Category Archives: Commentary

Is Your Blackberry Lowering Your IQ?

A good article from over at the BusinessWeek site citing research that found that communication overload causes a professional’s IQ to drop 10 percentage points.  Our addiction to our emails, VM’s, text messages, tweets, Facebook and the like is dysfunctional on many levels, but perhaps none so insidious as growing inability to focus our undivided attention for more than a few minutes.

The issue used to be that when we were at home, we were thinking about what needed to be done at work and when we were working, we were thinking that we needed to be spending more time at home with the family.  But, now we feel like we have to be everywhere, all the time!  When we are on the cell phone, we are checking email.  While reading email, our phone alerts us that we have a text message.  When we are on Facebook, we feel like we need to keep tabs on LinkedIn and when we are at lunch with a colleague that we haven’t talked to for a few months, we are constantly checking our Blackberry.

Perhaps the future will belong to those who use all of these technologies but have the courage to do so on their own terms?  Read the article here.

Communicating with Senior Executives: Do You Know Their “Hot Buttons”?

In a previous post, we discussed the need to understand the “language” that your senior executives use so you can properly communicate the value that your function brings to the organization.  As an example, we explored whether you should be talking about retail numbers or cost numbers when making corporate presentations.

I had a couple of readers weigh in with additional examples. One executive wrote, “In my company, we use units lost compared to units sold. My CEO always talks about shrink in terms of units lost being missed sales.” Another executive responded, “My CEO and CFO don’t talk in terms of percentage at all. They only talk in terms of cost dollars. Right or wrong, they don’t really care too much about high shrink percentage/low impact items. They figure the buyers will figure out whether those items continue to make sense from a margin perspective.” These are additional examples of the different languages and dialects that senior executives might speak.

In this post, we will examine a closely related issue – hot buttons. What is it that really gets your senior management team fired up? What do they stay up at night worrying about? What gets their attention? What should you be incorporating into your program proposals?

Let’s look at some possibilities…

  • Actual theft cases – There is no doubt about it, you can get the attention of some executives (loss prevention executives included) by showing them a dramatic example of what happens when people steal from your organization. Shoplifting or employee theft are both attention grabbers. It may not seem sophisticated to some of you, but it is real.
  • Financial ROI – The “holy grail” of building a business case, return on investment is the quickest way to get to the hearts (and checkbooks) of most CFOs and like-minded CEOs. Are decisions in your organization usually made in rational, analytical ways? If so, you will need to focus here.
  • Risk avoidance – Is your CEO most concerned about potential negatives? Does the CEO constantly ask about worst-case scenario or downsides of potential projects? For instance, if looking at a return policy change, is he or she most concerned about possible negative impacts on customers or sales? We make many proposals that can address potential risks and you may want to highlight those aspects. For instance, Payment Card Industry compliance, Sarbanes-Oxley issues, Foreign Corrupt Practices Act liabilities, , premises liability and many other potential risks can be avoided by prudent loss prevention programs.
  • Sales risks – Do you find repeated “roadblocks” to your programs due to concern over their negative impact on sales? If so, why are you not using those same concerns to support your proposals? For instance, what is the cost of lost sales due to lack of in-stock, on the shelf availability of hot products? Have you shown how your proposals might actually increase sales?

What are some “hot buttons” to which your senior management team pays attention to? Do you have some examples of successes you have had in presenting your business case in a way that resonated with your audience? If so, please share them and we can generate further ideas and dialogue.

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Originally published in RILA Report – Asset Protection – October 2008

Fact or Fiction? Maintaining Credibility

I was recently browsing various websites when one particular news ticker caught my eye.  It reported that “The Top 10 in-demand jobs in 2010 did not exist in 2004.”  Wow, that was a pretty shocking statistic!  Ironically, I was reading the March edition of HR Magazine the very next day when I ran across an article titled “Where the Jobs Are.”  The article included a sidebar “Top 10 ‘In-Demand’ Occupations.”

Naturally, I was curious to see what these jobs are that did not exist in 2004.  Here was the list: 

  1. Registered Nurses
  2. General and operations managers
  3. Physicians and surgeons
  4. Elementary school teachers
  5. Accountants and auditors
  6. Computer software engineers
  7. Sales representatives and managers
  8. Computer systems analysts
  9. Management analysts
  10. Secondary school teachers

Since this list was completely incompatible with what I had read the previous day, I decided to investigate.  Since HR Magazine is produced by the highly respected Society for Human Resource Management, my first suspicion lay with the web news ticker information I saw.

A quick check via Google pointed me to the widely circulated “Did You Know?” video that has been viewed over 5 million times according to the “shifthappens” wikispace .  In this video, it says, “According to former Secretary of Education Richard Riley, the top 10 jobs that will be in demand in 2010 didn’t exist in 2004.” 

Since a couple of other “facts” from this video had also been featured on the original news ticker, it seemed logical that this was the source for the info.  However, the conflict between this video and the SHRM list was not resolved.  So, I went in search for the original comments from former Secretary of Education Richard Riley.  It turns out that he did say this and was quoted in a book titled The Jobs Revolution: Changing How America Works.  But, here is the important fact that solves the mystery – the book was published in 2004.  If you go back and look at the quote, it now seems clear what has happened.

In 2004, Riley was making a prediction that he likely intended to make a point about how the pace of change would continue in the upcoming years.  That is far different that reporting his prediction as a fact in 2009 when it has clearly not come true.

Now, I don’t think the owner of the original news ticker that I read was trying to mislead anyone.  They simply picked up a widely circulated item and phrased it as a fact.  But, it certainly would make me question the credibility of other facts that I read on that ticker in the future.  Perhaps there is a lesson for all of us in this example.

I will talk in future posts about the importance of credibility, focusing primarily on expertise credibility and relationship credibility.  But, this example reminds us of the importance of what I’ll call “factual credibility.”  I use this term to differentiate it from a situation where someone is purposefully lying or being dishonest.

In our industry, we continue to see “statistics” cited in the popular press that are hard to substantiate.  For instance, whenever we have gone through an economic downturn, my phone starts ringing with reporters from various news outlets that want to do a story on how an economic downturn results in either: a) increased employee theft; b) increased shoplifting; c) increased burglaries and robberies; or d) all of the above.  They are usually disappointed that I will not endorse the concept carte blanche.

When I explain the nuances involved in statistically supporting the theory they are advancing, they grow bored and I can tell they simply want to call someone else who might be likely to enthusiastically agree to the premise.  It may very well be that employee theft, for instance, goes up in times of economic difficulty, but given the fact that the seminal report in our industry has a lag time of many months in reporting estimates of employee theft, it seems hard to believe we could detect a statistically significant trend in a matter of weeks.

Yes, the theory sounds reasonable, but there is also a theory that during times of relatively high unemployment, employees are less likely to steal and they realize the ability to replace their current job with one of approximate quality is diminished.

 Therefore, it is imperative on all of us to be careful in pronouncing theory, predictions, estimates, or guesses as fact.  An example might be the dollar figures that are often cited relative to the total impact of organized retail crime in the U.S.  There is no doubt that losses from ORC can be immense and that it is an issue that is worthy of our attention.  However, before we cite a specific number for our industry as “fact,” let’s make sure we can support it and maintain our credibility, lest we lose our bully pulpit on any issue.

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Originally published in RILA Report – Asset Protection, April 2009

Learning a Second Language: Communicating with Senior Executives

If you’ve ever traveled to another country where English is not widely spoken, you have probably experienced the difficulty and frustration of being unable to effectively communicate basic needs, much less hold fluid conversations and exchange ideas. And, while one might be able to expect residents of the United States to speak English, it is certainly hard to be upset with those in other countries who do not speak our language since we are in their country.

In a previous post, we discussed the problem of some senior retail executives not believing there is a cause-and-effect relationship between investing in the loss prevention function and the organization’s shortage results. If the senior leadership of an organization believes that shortage is subject to nearly uncontrollable, external winds and forces and that spending money on loss prevention investments does not necessarily result in lower numbers, there is a serious failing on our part in showing the cause-and-effect relationship and making an effective case for budget dollars.

In this post, we will begin to look at some opportunities we may have to change that mindset and be more effective in communicating our value, our business case and the reasons that organizations will benefit from funding our business proposals and programs. First, we will look at the issue of how we communicate with senior executives.

Just as different cultures and countries have different languages, companies have different languages too. Think of all the acronyms and abbreviations that you use in your workgroup that sound completely foreign when a new employee joins the team. Or, think of all of the special lingo that we use in our industry – LP, AP, DE, BOB, POS, LERPnet, RILA, CFI, CCTV, DVR, ORC, BOLO, and the list goes on and on and on.

Senior executives are no different. The terms, language, and references they use can range from somewhat unfamiliar to completely foreign. If we expect to communicate effectively with them, we had better be prepared to spend some time studying them, their language, and the issues that resonate with them. Let me give an example that illustrates the point.

Most of us in the loss prevention world have spent our entire careers talking about shrinkage and, when we do, I would venture that the vast majority of us talk about it in terms of the retail value of shrinkage as a percent of retail sales. This makes a lot of sense, especially when speaking with store employees and managers as it has good clarity since most of their focus is on retail price. Retail reporting is also used by the seminal study in our industry, the National Retail Security Survey, as the “benchmark” number for us to compare against.

However, in working with a number of retail companies over the years, I have consistently found that CFO’s and CEO’s look at shrinkage (and a whole range of other metrics) in terms of cost. This is an extremely important point. If you go in to a meeting with senior executives who are used to speaking in terms of shrinkage at cost and you talk about retail shrinkage, you run a real risk. At best, they will view you as financially unsophisticated. At worst, they will perceive that you are trying to inflate or overstate the size of the problem to support your budget requests.

For instance, one of the age-old illustrations many of us have used in our industry to illustrate the impact of shrinkage is the idea that “for every item that we lose, we have to sell 20 more items just to break even.” Have you heard that before? Have you used that before? It can be an effective way to discuss the impact of shrinkage when talking to hourly associates. Of course, it is predicated on a particular net margin that may or may not be applicable to your business. But, more importantly, it is unlikely to resonate with CFO’s as they will look only at the loss of the item at cost which, depending on your gross margin, may differ dramatically in terms of impact.

I’m not arguing for a cost number or retail number per se. Rather, I’m arguing for the importance of understanding the way that you senior executives look at the figures. What works for them? How do they speak about the issue? What will have credibility for them? If we do not start with learning their “language,” we will have as much success in communicating with them as most of us would have in ordering dinner in a restaurant in rural Japan.

In future posts, we will further explore how we need to assess the senior executives in our organizations to determine how we can best frame our business case in a manner that will get their attention, their support and their sign-off on budget dollars. As always, I welcome your views, thoughts and insights into this issue. 

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Originally published in RILA Report – Asset Protection – September 2008

Public Speaking & Loss Prevention?

In response to Saturday’s post about public speaking, I had an email that basically asked, “What does this post have to do with Loss Prevention?”  They could not understand why I had posted an item that seems so off-topic to them.  As I explained to them via private reply, I think it is a critical skill for most in the business world, but especially so for our profession.

 The ability to speak in public has an almost unfair impact upon how others perceive you.  Think about this scenario, you are asked to make a presentation to the Executive Committee of your organization on your results and plans for the upcoming year.  If you do a good job, you are perceived as an “up and comer” who has a great future.  If you have a flop-sweat performance and come across incoherently, you risk jeapordizing your future, maybe even your current position – even if you are a great performer when it comes to actually doing the job!

Is giving that much weight to a person’s ability to present in public fair?  Probably not.  But, it is reality.  For those of us in this profession, it is even more important given the stereotypes that exist for loss prevention and security practitioners.  When others think of the “typical” person in our profession, they are likely to think of the sullen, stand-offish, and oafish personality they have seen in movies or TV shows.

When we have a chance to present to a group, we have the opportunity to reinforce the stereotype or change it.  That is why this is a critical skill for all of us in this profession.