keep up with the subject’s narrative or her more lengthy answers to questions. For example, we use IDK to indicate “I don’t know the answer to that” or IDR for “I don’t remember.”

If a series of words are an exact quote they are placed in quotation marks. We also circle key words to show importance or a need to more fully explore the meaning. We might circle words such as “about,” “usually,” “he appeared nervous,” “he rushed,” or “he was very animated.” They are adjectives, descriptions, or estimates that indicate there may be more information available if the investigator probes. We circle them so as not to interrupt the flow of the subject’s narrative, but also to indicate areas we need to explore more fully.

Critical areas of the interview can be highlighted with a star to the left edge of the paper and a line drawn to the point in the narrative or time line that is very important. These areas could be verbal statements or physical movements that might indicate areas of stress and need to be explored more fully.

Indicate physical behavioral changes by drawing a line across the page to the left side and marking it with an “M” to indicate a movement or large body shift. While we don’t know the reason for the movement, the questioning will return to this area later in the interview to determine if it was random or the result of stress. We don’t generally worry about the exact description of the movement; we just indicate that one occurred. Think of these movements as possible stress points that need to be more fully explored, rather than indicators of deception.

Formatting the Page

To prepare the legal pad for note taking, draw a vertical line about 25 percent to the right of the left edge of the paper. Draw a horizontal line from the left side of the paper to the right side of the paper about two inches from the bottom. (See sample note page above.)

Effectively, what you have done is made a column on the left and a row at the very bottom of the paper, which leaves a large open area for note taking to the top right of the paper. The small column on the left is used to identify areas where there is a significant change in verbal or physical behavior in the story or to note something important that was said. The row at the bottom of the

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page is used to identify evidence that must be followed up on or possibly an investigative lead contained in the subject’s statements.

For example, the investigator might write, “Obtain bank deposits made last three months.” Using this bottom row provides a space for the investigator to capture information he might otherwise forget later on. There are a number of commercially available legal pads with this style of preprinted pages if you don’t mind shelling out the extra money.

The large open area to the right of the page is where we take the notes detailing the subject’s story. If you imagine dividing this space into three columns, we use the far right column as the time line of the first telling of the story. This is the uninterrupted narrative with as much detail as the subject includes and is the basic outline of the story. As the interviewer begins to use questions to expand the details, he uses the second imaginary column to write these details using a horizontal line to show where it fits in the timeline. The third column offers space to capture the answers to additional expansion of the details and to show where they belong in the timeline.

One page is often not sufficient to contain all the notes.

Considering the time line, the interviewer divides the line into logical breaking points. The interviewer then uses the next pages to expand the details of the narrative of each of these sections. So the second page might provide much more exquisite detail of the time between the subject’s arrival at work and when she logged into the register at opening. The investigator drills down the details during this section and then expands the next section and next until all the sections of the timeline have been full explored.

If there is critical detail that must be captured during a subject interview, a recording is the best way to make sure each word is captured. There may be instances where this is impossible or against policy, which makes note taking a critical component of capturing the information. The interviewer working with the witness can often establish a clear and comprehensive record of what was said and its context if a recording is not possible.

LOSSPREVENTIONMEDIA.COM

FEATURE

Analytics Where Big Data Is Taking LP and the Retail Enterprise

By Chris Trlica, Contributing Writer

Where Big Data Is Taking LP and the Retail Enterprise

W

ithout consciously realizing it, and certainly without having made a conscious decision to pursue it, we as a society find ourselves living in a time when nearly every public thing we do, every decision we make, is recorded. Everywhere we drive, everything we buy without cash, the names of people we talk with, most of what we read—all is being recorded somewhere. Ten years ago this state of affairs would have seemed some fringe conspiracy. But we as individuals have just sort of gone along with it in the vague hope that somebody on the other end is being responsible with the information we either volunteer or have no choice in giving up.

The loss prevention industry finds itself in a position of being one of those “somebodies” on the other end. By nature a conservative, risk-averse beast, the LP industry is well suited to the task of playing steward to this enormously valuable, enormously risky set of big data. And when used properly, LP is also well suited to the role of leader when it comes to guiding other retail segments toward best practices and responsible use.

Analytics is the side of big data that doesn’t have to worry as much about risks. Analytics plays with the data, extracting the patterns and putting them to useful ends. But guarding the data—cyber security—is outside the scope of analytics. Nevertheless, it’s important to keep in mind during any discussion of analytics that all of the data comes from somewhere and could have wide-ranging, possibly calamitous effects if not well protected.

The modern data-focused trajectory of retail Tom Meehan, CFI has accelerated its own pace of change and with it the rate at which a response is necessary in order for a retailer to remain competitive.

“The traditional LP person is focused on tangible things in brick and mortar,” said Tom Meehan, CFI, Bloomingdale’s corporate manager of data, systems, and central investigations. “But today, by the

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By nature a conservative, risk-averse beast, the LP industry is well suited to the task of playing steward to this enormously valuable, enormously risky set of big data. And when used properly, LP is also well suited to the role of leader when it comes to guiding other retail segments toward best practices and responsible use. time your loss is tangible, it’s already out of control.”

With the ongoing shift from conventional channels to multichannel, omni-channel, and now unified commerce, staying on top of the data—data that’s coming in from the many disparate avenues of the business—is essential to serving the multitude of platforms that consumers march–april 2016

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have come to use. “If we follow suit with the industry, we’re going to need to utilize data more to be able to make better business decisions in real time, especially given the omni-channel environment,” said Meehan. “If I didn’t utilize data, I wouldn’t be able to make business decisions. Behavior analytics is, in my opinion, the key to success in our future. I’m a big proponent of

Where Big Data Is Taking LP and the Retail Enterprise focusing on deviant behavior to identify anomalies. It’s looking at the behavior that’s driving the data. What our data guy says is, ‘There’s a lot of noise, but it’s all we have.’”

How Analytics Works

Using computers to search for patterns is all analytics really is. When an LP professional on the floor in a brick-and-mortar store notices certain tells common to bad actors in their stores, or gains a sixth sense when it comes to intuiting an investigation, he is taking inputs of data from his eyes and his ears and, consciously as well as subconsciously, finding patterns in that data. Analytics does the same thing, just using computers instead of the human brain and using hundreds or thousands of data feeds from all across the retail organization instead of human eyes and human ears.

Analytics has gained a certain mystique, surrounded by esoteric terminology like “Markov chain Monte Carlo sampling” or “traversing

million-dimensional Bayesian solution space.” And, true, the actual methods behind the approach—what goes on under the hood—is something that requires an advanced understanding of mathematics and statistical methods to really get. But what analytics does is quite simple. What analytics does is automatically, and in real time, look at the cornucopia of data streams available and search for patterns that have an impact on profit.

It supports the eyes and ears of an LP floor team member or investigator with computer files: point-of-sale (POS) feeds, employee time clocks, direct-store-delivery (DSD) manifests, inventories, and other kinds of data central to the running of the business. It can also use less obvious data sources. Video analytics can pull out information like average group size of customers entering the store or heat maps of which aisles or displays customers spend the most time around. Floorplans can be overlaid with all sorts of information pertaining to the within-store geographic centers of profit and loss.

Even social media can be used. Crawling Twitter and Facebook posts looking for mentions of the company or of key brands can be used to predict when spikes of sales or loss occur and help illuminate why they occur.

These data are usually available as time series, that is, as data points connected to a timeline. So by lining up the timelines of different kinds of data beside the timelines of profitability, you can see which variables impact shrink as well as which don’t matter as much.

Analytics just takes this concept to an extreme of sophistication, comparing thousands of variables, seeing if co-variance between a group of variables can explain profitability fluctuations if a single variable cannot, and searching for patterns that might not be immediately apparent, like if an indicator from six months ago is impacting shrink today.

Watching these leading indicators closely can help ensure that the day six months from now where the loss would have occurred never actually comes. Analytics enables the business to act predictively

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Where Big Data Is Taking LP and the Retail Enterprise

and proactively rather than descriptively and reactively.

Some indicators may not be direct in their influence on shrink. “We find that high cash over and short activity points to high shrink,” said Johnny Custer, LPC, CFI, director of analytics at Sears, “not necessarily because of direct effects, but because it shows there’s not attention to detail. And if there’s not attention to detail at the register, then there’s not going to be attention to detail for the more complicated things.” In such cases, addressing that one issue won’t fix the shrink problem since the root cause is Johnny Custer, LPC, CFI being ignored. But they are still valuable for the information they provide. “Look at the data points found throughout your enterprise, such as POS, inventory management, and others to see which ones truly have the highest impact on shrink and profit erosion,” said Custer. “Sometimes things like an employee morale test can act sort of like a profitability mood ring. In instances like that where you can isolate and measure some of these more ‘obscure’ data points, it can show you specifically where to focus your efforts.”

When constructing an analytical model, you’re trying to isolate which variables have the most explanatory power when it comes to the factors you’re interested in—profit and loss. But these things change

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“One of the main pieces that is important to communicate is that you’re building a predictive model. It’s a growing, organic report. We’re always adding to it, taking things away, and modifying. What’s important in December might not be important in August. After a few years, when your loss has stabilized, it becomes as much or more about sustaining those results.”

– Johnny Custer, LPC, CFI, Director of Analytics, Sears over time, as do the contributing factors.

Furthermore, the algorithmic methods and the software tools used are continually improving. What this means is that model building in analytics is not a one-time thing. It’s not like constructing a building; it’s more like the inventory on the shelves inside the building. You’re constantly adding things and taking things away to see what’s most successful.

“One of the main pieces that is important to communicate is that you’re building a predictive model,” said Custer, “It’s a growing, organic report. We’re always adding to it, taking things away, march–april 2016

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and modifying. What’s important in December might not be important in August. After a few years, when your loss has stabilized, it becomes as much or more about sustaining those results.”

Teaching a New Dog Old Tricks

As the LP function continues to morph into something more integrated with the digital world and the vast and varied streams of data associated with that world, the skillset required of LP professionals also changes. “In the past,” said Meehan, “we’ve always taken LP people and tried

to make them analysts. We’d take a guy who was great in the field and put him with a guy who was great at Excel. I’ve found that it’s a lot harder to teach a field LP guy statistics or advanced mathematics than it is to take a stats guy and teach him how we catch bad guys.”

Each organization will find a different balance between training field LP professionals in analytics and training analysts in fieldwork. “The older generation is very much about LP fundamentals—investigations, catching bad guys, being safety-minded,” said Custer. “Then we have a very new crop of people who are 100 percent data-centric. We have to meet in the middle. I worry that if we go too far to the analytics side, then we lose what we’re really good at. There’s always going to be a need for that ‘gut feeling,’ a need for good investigations.

I worry what happens when the new crop of LP personnel are only about analytics. I think anyone entering the field, whether straight from school with a statistics degree or coming from law enforcement or military, or from elsewhere in retail, they need the fundamental, foundational LP view. And they also need to get a comprehensive understanding of the company as a whole, not just catching bad guys.”

The opportunity now also exists for enterprising people either entering the profession or already on the LP path to aim toward exposure and training in as many facets of the job as possible, knowing the role that analytics and big data will be playing in the future as well as the importance of the stock-in-trade in the field.

Likewise, the opportunity exists for forward-looking companies to train the next generation of industry leaders holistically, creating opportunities for employees to have exposure to the role through a variety of lenses. Firsthand experience on each side could strengthen the position of the employee in all roles they perform, setting up the organization for future success.

Selling to Operators

Having boatloads of data is all well and good, but it’s useless unless it’s translated into changing the way the business actually functions. And a big part of taking the patterns unearthed by analytics methods into the real world starts with convincing operators, merchandisers, and the like that the data is worth paying attention to.

But it takes more than just showing that you’ve discovered real, significant patterns, Custer pointed out, “It’s a hard transition for an LP program to go from 100 percent traditional LP by immediately shifting 180 degrees and then burying them in data.

The key is not just creating and distributing data, but also having strong reports that are digestible and actionable. Unless you give them information they can actually act on, there’s not much they can do about it. They want to see and understand the direct shrink and margin impact, as well as exactly what they can do to influence the numbers.

“Sales reducing activities (SRAs) are one group of actionable leading indicators that the field works with every day. SRAs are any occurrence within a transaction that subtracts from the full value of a sale, such as coupons, voids, and price overrides. A

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continued on page 20 LP Magazine | march–april 2016

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Where Big Data Is Taking LP and the Retail Enterprise continued from page 19

“Cyber security is independent and has to be a part of every single systems initiative you have. You have to keep it separate from business intelligence and big data. The truth is, we’ve always had the most amount of personal data. It’s not because we’ve wanted to, but because we’ve had to. Without it, we can’t effectively do our job. But there are lots of things we can do on our end to build systems to protect the data.”

– Tom Meehan, CFI, Corporate Manager of Data, Systems, and Central Investigations, Bloomingdale’s 20

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large percentage of investigators still only look at the theft and fraud aspect of SRAs. What happens when I line up those high-ranking SRA stores and draw a direct correlation to shrink and margin erosion in 94 to 97 percent of your stores? This should raise a number of eyebrows. Certainly we can write off a good portion of SRAs to customer service, an expected and sometimes necessary part of driving sales.

However, a significant number of SRAs are due to fraud, operational deficiency, poor training, or even flat-out laziness.

Because of these strong correlations, I can leverage SRA and other leading indicators to produce an actionable report that tells me store 1234 has a 70 percent chance of hitting the wall six to eight months from now. Using the data as an educational tool, showing the math—that’s how you build credibility in your program. That’s how you get people to listen to you. You can’t argue with math,” explained Custer.

It’s also how the LP role becomes a more central, more valued part of the business. “If we can influence our partners to see why these numbers are so important,” said Custer, “We can sit down and have productive conversations with our store partners and educate them on whether and why we think their issue is theft, a training issue because of one thing, or an operational breakdown because of something else. We can then provide informed recommendations. Now, all of a sudden LP gets a much more important seat at the table. We’re now talking about driving sales, improved customer service, better gross margin; not just minimizing the bad stuff.”

Along the same lines, analytics can serve as a bridge into other parts of the business. Since other teams in the business are also realizing the value of analytics, they are also collecting data and building models to further their own goals. Reaching out to those personnel elsewhere in the business who are involved in similar tasks could result in mutually beneficial data sharing and workload

Where Big Data Is Taking LP and the Retail Enterprise reductions through fresh perspectives and redundancy elimination.

“It’s about getting the right people on the phone,” said Meehan. “Data is a very unique skillset. I hired a guy with a master’s degree in statistics, and what he did right when he got here was get me involved with people I would never have known about in other areas of the business because I don’t speak their language. LP has always had good data. We have data they don’t have, and they have data we don’t have. We have different strengths and focuses, but those can be complementary.

So if you go into the meeting with the mindset that we have a common goal of profitability, when you’re speaking the same language and have the same goals, you’re going to get good results. For example, marketing teams make look-alike models to replicate good customers. How many times have you sat down with your marketing team and said, ‘Let’s look at what a bad customer looks like’? The math is exactly the same. All you have to do is reverse engineer it. The opposite of good is bad.”

Big Data, Big Risk

With the power of analytics comes responsibility. Collecting and storing vast amounts of data has come back to bite thousands of organizations over the past several years. And many were truly massive breaches in national or global organizations—Target, Home Depot, the Department of Justice. Even the Department of Defense has had its system breached and massive amounts of personal data stolen (and in their case also highly sensitive and highly valuable classified documents). It’s bad enough when data thieves take credit cards. While there are systems in place to deactivate stolen card numbers and reissue cards to the rightful cardholders, consumers still suffer, and the damage done to a brand can be enormous. But when more than credit card data is stolen—especially personal data—the damage to consumers and the subsequent damage to a company can be downright catastrophic.

Identity theft is nothing new.

What is new is the scale of exposure.

A moderately sized national retailer

may store highly personal identifying information on millions of customers. And the kinds of information being retained are unprecedented. What havoc could thieves wreak with data about millions of Americans’ brand preferences and buying habits? Nobody may quite be sure yet, but if history has taught us anything, it’s that it would be foolishly reckless to assume that such data is useless to attackers and would present no risk. Before computers, nobody (except a few sci-fi authors) imagined that computer viruses would be a risk; the risks of the future are unthinkable until the systems that enable them are actually built and used for a time. New systems create alongside them entirely novel risks and avenues of attack.

The damage potential of highly public revelations of data theft should ensure any company embarking on large-scale data collection does so in the most careful, deliberate, systematic way possible, taking into account all possible vulnerabilities and designing redundant systems to protect against any imaginable attack—and ideally to protect against unimaginable attacks

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Where Big Data Is Taking LP and the Retail Enterprise as well. Clearly, not all companies have approached data collection so responsibly.

Each LP team member is responsible for doing their own part—even if it’s as small as practicing good password habits—in ensuring that their own organizations’ systems are secure. But even the most diligent team can be affected if other companies are slack. The risks of consumer pushback, overburdening legislation, and social movement away from free, careless data sharing exist if any one member of the corporate community suffers an attack. Each individual company’s failure reflects on the whole, as consumers think, “If this can happen to company X, why not to company Y?” And so the potential for a sort of tragedy of the commons exists. It is in each organization’s best interests to ensure that other companies, even competitors, are using best practices to ensure their customers’ data is secure.

Industry meetings and taskforces exist to help further this end, but data security is one area where a proactive approach is absolutely essential.

And solutions do exist. Protecting data is not impossible. It is the job of the system architects, the cyber security team, and IT networking much more than the analytics team. But analytics is still generating and storing important new data and needs to make sure it is playing its part. “Cyber security is independent and has to be a part of every single systems initiative you have,” said Meehan. “You have to keep it separate from business intelligence and big data. The truth is, we’ve always had the most amount of personal data.

It’s not because we’ve wanted to, but because we’ve had to. Without it, we can’t effectively do our job. But there are lots of things we can do on our end to build systems to protect the data. It’s important that everybody in the company knows what we have, where we got it, and what we’re doing with it. So we need to make sure to have the same checks and balances in place to make sure to protect the company’s profits for our own sake and our customers’ sake.”

Many companies have built systems that mask personally identifying information. By looking at the same data, investigations can be pursued and

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cases built without looking at personal information. Instead of watching “Alice Susan Smith, birthdate 08/15/1988,” an investigator can watch “Case 385825” or “Person Turquoise.” “I don’t need to know it’s you right away,” explained Meehan. “I don’t need to know it’s you until I’ve built a case. You can build a system that’s 100 percent masked and protected and still identify the same behaviors. I’d still say we’re in infancy. We’re not ever looking at details until I have built a case and am ready to apprehend.”

The point isn’t to mask a suspect’s identity from investigators. The investigator isn’t the person customer data needs to be protected from. The point is that if a system has been put into place that makes all customer data pre-anonymized, with proper encryption and access protocols, then if that system or database was stolen, a thief would have information about “Customer 959544” instead of “Alice Susan Smith.”

Actually, if properly implemented, instead of “Alice Susan Smith, birthdate 08/15/1988, makeup brand preference X, bread brand preference Y,” the thief would come away with a bunch of hashed, encrypted gobbledygook like “JFDfj#ajd$f7t02jfjjfa09fa&F.”

Piecing It Together

One recurring issue when talking about analytics is that everybody talks about it a bit differently. According to Meehan, this is a reflection of the fact that everyone in the LP industry is in a different place when it comes to analytics. “Some folks have one guy on Excel, while others have whole teams of people dedicated to analytics. The industry is using much more sophisticated tools today compared to three years ago, but it’s important to realize the limitations of what you’re doing. In the LP world I rarely talk to anyone who is doing anything more than linear regression and basic modelling. That kind of thing might even be a detriment because what you’re getting from it is not what you think you’re getting.”

Each organization is going to piece together its own solution in its own way, and there’s nothing wrong with that. But building an analytics solution is a process; there are no plug-and-play,

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turnkey solutions like there are in other technological domains. “There are folks out there looking for that secret sauce, one-stop solution,” said Meehan, “but that really doesn’t exist.”

Advances in the fields of analytics happen at universities, in the pages of statistics and machine-learning journals, and on the project pages of software development groups. There is already enormous variety in methods and approaches, but as LP more fully embraces data analytics as a core competency, more attention will be paid to breakthroughs in the field. New, better ways of doing things will be adopted. Enterprising teams who develop methods in-house may even contribute to the field by publishing their approaches. All in all, the data side of LP stands to gain from opening a dialogue with its analogues in academia. “If we’re not experts, if we don’t have experts in the industry, then we need to lean on the experts,” said Meehan, “and there’s nothing wrong with that.”

But continuing to emphasize the foundational approaches to loss prevention will be more important than ever, as the scope of the LP role within an organization broadens and blurs.

Especially important will be training the new computer- and statistics-focused hires on traditional LP skills and on how the business works as a whole, preemptively addressing potential issues of scope myopia. Finally, making sure to protect customers’ personal data should be an omnipresent imperative for anyone working in the field. There is huge potential risk if data is mishandled, and the ways that analytics is modifying these risks hasn’t been well explored. Once again there is a prime opportunity for the LP industry to take a leadership role in exploring these risks, reaching out across business lines, and mitigating them. It’s a new path, and it’s dark up ahead, so we should walk carefully.

CHRIS TRLICA is a business and technology analyst based in North Carolina.

He is a contributing writer to LP Magazine focusing on emerging technologies. Trlica can be reached at chris.trlica@gmail.com

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academic viewpoint ACADEMIC VIEWPOINT

Outplaced: Committing Loss Prevention Suicide?

T

by Richard C. Hollinger, PhD 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. © 2016 Richard C. Hollinger

his year I will turn sixty-six years old and intend to retire after over thirty-six years in academia, including thirty-three years at the University of Florida. I will still be affiliated with the University of Florida as a professor emeritus. This is a voluntary decision that my wife, Candy, and I have made on our own. We both are looking forward to this new chapter in our lives. There are many places and experiences that remain unchecked on our “bucket list.” Hopefully, the LP Magazine team will allow me to continue to write this column.

A Disturbing Trend

While contemplating this voluntary change in my life, I began to notice that many senior loss prevention and asset protection executives, most years younger than me, were recently being “outplaced” due to downsizing and reorganization in their

My concern is that many senior loss prevention professionals and friends who have contributed years of their lives to enhancing the profitability of their companies now find themselves involuntarily without jobs.

From my perspective it seems like the bean counters of the entire retail industry have suddenly forgotten about the years of experience that are being sacrificed. If there were corresponding new jobs in retail LP being created, this might be a different story.

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companies. I must admit that since I live in the ivory tower of academia, I had never heard of the word “outplaced.”

Regardless of what you call it, my concern is that many senior loss prevention professionals and friends who have contributed years of their lives to enhancing the profitability of their companies now find themselves involuntarily without jobs. From my perspective it seems like the bean counters of the entire retail industry have suddenly forgotten about the years of experience that are being sacrificed. If there were corresponding new jobs in retail LP being created, this might be a different story. However, just when the battle against organized retail crime, employee theft, vendor fraud, embezzlement, and data breaches is on the verge of being won, C-level retail executives have decided to “outplace” the very people whom they need to win the war and to improve the profitability of their firms.

Forgive me for being so frank, but what I see happening around me sounds crazy. This would be like a major university outplacing all its senior professors, instructors, mentors, and researchers and replacing them with young graduate students and recently finished PhDs. The quality of the institution would instantly be diminished, and years of hard-earned reputation would be lost. The quality of the education of generations would be affected.

Short-Sighted Insanity

I realize that I do not work in the world of business in which progress and profitability is measured in weeks, not decades, but I feel that something has be said to point out the insanity that seems to be happening right now in retail loss prevention. Is it not obvious to others reading this column that the short-term savings gained in senior loss prevention executive salaries will quickly be lost in the inevitable rise in shrinkage and loss of profitability? This seems to be a classic example of cutting off your nose to spite your face.

Just when the economy seems to be turning around from the crash of 2008 and the resulting Great Recession, a mere six years later the retail industry seems to be committing loss prevention suicide.

When I look at the names of people who have been recently outplaced, I wonder who will fill out the questionnaires for the next 2016 National Retail Security Survey—perhaps no one, since the email and mailing lists that we will be working from are no longer accurate.

Yes, perhaps I am exaggerating the risk, and the retail industry is not coming to an end. But I am convinced that in the profession of retail loss prevention, there will no longer be the level of experience and wisdom that existed just a few months ago. |

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Future of lp

By Tom Meehan, CFI

EMV: Not the End of Fraud, but a Helpful Tool

Meehan is the corporate manager of data, systems, and central investigations with Bloomingdale’s where he is responsible for physical security, internal investigations, LP systems, and data analytics. Meehan specializes in new technology deployments, business intelligence, industrial intelligence, and systems implementation and design. Meehan brings nineteen years of expertise in retail LP, information technology, and process improvement, the last eleven years with Bloomingdale’s and eight years prior to that with Home Depot. Meehan is also chair of the LPRC’s future of LP working group and co-chair of the fraud working group. He can be reached at tom.meehan@bloomingdales.com.

raud and cyber security have never been more on the forefront of asset protection professionals’ list of things that keep them up at night than they are today. With the introduction of the EMV chip, we were hoping to get a little bit more sleep at night. However, the EMV isn’t exactly “new” technology; it’s decade old, and the bad guys already can defeat it. EMV was first developed in 1994 as a way to mitigate credit card fraud, but before we get too deep in the issue at hand, let’s start with some basics.

was patented over fifty years ago in 1966. Hopefully that fact sets the frame for you as to why our old pay methods were so easily pirated by bad actors. To comply with many stores’ legacy systems, the EMV-chipped cards are backward compatible to still use the magnetic strip.

Those who have updated their systems now have customers “dip” or place the card into a reader for a moment of time, and the information is accessed off of the integrated chip. The consumer is then prompted to either include their signature or put in a PIN—hence, chip and PIN or chip and signature.

This is meant to alleviate some of the more basic methods of gathering card information like skimming.

EMV Basics

The Challenges

F

EMV was originally implemented to try to solve fraud and to better protect a customer in the omni-channel environment.

EMV stands for Europay, MasterCard, and Visa. EMV cards are typically used in three ways for transactions: smart cards, chip and PIN, or chip and signature. An EMV chip and PIN card creates a unique code for each transaction and (ideally) requires the consumer to enter a PIN (personal identification number) associated with the card instead of relying on a signature. Chip-enabled cards store their information in an integrated circuit as opposed to the magnetic strip that

The good news is that not every bad guy who had tools to get information off magnetic strips can do the same with the EMV chip. The bad news is that organized crime rings adjusted their tactics and found ways to skim and capture the information from the chip, including the PIN number for a chip card.

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Not many associates are familiar enough with your signature to verify that it is yours. Thus, the FBI recently released a survey that basically said EMV (chip and signature) was not going to solve the problem. The US needs to deploy chip and PIN for EMV to reach its full effectiveness.

Research coming out of the UK shows that after the move to chip and PIN, counterfeit card fraud losses in the UK decreased almost two-thirds from 2005 to 2013. In that same time span, fraud losses from lost or stolen cards decreased over 40 percent. While the result is significant overall, fraud increased year over year in other channels.

However, the lessons learned in the UK may not be an accurate representation of how the EMV chip will behave in the US. More than half of all card fraud occurs in the United States. In 2015, the US was responsible for 47 to 60 percent of the world’s card fraud, while only accounting for 24 to 30 percent of total worldwide card volume. To further obscure the issue, in 2005 there was no buy-online-pick-up-in-store, curbside-pickup, someday-deliver, or other omni-channel program the way they exist today—another reason the UK results probably won’t paint a clear picture.

The other problem is data breaches in the US. There were more than 1,500 data breaches in 2014, about a 46 percent increase from the year prior affecting more than one billion data records. Both retail and financial services account for about 20 percent of the breaches, almost evenly split. This is a problem: more info to the bad guys equals more counterfeit cards and IDs. In 2014 over 75 percent of reported data breaches worldwide were reported in North America. Forty-seven percent of fraudulent cross-border transactions on UK debit cards

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More than half of all card fraud occurs in the United States. In 2015, the US was responsible for 47 to 60 percent of the world’s card fraud, while only accounting for 24 to 30 percent of total worldwide card volume.

In 2014 over 75 percent of reported data breaches worldwide were reported in North America. Forty‑seven percent of fraudulent cross‑border transactions on UK debit cards occurred in the US in 2014. occurred in the US in 2014. My point is the US has and will continue to have more fraud than any other country.

Remember that part earlier where I mentioned that the bad guys can already defeat it? Well there’s good news and bad news. The good news is that not every bad guy who had tools to get information off magnetic strips can do the same with the EMV chip. The bad news is that organized crime rings adjusted their tactics and found ways to skim and capture the information from the chip, including the PIN number for a chip card. This should be a subtle reminder that different pins for different cards are the safest way to manage multiple payment options as a customer. Since the organized rings have devised these methods, the UK’s lost or stolen and counterfeit fraud has increased over the past few years.

So now what? Let’s review some of the challenges with rolling out EMV. The learning curve is steep. Some retailers have great messaging and loud beeps, while others don’t. The amount of time a card needs to be dipped may feel different to a consumer. With anything else new to the retail environment that affects customers, your associate population needs to understand how to explain the new technologies to the shopper.

Unlike other payment standards, everyone is not in the same place, so it is harder to get everyone on the same page. Not all banks are up to date, and they are issuing cards at different times. These are all things that had to be considered when rolling out EMV. In the Loss Prevention Research Council’s fraud working group, we cover EMV and many other topics related to fraud.

As with most topics, multiple heads are better than one, and it is exceptionally beneficial if those heads also happen to have decades of fraud experience.

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LP Magazine | march–april 2016

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interview

Changing Roles and Challenges in Loss Prevention Senior Executives Discuss Professional Development and Career Growth

By James Lee, LPC, Executive Editor

INTERVIEW

Stacie Bearden

Tim Belka

Bearden is responsible for the field organization’s theft and fraud including Home Depot’s organized retail crime program and all asset protection capital and technology programs. In her fifteen years with the company, she has held management roles in operations, distribution, delivery, and transportation.

Prior to Home Depot, Bearden retired as a lieutenant colonel in the US Marine Corps, worked in logistics with Schneider National, and taught management in the University of Georgia system.

She is currently a member of the RILA AP steering committee, the LPRC Future of LP working group, and the LP Foundation.

Belka began his career as a US deputy marshal before joining the Central Intelligence Agency as a special agent.

He has traveled extensively and has conducted sensitive investigations, performed threat assessments, and developed overseas site security strategy.

In his role with Walgreens, Belka leads a team responsible for the company’s Security Operations Center, executive protection, corporate campus security, international travel monitoring, event security strategy, and emergency planning and response. In his spare time, he enjoys participating in various outdoor activities with his wife and three children.

Director of Asset Protection, Field The Home Depot

EDITOR: As senior executives you have two jobs—your specific responsibilities and supporting the agenda of your boss. What are the challenges of those two roles?

BEARDEN: We typically avoid those challenges through alignment. Our department strategy was established as a leadership team, and our annual goals are jointly developed to support that. If an effort doesn’t support one of our three focuses (safety, accuracy, or profitability) or isn’t supported by our core values, it isn’t something we spend a lot of time on.

In a business as dynamic as ours if things come up, we talk through the situation.

Communicating often and openly helps avoid any conflict.

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Art Lazo

Senior Director of Global Security Walgreens

Director of Asset Protection 7-Eleven

Lazo currently leads 7-Eleven’s investigations function and the field asset protection team for the western half of the United States and Canada.

He came to the company as director of LP solutions for AP associates. Prior to 7-Eleven, he was a director with Kmart, held several loss prevention management and training roles with Home Depot, and served as regional LP manager for Circuit City. Lazo started his loss prevention career over twenty years ago with Toys“R”Us as a loss prevention specialist.

Brian Peacock

Director of Asset Protection, US Operations Rent-A-Center

Peacock is currently responsible for corporate asset protection support for more than 4,500 locations, managing physical security, remote video, data analytics, merchandise security, supply chain, case management, and the profit protection program.

He is an accomplished leader and forward-thinking innovator with over eighteen years of progressive experience in loss prevention, asset protection, and physical security. Prior to moving into the asset protection department, Peacock spent six years in operations as a store manager and area manager.

BELKA: It’s easy to lose your bearings but important to remember the perspective of the person you are managing, whether up or down. Senior executives are engaged in day-to-day business, but the truth is that they are necessarily focused on the next period, next set of goals, next set of numbers. It is critical, to the extent possible, to understand the executives’ vision or at least the risk to the future model so that any request or proposal you initiate is relevant.

I think the difference to managing down is that it is important to provide context so that the team executing buys into the program. In addition to buy-in, I think giving context fosters an open dialogue that allows the team to innovate and improve.

allows me to calibrate often to make sure we have alignment. There are always some challenges in getting everything done that we had set out to do at the beginning of the year based on the changing needs of the business. Project work can be a challenge as we build solutions to continuously improve our ability to support the stores and our franchisees.

Sometimes the scope of a project can change mid-stream based on some unforeseen obstacle in IT or a vendor issue for example. My boss makes commitments at a very high level, and unexpected issues can delay the timeline. Communication and clear expectations are key in ensuring that we avoid any big issues.

LAZO: I am fortunate in that I am able to spend a lot of time near my boss, which

EDITOR: How and why did you get a job in loss prevention?

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INTERVIEW BEARDEN: I had been with Home Depot over fifteen years and served in a number of very different roles—supply chain, district manager, and operations. I was asked to move to AP and take over a role that had seen a lot of turnover and was full of opportunity. It was an intriguing challenge, so I jumped on it.

LAZO: While working as a sales associate

at Toys“R”Us, I was attending community college with the intent to become a police officer. In those days, there was a security booth where customers would come and pick up video games after they were purchased at the register. It was my job to give out the video games. One day, I was in the booth, and a man came in the back door. He had a key that gave him access to every door in the building. I didn’t know who he was, but it turned out that he was the loss prevention specialist. Once I learned a bit more about what his role was from my manager, I was interested in making a career out of it. Sometime later, I was able to witness an integrity interview, and that is when I was hooked. I felt that it was the

“Today I see a lot of great educational programs for someone starting out in a loss prevention career. I think it is critical to continue to push yourself to stay in tune with what is trending in your field and to be aware of the changing landscape of retail and the new skills sets needed to stay relevant.”

– Brian Peacock, Rent-A-Center perfect type of job because it combined problem solving, criminal justice, and business. I worked my way into a manager role in operations while still interested in loss prevention. I was able to get on a development plan to prepare me for the job and eventually was given the role of loss prevention specialist in the Portland area.

LP Magazine | march–april 2016

PEACOCK: Unlike most traditional LP professionals, I started my career in operations as an assistant manager, store manager, and area manager. After six years in operations, I made a choice to join the asset protection team after being recruited by the regional asset protection manager.

The department primarily focused on

31

INTERVIEW

“Broader business experience is extremely valuable within the organization. While there is a significant piece of what we impact that is theft and fraud related, there are other completely controllable operational factors. Business acumen is not only beneficial but also necessary as one seeks to change processes and vie for funding.”

– Stacie Bearden, The Home Depot audits, but after taking the beginner WZ course, I started conducting investigations based on audit results and interviewing coworkers. I discovered that my operational background and my recent interview course provided me a level of confidence and a knack for mining data to identify cases.

After six months, I was asked to join the newly created loss prevention department, and four of us covered the US. I quickly realized I had found a career and passion for loss prevention.

BELKA: Generally, I think the industry does a much better job of giving access to training through organizations such as ASIS and RILA and publications like LP Magazine. I think education and training has always been available. I would like to have taken more time to take advantage of these opportunities. Any time you have the opportunity to walk in the shoes of your business partners, you necessarily are better equipped to understand and become a more effective partner.

EDITOR: What programs, educational opportunities, or other experiences would you have liked to have had as you came up in the industry?

LAZO: I think the training out there

BEARDEN: I have only been in AP

for two years. Because of that I haven’t grown up in the industry. While that’s also been an advantage—I don’t have pre-conceived ideas of how things have to work—it has made it like drinking from a fire hose. I didn’t learn about the LP Foundation or LPC/LPQ until this past year. It would have helped to know about that much sooner. Both RILA and NRF conferences have been invaluable as have the resources RILA provides and contacts they allow you to make. I would have engaged with both faster and sooner. All that said, I have found that there are so many things that do apply from the broader business and operations. Because of my experience in those areas, we’ve been able to address process, projects, capital and expense, and people challenges in a much different way.

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today when it comes to designations like the LPQ and the LPC are a great way to learn about our industry. I have pointed many people in that direction when asked how to obtain a career in asset protection.

When I was coming up, I was only aware of Wicklander-Zulawski training as being specific to what we do. Today, there are several industry-specific designations as well as universities offering coursework in asset protection. I think the educational opportunities have come a long way and would have loved to have had these options when I was just learning the business.

PEACOCK: Today I see a lot of great educational programs for someone starting out in a loss prevention career. I think it is critical to continue to push yourself to stay in tune with what is trending in your field and to be aware of the changing landscape of retail and the new skills sets needed to stay relevant. I have spent twenty years between two companies, and I feel very fortunate that, in both firms, I was able to be a part of building a lot of great programs, creating LP strategies, march–april 2016

|

writing standard operating procedures for the department, and working with some fantastic vendors. The experiences I have gained throughout my career have given me a solid foundation for my future, from operations, investigations, and interviewing to managing a field team to managing the back of the house. I feel very blessed with the experiences and opportunities that have been given to me.

EDITOR: What qualities set an LP professional apart as they climb the career ladder?

BEARDEN: Broader business experience is extremely valuable within the organization. While there is a significant piece of what we impact that is theft and fraud related, there are other completely controllable operational factors. Business acumen is not only beneficial but also necessary as one seeks to change processes and vie for funding.

BELKA: I’ve had the pleasure to work with a wide variety of people at all stages of my professional career. While there are many attributes that I admire, I think having a passion to understand and to adapt are the attributes for success. I have to remind myself to consider other solutions and ideas so that I don’t get caught by legacy strategy and thinking. This might be gratuitous but my current boss has consistently challenged our legacy thought processes. It is frustrating at times, but I know it has helped our department become an industry leader.

LAZO: I find that the folks that take the

time to truly understand the core business

LOSSPREVENTIONMEDIA.COM

INTERVIEW are the most successful whether they stay in LP or move over to operations. Many people in the industry today understand the value of breaking down barriers between LP and operations. I think the key is then making yourself and your team indispensable by continuing to show value and taking on challenges that may fall outside of your typical program. On an individual basis, the ability to be self-critical and willing to learn is a quality that sets people apart in my eyes. I think that if you surround yourself with people you trust to give you honest feedback and critique your work, you will be better prepared and rarely caught off guard.

PEACOCK: I would say innovation, adapting to change, and being a strategic thinker. The main priorities in LP that made a department successful ten years ago are not what drive a successful department today. To progress as an LP professional, take the time to learn the business you support and understand where the business is headed. Then take a hard look at how your department can support where the business is headed. Whether you are in the

field or the corporate office, a team has to share ideas and continue to change with the organization. It is easy to bury yourself in what you are doing now, but if you are not aware of your surroundings, you will find yourself and your department becoming less relevant in your organization. The LP professionals who are a part of a company’s continued evolution are the ones that will set themselves apart from the rest.

EDITOR: If you could change one thing about the LP profession, what would that be?

BEARDEN: I would have it be viewed differently within organizations.

The recently publicized rounds of reorganizations and reductions continue to indicate that LP is a field that is much like insurance. It’s invaluable when needed and viewed as nothing but an expense when it is not.

BELKA: I think our profession has progressed significantly in the development of diverse thought and background of the people who pursue loss prevention

careers. Our industry is more progressive and challenging than ever before. However, in retrospect it would have benefited the industry to aggressively pursue diversity of thought and background to make us more effective and relevant.

LAZO: I think the LP profession has seen

a lot of positive change in the last twenty years. More and more companies are seeking out professional LP advice whether they use a third-party contractor or build a program internally. The only thing I would consider changing is how we attract and educate people about what we do and the industry as a career. I believe there is still an opportunity to attract talent and show folks looking for a career that LP can be a great way to go.

PEACOCK: I think it would be the perception. Loss prevention departments (in most companies) are still seen as a necessary component to deal with the “bad stuff.” I think this is why you see a lot of departments beginning to rebrand (Rent-A-Center recently did) to asset protection or profit protection. There is

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LP Magazine | march–april 2016

33

INTERVIEW

“Our profession has progressed significantly in the development of diverse thought and background of the people who pursue loss prevention careers. However, in retrospect it would have benefited the industry to aggressively pursue diversity of thought and background to make us more effective and relevant.”

– Tim Belka, Walgreens Once you discuss the components of a basic LP program, they are extremely interested in all of the different things we get involved in on a daily basis. The misconception that I deal with at my own company and in companies that I have worked for in the past is a limited view on the work that we do. To the uninitiated, we are the company police. Once they spend some time actually working with us, their eyes are opened, and they see the value we can add. It is our job as leaders to get in front of as many of those people as possible and change that perception.

and always has been a strong desire to be seen as a strategic business partner. I almost relate the new role of LP support to be more like sales strategy. More and more LP departments are involved in providing analytics, information, and stats that help drive top-line growth while protecting the bottom line. In addition there is a strong appetite for new technology that can help mitigate losses while enhancing the customer experience. We cannot lose focus on our core responsibilities, but we have to also recognize and capture opportunities to leverage our skill sets in arenas outside traditional LP.

EDITOR: What do you see as the most impactful retail crime trends emerging today?

EDITOR: Are there misconceptions about loss prevention that we can or need to overcome?

BEARDEN: The one above is a big one.

Another is that LP is just about shrink, safety, and catching shoplifters. For example, our team is heavily involved in disaster response, ensuring our people, property, and product are safe, and we’re also closely involved with first responders and others in the community in times of crisis such as hurricanes. At the end of the day in LP, we protect brand and gross margin in ways few other departments do. That’s a big mental shift for some.

LAZO: There are always misconceptions

about loss prevention that you deal with, both in your personal life and within your own company. If you are at a party and people hear that you work in loss prevention, they automatically assume that you walk around and catch shoplifters.

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BEARDEN: As omni-channel dominates the merchandising and fulfillment minds of today’s retailers, criminals are adjusting. It’s a world where prosecution is complicated.

There are no cameras, and the victims can look a lot like the criminal. It’s top of mind for all of us. Another is the socioeconomic impact of drug abuse that we’re seeing in communities. It makes for an increasingly dangerous environment for our store teams.

The ease of obtaining technology is allowing the criminal to be extremely nimble. They’re running as fast as they can to stay ahead.

Just as the Internet is providing them a new environment for theft, it is also an endless resource. The last one is the impact of already over-crowded jails and over-tasked police departments. They’re challenged to meet the violent crime demand, much less the often viewed as “victimless” crime of retail. This increases the recidivism rate and results in our teams catching the same

march–april 2016

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offenders multiple times. It’s a challenge for both law enforcement and the retailer.

LAZO: Organized retail crime continues to

be a growing concern. In our environment, we deal with several issues including fuel theft, card skimming, and phone scams for money instruments.

EDITOR: What are the most impactful changes in the retail industry that are impacting LP? BEARDEN: The ability to check out in the aisle, order from the comfort of our homes, and pay without carrying a wallet will challenge all of us as we seek to provide more flexibility to our customers. It’s a business imperative we have to support.

LAZO: I think that economic challenges

are always a concern with any LP program.

The last several years have shown that companies continue to assess their LP programs and either trim their resources or change the definition of the role in a variety of ways. It is the role of LP leadership to continue to seek out opportunities to address challenges that may be outside of the normal LP channels. Retail is constantly changing, and we need to be able to adapt accordingly and show value in our roles.

PEACOCK: It would have to be the rapidly increasing digital presence and shrinking brick and mortar. E-commerce and mobile transactions are growing rapidly, and this is having a major impact on the way loss prevention teams are structured.

Unless you have a structured audit program in place, the field teams are starting to

LOSSPREVENTIONMEDIA.COM

INTERVIEW shrink, and the majority of investigations and interviews are being conducted remotely. With the store counts rising for field managers, the heavy lifting has to be moved into the corporate office. Like many departments, we recently created a central investigations team to focus on supporting the field with information and data to help prioritize investigations and store visits.

This streamlines the process and allows a small group to become very efficient at putting a case together and providing data to the field. The field can spend more time addressing the issues and less time reviewing an overwhelming amount of data.

EDITOR: What work or life experiences best molded you for your current job?

BEARDEN: My time in the stores and operations were both invaluable from a business acumen perspective. In supporting my field team, the experiences from my time in the Marines have also served me well. Messaging on our mission and values

help our front line leaders make the right decision in the heat of the moment. It also doesn’t hurt to have experience managing through a crisis or being able to make quick decisions and coordinate efforts across groups. With almost 2,000 stores, there is always something going on.

BELKA: I am fortunate to have had

a diverse set of experiences that have informed my current role—fifteen years as a federal agent and multiple roles at Walgreens. From the start of my professional career, I have had the opportunity to work with and for professionals from diverse socioeconomic and ethnic backgrounds as well as people with diverse life and professional experience. This has given me perspective and allowed me to look at business problems, team members, and strategy in a broader sense. I’ve learned and now better understand that any strategy or directive is executed on the ground by team members who may not have the same perspective or experiences.

LP Magazine | march–april 2016

EDITOR: Tim, you have diverse responsibilities at Walgreens.

What is the most difficult part of your job?

BELKA: Focusing on our team’s strategic

initiatives while dealing with the obstacles that often impede tactical execution. The Walgreens Asset Protection Solutions team goes through a deliberate and robust exercise to establish team and individual goals and initiatives; however, we are challenged on a regular basis to develop ad hoc solutions to problems that impact our enterprise. It is important to develop programmatic and ad hoc solutions in the framework of our strategy. If the circumstance is significant enough and does not fit within our existing framework, we must be flexible and adapt our strategy.

EDITOR: Art, you have been a vital part of the transformation of asset protection at 7-Eleven.

What have been the key

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INTERVIEW

“The last several years have shown that companies continue to assess their LP programs. It is the role of LP leadership to continue to seek out opportunities to address challenges that may be outside of the normal LP channels.

Retail is constantly changing, and we need to be able to adapt accordingly and show value in our roles.”

– Art Lazo, 7-Eleven initiatives that have proven most valuable?

LAZO: Several years ago, a process

was started with the goal of building an asset protection department that was considered best in class. Many people have contributed to making this a reality by building processes and providing tools to the team in the field and the franchisees in the stores. Some examples include a company-wide rollout of new DVR systems that allow the store operators to easily access recorded video. Point-of-sale analytics at the store level allow the franchisee or store manager to pin-point issues that can then be reviewed on the DVR and resolved quickly themselves or with assistance from their local asset protection specialist.

We have also dedicated more resources to building relationships with local law enforcement. 7-Eleven has partnered with local law enforcement for years on programs like Operation Chill. Recently, we have been able to reach out and collaborate much more frequently with law enforcement in hundreds of different municipalities, offering partnership and support in resolving issues that affect the franchisees and store operators.

EDITOR: Are there differences in how you handle company-owned and franchise stores?

LAZO: Each franchisee is an

independent operator. We are a resource for the franchisees as consultants, and

36

we provide tools to help them address issues related to shortage and physical security. The asset protection managers take every opportunity to participate in franchisee meetings to help train them on the tools available to address shortage issues and accurately manage their inventory. We will provide advice to franchisees when asked, but it is their responsibility to operate their businesses within the constraints of the franchise agreement. Corporate stores can be managed in a more traditional manner, consistent with other retail programs where we can directly address issues and escalate lingering issues through the operational chain of command. We partner at all levels of the corporate store structure to provide support and control losses.

EDITOR: Brian, you have a lot of stores and a small LP staff.

Where do you spend your time to get the greatest impact?

PEACOCK: In the last couple years we have realized that sometimes you have to do less with less. We took a step back and looked at all the things our department was doing. This gave the senior leadership team the chance to reevaluate and eliminate the things that were no longer adding value or were not a priority for the organization.

The second thing we did was focus on enterprise solutions and ways to leverage technology to help the organization. In 2014 our company started renting smartphones. We quickly realized that while this category march–april 2016

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would drive incremental business, new customers, and revenue growth, it was extremely high risk. Our department led the creation and implementation of a phone-locking software that helped mitigate the risk within this new segment of our business. We took a technology primarily used for data security and designed a new model that secures our assets when a customer contract expires, assists in collections, lowers losses, and creates a value-add by assisting in the recovery of a phone that was stolen from one of our customers. The results have been better than we expected. It has opened some eyes as to what our department can do for the organization outside of “catching bad coworkers.”

We have two more exciting enterprise technology-based solutions we are driving in 2016 and hope to realize similar impacts for our organization.

EDITOR: Specifically at Rent-A-Center, are you most driven by crime, shrink reduction, profit and loss, or something else?

PEACOCK: In our business, loss is a very reactive stat. Our team focuses on past-due accounts. Unlike traditional retail, approximately 70 percent of our inventory resides in customers’ homes.

When we rent merchandise to a consumer, we still own the merchandise until it is paid in full. This unique challenge does not allow us to focus on the traditional metrics. So past-dues are our first indicator that we have a potential loss.

LOSSPREVENTIONMEDIA.COM

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By Steve Sell

Grasping the Future and Today: A Balancing Act E

Sell is chief marketing officer for USS. He has over twenty years of retail as an active influencer, thought-leadership contributor, and advisor with the Retail Industry Leaders Association, National Retail Federation, Loss Prevention Research Council, and LP Magazine. Prior to USS, Sell served as director of North America marketing for Tyco Integrated Security, vice president of global marketing for Checkpoint Systems, and also held global leadership roles with Accenture and Deloitte Consulting. Sell can be reached at ssell@ussinnovate.com.

very day, when the alarm goes off in the morning, all of us in the retail industry have a similar challenge awaiting us. Whether you are a retailer steering through vast change in the marketplace or a solution provider trying to deliver the right solution at the right time for your customer, the challenge boils down to two questions. First, what actions do I take to manage the immediate realities of today—protecting my core business and winning my next customer? Second, what do I do about the future and keeping up with inevitable change in my business? Then more questions creep up: Can I do both?

And, if so, how and how much?

The big takeaway, I believe, is that a steady hand on the business of today is a prerequisite for a successful tomorrow. Being a visionary company with a lot of big-thinker power actually means we protect the success of today at all costs and build from that point of strength, not leave it for dead.

Recently I ran across some simple yet compelling insight.

(I am not sure it’s advice, but I will use it that way.) In a Fast Company article about Facebook’s success, the Chief Technology Officer (CTO) Mike Schroepfer said, “I have one hand in the day-to-day and one in the future…because it’s important that our core business continues to do well.

Because that is what allows us to aggressively invest in longer-term things.”

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march–april 2016

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The CTO of Facebook talking about today and not about tomorrow? This is the company described by most business analysts as innovative, forward-thinking, and fully entrenched in all things cutting edge. My guess would have been that Facebook has all its hands and feet constantly in the future. How else could they have accomplished what they have? But as it turns out, they have the same challenge the rest of us do and approach it by paying equal attention to the now and the tomorrow.

This brings me to our industry—retail. In this era of rapid change, the promise of a sizzling new technology can be alluring. I am sure we have all experienced a time or two when we jumped onto something new and exciting only to look back and see things we were doing well suddenly falter.

For example, spend a lot of time planning an advanced new inventory system, and then shrink spikes because everyone took their eyes off it. Or focus completely on the day-to-day, only to wake up suddenly to the fact that the competition is now light years ahead technologically. Solution providers can fall into this trap too: Spend an enormous amount of time talking about the next great thing, forgetting that their customers have problems that need to be solved today.

Or get complacent producing the same stuff year after year, only to find out that their products now solve only yesterday’s problems.

Retailers and technology creators must maintain a similar balance to what Facebook’s CTO described—one hand in the day-to-day and one in the future. The big takeaway, I believe, is that a steady hand on the business of today is a prerequisite for a successful tomorrow. Being a visionary company with a lot of big-thinker power actually means we protect the success of today at all costs and build from that point of strength, not leave it for dead. To me, what Schroepfer is really saying is this: Always protect and finish what you start if it is working well. And never allow yourself or your business to chase tomorrow without a solid respect for what made you successful.

I feel that Facebook believes it possible to chase the future too fast, or out of order, if we put both hands on that pursuit. To some this idea might sound old fashioned and unexciting. But since it’s coming from Facebook, the company that in many ways has defined the future, it might actually be quite forward-thinking.

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FEATURE

Rethinking Loss Prevention and Shrink Management Findings of PwC’s 2015 Retail Industry Survey

By William “Bill” Titus and Suni Shamapande LP Magazine | march–april 2016

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RETHINKING LOSS PREVENTION AND SHRINK MANAGEMENT

T

he pace of change in the retail industry has accelerated dramatically over the past few years. The move to online shopping, emergence of mobile retail, and use of social media as part of the “daily fabric of shopping”—three of the disruptive forces highlighted in PwC’s Total Retail 2015: Retailers and the Age of Disruption published in February 2015— are among the factors making it more difficult to prevent, detect, and manage loss and shrink.

Most retailers have adopted omni-channel strategies to meet consumers’ demand to browse or buy whenever and wherever they choose. But enabling everything from mobile POS to in-store pickup of online purchases has made inventory management and product logistics far more difficult. The complex new retail environment is increasing a variety of risks, including the risks of internal and external theft, paperwork and operational errors, system issues, and vendor fraud.

The retail industry is struggling to manage the emerging risks it faces. As the industry transitions from bricks and mortar to “bricks and clicks,” the capabilities of existing systems are being stretched thin, and many retailers have not fully integrated the new technology required to manage loss and shrink effectively in an omni-channel world.

To better understand the current state and emerging challenges of the retail industry, in the summer of 2015 PwC conducted an online survey of loss prevention (LP) professionals within US-based retail organizations, including big box stores, specialty retailers, department stores, grocery chains, and drug stores.

The survey results, highlighted below, suggest a need for many retailers to rethink their LP strategies, organizations, and practices. Among other things, retailers must embrace formal root-cause analysis and the use of data analytics to remain competitive in a dynamic, increasingly risky environment.

The Scope of Shrink and Loss

We asked LP professionals to report on their organizations’ shrink rates over the

42

Average Retail & Cost Shrink

5.3%

Over the most recent twelve-month period, what were your organization’s shrink rates?

3.2%

2.0% 1.4% 0.3%

0.7%

0.2%

Low Quartile

Median

Retail Shrink (% of Retail Sales)

1.2%

Average

High Quartile

Cost Shrink (% of Retail Sales)

Root Cause Breakdown of Shrink Over the most recent twelve-month period, what was the breakdown of source/root causes of shrink within your organization’s unit?

System issues 6.9% Paperwork/ operational errors 17.8%

Vendor fraud 4.8%

External theft 35.1%

most recent twelve-month period. Among our survey respondents, the average retail shrink rate was 2 percent, and the average cost shrink rate was 1.2 percent.

Sources of Shrink and Loss

According to our survey respondents, internal and external theft are by far the main sources of shrink, accounting for 36.4 percent and 35.1 percent of the total, respectively. These results represent a significant shift in the industry. In the past, most retailers have reported that internal theft was significantly higher than external theft, due to employees’ access to cash registers, alarms, and inventory.

What accounts for the shift in the sources of shrink? Organized retail crime, facilitated by social networking, is likely the main driver of the relative increase in external theft. The emergence of omni-channel retail, which makes it more necessary to gain an enterprise-wide view of inventory and to accurately track and

march–april 2016

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Internal theft 35.4%

LOSSPREVENTIONMEDIA.COM

manage inventory, is more likely the main factor driving internal theft, paperwork and operational errors, and system issues.

(Organized retail crime likely also plays a role in driving shrink related to system issues, paperwork and operational errors, and vendor fraud.)

Another surprising finding is the significant percentage of shrink that is due to paperwork and operational errors (17.8 percent) and system issues (6.9 percent). Typically the industry doesn’t break out system issues as a potential root cause of shrink; rather, these issues are integrated into the category of paperwork and operational errors. But in our view, they deserve a separate category because the emergence of omni-channel has made systems themselves a significant issue in loss prevention. System errors are exacerbated by dynamic omni-channel customer fulfillment and reverse flow (returns) logistics.

We believe that the relative amount of shrink attributed to system issues by survey respondents (6.9 percent) is

RETHINKING LOSS PREVENTION AND SHRINK MANAGEMENT artificially low, the result of confusing operational errors with system errors—including errors that result when transitioning from manual to computerized processes, or integrating new systems as part of implementing an omni-channel strategy.

Identifying and Addressing Root Causes of Shrink

The vast majority of survey respondents (78 percent) use internal experts and historically reliable procedures to identify sources of shrink. More than half (59 percent) have developed a structured root cause analysis protocol that they use consistently, and the same percentage report using data analytics and end-to-end root cause analysis as their primary tool to identify shrink.

When asked how they address the root causes of shrink, the vast majority of respondents (83 percent) said they leverage historical best practices and activities that work consistently. Almost nine in ten (87 percent) use historical best practices

The retail industry is struggling to manage the emerging risks it faces. As the industry transitions from bricks and mortar to “bricks and clicks,” the capabilities of existing systems are being stretched thin, and many retailers have not fully integrated the new technology required to manage loss and shrink effectively in an omni-channel world. and targeted awareness programs and leverage key indicators of shrink to address root causes and find solutions. Just over two-thirds of respondents (65 percent) said they go one step further, leveraging data trends and predictive analytics to identify the root causes of shrink, and another 16 percent plan to adopt this strategy in the next eighteen months.

Implementing an Effective Root-Cause Analysis The survey results suggest that retailers understand the importance of using root-cause analysis to identify and manage shrink in a complex retail environment. But in our observation, not all retail organizations conduct thorough, effective root-cause analyses.

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LP Magazine | march–april 2016

43

RETHINKING LOSS PREVENTION AND SHRINK MANAGEMENT

Addressing Root Causes of Shrink How does your organization identify sources of shrink?

0% We have internal experts and historically reliable procedures to identify causes of shrink.

50%

100%

22%

Our organization has developed a structured root-cause analysis protocol, which we consistently leverage.

78%

38%

We use data analytics and end-to-end root-cause analysis as our primary tool to identify shrink.

59%

25%

59%

3%

16%

Which of the following best represents how you address the root causes of shrink?

We leverage historical best practises and activities, which consistantly work for our organization.

We use historiacal best practises, targeted awareness programs, and leverage key indicators of shrink to address root causes and find solutions.

We use best practises, targeted awareness programs, key indicators of shrink, data trends and predictive analytics.

Not Practised Doing so requires the following key steps: ■ U se cross-functional teams to develop hypotheses and analyze results.

■ L everage data analytics and systems-process mapping to test hypotheses.

■ D evelop a shrink-reduction strategy and corresponding mediation plan based on results.

■ I dentify and decompose shrink drivers and quantify their impact over time.

■ D evelop dashboards and diagnostic tools to monitor and track root causes of shrink over time.

Collecting and Analyzing Data

In our view, how retailers collect and analyze data is the most important area of our survey. Leveraging data and analytics more effectively is the most critical step that LP professionals can take to address the current and emerging risks they face.

Analyzing data is essential to identifying risks early, when they can be addressed more effectively. For example, one major US retailer was able to reduce shrink by

44

17%

83%

10%

87%

19%

Currently Practised

65%

|

16%

Next 18 months

more than 70 percent over six years, from more than $950 million to less than $250 million, by focusing on high-risk stores and leveraging data analytics to identify potential losses and prioritize risks earlier in the risk cycle.

Analytics can also help to optimize scarce resources. For instance, predictive analytics can be used to reallocate LP personnel to stores whose risks are increasing, to proactively address and mitigate the risks before they become a major problem that impacts profitability.

Data Collection. Almost all of the LP professionals we surveyed (93 percent) indicate that their organizations collect key performance indicators (KPIs) and metrics that historically have had the greatest impact on operational excellence. Six in ten (60 percent) collect metrics on a more frequent basis, and they use trend data to determine how to deploy resources—an approach that’s much needed to optimize the use of reduced levels of staff.

Only 24 percent of survey respondents use real-time KPIs with advanced algorithms and predictive indicators programmed to recognize patterns (for march–april 2016

3%

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example, those related to cash and inventory levels), but 34 percent plan to begin doing so within the next eighteen months. The use of real-time KPIs can help retailers to identify and address risks earlier in the risk cycle, mitigating their potential impact.

Analytical Tools and Resources.

Nine in ten of the LP professionals we surveyed (90 percent) still use a traditional tool—Microsoft Excel (pivot tables and formulas)—to analyze data, and 72 percent use analytics tools such as SAS and SPSS. Only one-third (34 percent) leverage sophisticated business information tools such as Tableau and QlikView to analyze data, although an additional 17 percent indicated they plan to adopt such tools in the next eighteen months. And less than half of respondents (48 percent) use LP technology dynamically across the organization to define, detect, predict, and prevent shrink, although another 38 percent plan to begin doing so in the next eighteen months. This result indicates that retailers are waking up to the need for continued on page 47

RETHINKING LOSS PREVENTION AND SHRINK MANAGEMENT Most retailers still use traditional metrics, but a significant percentage use real-time KPIs to predict theft and shrink.

93%

24%

Collect existing KPIs and metrics that have had the biggest impact on operational excellence

Use real-time KPIs with advance algorithms and predictive indicators programmed to recognize patterns

Microsoft Excel is still the most widely used tool for data analysis, but more advanced tools are emerging.

Use Microsoft Excel (pivot tables, formulas) 90%

34%

Use analytics tools (such as SAS and SPSS) 72%

Leverage dynamic business information tools such as Tableau and QlikView

Less than half of retailers use LP technology dynamically to manage shrink.

97%

Used LP technology primarily for monitoring and investigating shrink incidents (such as internal and external theft)

48%

Used LP technology dynamically across the organization to define, detect, and predict/prevent shrink

LP Magazine | march–april 2016

86%

Used LP technology to enhance operational effectiveness and deterrence strategies based on the results of monitoring shrink indicators

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RETHINKING LOSS PREVENTION AND SHRINK MANAGEMENT Loss Prevention at a Glance:

How Retailers Are Expanding the LP Mandate to Mitigate Risks The majority of retailers are taking an analytical approach to allocating resources.

59%

82%

Assign people to stores based on historically required frequency

79%

Analyze trend data and use it to monitor LP risks and allocate LP resources

Allocated resources dynamically based on multivariable, cross-functional indicators

LP organizations are actively involved in managing a variety of risk areas.

86%

82%

82%

Safety

Crisis management

Organized retail crime

81%

74%

Business continuity planning

Supply chain

73% Omni-channel challenges

Employee Turnover as a Risk Indicator Employee turnover is a good indicator of risk trends. It is intuitive that increased turnover can lead to increased shrink, and our survey findings confirmed there is a link.

Among respondents, the average employee turnover rate for organizations with high shrink (greater than 1.4 percent) was 45.1 percent, while the figure for organizations with low shrink (less than 1.4 percent) was 33.0 percent. These findings are consistent with the industry trend and with the 2015 National Retail Security Survey. The challenge for retailers is to leverage data analytics to understand how, specifically, the turnover rate in their organization is correlated with the organization’s risks.

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67% Data security breaches

Low Shrink Correlated with Lower Turnover Rates

Average employee turnover rate among organizations with…

High shrink (>1.4 percent) 45.1%

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Low shrink (<1.4 percent) 33.0%

RETHINKING LOSS PREVENTION AND SHRINK MANAGEMENT continued from page 44

rapid prediction and detection of shrink in a dynamic omni-channel environment.

Retailers that are ahead of the curve, using sophisticated, dynamic tools to manage loss and shrink, have an opportunity to leap ahead of competitors that continue to use traditional approaches to data analysis. That said, even the most sophisticated analytical tools will not be effective without the knowledge and resources required to understand the tools and utilize them effectively to perform sophisticated analytics. This is a lesson that some retailers have learned the hard way as they failed to realize the benefits of the powerful tools they purchased.

An Expanding LP Mandate As the roster of retail risks has expanded, so has the mandate of LP professionals. Large percentages of survey respondents report that their LP organizations are involved in mitigating risks and losses for a variety of areas, including areas not typically addressed by LP professionals, such as supply chain (74 percent) and business continuity planning (81 percent).

The results of PwC’s retail industry survey highlight the need for retailers to reassess their LP strategies and capabilities to ensure they can remain competitive, much less move ahead.

As we have discussed, retailers must

deploy effective root-cause analyses and leverage data analytics and technology tools to identify and manage shrink and loss and to deploy scarce resources effectively in a complex, dynamic environment.

To better manage loss and shrink, many organizations are building advanced data analytics and other LP capabilities in-house or leveraging external organizations to augment their internal resources. Whatever approach they choose, retailers that recognize and address the evolving risks and challenges of the new retail environment will be better positioned for success.

WILLIAM “BILL” TITUS is a managing director in PwC’s risk assurance practice and has a broad array of retail and loss prevention experience. Prior to joining PwC, he was vice president of loss prevention and safety for Sears Holdings, where he successfully merged the Sears Roebuck and Kmart organizations, enhancing their capabilities and value to the organization through technology integration and using data analytics. Titus is actively involved in professional industry organizations, such as the National Retail Federation and the Loss Prevention Research Council, contributing to the future and progress of retail loss prevention. He can be reached at william.m.titus@us.pwc.com.

SUNI SHAMAPANDE has over twenty years of global retail, consumer, and wholesale experience including business operations, enterprise-wide risk and loss mitigation, global cash control, asset protection, business continuity management, supply-chain security, safety, and brand protection. His experience includes time with companies like Sears, Nike, Polo Ralph Lauren, and BCBGMaxazria. He currently specializes in retail and consumer products risk assurance consulting in PwC’s performance, governance, risk, and compliance group. He can be reached at suni.k.shamapande@us.pwc.com.

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PERSPECTIVES

Retirement and Thanks

By Claude R. Verville, LPC Verville is the former vice president of loss prevention, safety, and hazmat at Lowe’s. He joined the company in 1993 and was promoted to VP in 1998. Verville started his LP career in California at Robinsons-May, a subsidiary of The May Company, where he worked thirteen years leaving as director of investigations. He has been a leading voice in the LP industry as a member of the Loss Prevention Foundation board of directors, LP Magazine editorial board, and the Retail Industry Leaders Association steering committee. He can be reached at ClaudeV@LPportal.com.

H

ere I am sitting on a plane Monday morning headed to Southern California to visit family and friends after officially retiring from Lowe’s on January 31, 2016, after twenty-two incredible years. I must admit, I felt completely stress free this morning going through the whole airport experience with my wife. Mondays have seldom felt quite like this—at least for the last thirty-five years in retail.

and influenced my management style forever. He taught me to assemble a strong, diverse, driven, and talented team; create healthy competition in order to drive performance; and have a hell of a lot of fun along the way.

Friends and Colleagues

Paying It Forward

I feel an overwhelming need to pay it forward as I will always be indebted to the retail industry and loss prevention profession that I inadvertently chose back in 1981.

At my first interview with Robinsons-May, I had no idea what loss prevention was, and my soon-to-be supervisor quickly picked up on that. But for whatever reason, he made the decision to hire me anyway, and the rest is history.

My first thank you goes to Jim Lee and LP Magazine for giving me an opportunity to write a column based on my experience. I warned the LPM team that I am far from politically correct, and my intent is to write a column that will be real, from the heart, and an honest reflection of my experiences.

I plan to be retrospective in disclosing where and how my many failures and poor decisions occurred. There were, no doubt, many moments of frustrations along the way as well. But these were far outweighed by the achievement of many successes and milestones, while maintaining a sense of humanity in the midst of the endless pressures and stress that come with our responsibilities in retail.

I will also share some insights from the successes and failures of my former team, including the often-understated factors such as leadership behaviors and principles that invariably determine a team’s performance outcomes.

I will delve into attitudinal aspects of building essential cross-functional business partnerships necessary for your team’s success and long-term viability. I will share my experiences when hearing an executive speak words like, “Remember—it’s business.

It’s never personal.”

On the humorous side, I will share my insights on the many instances where I had a moment—which we all do—where we internally evaluate the level of importance of our employment before responding or reacting during a time of conflict.

My Mentor

My second thank you goes out to my mentor and “big brother” Bob “Obie” Oberosler who saw something in me twenty-four years ago that few others did when he first promoted me to the director of investigations position at Robinsons-May. His infectious passion, enthusiasm, and drive left a significant impression on me

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My third thanks goes to my best friends and most respected colleagues in the retail industry, Leo Anguiano and Cornel Catuna, who were also part of Obie’s original corporate team at Robinsons-May. Obie was a master at telling each of us individually how we were the best investigator or interviewer, only for the three of us to get into a spirited debate as to who was the superior interviewer. As we each steadfastly proclaimed our dominance, we would suddenly realize that our convictions were all a result of the same praise we received from Obie. We agreed our friendship would always take precedence over our competitive aspirations for our careers, and we always remained true to that promise.

This is one area that I wish was more prevalent in our industry—remaining grateful and experiencing lasting, loyal friendships with our mentors and sponsors, as opposed to allowing ego to create unhealthy, competitive environments that are often at the root of talented, yet dysfunctional teams.

The Lowe’s Team

My fourth thank you goes out to my awesome, highly functional, best-in-class Lowe’s loss prevention, safety, and hazmat team. We instilled a team-first approach over personal accolades, and the results were unbelievable. My team executed while I listened and led as required.

Family and the Future

My last thanks goes to the beautiful woman sleeping next to me on the plane—my wife, Lucia, of twenty-five years who basically raised our two children and kept me sane with her positive outlook and personality. Thanks to her and the good lord for being my ultimate role model, calming force, and influence of my core principles.

I will make one more promise: my articles will be about real-life experiences, at times controversial, and retrospective of career events at every level of our profession. After all, I started in an entry-level position like many of the readers of this magazine. I have one objective—providing thoughts and learnings from my experiences that may someone in our industry glean an insight that may in whatever small way improve their career in loss prevention.

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certification

Helping Loss Prevention Professionals in Their Time of Need O

by Gene Smith, LPC Smith is president of The Loss Prevention Foundation, the not-for-profit organization charged with the responsibility of managing certification. He was formerly president of the industry’s largest executive search and consulting firm. During the past fifteen-plus years, Smith has provided career counseling for thousands of industry professionals nationwide. He can be reached at 704-837-2521 or via email at gene.smith@losspreventionfoundation.org.

ver the years, our profession has always been generous in raising funds for many meaningful charities. But have we done everything we could to help our own? In late 2012, Luis Jhon, a Walmart asset protection professional, lost his life while trying to confront a shoplifter. This event struck a nerve with the Loss Prevention Foundation (LPF) team, and we decided it was time to do something about it.

As a profession, we could no longer allow the families of our fallen friends and colleagues to mourn their losses without voice or support. It was about time our profession rallied to offer assistance to help families who suffered the loss of a loved one who died while conducting the duties of the profession. As a result, the LPF created the LP Memorial Fund to honor the fallen and provide financial assistance to their families at their greatest time of need.

LPF launched a fund-raising effort, and soon teams of loss prevention professionals, including Staples global asset protection team and the Retail Industry Leaders Association (RILA), began to help raise funds. An independent committee was subsequently established to oversee all fund-raising efforts including the disbursement of funds for those in need. The breath-taking reaction when an unexpected check was delivered to the surviving families motivated the committee and LPF staff to do more.

In late 2015, the Loss Prevention Foundation created the LP Benevolent Fund (LPBF), a 501(c)(3) (pending approval) organization. In addition to distributing funds to the families of the fallen, the LPBF was established to provide financial grants to eligible participants who experience a verifiable economic hardship as a result of qualifying circumstances.

Situations that could qualify for a grant include serious medical issues, death of a dependent, natural disaster, no permanent shelter, homelessness, and so forth. Applications for assistance made to LPBF will be kept confidential except as required by law.

LPBF will operate under the oversight of the LPF board of directors. A contracted independent auditor will audit

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all financial records annually in accordance with LPF’s standard operating practices and compliance as a 501(c)(6) not-for-profit organization. All fund-raising records will be reviewed and presented at the annual board of directors meeting.

The first major LPBF fundraising event for 2016 will be held during the RILA Asset Protection Conference in Dallas April 17–19 followed by the NRF PROTECT Conference in Philadelphia, June 14–16.

The Committee

Committee members perform several important duties while they serve: ■ Provide general overall administration of the LPBF program.

■ Evaluate eligibility and approve the issuance of all financial grants.

■ Ensure that 100 percent of all funds raised are directed to supporting the charitable mission of the LPBF. ■ Ensure that during each general board meeting, the activities of the LPBF Committee are formally reported, read into the minutes, and approved by the board.

■ Provide general oversight and support to all fund-raising initiatives sponsored by retailers (such as Staples) and trade associations (such as RILA).

Committee Members

Chris Duke, LPC, (Chair) Rob Shields, (Treasurer), Director of Loss Prevention, Staples Lou DiLorenzo, Director of Client Relations, SOS Security LLC Steve Hyle, LPC, Vice President of National Accounts, AFA Protective Systems, Inc. Paul Jaeckle, LPC, Senior Director, Asset Protection Operations, Walmart Lisa LaBruno, Esq., Senior Vice President, RILA Gary Johnson, Senior Advisor, Excelerator Consulting LLC Melissa Mitchell, Director of LP and Inventory Control, Lifeway Christian Stores Bill Davis, Regional Director of Sales, Southeast US, BSI - Best Security Industries

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LossPreventionAd.qxp_Layout 1 1/15/16 8:54 AM Page 1

Richard Dobson, Senior Director, Global Supply Chain Asset Protection, Luxottica North America

Call to Action

The LP Benevolent Fund Committee is seeking individuals, organizations, and businesses who can donate resources to help the committee raise money, as well as volunteers to assist the committee in its efforts. If you would like to make a cash or prize donation, or volunteer your time and energy to help the LP Community, we want to hear from you. Please contact Chris Duke, LPC, at Chris.Duke@losspreventionfoundation.org for more details.

Two-W ay Business Radios

Newly Certified

Following are individuals who recently earned their certifications.

Recent LPC Recipients Daryl Blackmore, LPC, Shoppers Drug Mart Michelle Brown, LPC, Cspire Wireless Brett Carlson, LPC, Department of Homeland Security Mary Colcombe, LPC, Ahold USA Jonathan Dalton, LPC, Helzberg Diamonds Leonard Davis, LPC James Diemer, LPC, Delhaize America Robert DoCarmo, LPC, Ahold USA Heather Dudman, LPC, Publix Super Markets Paul Ferreri, LPC Cameron Hess, LPC, Belk Department Stores David Huhner, LPC, Sears Holdings Deborah Lanford, LPC, 7-Eleven Timothy Lapinski, LPC, Helzberg Diamonds Taylor McDonald, LPC, Cspire Wireless Michael Moore, LPC, Walmart Stores Sharon Nawrocki, LPC, Meijer Gary Novello, Jr, LPC, Bed Bath & Beyond Mary Pelletier, LPC, Ahold USA Elizabeth Rush, LPC, Delhaize America Jennifer Schaefer, LPC, McDonald’s Jessica Smith, LPC, Helzberg Diamonds Patricia Smith, LPC, Rite Aid Patrick Smith, LPC, CFI, Helzberg Diamonds Matthew Tarlton, LPC, Sears Holdings Michael Trella, LPC, Binny’s Beverage Depot Graham Twidale, LPC, Tera Tylliros, LPC, Indigo Books and Music

Recent LPC Recipients Shannon Danko, LPQ, Samsonite Jennifer Dille, LPQ, JCPenney Josephine Henderson, LPQ Stephen Kelly, LPQ, American Eagle Outfitters Kenneth Labadie, LPQ, Belk Department Stores Mark Ortega, LPQ, T-Mobile Vincent Palumbo, LPQ, Macy’s Logistics and Operations Tiffany Paxton, LPQ, Lowe’s Stephen Rickey, LPQ Marcy Smith, LPQ, Weis Markets Ryan Stephenson, LPQ, Seattle Goodwill Industries

Portable Two-Way Radios

Designed Specifically for Loss Prevention

LP Magazine | march–april 2016

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1-800-950-5005

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Evidence-Based lp

Watch Trends to Plan for the Future

by Read Hayes, PhD, 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. © 2016 Loss Prevention Research Council

N

obody can predict the future. We can look backward and at the present. We can hear about and see certain things that are already unfolding. But it is important to think and plan for the future.

You’re the Resident Expert: Part II

In the last issue of LP Magazine, I wrote about how you need to understand your company’s total retail enterprise and how that plays into security and loss prevention. Your

Loss prevention and asset protection professionals should strive to include a little retail 101 and future trending updates in their monthly routines. How retail will be structured and delivered will absolutely drive what needs to be protected and from what threats. company also needs you and your team to be watching and thinking bout the future. Tactically, we should be looking at data and talking to people about current and evolving violence, fraud, and theft incidents and trends. We should know where new stores are planned to open, new high-value merchandise we plan to carry, new operational processes, and so forth. We need this information to assess necessary protective action.

You should also be thinking a little about strategic issues—about how your organization and similar businesses are evolving what and how they sell and operate. What macro challenges lie ahead? Demographics, crime trends, buying habits, illegal selling sites, and methods should all be examined periodically.

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Broad Trends

Skimming over LinkedIn articles and retail magazines can help us all stay a little more up to speed. There are a lot of people paying close attention to shoppers and their wants, needs, and behavior. Loss prevention and asset protection professionals should strive to include a little retail 101 and future trending updates in their monthly routines. How retail will be structured and delivered will absolutely drive what needs to be protected and from what threats. We already see some meaningful emerging patterns.

Personalization. Online selling provides very personalized selling and selection. Brick-and-mortar stores are following this pattern. Retailers want to instantly know who is in their stores and what they typically want and buy. Better trained staff, and of course smarter technologies, will continue to enhance the in-store experience for shoppers to maximize sales and loyalty.

In-Store Tactics and Technologies. Shoppers expect retailers to continue to help them more quickly find what they want and what else they might want. Technology and signage is being used to guide shoppers to primary and allied merchandise. Of course, easier and quicker checkout is being addressed via store design, technologies, and training. And security technologies and alert, trained staff can make any store visit better and a little safer from the parking lot to the store and back.

Fulfillment. Shoppers expect very fast, reliable, and low-cost product delivery. Multiple options (omni-channel) are already here and growing and present a lot of improvement opportunities.

Loyalty. One-time or occasional sales to customers are not what a retailer wants with most of their core shoppers.

Longer-term relationships, where the retailer is the customers’ first thought, is the goal. So gamification, digital responses, and a little more personal attention in the store by engaged associates are the goals.

There are more trends and changes happening or getting ready to happen, but the point is for us to look at our environments and the macro space around us—whether cyber, social, or built—and look to anticipate and adjust planning and action to head off and curtail upcoming problems.

We invite you to consider joining in with our Loss Prevention Research Council (LPRC) Future of LP working group by contacting operations@lpresearch.org. The team is made up of executives from leading retailers and solution partners. They have monthly calls and webinars and take field

LOSSPREVENTIONMEDIA.COM

trips to innovation labs and stores. Their mission is to feed meaningful information and referrals to their companies and to other LPRC working groups.

You can imagine the group’s members led by Bloomingdale's AP leader Tom Meehan learning about future retailing concepts and constantly bird-dogging for new or adjusted tactics and technologies to address crime and loss issues for the supply chain protection, organized retail crime, product protection, video solutions, retail fraud, and other LPRC working groups.

2016 LPRC Board of Advisors

We all need someone providing feedback, ideas, and guidance.

At the LPRC, we have long had a group of retail LP and AP, LP technology provider, industry, and product manufacturer executives providing this “adult leadership” in the form of a board of advisors (BOA).

This team volunteers to help the LPRC team provide members with needed research in a usable format, such as executive report summaries, the Impact conference, a weekly emailed newsletter, monthly research-in-action reports, an online knowledge center, and quarterly webinars.

The LPRC BOA recently met in Tractor Supply Company’s store support center in the Nashville, Tennessee, area for a couple of days. The group was briefed on the overall research and development strategy and almost twenty planned projects (all based on member and BOA input). Our BOA members bring a wealth of diverse business expertise and aren’t at all hesitant to weigh in on how the LPRC can continue to improve process and delivery.

BOA members all share on thing in common—a real passion for moving the LP and AP field to a much more

evidence-based process. And I’d like to again personally thank each and every BOA member and the LPRC membership as a whole. It means a ton that the industry is continuing to move to evidence-based practice. Life safety, brand reputation, liability exposure, and profitability in an increasingly intense environment demand science-guided innovation, collaboration, and evaluation.

In future columns we’ll discuss more details around LP and AP strategy and process, and I would encourage you to think more about this very important topic, while also sharing your ideas and experience with me.

Coming Attractions

Look for a series of LPRC webinars, at least four field trips (Future of LP, supply-chain protection, and so forth), the 2016 Impact Conference at the newly renovated University of Florida Reitz Student Union (October 4–6), and the monthly working group calls.

Recommended Reading

Crime Prevention through Environmental Design by Timothy D. Crowe describes ideas to link built places and spaces to influencing user behavior. The most basic tenets are: ■ Natural access control ■ Natural surveillance ■ Territorial reinforcement As always, our University of Florida and LPRC teams are working to support you, so please let me know your thoughts and suggestions via our website at lpresearch.org, on LinkedIn, or at rhayes@lpresearch.org.

Industry Innovation.

Corporate Perspective.

It’s In Our DNA.

Print, Digital, and Mobile Solutions for Industry and Companies

You can rely on our expertise for the latest training, awareness, and education innovations in loss prevention, asset protection, safety, and retail operations.

For more information, visit us at LPMmediagroup.com LP Magazine | march–april 2016

53

Partnering with Retailers

How eBay Works with Law Enforcement

W

LeadsOnline

The LeadsOnline First Responder Service (leadsonline.com) is available 24/7/365. Our partnership with LeadsOnline makes it possible for law enforcement personnel to locate possible stolen merchandise that has been listed for sale or sold on eBay. LeadsOnline can assist with the following searches: ■ Locate seller ID information for property listed on eBay. ■ Locate seller listings and sales history for property listed on eBay.

Law Enforcement Resources

Law enforcement agencies in North America seeking assistance and records for investigations relating to eBay should use the following resources: ■ Search eBay listings and obtain eBay records in real time using the LeadsOnline First Responder Service at leadsonline.com.

■ Submit a request to one of our investigators via our Law Enforcement eRequest System (LERS) site.

Please note that we will not respond to requests received by mail, email, or fax, but only official requests submitted via the LERS site.

■ Email us at stopfraud@ebay.com for questions on how to accurately request records. This service is dedicated to law enforcement officers only, and inquiries from customers won’t be processed.

■ Members or the general public who would like to report a problem to eBay should visit our Reporting Fraud or Stolen Goods to the Police section.

Partnering with Retailers Offensively Against Crime and Theft

Retail loss prevention departments in North America seeking assistance with an investigation relating to eBay may contact eBay’s PROACT team for assistance. The PROACT program features among other benefits: ■ A way to report evidence of theft to eBay for investigation.

■ A dedicated email address to facilitate quick communication with eBay about retail theft investigations.

If you are a retailer whose company is not yet enrolled in the PROACT program, please contact us at PROACT@ebay.com for additional information.

Save Time in Your Investigation

The following tips are for law enforcement agencies to assist in your investigation. Note that eBay listings remain visible on the site for about ninety days after closing and are searchable by specific item number.

1. Search for active listings using a search string or specific item number. You can search by nearest zip code using search options on the left-hand column of the advance search function.

2. Search by seller ID for all active/completed sales dating back thirty days. This generally provides you with the seller’s state of residence.

march–april 2016

DiSilva is senior manager of global asset protection for eBay where he oversees eBay’s tools and PROACT teams. Prior to joining eBay in 2010, he held retail leadership roles in analytics, investigations, corporate LP, shortage control, e-commerce, and supply chain. DiSilva is an active member of the Loss Prevention Research Council, serving as co-chair of the predictive analytics group. Since 2011 he has been an LP Magazine contributor. DiSilva can be reached at 408-332-8666 or dadislva@ebay.com.

3. Feedback profile reflects comments made by other users regarding prior transactions.

4. Create your own favorite searches.

ith the beginning of a new year, I thought it appropriate to provide some basic information for how retailers and law enforcement should interface with eBay’s Global Asset Protection Team (GAPT) to collaborate in apprehending and prosecuting criminals who attempt to use our platform for ill gain. Most of these guidelines can be found in the Security Center of the eBay corporate website at pages.ebay.com/securitycenter.

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By Dave DiSilva

eBay’s Privacy Policy and Law Enforcement Disclosure

We care deeply about the privacy of the eBay community and will protect the privacy of our members even while working closely with law enforcement to prevent criminal activity. If you are unsure about our privacy practices, please visit eBay’s privacy page for more information at pages.ebay.com/help/policies/privacy-policy.html.

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FEATURE

Netflix’s

Making A murderer:

The Omission of Critical Facts Creates Bias

By David Thompson, CFI

The omission of critical facts creates bias

T

he Netflix documentary Making a Murderer has caused an outcry for justice in a system that is perceived by many as unjust. Taking social media by storm, this series has led to a downpour of compelling discussions on interview and interrogation techniques, false confessions, and alleged corruption in the criminal justice system. It is an incredible example of how quickly and easily our society becomes divided and blinded when discussing potential injustice and impropriety during a criminal investigation.

What You Missed if You Haven’t Been Watching

The ten-part documentary depicts a critical perspective of the criminal investigation involving Wisconsinite Steven Avery and his nephew, Brendan Dassey, as they travel through the many layers of the criminal justice system.

so began the dramatic series of events to follow.

Upon Avery’s release, the sheriff’s department had been exposed for mishandling the Beernsten investigation as they allegedly ignored information that may have exonerated Avery eighteen years earlier. The vital information included details about another suspect, Gregory Allen, who had been under investigation for a similar assault and eventually had registered as a match to the DNA from the Beernsten case. After his release, Avery filed a $36 million lawsuit against the county for its negligence that resulted in his false imprisonment.

While the respective witnesses and defendants were being deposed and providing testimony in the lawsuit, a young photographer, Teresa Halbach, was brutally raped and murdered in Manitowoc County. Halbach, twenty-five years old, had started her own photography

A jury heard weeks of testimony and then deliberated for days prior to making a decision in the Avery court case. The filmmakers, on the other hand, present a ten-hour documentary.

Before a viewer decides on a verdict, it would be appropriate to take a step back and deliberate the criminal investigation from an unbiased perspective.

The documentary is not your typical Law and Order episode with a clear, concise conclusion and examination of facts. This binge-worthy series features a man, Steven Avery, who was wrongfully convicted of a vicious attack on a woman, Penny Beernsten, in 1985. Avery was arrested by the Manitowoc County Sheriff’s Department and served eighteen years for this crime until he was cleared by DNA evidence. Avery was incarcerated for a crime that he did not commit, and

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business and was making extra money taking pictures of vehicles for Auto Trader Magazine. Investigators discovered that one of Halbach’s last known locations was at a familiar address—that of Steven Avery. This led to the arrest of Avery and subsequently his young nephew, Brendan Dassey, for the rape and murder of Teresa Halbach.

A man who had already lost eighteen years of his life for a crime he did not commit was again behind bars and pleading his innocence. Interrogation march–april 2016

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footage of Dassey had many questioning the possibility of a false confession and the possibility of corruption and conspiracy.

As a certified forensic interviewer (CFI), I feel it is imperative to take a critical look at the series—and the criminal investigation—and separate truth or evidence from drama and conspiracy.

The Inherent Bias of Edited Media

The documentary produced by Laura Ricciardi and Moira Demos begins in 2003 and is broken down over ten different episodes that all leave the viewer hanging and salivating to watch the next one. Since the documentary first aired on December 18, 2015, almost 400,000 people have signed a petition to the White House asking for the federal government to take another look at the criminal investigation involving the Avery case.

Justice, in the eyes of some viewers, has not been served. However, it is interesting that a series that highlights injustices and biases is unequivocally mirroring that same behavior.

Ricciardi and Demos have made several appearances and interviews since the release of the documentary and have stated, “We’re not prosecutors. We’re not defense attorneys. We do not set out to convict or exonerate anyone.”

If the documentary is not meant to convict or exonerate, a critical review of it should make the viewer question the filmmakers’ intent.

As we continue to take a critical view of this documentary and the claims and allegations it has so widely publicized, it’s important to review the information presented. A jury heard weeks of testimony and then deliberated for days prior to making a decision in the Avery court case. The filmmakers, on the other hand, present a ten-hour documentary. Before a viewer decides on a verdict, it would be appropriate to take a step back and deliberate the criminal investigation from an unbiased perspective.

If there were one word to describe the selection of content provided during this documentary as well as the actual criminal investigation that took place, “bias” would be a perfect description. There are several types of biases that we all fall victim to in

The omission of critical facts creates bias different circumstances. A personal bias is obvious, and the basis of this documentary is an alleged personal bias against the Avery family by the criminal justice system and specifically the Manitowoc County Sheriff’s Department.

Based on the information provided in the documentary, the viewer is led to believe that the entire homicide investigation of Teresa Halbach was focused on Steve Avery predicated on his history with the department. Avery was in the process of settling a large lawsuit based off of his wrongful conviction that placed him behind bars for eighteen years of his life. There are several allegations of the sheriff’s department’s wrongdoings, including the planting of evidence, lack of due diligence, and misleading interviews.

This series begs the viewer to question the integrity of the criminal investigation, the ethical and moral violations by the sheriff’s department, and the unjust nature of the resulting verdicts.

Trust in the criminal justice system, and specifically law enforcement, has significantly eroded over the last several

years. Without any doubt, there are flaws in the system, but they are publicized through the foggy lens of media persuasion and bias. When broadcasting incidents of alleged police brutality or misuse of force, the media tends to have selective publishing.

A routine, police-involved traffic stop that leads to the recovery of drugs may not be headline material.

However, showing the last ten seconds of video footage with the subject being restrained on the pavement turns it into a really provocative story. The Making a Murderer documentary even delivers this message for the viewer when they show a clip of an interview with a producer from NBC’s Dateline. The Dateline producer makes a comment about the Avery case: “This is the perfect Dateline story. … Right now murder is hot; that’s what everyone wants. …We’re trying to beat out the other networks.” We can’t blame the filmmakers of this documentary for taking the same approach, after all they are “not putting on a trial, but a film” as stated by Ricciardi.

Documentary versus Due Process

Armchair jurors are quickly and loudly voicing their opinions on both the Avery and Dassey verdicts, but there are stark differences between watching through the narrow angle of a filmmaker’s lens versus the panoramic view from a jury box. The documentary aids the defense in making several claims of police misconduct during the criminal investigation by highlighting one side of the argument. When discussing biases and perception, viewers need to recognize the difference between the burden of proof of the prosecution versus the defense’s ability to make unfounded claims or arguments.

In a court of law, the prosecution is tasked with proving, beyond a reasonable doubt, the several elements of each crime for which the defendant is charged. On the opposing side, the defense simply has to cast doubt by poking holes in the evidence presented. In this documentary, the viewer is provided with several claims that could result in reasonable doubt; however, they are not presented with the entire story that

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The omission of critical facts creates bias the jurors heard. In essence, the defense is able to provide theories and present claims without as much supporting evidence as the prosecution would need to prove the same. As we look at several examples from the documentary, the filter that the viewer is subject to should become more obvious.

In the very beginning of the Making a Murderer series, the viewer is enlightened with information about the wrongful conviction of Avery as well as some vague details on his history with the police. One of the incidents the viewer is exposed to involves Avery pleading guilty to animal cruelty for accidentally setting his cat on fire. However, as reported by the Associated Press, the criminal investigation revealed that Avery had actually poured gasoline on a cat and intentionally threw it into a bonfire.

The severe punishment and disgust for those who commit acts of animal cruelty is

blood inside Teresa Halbach’s Toyota RAV4. Encouraging the viewer to watch the next portion of the series, we are still left without answers to many questions.

We see, in dramatic fashion, Avery’s attorney inspect an evidence box that has been ripped open, and a needle-sized hole is seen in the top of a tube of blood.

There isn’t much that would be more controversial and climactic than planted evidence in the criminal investigation of a murder case, so that’s exactly what the viewer is shown.

What the viewer isn’t told is that Avery’s DNA was found in several locations on Halbach’s vehicle. There was DNA extracted from Avery’s sweat on the hood latch of the Toyota. Ironically, this piece of evidence corroborates other testimony that is never heard during the series. Avery’s nephew, Brendan Dassey, had informed the investigators that he

The documentary aids the defense in making several claims of police misconduct during the criminal investigation by highlighting one side of the argument. When discussing biases and perception, viewers need to recognize the difference between the burden of proof of the prosecution versus the defense’s ability to make unfounded claims or arguments. a widely supported feeling. This omission of facts could have changed the perspective the viewer has of Avery starting from episode one. However, if the viewer has animosity toward Avery and assumes he is guilty in the first hour, then there would be no reason to dedicate themselves to nine more hours of confirming that thought.

Instead, the documentary portrays Avery as an innocent person with a troubled past.

One of the major turning points in the documentary, and appropriately staged at the end of an episode, is the suggestion that the sheriff’s department planted Avery’s

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assisted Avery in relocating Halbach’s Toyota into the junkyard and that Avery had removed the battery cable from under the hood. This evidence and information, which would significantly sway the viewers’ opinion of the criminal investigation, is not shown in the documentary.

Further evidence presented in the documentary involves Halbach’s cell phone, including allegations of harassing calls and deleted voicemails. This sequence of events in the documentary includes testimony from Halbach’s march–april 2016

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co-worker, her ex-boyfriend, and her brother.

During this portion of the film, there is information provided that Halbach was receiving harassing calls from a blocked number and that her ex-boyfriend and brother had hacked into her phone to listen to voice messages. This leads the viewer to draw a conclusion that there were other suspects and, therefore, reasonable doubt. This has also started a widely supported opinion by viewers that Halbach’s ex-boyfriend could have been involved in the murder or the conspiracy.

Continuing with the theme of omission and selective editing, the documentary does not discuss the fact that the prosecution presented other evidence from the criminal investigation relative to these claims.

District Attorney Ken Kratz has stated that Avery called Halbach’s cell phone three times, twice attempting to block his number on the phone call. Avery also contacted Halbach’s employer, specifically requesting that she be the representative that came to his house. This information may have helped the jury in deliberations, but the omission of such detail in the documentary makes it very easy for viewers to find reasonable doubt.

As we have reviewed the omission of evidence and the skewed perspective the documentary gives its viewers, it is vital to realize two other points. First, this is a documentary, not a trial in the court of law; it is a trial in the court of public opinion. Because of this fact, there are no rules of law, no suppression hearings, and no full disclosure of evidence. There is also nothing requiring the filmmakers to adhere to those regulations, and Ricciardi has even stated, “Of course we left out evidence.”

Second, and most ironic, is that the documentary clearly establishes a bias for the viewer with limited information provided from the criminal investigation and a one-sided narrative, which is exactly the issue they are focused on targeting.

Body Language, Baselines, and Bias

Some of the most common feedback from those who have watched the interrogation footage of Avery, Dassey, or other witnesses revolves around the behavioral cues seen during their respective

The omission of critical facts creates bias conversations. Many viewers have observed erratic eye movement, fidgety or uncomfortable gestures, and changes in verbal behavior or responses.

One of the major issues with behavior interpretation is confirmation bias. If an interviewer, or viewer, believes that the subject is guilty, then they are more likely to identify several behaviors supporting that claim. If a subject consistently looks away and scratches his leg, it would serve as confirmations that the subject is guilty.

This confirmation bias is a detriment to the accurate evaluation of someone’s behavior.

If we observe someone hoping that they look guilty, ultimately they will.

There are several rules when attempting to interpret behavior, and one of the most important is to recognize that there is no single behavior that is fully indicative of truth or deception.

In other words, simply because a subject blinks excessively, brushes lint off of their shoulder, or crosses their arms, this does not necessarily indicate deception. If the behavior is on time to a stimulus—such as the interrogator

stating the subject’s name—then we can at least start to correlate the behavioral response to a trigger. However, this still doesn’t indicate that the suspect is lying or hiding something. It is very possible they may have anxiety or concern for a different reason.

Imagine if someone had to speak in front of a large audience and wasn’t prepared for it. When they first stand in front of the group, they would show several signs of anxiety, possibly increased respiration or perspiration, excessive blinking, or manipulators. In this context, these behavioral cues are not due to deception, but rather due to anxiety. In an effort to identify the difference between anxiety and deception, it is imperative that the interrogator establish a behavioral norm of the subject they are interviewing.

This important element of establishing a behavioral norm, or baseline for behavior interpretation, is indirectly referenced during the documentary.

As claimed by Dassey’s attorney in the documentary, Dassey is alleged to have a fourth-grade reading level

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and a limited cognitive ability. This is important information to an interviewer as it is essential that the subject does not misinterpret the interviewer, nor the interviewer misread the subject.

This is also important to recognize as an interviewer because it could increase the likelihood of a false confession or misrepresentation of the facts.

The suggestion provided by the defense of Dassey is that the interrogators led Dassey to a false confession because of his vulnerability. During the trial, Dassey’s attorney cross-examined the agent that led the interrogation. In the line of questioning, the interrogator tells the court that he observed abnormal behavior from Dassey. He further discusses specifics about the behavior he observed and stated that he felt as though Dassey was hiding something. The defense attorney quickly reacted to these behavioral assessments by challenging the interrogator to his knowledge of Dassey prior to this observation. The attorney questions if the interrogator had ever spent time with Dassey at school or in

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The omission of critical facts creates bias any other circumstance to establish his normal behavior.

This serves as an excellent observation of the importance of establishing a behavioral norm before attempting the already-challenging task of interpreting behavior. Non-verbal indicators may be starkly different based on the context of the situation, the culture or demographic of the subject, and many other variables that would be nearly impossible to list.

To properly assess and interpret any behavior in a conversation, it is essential for the interviewer to be aware of these surrounding variables.

Interrogation or Intimidation

There are several theories and strategies when it comes to the practice of investigative interviewing and interrogations. In the past several decades, this industry has undergone several

cognitive ability and the approach used when law enforcement representatives talked with him.

Brendan Dassey, sixteen years old at the time of his arrest, is a quiet and withdrawn person with limited social and communication skills. Dassey is known to have limited intellectual ability relative to his age and is therefore easily persuaded or influenced by authority. The series of interviews conducted with Dassey highlight a misuse of interrogation methods filled with persuasion, suggestion of leniency, and threats of punishment applied to a vulnerable, introverted subject. Dassey even stated to his mother after his confession, “They got in my head.”

Academics have argued that a direct, confrontational approach increases the likelihood of a false confession, especially with a subject that may be susceptible and vulnerable to such an accusatory conversation. In listening to excerpts from

What many viewers have now come to realize is the possibility that law enforcement could have acted improperly, and simultaneously, Steve Avery could also be guilty. Demonizing one side of the argument does not and should not be a direct correlation to believing or disbelieving the other. changes and will continue to adapt based on legality and research. It is imperative, however, that any interview or interrogation is conducted with integrity and with the intent to determine the truth and the substantiation of such.

Commonly known methods being applied across several industries and some countries include the Reid technique, the PEACE model, and the WZ method of non-confrontational interviewing.

The documentary directly cites Reid when the Brendan Dassey’s defense team discusses its claims against his interrogation. It is important to understand that different approaches or techniques of questioning may be more relevant and successful in some interviews versus others. It is even more vital to observe the facts of this case: a young subject who is known to have limited

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this four-hour interrogation, it is observed that the law enforcement agents told Dassey that he was involved in criminal acts and re-accused him several times with limited or potentially zero evidence to support that claim.

It is an unfair critique of the interrogation with hindsight as a valuable resource; however, in retrospect there are several other techniques that may have been better suited when interviewing a subject such as Dassey. Alternative methods may have provided Dassey with the ability to provide an honest and truthful response with substantiation of any said facts, without the use of intimidation or promises of leniency.

Most important is the interrogation that ultimately led to Dassey’s confession and subsequent trial. In this interrogation it is observed that Dassey is a quiet, march–april 2016

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withdrawn, and vulnerable subject. When Dassey is asked several questions, his answers almost sound like he is guessing as to the correct response to satisfy the interviewer. Dassey admits during this interview that he was involved in the rape and murder of Teresa Halbach and depicts a gruesome scene of the incident.

Later in the documentary Dassey is asked by his mother how he came up with such a story, and Dassey replied, “I guessed.”

Dassey’s mother then challenged him on that response, stating, “You don’t guess with something like this, Brendan,” to which Dassey replied, “Well, that’s what I do with my homework too.”

The major issue with this interrogation is the release of information by the investigators that ultimately contaminates Dassey’s confession. Most investigations will contain a piece of evidence or information that is kept from the general public, with the intention that it prevents false confessions and will substantiate a true admission of guilt from the responsible party.

Unfortunately, false confessions happen for a variety of reasons, and sometimes it is simply because a subject wants notoriety for the horrific crime, causing them to take credit.

By not releasing specific facts or a piece of evidence to the public, it is assumed that only the actual guilty party will be able to provide it. This vital information in the Halbach case was the fact that she was shot in the head prior to having her body burned in a fire. If Dassey or Avery had stated (without being prompted) that Halbach was shot in the head, it would be a solid substantiation of such admission that they could speak to the intentionally omitted details of the criminal investigation. However, the investigators that spoke with Dassey revealed this information and therefore reduced all of its potential value.

The investigators led Dassey down a path, like a game of Taboo, where they gave him all of the clues hoping he would pick the right answer. “What happened to her head, Brendan?” Dassey continued on page 62

The omission of critical facts creates bias continued from page 60

replies that Avery cut her hair and that Avery punched her. The viewer can sense the investigator becoming anxious, finally saying, “I’m just going to come out and ask you. Who shot her in the head?”

The valuable piece of evidence that was intended to prevent false confessions had just been given to the most vulnerable subject in the entire criminal investigation.

As noted throughout the documentary, there are four different occasions when Dassey is interviewed without an attorney or a guardian present. Depending on the custodial nature of each conversation, there may not be any legal obligation to provide Dassey with this assistance.

However, it may have prevented any misrepresentation of what occurred in those interviews.

Most ironic is the interrogation that occurs with Michael O’Kelly, the investigator hired by Dassey’s court-appointed attorney, Len Kachinsky.

During this interrogation, O’Kelly is clearly pursuing an admission of guilt from Dassey as he threatens him with “spending the rest of your life in prison.”

O’Kelly continues to persuade Dassey by asking if he wants a chance to get out one day and have a family. Ultimately, after many challenges and changes to his story, Dassey confesses to the crime.

An investigator and attorney who are supposed to uncover the truth on behalf of Dassey instead appear to have a goal of implicating him. Since the documentary has aired, Kachinsky has spoken to the media claiming, “In 20/20 retrospect, I should have never hired or fired O’Kelly.” Kachinsky also speaks about the potential of a plea deal that may have been reached with the prosecution had Dassey wanted to testify against Avery.

Even with all the aforementioned errors in the Dassey interrogations, it

is still possible that he was involved in the rape and murder of Halbach. Any misapplications of methods used when interviewing Dassey do not necessarily prove his innocence. However, it does cast doubt on the validity of his confession in its entirety.

Investigators, whether they work for the prosecution or the defense, should always have the same intent: to extract and reveal the truth without prejudice. When planning an interview or interrogation, it is essential to understand the moral and ethical obligations one has for justice and for the subjects involved.

A Search for Truth

When reviewing this case, as well as reflecting on the criminal justice system as a whole, it is evident that there is a clear distinction between the goals of obtaining the truth versus simply obtaining a confession.

In the documentary, it is mentioned that the interrogators had been trained to elicit a confession rather than the truth. Without knowledge of their respective training or intent, it’s difficult to validate or dispute that claim. To further differentiate these two terms, it’s important to recognize the fact that the subjects’ innocence or lack of involvement may very well be the truth. Regardless of the specific facts of the Avery case or any other criminal investigation, the most important piece of evidence will always be the truth.

It is the ultimate goal for any interrogator or investigator on either side of the courtroom to uncover the truth. If an interview is conducted with the sole purpose of a confession, especially with limited evidence, then the perception is that the conversation is conducted with a critical bias. In regard to the documentary, we have to recognize the fact that biases may very likely be derived from both the prosecution and the defense. The critical differences between what the

documentary tells its viewers and the actual totality of evidence in the trial illustrates the bias in the filmmakers’ intent. Was it a search for the truth or the pursuit of publicity?

Moral of the Story

Without this presentation of potential impropriety, it is debatable whether or not this series would have taken off as quickly in popularity as it has.

This fact alone should make the viewer question if there is full transparency in the documentary. The millions of viewers, and now self-proclaimed legal experts, are deriving opinions and signing petitions based on a small sample of the entire criminal investigation.

What many viewers have now come to realize is the possibility that law enforcement could have acted improperly, and simultaneously, Steve Avery could also be guilty. Demonizing one side of the argument does not and should not be a direct correlation to believing or disbelieving the other.

Without thorough in-depth knowledge of the case and all of its surrounding facts and evidence, it would be ethically irresponsible to come to a conclusion of truthful or untruthful, guilty or innocent.

However, it is perceived that those producing the documentary as well as those prosecuting the case may have had equal but opposing intent in the investigation of the Avery case.

If nothing else, this documentary stirs up a conversation as to the ethical and legal limitations and responsibilities of the criminal justice system, as well as the ease of persuading and dividing the general public through the media. Moving forward, interviewers and investigators alike should remind themselves of the high ethical standard they are held to, and they must act accordingly while performing the very challenging task of bringing down the full weight of justice by obtaining the truth from sometimes untruthful subjects during a criminal investigation.

DAVID THOMPSON, CFI, is an instructor and manager of investigations and consulting with Wicklander-Zulawski & Associates (WZ). He handles a variety of investigations, as well as conducting interviews and interrogations across a wide spectrum of clients and diverse cases. As a speaker for WZ, Thompson has presented at seminars and conferences, hosted a variety of webinars, and conducted live broadcasts of training. His educational background is in the field of psychology and criminal justice, while his professional experience is mainly focused on the private sector. He can be reached at DThompson@w-z.com or on Twitter @DThompsonWZ.

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showcase solutions BEST SECURITY INDUSTRIES

Consider BSI—Think Green Extending the Life of Your EAS Investments

By John Gantenbein, President, BSI

A

mong the more significant technology expenditures retailers make in today’s business are those for electronic article surveillance (EAS) and John Gantenbein video systems. Once the decision is made to deploy a technology such as EAS across the entire footprint of a retail chain, the real work begins.

It starts with a few necessary steps to ensure the investment will work as planned: ■ A cquiring the capital funds to purchase the systems.

■ P lanning and scheduling for any potential disruption to operations during the installation process.

■ T aking into account the cost of installation—floor cuts, electrical requirements, and manpower.

■ T raining the store associates in the proper processes and protocols.

So what happens several years down the line when the EAS technology retailers embraced starts to age and is no longer supported by the original equipment manufacturer? Do they need to start over and replace the worn-out systems with new? How much more do these new systems cost? How does it impact the ROI? What other unforeseen costs are missed?

There are, in-fact, viable options to extend the life of your EAS investments and contribute to environmental sustainability goals. Figuring out when or where it makes sense to revive legacy systems versus investing in new is the key. Retailers have some incredible value-added options today that provide for significant savings while protecting their original investments.

Best Security Industries (BSI) is known as a premier provider of both private-label and certified pre-owned EAS systems, as well as engineered video solutions. It is also the largest procurer of legacy EAS technology in the industry. But what some may not realize is that we also offer

robust field service, maintenance, and bench repair programs that can extend the life of most legacy EAS technologies and accessories. Our organization consists of certified service, repair, and installation professionals. BSI’s technicians have on average 20 years of experience. We employ a knowledgeable sales organization as well.

The combination of these experienced and accountable people are sure to meet and exceed your expectations.

BSI’s other services include on-site or remote diagnostic services to identify potential issues with EAS systems. Our technicians can remove and repair just about any existing legacy EAS system or components deployed today. A value add for a retailer is the option to simply ship any damaged unit or component to BSI and utilize our repair depot where it will be fixed and returned for re-installation. We warehouse a large inventory of legacy EAS equipment allowing for the replacement of damaged units with newly refurbished ones.

This service saves considerable down time while getting systems operational again.

Our company offers an in-house “express exchange” or repair program.

Equipment accessories such as detachers and deactivators can be repaired or replaced at our warehouse. It is important to note that these accessories, in many cases, have a one-day turn around.

Additional services designed to support sustainability goals, we recycle and repurpose older legacy systems for use as replacement components within a retailer’s existing footprint.

As part of our depot program, we will remove EAS systems from closed locations, refurbish them to original manufacturers’ specifications, and warehouse (or depot) the inventory until it is needed in new locations. BSI will also handle most merchandise protection solutions (MPS) including tags, pins,

LP Magazine | march–april 2016

wraps, and cables that require sorting, cleaning, quality-control inspection, and repackaging. The product is then inventoried and, if desired, put into depot for a retailer, so it can then be used for future deployment or immediate distribution to specified locations.

BSI can extend its refurbish, repair, and replacement programs to some video systems including domes, fixed cameras, switches, and digital video recorders. This service is available through our video services team and requires some initial qualifying with the retailer.

BSI prides itself on being a value-added solutions provider that retailers can turn to for help in extending their investments in legacy EAS and MPS technologies but also recognized for their private-label new EAS systems and engineered IP video solutions.

When retailers are faced with the choice of holding on to their original investment or replacing the existing infrastructure with new systems, they need to understand they have options. If you have not met with a BSI sales consultant, reach out for a professional assessment of your existing equipment and get a customized demonstration of the value BSI can provide.

Serving the loss prevention industry since 1987, BSI is a choice worth considering.

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showcase solutions Sysrepublic

Get Set to Drive Sales: Manage Key Profit Metrics (KPMs) with Analytics

By Renee DeWolf

g Back FY 2014-6

Renee DeWolf is the vice president of industry strategy for Sysrepublic. Prior to joining Sysrepublic, she managed LP analytics for CVS Health and Hilco Global. She has an MBA in economic crime and can be reached at renee.dewolf@sysrepublic.com.

T

KPM analysis focuses on identifying and analyzing a client’s key profit metrics. Key profit metrics are the indicator flags in any given retail data set that correlate strongly to reductions in margin and revenue.

KPMs can come from a variety of sources, such as: traditional POS transactions like refunds or discounts, supply chain data, case management feeds, cashier coaching events, and more.

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FY 2013-6

TOTAL KSI AS A PERCENT TO SALES

SELECT A CATEGORY 9.67%

ğ

²

5 MORE

5.43%

3.37%

8.41%

LINE VOIDS

TRANSACTION CANCELS

RETURNS

10.57%

THIS MONTH

LAST MONTH

oday’s omni-channel environment is transforming retail, and asset protection is no exception.

Following trends in self-checkout, mobile point-of-sale (POS), Renee DeWolf e-commerce, and a rise in creative supply-chain strategies, solutions like Secure 3.5 are now analyzing data from a variety of sources across the enterprise and empowering asset protection leaders to deliver well beyond the shrink line.

Secure 3.5, newly released in the fall of 2015, is the industry’s most advanced all-in-one asset protection global data command center. The platform now has a fully integrated suite of information capture add-ins for case management and audits alongside a host of features including, but not limited to, multi-lingual/ multi-currency conversions, real-time data capture and processing, robust querying, exception learning statistics, configurable dashboards, and any-device operability.

Sysrepublic has a long history of partnering with retail leaders to innovate new ways to create value from data, and the key profit metrics (KPM) analysis features in Secure 3.5 represent one of the latest examples of that commitment.

Analyzing Key Profit Metrics

ENTERPRISE

Secure 3.5 KPM analysis examines these indicators for frequency at every organizational level to identify a client’s personalized standard and best-in-class performance levels. By combining percentage-to-sales measures with financial-analysis-style frequency ratios, a clear and concise view is provided of how often a profit-impacting event is occurring and where the greatest opportunities lie to reduce related risk.

Secure 3.5 KPM measurements work together to support strategic benchmarks and flags relative to associates, locations, or geographic areas as they improve—or move in the wrong direction.

Flexibility in Design

With a client’s personalized KPM identified, dynamic dashboards are configured in Secure and specifically targeted to each user’s area of responsibility. This enables emerging risks to be rapidly communicated directly to the people who need them most.

Flags can be customized, and with an item flagged the user has a variety of drill-down options beginning with a view down to the next level of the organization for primary risk contributors.

System drill downs go from there through every level of the company all the way to day-of-the-week trends and the secure store detail transaction viewer. At any level, alternate views provide detailed breakouts of each KPM, store-level risk reporting, and associate-level risk reporting.

By combining a high-level overview with the flexible drill down and suggested link features in Secure, profit leaks can be focused on the areas of greatest risk, escalated quickly, and researched with ease.

Uncovering Hidden Insights

One of the benefits of the Secure KPM Analytics package is the ability to bring otherwise hidden insights to the forefront.

For one retailer, examining a variety of discounts revealed a surprising trend—nearly

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PEERS

LAST PERIOD

9.37%

DIFFERENCE BETWEEN PERIODS

12.8%

EMERGING RISKS LINE VOIDS AREA 1

UP 10.43%

ITEM DISCOUNTS

KEY

LONG TERM RISKS

IMPROVING RISKS

LINE VOIDS AREA 1

REFUNDS AREA 2

DOWN 4.56%

UP 4 CONSECUTIVE PERIODS

REFUNDS AREA 1

UP 9.34%

TRANSACTION CANCELS AREA 2 UP 4 CONSECUTIVE PERIODS

TRANSACTION CANCELS AREA 3

DOWN 4.19%

TRANSACTION CANCELS AREA 2

UP 8.26%

REFUNDS AREA 3

ITEM DISCOUNTS AREA 3

DOWN 3.98%

UP 3 CONSECUTIVE PERIODS

every customer was receiving one or more price reductions. Upon investigation, it was discovered that the wide variety of discount types available at the retailer, combined with their customer satisfaction initiatives, had cultivated an environment where employees were working to ensure that almost no customer would pay full retail.

For a retailer that did not consider themselves to be in the discount vertical, this empowered the loss prevention team to escalate their findings to the highest levels of the organization and thoughtfully promote changes to processes, systems, and culture that would improve margin.

Directing Change

Asset protection departments can also use KPM data to proactively drive change in a way that benefits the traditional investigation processes. One team used the POS benchmarking data to substantiate recommendations for management intervention thresholds.

The frequency measurements allowed them to identify how often certain types of activities were occurring at POS and mitigate push-back based on concerns related to slowing the speed of checkout.

By strategically adjusting controls at POS, the existing exceptions the team had in place became more productive, and case closure rates improved without a negative impact to customer experience.

For questions or to see a demo of Secure, contact me at renee.dewolf@sysrepublic.com or 310-802-3044.

My Turn

Data Analysis: The Key to Good Loss Prevention and a Great Career T echnology is amazing. It has changed our personal lives, the way we do business, and is changing the loss prevention profession in every way. We are surrounded by CPUs and memory chips. As a result of this melding of mankind and microprocessors, we have become exquisitely skilled at hoarding data. We collect every bit of data possible and store it for later access.

Most of us don’t know exactly where it goes or even why we are saving it, but we just do. Two even greater mysteries are how to get the data back and how to turn it into valuable information to benefit your enterprise and your career goals. This is the essence of data analytics.

Data analytics (DA) in business is the scientific analysis of raw data to create information that will allow us to draw assumptions and logical conclusions about what that raw data represents and how it can improve profitability.

The Digital Ceiling

As a retail loss prevention professional, you are likely very familiar with the data-hoarding tendencies of your enterprise. This is why you must be highly knowledgeable of data and DA. This knowledge allows you to provide the highest level of performance to your employer and the greatest opportunity to promote your career and improve the quality of your life. The days of just being able to resolve theft cases are quickly coming to an end. You must act now to become technically savvy regarding databases and basic computer architecture. Failure to act, and very soon, will cause your career to come to a screeching halt when you reach the “digital ceiling.” I refer to it as the digital ceiling because it is the threshold in any enterprise where you just simply need to know computers and data to be productive at that level. You will forever bump your head on the digital ceiling until you make the effort to gain the tools and knowledge to smash it into the billions of bits it is made of.

Learning Data Analysis

There is a misconception that you need to have a doctorate in computer science to understand computer

By Eric Mickelson Mickelson is a data analyst and Caseboard software trainer at 4Sec Global. He has twenty-six years of loss prevention experience in regional, district, area, and store-level investigative and leadership roles. He previously worked in LP and security at Nordstrom, Tower Records, and the San Francisco 49ers. He holds associate’s degrees in law enforcement and physical security and is working on his bachelor’s degrees in IT/network security and computer forensics and criminology at Utah Valley University. He is also a graduate of the San Jose Regional Police Academy and is WZ certified and a certified digital forensics data analyst. He can be reached at emickelson@rocketmail.com.

architecture and DA. Nothing is further from the truth. Databases are quite simple when you grasp the basics of relational database design and how to make the individual bits of data maintain their proper relation to other individual bits of data. It really is as simple as picking up a few books, downloading a free database program, and playing around with the simple and easy-to-learn code known as structured query language (SQL).

The web is loaded with SQL information and tutorials. W3Schools.com is highly recommended for its SQL tutorial. It is a straight-forward learning tool that is free and in-line with SQL coding best practices. If you like the more romantic approach to learning, pick up a book. Any SQL book will do if you’re just trying to get a basic understanding of relational databases.

SQL for Dummies is a great starting place. It is a simple read with reduced technical jargon. Move on to more advanced texts if you catch the coding bug. I highly recommend that you download an open-source free distribution of PostGreSQL, so you can explore making a variety of tables and understand how data is organized and linked between them.

Developing Questions of Data and Answering Them with Information

Data analysis is all about answering questions. To properly develop the questions, you must first identify your enterprise’s opportunities to increase profitability.

Second, you need to identify the specific data needed to answer these questions. Finally, you must determine the tools and resources you can use to turn that data into actionable information to resolve the opportunities.

Develop the Questions. Increase in profitability is always the goal of any enterprise. Opportunities reside in breaking up organized retail crime (ORC) rings that are having a heavy impact on shrinkage and item availability across your business. Improving safety protocols to reduce internal and external injury claims would avoid payouts. Upgrading software to improve workforce efficiency and productivity would result in reductions to labor cost centers. How do you resolve these opportunities? The specific questions can be limitless, but the answers are almost always contained in your data.

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Find the Data. Once you have determined your questions, you need to find the data to answer them.

Look at every level of your enterprise and understand all of the data being collected and how it can possibly morph into information that can answer your questions. You may find that the human resources department has data that can help with your efficiency and workforce productivity. There is also information in logistics and point-of-sale databases that could help. You must look at a variety of sources to gather sufficient data to answer your questions.

We are in the very first stages of the next great technological boom in history. The next great advancement is the significant increase in data storage available to us. It will make data analysis more difficult but at the same time more important than ever.

The Coming Data Revolution

Are you aware that we are in the very first stages of the next great technological boom in history? The next great advancement is the significant increase in data storage available to us. It will make data analysis more difficult but at the same time more important than ever.

3D X Point (pronounced 3D cross point) memory is here. It was released in July 2015 by IM Flash, an Intel and Micron joint corporate venture. It is the first new nonvolatile memory revolution in twenty-five years. It is a completely new memory architecture that eliminates resistors and uses columns to store data. It is 1,000 times faster than current NAND memory, and ten times the density and durability of NAND. In short you can store ten times the data for ten times as long and access it 1,000 times faster than you ever could before. Processors will now be able to access their full potential enabling technology that could only be imagined until now. You must stay ahead of the curve, and you must prepare for this. 3D X Point technology will create an environment where the requirement to have DA skills and the ability to access the massive stores of data will reach critical mass. It is here, it is amazing, and it will change your role as a loss prevention professional dramatically.

Clearly, data analysis is a critical skill needed by all loss prevention professionals to stay viable in the technology-driven marketplace. Enhancing your knowledge of data, information, and technology will not only create more value for your employer, but also give you a competitive advantage when looking to advance your career.

When collecting your data, you must be proactive and diplomatic at the same time. Snooping around in databases often is met with resistance, for good reason. Information security, proprietary secrets, HIPPA, and a whole host of other factors may create a discussion as to why you may want access to the data. Make sure you have clearly defined goals, ensure that you have proper oversight while examining, and be patient but politely persistent.

Find the Tools. Now that you have formed the questions and identified your data, you need to aggregate the data in a methodical way and turn it into actionable information. This is the most difficult part of the DA process. We have all sat at a desk trying to make the link between transaction data, inventory data, suspect data, tips, and video images to resolve an ORC group or an internal case.

And we have all conducted analysis of cycle counts and physical inventory with multiple databases and applications open on our laptops to try and find out why our numbers are off. There is software out there to help aggregate and analyze data to answer your questions.

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A great data analysis software platform should be able to: ■ Instantly access and view all relevant databases through one interface.

■ Graphically create relationships between data and build a case for the answers to your questions.

■ Create multiple graphs of the information for better understanding.

■ Accept and analyze social media and hashtagging.

■ Use facial recognition of stored photo and video images as well as run actively against live CCTV feed.

■ Be flexible in allowing specific modification to LP needs but also to any need in your enterprise.

■ Not change or alter your data in any way.

All of these points are key to getting the capital expenditure toward DA software. You can prove value in purchasing DA software by showing that it can accommodate any department in the enterprise, not just LP. And the fact that software only looks at data and does not affect the data in any way will give you greater access and buy-in from IT and other stakeholders.

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Digital Dialogue

By Jacque Brittain, LPC

In Terms of Professional Development, Relevance Is a Product of Evolution

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.

Organized Retail Crime

I

n the digital space the concept of evolution is a frequent topic of conversation. Naturally this makes a great deal of sense, as we are indeed in a state of constant flux as a society and in terms of the business and the profession that we represent. We read about, witness, and experience these changes on a daily basis and consider how this information holds relevance in terms of what we do and how we accomplish our objectives. But in terms of our own professional development, the ability to apply what we learn is just as important.

When we talk about the evolution of the retail industry or the loss prevention profession, we must also recognize that we’re not simply spectators—we are along for the ride. This requires that we continuously look for ways to evolve ourselves. We must assume responsibility and take an active role in the process, or else we’ll find ourselves trying to catch up—or left behind.

News is more than simply information. Daily events provide a barometer that can help measure changes and pressures in the industry, important retail trends, ongoing concerns, and new developments that can directly impact the retail industry in general and the loss prevention profession in particular. Every story provides us with an example that can help us learn and grow. This should further influence the way that we approach the news and what we do with the information once it is provided to us.

There are loss prevention departments that regularly review internal incidents and ongoing news stories with their teams. There are leaders in every department that go out of their way to share events and educate their employees. While these efforts should definitely be applauded, it should by no means serve as our sole resource for this type of knowledge and education. Every loss prevention professional has the responsibility to take charge of their own professional development, which includes staying informed and applying information accordingly.

Often the news provides us with reminders rather than revelations. But this can be just as important to our day-to-day responsibilities as well as our long-term professional development.

Learning is largely a product of experiences; and by looking for ways to make the news more relevant, we are also enhancing our own relevance as well. Let’s take a look at a few examples from recent news events and apply these incidents in a way that can benefit each and every one of us.

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On a daily basis we are exposed to the evolution of organized retail crime and the different ways that these professional thieves have devised the means and methods to steal both products and information from our companies. As needs and opportunities continue to change, we see the criminal element responding based upon supply and demand—modifying the products that they attempt to steal based on the desires of their customers, the re-sell value of the products, and the opportunity and risk associated with obtaining the merchandise.

Learning and professional development must be an ongoing process if we want to remain relevant and productive. The industry provides us with examples every day, but it is still up to each one of us to take the steps and make it happen. Seizing the opportunity can be as simple as opening the newsletter on your smart phone.

For example, we recently reported on a series of deadly robberies involving the theft of hair weaves. While this may seem like an odd item for organized retail crime teams to focus on, these weaves typically range in value from $120 to $170 and higher.

They are in high demand, easy to sell, and virtually untraceable.

They can be easily sold on Internet auction sites or other brick-and-mortar locations.

From a professional development standpoint, how can we then apply this information? Have we looked at current theft trends and compared those trends to products sold in our own stores?

Have we applied the concepts of supply and demand, attempted

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to predict what merchandise might be popular targets of organized retail crime in our own stores, and looked for ways to prevent potential incidents?

By applying the available information we are then better equipped to manage potential incidents before they occur.

Retail Robberies

Unfortunately, retail robberies also occur on a regular basis. But while some types of retail locations might be more likely to have robbery incidents, every retail location should be prepared for potential incidents—and those incidents can originate from some very different sources.

For example, we recently had a story about an eight-year-old boy that took a 9 mm handgun out of his mother’s purse, rode his bicycle to a nearby store, and attempted an armed robbery—pointing the loaded firearm at the store clerk and demanding money from the cash drawer using some very harsh and direct language. Fortunately no one was hurt, but the incident could have turned out much differently based on the way it was handled.

From a professional development standpoint, this provides us with a prime example that potential robbery incidents can strike at any time and can involve almost anyone. It emphasizes the importance of preparation and following designated policy and protocol in such situations to ensure that no one gets hurt in our stores. Such stories can provide valuable learning opportunities for our store teams and strong incentives to keep our customers and employees safe.

When Bad Decisions Trump Bad Stops

There are many reasons why most retail organizations choose not to allow store employees to make shoplifter apprehensions in their stores. Most often we point to concerns over following the five steps of the apprehension process, the possibility of making bad stops, and the opportunity for someone to get hurt when untrained and ill-advised situations occur in the stores. Unfortunately, other situations can develop as well.

Recently an assistant manager at a Tennessee store was arrested and charged with raping two women after he

allegedly detained them for shoplifting merchandise, according to authorities.

After witnessing the women shoplifting, the manager allegedly took them into a back office and told them to undress.

After complying with his demands, they were allegedly fondled and forced to perform sex acts on the manager, according to reports. Police say that the women claim that they “were in fear for their safety and felt that they had no choice” but to comply with the manager’s demands. The manager then reportedly allowed the women to leave the store with some of the merchandise that they had attempted to steal.

Obviously there is a great deal that is wrong with this story. The incident allegedly occurred in a discount specialty-type location without a dedicated loss prevention team, and the manager reportedly acted on his own.

If the story is accurate, it clearly points to a twisted abuse of authority and criminal behavior. By the same respect, however, if the story for some reason was proven inaccurate, it shows what can happen when employees take such situations into their own hands, fail to have witnesses, and fail to follow company policies and protocol. As ugly as the story might be, from a professional development standpoint, these unfortunate circumstances can provide an important learning opportunity for both loss prevention professionals and the employees that they serve.

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Grasp the Opportunity

Even for the most seasoned loss prevention professionals, professional development opportunities are presented each and every day. Technology, retail trends, cargo thefts, legislation, employee theft…these examples only scratch the surface of the possibilities and the potential when we are willing to apply information in a productive and constructive manner.

Learning and professional development must be an ongoing process if we want to remain relevant and productive. The industry provides us with examples every day, but it is still up to each one of us to take the steps and make it happen. Seizing the opportunity can be as simple as opening the newsletter on your smart phone. There simply are no more excuses.

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People on the move Kevin Hazel is now a Security Analyst for ALDI.

Nate Pearson was appointed Executive VP for General Security Services.

Michael Buck is now an LP Coordinator for Barnes & Noble.

Kelly Moye, CFI is now Corporate Investigations Manager for GM Financial.

Bill Seering was appointed VP of Sales and Marketing, and Brent Ewing was named VP of Product Development and Strategic Partnerships at Southern Imperial.

George McDowell is an Area AP Leader at Big Lots.

Beth Guinn is now Manager of LP for Harding Retail.

Martin Hernandez is now Area LP Manager for Tawa Supermarkets.

Andrew Buchanan, CFI was appointed Director of LP for Calgary Co-Op.

Scott Draher, LPC was promoted to VP of LP, Safety and Operations for Lowe’s.

Raymond Sosa, MBA, CFI is now Director of LP at CVS Health.

Jennifer Thomason, CFI is now Global DTC LP Operations Manager for Nike.

USS announced that Patrick Avery, Bob Bartholomew, Faisal Khaliq, CFI, Christine Olsz, and Brian White are now National Account Managers for the Eastern US, and Lonna Barret, Vince Fillari, Shannon Gregg, Brad McGarrh, and Michael Bitzer are National Account Managers in the West.

Anthony Rodriguez was appointed Director of LP for David Yurman.

John Spirko was appointed Director of LP for Equinox.

Debra Martin was named Director of LP for Fresh Market.

James Stark was appointed Director of LP for Pier 1 Imports.

Damon Trite, CFI, LPC is now Regional LP Manager for Signet Jewelers.

Stan Welch, LPC was appointed VP of Business Development for The Zellman Group and Agilence Strategic Partnership.

To stay up-to-date on the latest career moves as they happen, sign up for LP Insider, the magazine’s daily e-newsletter, or visit the Professional Development page on the magazine’s website, LossPreventionMedia.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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Calendar March 1–3, 2016 Jewelers’ Security Alliance 38th Annual Security Seminar & Expo Hard Rock Hotel & Casino Hollywood, FL jewelerssecurity.org

April 12–14, 2016 International Organization of Black Security Executives Annual Spring Conference Hosted by Tyco Boca Raton, FL iobse.org

July 24–27, 2016 Restaurant Loss Prevention & Security Association Annual Conference La Cantera Hills Resort San Antonio, TX rlpsa.com

March 7–10, 2016 Merchant Risk Council e-Commerce Payments & Risk Conference Aria Resort and Casino Las Vegas, NV merchantriskcouncil.org

April 17–20, 2016 Retail Industry Leaders Association Retail Asset Protection Conference Gaylord Texan Resort & Convention Center Dallas, TX rila.org

July 18–20, 2016 Security100 Summits Security100 Retail Chateau Elan Winery & Resort Braselton, GA security100summits.com

March 14–17, 2016 Food Marketing Institute Asset Protection Conference Westin La Paloma Resort & Spa Tucson, AZ fmi.org April 5–8, 2016 ISC West Sands Expo & Convention Center Las Vegas, NV iscwest.com

June 14–16, 2016 National Retail Federation NRF PROTECT Loss Prevention Conference & Expo Pennsylvania Convention Center Philadelphia, PA nrfprotect16.nrf.com

August 24, 2016 Georgia Retail Association 6th Annual GRAORCA Retail Crime Conference AmericasMart, Atlanta, GA graorca.org September 12–15, 2016 ASIS International 62nd Annual Seminar and Exhibits Orange County Convention Center Orlando, FL asisonline.org

For more information about these and other industry events, visit the Events page at LossPreventionMedia.com.

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Advertisers American Public University............................... 2 studyatapu.com/lpf Axis Communications....................................... 37 axis.com/zipstream BSI....................................................................... 59 bsi-eas.com CAP Index........................................................... 21 capindex.com/hasyourback CEC...................................................................... 43 correctiveeducation.com Checkpoint......................................................... 17 checkpointsystems.com ClickIt Inc........................................................... 23 clickitinc.com Cyber Security Summit.................................... 28 cybersummitusa.com Detex..................................................................... 9 detex.com/badboys1 FireKing Security Group................................... 27 fireking.com Industrial Security Solutions........................... 35 isscorpus.com InstaKey Security Systems............................. 31 instakey.com International Assoc. of Interviewers............. 61 certifiedinterviewer.com Kenwood............................................................ 51 kenwoodusa.com Loss Prevention Foundation............................ 40 losspreventionfoundation.org LPM Media Group............................................. 53 lpmmediagroup.com LPjobs.com......................................................... 70 lpjobs.com LP Software....................................................... 45 lpguys.com National Retail Federation............................... 67 nrfprotect.com/register Northern Michigan University........................ 33 nmu.edu/criminaljustice/lpm Palmer, Reifler and Associates...................... 25 palmerreiflerlaw.com Protivity............................................................... 69 protivitycommunications.com Protos Security.................................................... 3 protossecurity.com The Retail Equation............................................. 5 theretailequation.com/success Retail Industry Leaders Association............... 7 rila.org/ap SAMSUNG TECHWIN AMERICA................... 13 samsung-security.com SECURITECH...................................................... 49 securitech.com/simplythebest Security Resources.......................................... 75 securityresources.net Southern Imperial............................................. 47 intelligentlossprevention.com Turning Point Justice....................................... 57 turningpointjustice.com Tyco Integrated Security................................. 76 tycois.com/retail USS.................................................................. 1, 39 ussinnovate.com Verisk Retail....................................................... 19 veriskretail.com Wilson Safe........................................................ 69 wilsonsafe.com

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Vendor advisory board American Public University Tatiana Sehring Director, Corporate & Strategic Relationships Axis Communication Hedgie Bartol Business Development Manager, Retail Best Security Systems (BSI) John Gantenbein President CAP Index Stephen B. Longo Vice President, Strategic Initiatives Checkpoint Carlos Perez Senior Director, Global Marketing

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LP Software Brian Eskra President

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Corrective Education Company Jeff Powers Chief Operating Officer

Nedap Retail Patrick O’Leary Vice President & General Manager NA

Turning Point Justice Lohra Miller President and CEO

Detex Ken Kuehler National Account Manager

Palmer, Reifler & Associates Jeff Welch Executive Director

Tyco Integrated Security Kevin E. Lynch, LPC Executive Director

Protos Security Kris Vece Director of Client Relations

Universal Surveillance Systems Steve Sell Chief Marketing Officer

FireKing Security Group James Currey Senior Vice President Cash Management Solutions Industrial Security Solutions Dave Sandoval President

The Retail Equation Tom Rittman Vice President, Marketing

InstaKey Security Systems Cita Doyle, LPQ Director of Sales & Marketing

Security Resources, Inc. Patricia M. Rusak Director of Sales

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Parting words

The Audacity

Jim Lee, LPC Executive Editor

W

that he would go on to become a hall of famer. I knew of his reputation and was pretty nervous and fearful standing in the batter’s box. Speaking with him after the game, I found out he was full of the same fear when I stepped into the box.

Regardless of how tough or good you are, fear is natural. I suspect that if you aren’t feeling a little fear, you are probably playing it too safe. And that should be enough right there to scare you.

Too much fear, however, can sometimes set off a self-perpetuating cycle of negative thoughts. You think of all the difficulties and challenges and imagine the worst possible outcomes, such as “I will not get a raise,” “I could look stupid,” “I could lose my job,” “my shrink results will be bad,” “I will be over budget,” or “I may get outsourced.”

hen we started this publication fifteen years ago, we had a single purpose with a clear focus and mission on what we wanted to accomplish. We have enjoyed overwhelming support from LP professionals, associations, vendors, academics, and C-level executives. We could not have sustained without them, and we are constantly singing their praises and giving them thanks.

Since our first edition we have strived to make each issue better than before. When you think you have a good thing,

“You have to be single minded, drive only for the one purpose you have decided on, and if you think you are getting there, bear in mind that there will be people hanging around doing their damnedest to trip you, blacken you, and break your spirit.”

– General George S. Patton, Jr.

Take the Bite out of Fear

you can be reluctant to change. You know the old cliché—if it ain’t broke, don’t fit it. That’s baloney! As we migrate to more and more of a digital publication, we are not shaken by fear of change, fear of failure, or fear of rejection.

The Threat of Fear

Have you ever had to face major change in your life?

Did you feel the fear? It’s pretty normal. It could be a job interview, a theft interview, a new job, losing your job, marital change—all things that come with fear. I have known a few really tough people whom I could not imagine ever being fearful of any situation, but they are.

As a young adult I played serious baseball. One day I was at bat against a pitcher who was really good, so good

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I would suggest that almost all the fears are exaggerated and irrational. If we can agree with that suggestion, then we can deal with fear through a strong dose of reality.

Step back and ask yourself, “What is the worst thing that could happen?” The worst is that you lose everything—job, reputation, money, family, and friends. It’s not going to happen.

The worst case never happens. We are just afraid it might. Fear exaggerates the perceived risk, making it seem much greater than it actually is. Rather, as another cliché goes, the sun will always come up tomorrow.

Going back to the challenge of managing a professional magazine, how do we generate quality content that is meaningful to our readers while providing value to our advertisers?

Sometimes we fail and make a decision that is unpopular or met with criticisms. We’ve done that a time or two. We get back in the saddle and look for ways to make it better. We all must face fear by understanding and accepting real and perceived fears.

I believe we all have to adhere to a core belief to guide us both professionally and personally. While I know very little French, one of my favorite sayings is “l’audace, l’audace, toujours l’audace.” It translates to “audacity, audacity, always audacity.”

You can never be fearful to act promptly and decisively on reasoned, calculated decisions.

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