Turning LP Personnel into Retail Business Professionals

Turning LP Personnel into Retail Business Professionals

EDITOR’S NOTE: Samuel J. Rowell is vice president of loss prevention for Pep Boys. His department is responsible for the development of shortage reduction programs, internal and external investigations, store auditing, background clearance, and the company’s employee awareness program.

Rowell has been in retail loss prevention for over 30 years. He joined Pep Boys from Marshall Department Stores, where he was regional manager of investigations. Previously, he held other regional management positions at both Neiman Marcus and The Broadway Stores.

Rowell is active in promoting the loss prevention industry. He is vice chairman of the LP council of the Retail Industry Leaders Association (RILA). Rowell was recently appointed to the board of the Loss Prevention Certification Council. He is also on the editorial board for LP Magazine and has published articles in this magazine as well as Integrated Solutions for Retailers.

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EDITOR: Lets start off with the question on everyones mind. Just who are Manny, Moe, and Jack?

ROWELL: They are the true founding fathers of this company. People may think that theyre not real people, but they are. They established the company almost eighty years ago as the neighborhood place to shop for automotive parts, and its grown into the company today with 593 stores and 6,000 service bays in thirty-seven states with 2.2-billion dollars in sales.

EDITOR: While you are a vice president of loss prevention today, you started out at an entry-level position. Describe your first job in LP.

ROWELL: I started out as a fitting room inspector with the Broadway Department Stores back in 1975 when I was just 18 years old. My role was to clean out fitting rooms and make sure that the right number of items went in and out of a fitting room. I think I made a whopping $3.95 an hour.

EDITOR: Did you have any idea at that time that you would make a career in loss prevention?

ROWELL: Absolutely not.

EDITOR: What caused you to stay in loss prevention?

ROWELL: I think the first thing was just the excitement of the job. As a fitting room inspector, I wasnt supposed to make arrests. But I did anyway, which almost got me fired. I was totally intrigued when I watched the investigators come in to identify who was stealing from the company. I wanted to be a part of that investigative group.

I was promoted relatively quickly at the Broadway. I was a regional manager by age 21. I went through a number of positions at an early age, because I had an inner fire to be a part of something. Plus, in those cops-and-robbers days of LP, there was that adrenaline rush. Now my excitement is being part of the evolution from where we were then to the profession we are today.

Turning LP Personnel into Retail Business Professionals

EDITOR: How do you counsel young people regarding the career opportunities in loss prevention?

ROWELL: When I talk to people coming into the business, especially right out of college, I give them a little history lesson to educate them about where we were versus where we are today. I describe how we contribute to the success and profitability of our company; how we add shareholder value. Sure, we are still catching bad guys, but were much more a business partner contributing to the success of a retail organization. If people understand that concept, I think they can see that theres a valid, long-term career opportunity in loss prevention.

EDITOR: You and Pep Boys have a reputation in the industry of having a LP program with a lot of balance, by that I mean that you are involved in several different areas of the business that others may not. Audit is one. Tell us about how youve organized audit in your company, and the value it brings.

ROWELL: Our auditors provide the third-party review of each of our individual stores to measure operational compliance. We look at many different areas. For example, in our operational compliance auditour big auditwe look at cash handling, merchandise movement, service, commercial, as well as loss prevention, HR, and safety. Within each of those areas, we look at many different measurements. From a merchandise movement perspective, for example, we examine cycle counts, pricing; a number of the issues that, if not executed correctly, can lead to some type of profit drain to the company. The audit also looks for violations of policy from an individuals perspective, which can help us identify internal theft. So, our audit is basically two-fold, accomplishing objectives for both operations and loss prevention.

EDITOR: The people doing these audits are loss prevention personnel, correct?

ROWELL: They are all LP. They are not operations or internal audit or HR. They are loss prevention individuals.

EDITOR: Do you also have LP-specific audits?

ROWELL: This most recent year we developed our shortage audit, which is conducted not only by auditors, but also by our area LP managers [ALPM]. The shortage audit is strictly focused on different exposures within our world that add to shrink. But these audits are important outside of LP. These reports are published daily to our senior vice president of store operations, who funnels them back down through his pyramid to make sure operations is focused in the right place and to make sure things are corrected.

EDITOR: Is your auditor position a stepping stone for promotion through the ranks?

ROWELL: Absolutely. Our auditors have the ability to either work into an ALPM position, an investigators position, or a DC management position, should their career take them in that direction.

EDITOR: You have for many years had a great commitment in the world of awareness training programs. Talk about that initiative and how important you see that in your organization.

ROWELL: Our awareness program is one of our biggest initiatives, and one that Im very proud of. In the thirteen years Ive been at Pep Boys, my philosophy has always been keyed on education. Without education, you cant have expectation. If we dont educate people in how to do the right thing, how can we expect them to do the right thing?

Our loss prevention and safety awareness program, called Refuse 2 Lose, is an extremely visible program within the company. We average about a 96 to 97 percent participation rate company-wide. That means 20,000 to 22,000 employees each month log online in the store, review the educational modules, and take the quiz. For the past seven or eight years the program has been in place, its been one of the most effective employee programs in the company.

EDITOR: How has it evolved over that time?

ROWELL: We went from the old paper-based, store-meeting process to IVR [interactive voice recognition] to web-based. Everything today is on our intranet, which provides a lot of data to measure participation and focus our training. If the response to a quiz question indicates that the employee population doesnt seem to have the proper understanding of, say, a particular safety issue, we can develop a training program that we take back to them to increase the level of understanding and, thus, minimize our exposure on that issue.

EDITOR: This awareness program is aimed at the non-LP stores organization, correct?

ROWELL: We actually do three separate messages one for retail, one for the service side of the business, and one for our distribution centers. Our commercial business falls under the retail side.

EDITOR: What do you do for training of your loss prevention personnel?

ROWELL: When I came here from Marshalls, I thought to myself, I dont know anything about Pep Boys. I really needed to know how this company functioned before I could apply my loss prevention background. We assume the same thing is true for our new hires today. So, regardless of their prior experience, a new LP professional goes through an eight-week training process. During that time, they are not allowed to do any investigations, interviews, audits, or anything else. The whole idea is to learn Pep Boys. After all, our business is significantly different from softlines, where a lot of our new hires come from. We have a retail business, a service business, and a commercial business. You have to understand the intricacies of those different businesses to understand how to be successful as a LP professional. We actually have them work in all three areas before bringing them back into the office for orientation with our shortage-control department, our risk management department, our finance, and our HR departments.

Turning LP Personnel into Retail Business Professionals

EDITOR: Are there other training programs for the incumbent loss prevention people?

ROWELL: We have put a number of people through the CFI [certified forensic interviewer] program. Ive sent some of my upper management executives through Dale Carnegie leadership workshops, as well as John Maxwell, Ken Blanchard, and Franklin Covey seminars. The whole idea is to get the LP team to understand they are leaders. As an LP executive, they need to know how to be a leader in order to influence our business partners. Leadership skills are whats going to make them successful individually, as well as make this company successful in the long run.

EDITOR: Your emphasis on leadership and education extends beyond Pep Boys. You personally have been an active leader in the retail community, specifically, with the Retail Industry Leaders Association [RILA]. What is your role in that organization and why RILA?

ROWELL: Im currently the co-chair of the loss prevention committee. Doug Marker of Michaels is the chair. The reason Ive been associated with RILA is based on education.

Over the years, I have attended all the major conferences. But when I look at the takeaways from the conferences, RILA has always been the main conference that I made sure my team always attends. The content, the vendor participation, and probably just the sharing of information, to me, are phenomenal at RILA.

EDITOR: The next RILA conference is the end of March in Orlando. What can people expect attending that conference?

ROWELL: The main thing that anyone can get from it is the accessibility to all the senior executives who will be there. We are all loss prevention professionals trying to accomplish the same thing to make the retail industry more profitable. At RILA I know I can walk up to Paul Jones from Limited, Jerry Snider from Dollar General, Doug Wicklander, or whomever. There’s not anyone there who would not make themselves accessible to sit and talk about what makes them successful.

Turning LP Personnel into Retail Business ProfessionalsEDITOR: You mentioned vendor participation. What do you mean by that?

ROWELL: First of all, we have vendors represented on the steering committee, which may be one reason the conference is different. We’ve seen a significant increase in the number of vendors attending the conference, both as exhibitors as well as presenters. Their participation gives everyone the benefit of the knowledge and experience they bring to the table. In presentations, I have yet to see a vendor take advantage of the situation to promote themselves. Whether its background checks, keys and locks, whatever, they provide global-type information that benefits the entire industry.

EDITOR: Vendors at RILA are also allowed to attend the seminars, correct?

ROWELL: Vendors are not only allowed, but encouraged to participate in the seminars. By attending the seminars and hearing the presentations and the questions attendees have, it better equips them as to how their products or services can meet the needs of the retail industry as a whole.

EDITOR: You are also involved in RILAs newest educational initiative certification. The magazine is proud to be a partner in this initiative as well. What is your view of loss prevention certification?

ROWELL: Weve already talked about the evolution of loss prevention as a profession and a career. Certification is the next logical step. When you consider educating the rank-and-file LP professional, certification will be a phenomenal process. Think what it will mean to the individual who earns an accredited certification that indicates to the world that they have achieved specific levels of knowledge in the industry. I believe certification is really going to be a driving force to promote our industry moving forward.

EDITOR: Why is education and communication within the loss prevention industry so important to you?

ROWELL: This may sound like a clich, but I look at everyone in the retail industry and especially in loss prevention as being family. If I get an email or voice mail from another LP person, its usually because someone needs something. I will to the best of my ability try and get them what they need whether its just an answer, or whether its product like we did during Hurricane Katrina. If more people would recognize that each of us has a professional responsibility to the industry, just as each of us has a personal responsibility to our family, I believe we would be better off. After all, what would you not do for your family if they needed something? Youd do whatever you could. Thats part of what I try to do. Im not perfect, but I do the best that I can.

EDITOR: Were there individuals in your career who exemplified that attitude and taught that perspective to you?

ROWELL: There are three individuals who molded my mindset regarding loss prevention. One is Gary Manson, the vice president of loss prevention at Neiman Marcus. I worked with Gary for a number of years, and he certainly molded me from that perspective. When I moved to Marshalls, there were two individuals who influenced me.One was Rod Holm, and the other was a fellow named Jim Lee. When it comes to professionalism, when it comes to vision, when it comes to just who you are as a person, these three professionals were instrumental in molding my thought process and how I approach the industry.

EDITOR: Thank you for that. Your approach must also have a positive effect on your LP organization since youve maintained a very stable senior management team. How have you managed to keep your team intact for so long?

ROWELL: Im fortunate that the average tenure of my direct reports is about ten years. In fact, the overall turnover in the department is one of the lowest in the company. It has been as low as eight percent. But to your question, I think one thing thats important is a strong sense of democracy in the team. We make decisions together. Granted, I will have a strong opinion on things, but we talk out issues and listen to feedback from each other. We consistently review our business strategies together, and they’re a part of the decision-making process.

Turning LP Personnel into Retail Business Professionals

Secondly, I give them as much autonomy as I can. As the executive running their division or operation, I expect them to come to the table with the ideas, plans, processes, and programs that will work in their individual situation. They need to have the latitude within the broad corporate umbrella to develop and work with their operations and HR teams to come up with what makes sense for that division. What Sharyn Copeland does in the Southern Caribbean division may be different than what Jim Grande does in the West. But, that makes sense when you consider Puerto Rico has a different dynamic to it than the stores in the states.

I also think my people know that Im always there for them. We always work through the agree-to-disagree process out in the field. But if something ends up on my desk, its going to end up on our CFOs desk, the CEOs desk, or our senior VP of operations desk, depending on where it needs to go. All this falls in line with our department operating principles.

EDITOR: What do you mean by operating principles?

ROWELL: At Pep Boys, we have what we call our Loss Prevention Operating Principles, which consists of three key things, or legs, with some additional elements under each.

Our main operating principle is, Develop business partnerships. Thats pretty self-evident. We cant accomplish our goals by ourselves. Unless we have the proper relationship with operations, HR, merchandising, finance, or whomever, were going to be pulling against each other instead of with each other.

Our second principle is, Implement high-quality technical programs that will add shareholder value and make sense for the business.

And the third one is, Be the corporate conscience. By that we mean that we understand what our business risks are, we demonstrate the highest standards in integrity, and we do what’s right for the business. That may mean you dont make the most popular decision, but youve got to do whats right for the business.

EDITOR: How do you communicate these principles?

ROWELL: Whether you are an area LP manager, a DC LP manager, or a division director, each of us carries what we call our role card. On one side of the card are the three principles. On the other side are those things that are expected of you in your specific role. It gives each person a road map of whats expected of them. By trying to keep people focused on some key principles, I think we dictate who we are as a loss prevention professional in the department and who we are as an organization within Pep Boys. Its one thing Im very proud of in our organization.

EDITOR: What else are you proud of?

ROWELL: Theres nothing that Im more proud of than when operations comes to LP for advice on how to run the business. Theres nothing that makes me more proud than when operations comes to LP because they want an LP professional to become a district sales manager or a retail sales manager. Because that just proves the point that we are global in our thinking; that were just not cops-and-robbers type people. We are retail business professionals who just happen to have a slant on LP.

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