Stan Welch, LPC is the vice president of loss prevention for JCPenney. Prior to joining the company in 2007, Welch held a wide range of positions with a number of major retailers over the course of his loss prevention career. He is also active in the industry as chair of the Retail Industry Leaders Association (RILA) loss prevention committee, a member of the editorial board for LP Magazine, and a member of the board of directors for the Loss Prevention Foundation.
EDITOR: You have a big job with a big company. I want to examine your journey from getting started in your loss prevention career to where you are today.
WELCH: When I graduated from Eastern Illinois University in May 1987 as a political science major with a minor in sociology, I wanted to get into law enforcement. I applied with the FBI, took a state police test, and also applied with the University of Illinois police. I joined Carson Pirie Scott in June of ’87 as a store detective. At the time I was also working full-time for the University of Illinois campus parking. When my job ended with campus parking in August, I became full time at Carson’s. I was also asked to supervise the fitting room associates. I was promoted to LP manager in March of 1988.
EDITOR: Tell us what kind of training you were given during that first year of your loss prevention career.
WELCH: My training was minimal. When I interviewed, they offered me the job on the spot and took me to the loss prevention office. They opened up the desk drawer and handed me a badge and set of handcuffs. The first time I caught a shoplifter, I didn’t know what paperwork needed to be filled out and had to call another store to walk me through it over the phone. During that phone call I learned there was a training class. I ended up going through a two-day training class in Chicago for store detectives and learned the LP guidelines and expectations. Basically I was on my own to learn processes, operations in the store, and how to detect theft. It was about self-educating and learning on the job.
EDITOR: What was the next step in your loss prevention career?
WELCH: About the time I became the LP Manager at Carson Pirie Scott, I met Beth, who is now my wife. We decided we wanted to live in a bigger city, so we looked for opportunities in St. Louis. We both interviewed with Famous Barr. They offered me a posi-tion in Peoria, Illinois. Because it was more money and was the kind of progression to another company that I hoped would eventually get me to St. Louis, I took that job. I joined Famous Barr in the summer of 1988 and was the LP manager at that location for about a year.
EDITOR: Where did Beth end up?
WELCH: Beth was given the opportunity to go to Cincinnati, Ohio, with Lazarus Department Stores. Her career took off in Cincinnati. She was promoted and took on more responsibility in their downtown store. We decided to get married in 1989. Because her career was going so well and there was more opportunity in Cincinnati, I interviewed and joined Lazarus as an LP manager in their Kenwood Towne Centre store. About eighteen months later, I was promoted to the downtown location as manager of investigations and training.
I was approached by my former regional LP manager at Lazarus about a position at Marshalls right after I was promoted. Because Lazarus was in Chapter 11, we decided I should take the opportunity at Marshalls. So, I joined Marshalls in 1991 as the regional investigations manager in Chicago.
EDITOR: Stop right there. You changed companies two or three times in a fairly short time. Why do you think a young Stan Welch could interview with other companies and get hired?
WELCH: Looking back, I would say it was being confident and having the track record of results to speak about. I had driven strong results, whether it was safety, shrink, people development, or theft results. I’ve always believed that there’s a recipe for success; one that you can duplicate over and over again over the course of your loss prevention career path.
EDITOR: What’s your recipe for success?
WELCH: It starts with your team and putting the right person in place. The other key ingredients include awareness programs, impactful shrink and safety action plans, merchandise protection strategy, theft identification and investigation, and operational ex-cellence in stores. When you have operational breakdowns, it is important that you know how to fix them and what the dollar value is worth to the company.
EDITOR: How valuable do you think your college degree was to your loss prevention career, and how much value do you place on a college degree when you are recruiting people to JCPenney?
WELCH: I would say my college degree definitely helped my loss prevention career. When I compare candidates today, I look at the experience in their backgrounds. Do they have a college degree? What type of results did they have at their past jobs? Do they have any certifications? Are they certified interviewers? Have they taken the LPQ or LPC? It’s important to me to see if they are still learning and gaining knowledge. That’s the kind of individual I look for.
EDITOR: Getting back to Marshalls, where did your loss prevention career go at that point?
WELCH: As I mentioned, I started out as a regional investigations manager in Chicago. When the company reorganized, I was asked to take over a new, larger region in Dallas-Fort Worth. That region covered ten states. It was a much bigger job with five investigators reporting to me.
I was also asked to be a certified interview instructor for Marshalls. It was an innovative program that Marshalls began with Wicklander-Zulawski. I became one of fourteen who went through instructor certification training and began training all of Marshall’s investigators across the country.
EDITOR: Even though you had great success at Marshalls, you were attracted to another company.
WELCH: Marshalls went through another reorganization and closed the regional office in Dallas. My job changed to senior investigator. There was also a change at the VP level of the LP organization. All of the change made me feel like my career was in a bit of limbo.
I was approached by Rod Holm, who I had worked for at Marshalls. He had joined Target as a group asset protection team leader [GAPTL]. He contacted me and told me about the company and job opportunities.
In 1995 I joined Target as a district asset protection team leader [DAPTL]. They trained me for six months and then put me in Houston. I was promoted in December 1997 to the group position that covered Houston, Atlanta, and the Carolinas with 85 stores.
In 2001 there was a major reorganization in the LP organization that eliminated my GAPTL position. I was offered two options. I could either go to the home office in Minneapolis to be the manager of market investigations, or I could move into operations as a store manager in Houston. I decided to move to Minneapolis and spent a year organizing and structuring market investigations with the manager of national investigations. We put that program in place and centralized it.
EDITOR: Let me stop you again. You made a decision that a lot of people have difficulty with. You took a step back in your loss prevention career in order to take a step forward. That’s not easy to do. That’s not easy to do. Talk about that.
WELCH: You can’t get overly concerned about titles. Sometimes taking an opportunity that may be perceived as a lesser position gives you different experiences and exposure to different issues that will help you grow in your career and as a leader.
EDITOR: You rose to what level at Target before your career took another turn?
WELCH: I was a DAPTL, GAPTL, manager of market investigations, and manager of LP operations. Finally, when Target was having difficulty finding GAPTLs, I was asked to move back into a group position managing both the Minneapolis and Kansas City markets. In 2002 I took over two groups with about 153 stores and did that until 2004.
EDITOR: What happened in 2004?
WELCH: I was recruited to Sears to be the director of shortage control.
EDITOR: That was another big change in your career. Were you ready to take on that big responsibility at Sears?
WELCH: It was a bit of a new challenge because I’d never owned the inventory process side of the business. As director of shortage control, I had both merchandise protection and the shortage control function, which involved putting together the inventory instructions, and my team did the shrink analysis. It started out as a relatively small position, but within a year, we merged with Kmart, and it grew into running all of the operations for the loss prevention division. I had three directors reporting to me who managed shortage control, technology, merchandise protection, food safety, and safety.
EDITOR: How long were you at Sears before JCPenney came calling?
WELCH: I was at Sears about two years when my mentor called to tell me that JCPenney was looking for a vice president of loss prevention. At that time, we were just coming through the transition with Kmart, and I didn’t want to leave my responsibilities. My mentor called me a couple of more times and told me that I really needed to talk to the JCPenney recruiter. I went through series of interviews and joined JCPenney in January 2007.
EDITOR: So, at this point you had held several different jobs with no less than five different companies. Sometimes people think that that’s a negative on their resume. Obviously, JCPenney didn’t see that as a negative.
WELCH: I had some great experiences in several positions. Those experiences are what got me ready for each new position. Working for multiple companies, you learn a lot of different aspects of the business and how to lead those operations. I think they saw that all of my different experiences would benefit JCPenney.
EDITOR: When you arrived at JCPenney, what were some of the priorities that you put in place to brand the organization the way you wanted to move forward?
WELCH: When I joined, I spent time in the stores. I learned the process of how they flow merchandise from the dock all the way to folding clothes. I spent time with the loss prevention team. Basically, my first ninety days all I did was listen, observe, and learn. I was able to set priorities based on my observations.
The first thing I reviewed was the loss prevention structure, and I developed a proposal for some changes. I worked with my executive vice president of stores and we added three directors to the organization. We put in a director of shortage control. We added a director of investigations with market investigation teams in New York and L.A. I organized the home office so I had a director of operations/safety and a director of supply chain. By the second half of 2007, we had a structure where people understood their roles.
At that point we turned to the programs and processes we needed to put in place. For example, we changed our apprehension guidelines to improve the safety of our LP teams. We also improved our shrink focus at the store level by adding processes, reporting, and new technology like EAS and CCTV.
Once we had these in place we began to focus on people development and put programs in place for our future potential leaders.
EDITOR: I know that professional development is a major priority for you at JCPenney. How does that work?
WELCH: We have two developmental programs in loss prevention. One program focuses on loss prevention managers and supervisors in stores or supply chain. The other program is focused on DLPM and home office managers. The candidates go through an assessment process that consists of interviews, presentations, and group exercise, depending on the program. We work with our human resource partners during the selection process. Our goal is to strengthen their leadership skills and abilities.
EDITOR: What types of positions have these people moved into?
WELCH: We’ve had people promoted from DLPM positions into home office positions. We’ve also had individuals promoted from senior loss prevention manager/supervisor positions to DLPM and market investigators.
EDITOR: What percentage of your positions is filled by internal promotions versus outside hires?
WELCH: It’s roughly fifty-fifty.
EDITOR: Let’s turn to some of your initiatives that are driving your shrink results. One is your merchandise-protection program. Talk about the value of putting in a structured merchandise-protection program.
WELCH: It is huge because it takes a collective team effort, with finance, retail operations, merchandise teams, and supply chain. When I joined JCPenney, they already had best-in-class execution of tagging merchandise. We tag at the logistics facility before it ever gets to a store, which is a good best practice. The piece that we worked on was identifying merchandise that we saw with risk and protecting it before we put it in our stores to prevent shrink. We also use public-view monitors in high-shrink areas.
We have EAS systems in approximately 500 stores today and continue to add EAS systems to drive profitability. We’re constantly analyzing the best places to put LP resources and technology to get the best ROI for our organization.
CCTV is the other piece on the merchandise-protection strategy. We’re making sure we have systems in the right stores and camera coverage on the high-shrink items.
EDITOR: Are your merchandise-protection standards different in different stores?
WELCH: No, the merchandise-protection standards are consistent across the stores. We also look at different levels of risk in our stores by item and improve the protection on those items.
EDITOR: Over the last several years, the issue of organized retail crime [ORC] has received a lot of notoriety. Is that an issue you are dealing with?
WELCH: As I mentioned earlier, when we restructured the LP organization, we put into place two market investigation teams. We have since added a market investigator in San Francisco and a team in Chicago.
The teams investigate organized theft and fraud impacting our stores and supply chain. They have been very successful resolving several burglary thefts, refund theft groups, and closing fence operations. I attribute the success to the communication and partnership between the market investigation teams and store LP teams.
EDITOR: Do you work with other retailers and associations in your ORC program?
WELCH: The teams work with different retailers and task forces across the U.S. They also are involved with RILA and NRF to talk about ORC and present case studies. We’re all after bad guys, and being able to share and communicate that information makes everybody successful in resolving investigations
EDITOR: I want to circle back to our earlier discussion of you graduating college and wanting to get into law enforcement, but ending up in loss prevention. Since you’ve been at JCPenney, you have put in place a college recruitment program for loss prevention people. Would you speak to what you’ve done, and what have been some of the results?
WELCH: This past summer, we had two individuals, one from Sam Houston State and one from Northern Michigan University, who interned with us. My team has also been doing college recruiting trips to a variety of colleges over the last couple of years.
We’ve had success in recruiting individuals in our entry-level positions as loss prevention officers while they’re still in college. Getting them into an entry-level position while they’re in school allows them to gain experience and see if they like it. Then, when they graduate, they have that experience and can interview for a loss prevention supervisor position.
EDITOR: You are representing JCPenney on a number of industry association committees and boards. Talk about the importance you place on that involvement?
WELCH: I enjoy collaborating with my peers on how we can make the LP industry better. We want to make an impact in individuals’ lives who are coming up through the LP ranks. Some of the programs that have been put in place, like the Foundation’s LPQ and LPC, allow college students and those already in retail to gain knowledge that will help them in their development.
This article was first published in 2011 and updated in January 2016.
EDITOR: Thank you, Stan. I really think your career is an inspiration to any young person getting into our industry.