In today’s highly competitive marketplace, the fastest and surest way to improve operational results is through increasing the productivity of your organization’s assets. In the current knowledge-based economy, that means you have to leverage your most important asset–your people. Their capabilities, knowledge, and motivation are the most significant indicators for most organizations’ success or failure.
In this context, learning becomes a way to leverage your existing assets (people) to improve performance over current baseline. Think of it as analogous to increasing the sales per square foot of a store location: you are looking to produce more contribution to the organization through existing capital…in this case, human capital.
If you improve the output of your people by increasing their knowledge and skills, they will be able to impact operating results. As an example, think of an investigator in a typical retail setting. Let’s imagine he is currently capable of successfully closing about 80 percent of his investigations and is producing X number of cases per year. However, there is significant caseload and exception data that suggests there are additional cases that could be investigated and closed if additional resources existed.
Clearly, one course of action would be to hire an additional investigator to pick up the additional potential caseload. To pursue this course of action, one would have to evaluate the potential additional caseload that would be investigated and, presumably, resolved versus the cost of the additional payroll, travel, benefits, and other expenses.
Alternatively, you could increase the capability and output of the current investigator through additional training and education. Suppose that by sending the investigator to advanced training on interrogation, their capability to resolve cases rose to 90 percent from the current 80 percent. You would be increasing contribution to operational goals without adding additional expense other than the cost of the training interventionIn other words, you would be leveraging your current asset, the investigator.
Entry-Level Versus Executive Learning
As in the above example, it is often relatively easy to identify learning and training opportunities at the entry-level positions since they tend to be technical in nature. However, as one rises to higher levels in the organizational and industry hierarchy, it becomes less clear what learning needs to occur.
The information below specifically addresses this challenge and, therefore, is written in the context of executive education. However, the principles can be utilized to impact performance at all levels, in all workgroups, and across market segments. If you are a district loss prevention manager or store detective, you will find the content can apply to your current responsibilities and challenges and will also prepare you for future assignments.
Why Continuous Learning and Education?
The first question one must ask is, “Why is continuing education important?” After all, if you have been successful within the industry or organization, doesn’t it logically follow that you can continue to do what you have done in the past?
Responsibility to Yourself. The first responsibility for continuous learning is to yourself. The model of lifetime employment by one employer is clearly obsolete and, in this new employment environment, we must find a new model to follow in our careers. According to Rosabeth Moss Kanter in her book, When Giants Learn to Dance, employability is the “new job security.”
For most loss prevention professionals, production is not a matter of physical exertion or labor, but, rather, a matter of application of knowledge or skill.Therefore, no matter how hard you work, what matters is the ability to leverage knowledge and skills into operational results. Tenure or years of experience carry little weight. In fact, there are some who have experienced the situation where having a long history of experience can be viewed as a negative since some may surmise an “old-school” mentality or approach, whether right or wrong.
Additionally, the fact that functionalism is dying in corporate America signals another imperative for continuous learning. It is no longer acceptable to contribute to an organization in one narrow area without regard to the interplay of the complexities of the overall organization.In other words, you cannot simply be a LP or security executive without regard to the disciplines of marketing, operations, finance, risk management, and other areas. This opens up entire new disciplines for the application of ongoing learning.
Finally, the technological advances of the computer industry have added another burden to our continuous learning—technology. As one person stated, “I don’t want to be road-kill on the information superhighway.” To ensure employability, one must not only know the basics of using today’s software and technology tools, you must also understand the interrelationships between technology solutions and business objectives.
Responsibility to Your Company. The past several years have shown how quickly the retail industry can be affected by dramatic shifts in markets, competition, products, and challenges. Add those factors to the previously cited advances in technology that continue according to Moore’s Law and the flattening of organizations occurring in the corporate world and you have a situation where your company needs you to improve your knowledge base. (Moore’s Law was developed by Gordon Moore, co-founder of Intel, who predicted that the number of transistors per square inch on integrated circuits, which equates to computing power, would double every twelve to eighteen months.)
A 1997 study by the American Society for Training and Development (ASTD) examined the relationship between organizational commitment to training and stock market performance. They first indexed companies based on an evaluation of their investment in training. For the top 50 percent of organizations in training investment, the total stock return was 86 percent higher than for the bottom 50 percent of organizations in training investment. This study suggests a strong correlation between learning and organizational performance and offers proof of the payoff for education and training investments.
Responsibility to Your People. Even if you discount your responsibility to yourself or your organization, you still have a moral and leadership obligation to your people. It is the role of leaders to not only produce results through their people, but also to develop their own skills and potential. That means one of today’s key roles for a leader is to“create an atmosphere of lifelong learning” as acknowledged by Gibert F. Amelio, CEO of National Semiconductor Group.
It is painful to see an organization with a highly tenured workforce where a senior position becomes vacant, yet the organization cannot find a viable internal candidate. This is not typically a failing of the workforce, but, rather, a failure of the leadership. As James Bolt observes in his book, The Leader of the Future, “this leadership crisis is in reality a leadership development crisis.”
Responsibility to Our Industry. Even if you could be excused for not developing a discipline for continuous learning for yourself, your organization, or your people, you still owe a certain level of responsibility to our industry.
Due to the lack of formal structures and a clearly identified body of knowledge,the loss prevention industry demands greater leadership and professionalism on a voluntary basis. We do not have the same level of recognition as accountants with their certified public accountant (CPA) designation or medical doctors, lawyers, or other professionals who must ascribe to strict professional standards and recognized certifications.
As a retail loss prevention industry, we also face the challenge of developing future leaders despite the dramatic reduction in entry-level jobs. According to studies and supported by interviews with top executives, there has been a dramatic reduction in the total number of personnel in the loss prevention industry, most notably at entry- and mid-management levels.
With this reduction in raw numbers of entry-level and mid-level employees, we must ensure we invest in the relatively few that we do have at these levels to guarantee successful succession planning.
What Do You Need To Learn?
As mentioned earlier, it is often easy to identify the technical learning objectives at entry-level positions. As one moves into a management position, the skill sets needed become more complex, but are still relatively easy to identify. Quite often, training programs are readily available from within the organization and through third-party providers.
However, if one becomes fortunate enough to move into a position of senior leadership, it can become more mysterious as to areas of needed development. After all, if one is moving into a senior leadership role, they have most likely been quite successful in the skill domains leading up to this new appointment. However, the skills that got them to that position may not necessarily ensure success in this new role.
In fact, a strong focus on their technical skills might even work against them. Speaking in the March/April issue of this magazine, Thomas Coughlin, president and CEO of Wal-Mart Stores said, “While there are certainly needs for people with specific talents in every company, I believe most of the best leaders are generalists.”
Although not a complete list, the above chart differentiates four skill domains used in the course of your employment and gives a few examples of each. In focusing on the executive skill domains, one quickly sees the needed skills are broad-based in nature and are not specifically functional in nature. This is not to suggest that the preceding skill sets are to be abandoned or diminished, but, rather, they are to be built upon.
There are ample learning opportunities and educational programs available in each of these areas. Workshops and programs in these skill areas are offered by graduate business schools, professional organizations, such as the American Management Association, seminar companies, and retail loss prevention consultants.
Executive LP Study
In an effort to determine the nuances of development needs specific to the loss prevention industry, a survey was conducted with senior loss prevention executives from across industry segments. The sample group had an average of 19.8 years loss prevention experience with an average of 9.0 years in “responsible charge” of the function.
There were four key themes that emerged from these executive interviews. Each of the following skills was deemed “essential” for survival and success at the corporate level.
Issue #1: Office Politics
Mention the term office politics to people, and they will usually have a negative association with it. However, one survey respondent said, “Young people have to think about office politics as a positive skill. I’m not talking about stab-someone-in-the-back mentality, but figuring out the human dynamics of the organization.”
Across the board, survey respondents identified this as “an absolute survival skill” and one of the hardest transitions hey had to make when they first took charge of the loss prevention function. As one respondent put it, “I wasn’t prepared for managing perceptions. I thought simply coming in and producing operational results and doing the right things were enough. It wasn’t until I spent more time working on relationships with others at the office that I was really able to make a difference.”
How does one go about learning office politics? Look for opportunities to get training and experience in the following, recognized skill sets:
- Influence and persuasion
- Listening skills
- Presentation skills
If you can bring these skills together with enthusiasm and positive energy, you will be well on your way to succeeding at working with others.
Issue #2: Financial
The second issue that received overwhelming endorsement was in the financial arena. For many, it wasn’t until they were responsible for a loss prevention department with a budget of millions of dollars that they were required to use financial tools and analysis. It is often the first time they had meaningful interaction with the chief financial officer (CFO) for the company.
Specific areas that were identified include:
- Budgeting and forecasting
- Return on investment (ROI) analysis
- Reading a profit-and-loss (P&L) statement
- Risk management, general liability, insurance
- Financial view of inventory process
If you need to develop these skills,consider taking an accounting or business class at your local community college or adult education program. You can even find many programs on this through e-learning workshops.
Issue #3: Understanding Other Functional Areas
The third area executives identified as a developmental need was the ability to understand the other functional areas of the business and how they impact the efforts of the loss prevention function.
By learning more about areas such as merchandise allocation, distribution, operations, inventory control, risk management, and other departments, they said they were able to understand how the different functions could reinforce and support the goals of each other.
One respondent observed, “I thought the senior merchant was working against me on some issues. But, then I went and met with him and explained what we were trying to accomplish and how his function could help. He wasn’t working against me, he had just never heard what we needed from him. He picked up the phone right then while I was in the office and called a vendor and changed the packaging on a high shrink item that I had been chasing my tail on for months. That was the beginning of a great business relationship!”
At the same time, there may be many ways that you can help other functions achieve their goals through your normal activities without sacrificing any of your objectives. You really are looking for a proverbial win-win situation with this skill area.
In addition to the benefits of partnership with other functions, you can also identify systemic or process issues that impact shrink. With the complexity of today’s retail enterprise, there are many areas where shrink can occur through a gap in the process. By understanding other functional areas and responsibilities, you will be better able to identify cross-functional gaps that could have negative consequences.
Issue #4: Mentorship
When asked, “How did you gain the skills you needed in your new role?” most respondents cited the importance of finding a mentor who helped them. These mentors ranged from coworkers to a boss to someone outside the company to a father.
Mentoring relationships can be formal or informal, long-term or short-term, but their value is almost without question. Leaders should also be instituting mentorship programs and relationships for their junior staff. As one respondent said, “You have to be careful assuming they will just pick up leadership skills. Who’s the teacher?”
As one survey participant said, “Don’t unconsciously shift into neutral.” It is easy enough to do, since the demands on an executive’s time can be immense.
That is why it is necessary to have a strategy to pursue continuous learning.
Here are some ideas on how to maintain your drive for new skill sets:
- Find a mentor, accountability group or a personal “board of directors” to keep you on track. Ask people you trust to give you honest feedback to assess your developmental areas.
- Consider formal education, such as a MBA, executive education programs, and seminars. Several respondents in the executive survey had either earned their MBA or were pursuing it. These individuals remarked that they found it to be pertinent to their roles.
- Don’t discount informal opportunities inside and outside your organization to learn and develop new skills.
- Seek networking opportunities. Networking is not just about meeting people; it is about learning from others. What are they doing? What challenges are they facing? What is working for them? A tremendous mount of wasted effort can be avoided by simply having others you can call and ask what they have done that worked in a parallel situation.
- Participate in special projects, such as volunteering for projects within your organization that no one else wants. Usually, others avoid them because the assignment requires them to get out of their comfort zone and learn a new skill.
Take a sabbatical from routine. We quickly become creatures of habit, and habits do not typically yield new skills…they reinforce old ones, both good or bad. Go to lunch with someone you don’t normally talk to. Visit a department you don’t know much about to learn what they do. Work the second shift for a few weeks. Any of these changes from your normal routine will expose you to new people, skills, and challenges.
- Be active in community or volunteer work. You might be surprised to learn how much practice you get at influence and persuasion when you serve in a volunteer organization. With the formal job titles, organizational charts, and institutionalized power structures stripped away, you have to learn to deal with others on equal footing.
Whether you are the senior vice president of loss prevention or a store security manager, you have an active role to play in not only your own development, but also in hat of your people and your organization:
- Be a role model for continuous learning
- Budget dollars for education and development offerings
- Encourage networking
- Assign special project opportunities
- Be a mentor
Talk is Cheap
If you don’t take action right now, you have wasted your time in reading to this point. Think about and write down the answers to the following questions:
- What two things am I going to do for my own development in the next three months?
- What two things am I going to do for someone else’s development in the next three months?
If you don’t take out a piece of paper and write it down right now, you will most likely not take action. If you don’t act on the information you just read inthe next twenty-four hours, it will most likely die a quick death.
Finally, remember what John Wooden, probably the most successful team coach in modern athletics, said about long-term success: “It’s what you learn after you know everything that counts.”