To successfully innovate today, LP leaders repeatedly emphasize the importance of reciprocity in relationships—forging a two-way bridge between LP and its business partners, between corporate planners and field operators, and between the future and the past.
At one discount retailer, for example, loss prevention software from ThinkLP was brought in for case management, but it also helped the company to expand the investment’s value by utilizing the LP tool to manage reporting companywide. Distribution centers use it to report accidents and thefts, stores to report pricing discrepancies, and promotions to track and report sales performance. LP also worked with the operations team to build a routine audit tool into the LP software for its use.
“Oftentimes, leaders in AP don’t involve their peers until after the fact, and then you’re looking at modifications,” the director of asset protection observed. “And that’s when you can upset some of your business partners, especially when the failure to involve others costs them time and effort.” He believes it’s mandatory for asset protection leaders today to transform LP innovation into companywide initiatives and that it’s something that should drive projects from the start.
LP innovation also hinges on being able to leverage asset protection value from partners’ technologies. “You can’t afford to miss it if there is some sort of innovation that is being used by store operations that can be of use to AP,” said Scott Roubic, former vice president of internal audit, asset protection, and real estate at JOANN Stores. “You want to put yourself in a position so that you’ll be exposed to that idea, so you can think, ‘Is there an AP use here?'” At JOANN, for example, AP has taken a system typically used by other retailers to alert store associates to long dwell times at changing rooms and deployed it in high-shrink areas of high-shrink stores. So potential thieves who linger in aisles before stealing are instead greeted by staff asking to help them.
Although it can be a challenge to initiate, cross-functional collaboration—once established—will typically reinforce itself. “The more you’re seen as taking a holistic approach, the more others are likely to connect with you on their initiatives and for you to be involved in their projects from a shrink perspective,” explained one LP director. “Because I involve my peers in our initiatives, they all involve me in theirs.'”
AP has a large degree of responsibility for innovation at Macy’s, and innovation shouldn’t only be the focus of top AP executives, according to Brian Goddard, manager of asset protection innovation and implementation at Macy’s. He has more than two decades in AP, many at the store level, and thinks store personnel are valuable assets in a corporate AP department’s pursuit of innovation. “[Innovation] doesn’t have to start at the highest level and trickle down. I personally came up with ideas at the store level, innovations involving expense reduction and better information sharing, and had the mindset that I wanted to see those tools trickle up.”
So it makes sense that a significant focus of Goddard’s corporate position now is to go out in the field to collect those store-level ideas to help drive strategic asset protection system innovation companywide. “I ask merchants and operations managers what they want to see, what we can do to make it happen, and how different tools relate to customer service,” he said. “It’s important to stay in close touch with our AP partners in the field-and also our non-AP partners in the field. Some of our best ideas and achievements have come to fruition from non-AP partners. The more partnerships you secure and the more they embrace the technology and understand what it can do for them, the more likely your projects are to be successful.”
Store-level training is another part of Goddard’s field outreach, which he sees as a critical, final piece in asset protection system innovation projects. “You have to coach on what these innovations are,” said Goddard. His outreach to stores includes going to marketing and sales managers and piquing their interest with use-case scenarios: What if I could tell you the average time the last ten customers had to wait in line was six minutes? What if I told you that you that you can get a text the next time that waits exceed three minutes? What if you knew which was your busiest door during the busiest time of day? “And it’s much the same with the operations piece, where we’ll go to them and say, ‘What if you could see what’s going on in all your stores and provide you a live view of loading docks?'” This is incredibly powerful information, and the better you can paint that picture, the better position AP is going to be in when being considered in projects from other functions, according to Goddard.
To Goddard, innovation isn’t limited to finding and implementing new technology tools—it’s about getting stores to use them. “A lot of our technology we haven’t been using for very long, so [stores] are still evolving in their understanding of the value of it,” he explained. “We can roll out something fantastic, and it is crucial we ensure our success by continuously training to these new technologies while soliciting ideas from our end users. It must be user friendly, and we must overcome challenges along the way and push the envelope with our end users and solutions providers alike.”
Outreach can also help reduce duplication of effort or reduce store costs. For example, one vendor said it’s not uncommon for store merchandising managers to hire an outside company to test the effectiveness of an endcap or a display, even though they already have a camera that could do it for them.
Finally, Roubic suggested a third way in which LP innovation needs to be a two-way street—by looking not just at the future, but also at the past. “A couple of years ago, one of our field AP pros asked, ‘Why aren’t we looking at patterns in discounts and coupons?’ We use them a lot, so we started using our exception-based reporting system to dig into trends,” explained Roubic. By doing so, the AP department had a “significant and immediate impact” by rooting out team member abuse of coupons and, more significantly, by identifying and addressing training and systemic gaps that were contributing to lost revenue.
Read the full article, “All Together Now,” for more expert insights and the best ways to position your AP department for success. The original post was published in 2018; this excerpt was updated November 20, 2018.