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Web of Deceit: The Global Impact of Counterfeit Products

The U.S. Commerce Department estimates that piracy and counterfeiting costs U.S. businesses between $200 billion and $250 billion a year. Those ubiquitous Louis Vuitton purses sold on bedsheets by street vendors do not represent an isolated amateur act; they are directly related to fake housing components, fake vaccines and even fake airplane parts. Last year, the U.S. Air Force noted that an “unknown number” of phony airplane parts had found their way into Air Force and Navy planes. The Federal Aviation Administration estimates that 2%, or 520,000, of the 26 million airline parts installed each year are fakes-a frightening thought for anyone who flies. 

In addition, according to MarkMonitor, a San Francisco-based counterfeiting research firm, instances of “cybersquatting” (using a domain name that capitalizes on an established brand) increased steadily throughout 2008, up 18% year-over-year to more than 1.7 million instances. The number of websites devoted to selling counterfeit goods also rose to more than 87,200, up 46% from the previous year.


The 3 Habits of Highly Irritating Management Gurus

This article takes a critical look at the business self-help genre and its visible “gurus.”  According to the article, these writers tend to have three characteristics in common. Lousy leadership “gurus” are marked by a tendency to overstate the newness of their ideas, a fondness for naming “model” companies and a willingness to market various “tools” that purport to reduce leadership to a few easy steps. “If management could indeed be reduced to a few simple principles, then we would have no need for management thinkers,” the author writes.

While I would not dismiss their work out of hand, as this article does, it is an interesting phenomonen that business leaders flock to the same well-worn management principles time after time after time.  It seems there is serious money to be made by taking a timeless principle and using a new metaphor.  The more simplistic you make it, the better.  If you write it as a parable (think Who Moved My Cheese) that is the best!  Perhaps that is why you can find legions of folks who have read The One-Minute Manager but hardly a soul who has read Drucker’s The Effective Executive or The Practice of Management

Read the full article at The Economist.


Retail Theft Up 10% in Quebec

The Retail Council of Quebec reported Wednesday they are also increasingly victims of theft and fraud. In 2008 and so far this year, the province’s retail sector has registered economic losses of nearly $900 million – 84 per cent of that attributed to theft and fraud by staff, shoplifting and consumer fraud.

In a survey carried out for the council between July and August by geomarketer and retail researcher Altus Géocom, 54 per cent of the respondents (who represent approximately 162,000 employees working in more than 4,250 stores) reported a 10-per-cent increase in those incidents from 2007.  Read full article here.


Employee Theft Attitudes: A Disconnect with Management

After posting Lencioni’s column yesterday, I went back and reviewed some notes from a presentation I saw a couple of years ago in London by Martin Gill, one of the leading researchers in the area of loss prevention and security.  In this presentation, Gill was presenting the findings his firm, Perpetuity Group, found from offender interviews they had conducted.

When interviewed after the fact, employees who had been caught stealing from their employers typically had a “positive” or “very positive” attitude towards their employer and said they had good work relationships with colleagues.  However, their negative attitudes included the view that there was poor communication between managers – often putting them in the middle of conflicting direction – and that “managers and supervisors did not always appear to take security seriously.”

 This research echoes findings that Hollinger and Clark made over twenty years ago.  In this current economic cycle, when payroll is more constrained than ever and managers have more on their plate than ever, perhaps the greatest challenge that any loss prevention group could face is how to keep their front-line management teams engaged with their employees and creating an environment that encourages honesty and discourages theft.


Loss Prevention Research Council: Impact Workshop

I had a chance to attend the LPRC’s Fall Workshop hosted at the University of Florida last week.  This is a group of loss prevention professionals, solutions providers, and academics that have come together under Read Haye’s leadership to advance the research agenda for the retail loss prevention industry and help all of us make decisions based on science, not mythology.

The LPRC has already produced several studies and has results from over 350 research projects on their website.  This is the type of effort that I continue to believe needs to be supported by our industry associations such as RILA, NRF, FMI, and others.  If you are interested in finding out more information on the efforts of the LPRC, visit them at


The No-Cost Way to Motivate

 A manager’s genuine interest in employees’ lives pays off at every level, in every job

“One of the greatest causes of misery for employees is the feeling that the person they work for isn’t interested in who they are and what goes on in their lives, personally or professionally. Regardless of how much money people make and whether their jobs suit them, if they feel anonymous they’ll dread going to work—and return home deflated.”

Patick Lencioni has written a nice, straight to the point reminder for all of us about the important role an employee’s first line manager plays in their life.  This is important for us to remember as managers, but also critical for us to remember in how it impacts shortage, safety habits, and engagement in the workplace.  We can design every training and awareness program we can think of, but it all comes to nothing if not supported, reinforced, and breathed into life by our store management teams.  Read the full article here.


National Cargo Theft Task Force

ISO and the National Insurance Crime Bureau (NICB) announced today their intent to create a national information sharing system to combat cargo crime. By networking existing databases and adding secure reporting and analytic functions, the new system will enable more efficient, accurate, and timely sharing of cargo-theft information between theft victims, their insurers, and law enforcement.

Cargo theft is a multibillion-dollar economic drain that exploits existing gaps in the nation’s information-sharing framework. When theft victims are unable to provide timely and accurate information concerning their losses, it hampers law enforcement’s ability to conduct an effective investigation. Aside from the immediate loss of merchandise, cargo theft affects insurers and their policyholders through added costs that are ultimately borne by consumers.  NCTTF


Loss Prevention Hiring: Ramping Up?

Several weeks ago we noted that hiring at the field loss prevention level seems to be ramping up and it looks like this trend is continuing.  Disney, Express, A&F, Dollar General and many others are looking for district, regional, and senior regional loss prevention managers and we are also seeing some postings in Mexico and Canada.  We would expect there to be a flurry of activity between now and the beginning of November when most retailers want to have everyone in place to focus on the holiday season.


New England ORC Conference

Several weeks ago, I had the pleasure of attending the New England ORC Conference sponsored by the retail associations of the various states in the area who have come together in cooperation on this issue.  Congratulations to Kevin Plante from Staples who was responsible for leading the coordination and planning of the conference.  It was a very well-run conference and it is my understanding that it was a record attendance.

During my remarks at the conference, I made the observation that we, as an industry, should feel good about the progress we have made on ORC.  It often seems that we come across as “chicken littles” on this issue when, in fact, we have made substantial ground.  The increased use of technology, information sharing across the industry, and coordinated efforts on legislation are all possible indicators that perhaps we are controlling this issue better than ever before.  Your thoughts?