The loss prevention audit is a means of providing an objective
and consistent evaluation of company standards, operating procedures and
internal controls. Audits enable companies to address a variety of performance
efficiencies that shape and influence service, sales, organization, security, productivity
and numerous other factors that impact overall management and profitability of your
store or facility.
Analyzing the results of a loss prevention audit can provide you
with a multitude of insights in to the overall operations of a store.
Compliance—and non-compliance—does more than provide you with specific
information regarding how a specific strategy is being executed. The audit
process will also provide insights about the bigger picture:
- The
leadership in the store and the way they supervise their teams.
- Organizational
skills and the overall way store operations are managed.
- Management’s
ability to plan, prioritize and multi-task.
- The
character of store management and how they perceive the importance of certain
aspects of their job.
- The
sense of ownership that store management carries in making and keeping their
store successful.
Auditing is a process, and should not be viewed as a single
event that occurs in the store on any given day. Results should be reviewed and
analyzed over time. Anyone and any store can show great results or great lapses
in efficiency at any given time…but it’s how those results are received, how
they are addressed moving forward, and how they are managed over time that will
provide you with true insights.
It is
vital that you approach audit functions with the appropriate understanding
of your role in order to most effectively serve the company, the store, your
associates and your customers. The spirit of the entire audit process should be
one of growth and progress.
There will be
challenges and opportunities, including:
- This is what we found…
- This is why it’s an issue…
- Here is how it should be corrected…
- Establish an action plan that facilitates correction
and improvement…
- Establish a timeline to follow up on the areas of
opportunity…
The purpose is to
reinforce principles that should already be familiar to those being audited and
evaluate compliance with established performance standards. Too often, audits
tend to focus on the negative. This unfortunate tendency can and will influence
the entire process, and must be addressed in order to make the impression and
realize the results that we hope to accomplish. Our methods and mentality
should acknowledge achievements while recognizing the importance of training,
education, and awareness as a means to send a message and improve our stores.
Driving Performance with Loss Prevention Audits
A loss prevention audit should
do more than evaluate performance. A well-managed program should also serve as
a training tool that enhances performance through
training and development. Compliance is a result of information effectively
learned so that it can be applied, and behavior effectively inspired so that it
will be modified and maintained. Ensuring that policies are correctly followed
must be an emphasis of the audit process.
Tracking Results
There are many ways to input and track audits results. Some companies use paper
audits and manually track the results. Some companies use software programs and
handheld devices that enable them to instantly view, sort, and track results.
However you do it, make sure that the results you track include the total audit
scores, as well as the responses to each individual question.
The ability to
quickly view the results of the inventory shrink audits should be a major
consideration. Audit scores are important, but so are the common findings. For
example, knowing that 95% of your stores failed questions 25 and 26 on the
audit will enable you to determine why they are failing those questions and
identify what needs to be done to get them back into compliance. Common
findings should be reported on a regular basis so you can course correct
throughout the time period leading up to your inventory analysis.
Communicating
Results
Timely
reporting of audits is important. As soon as an audit is completed, the results
should be communicated to the store and the district manager. This enables them
to take immediate action to correct identified issues. The sooner they can be
addressed, the sooner they can be corrected.
Audits can serve as
an important vehicle for ensuring operational compliance, enhancing awareness,
measuring key performance functions, and providing valuable teaching and
training opportunities. But our impact on the business is only as successful as
our methods, our approaches and our attitudes when conducting the audit, when
sharing the results, and when supporting the store teams. Information must be
used in a positive and productive way. Our objective must be to improve the
performance and productivity of our stores, and add value to the organization
as a whole.
Loss prevention
audits can be a tremendous tool in helping to validate performance and bring
attention to store strengths and deficiencies, but it is how that information
is used that will add value to the organization. We have to maintain a
positive, objective approach when evaluating compliance. We should recognize
exceptional performance when it exists.
We should not only
identify opportunities for improvement, but educate the store on the reasons
why it’s an issue, how it can potentially impact the store, and how we can make
improvements.
