This Blog is moving!!!

I know this blog is young, but in its short life we have picked up a number of fans. Have no fear! I did not desert you. Instead, we at Agilence have decided to consolidate our multiple blogs into one (and actually added a new and exciting blog/RSS at the same time!)

So, from this point forward, you can follow this blog, along with Derek Rodner's blog at ReThinkLP

And, is that isn't the coolest thing, this is! We are in the process of launching a new blog that is a weekly list of some of the shrink activities that our customers have found using Agilence software! We did our first post a couple weeks ago, but I am preparing to go back 8 weeks and post 3-10 items per week!!!

You can find this at: Weekly Shrink Activities

Hope you enjoy it and I will see you over there!!!

Recent RILA conference

I am fresh from the recent RILA conference held in Orlando.  Paul Jones and company did a terrific job.  Some of the best content I’ve seen in a conference in a long time, if you have a chance to get hold of the material it’s worthwhile.

Debra Martin from the Raley’s Markets and I did a presentation summarizing the outcome of a pilot we recently finished and some of the results.  The data is pretty compelling and the most surprising outcome is that all of the results discussed in this session were about the value of operational losses and not fraud.  Something I will be writing about quite a bit more in the future.  I’ve attached the power point from our joint session for your review.  I welcome feedback on the deck and also want your opinions on the concept of focusing on operational losses as a quick means of getting to an ROI versus focusing on fraud.

Let us begin to change the discussion around POS losses and make it more encompassing to include all the activity that takes place there.

Funny How Things Change

For over a year we’ve heard nothing but doom and gloom about the economy, our savings and what the world will look like on the back end of this.  Just as the data, mood and media coverage were starting to change like the sunshine that hit the Northeast we get “Swine Flu”.  True to form the media takes the story of the day and runs with it making it seem as if once again we’re on the edge of a precipice.

If your read all the media coverage from past recessions the “Experts” are always ready to offer the gloomiest scenarios and also ready to say the world will be vastly different on the back end of the problem.  This is compounded by the fact that in today’s hyper connected world things seem to be somewhat distorted by the frenzy of news.  Although I am not trying by any means to downplay the current economic situation and the true effects on people, I have to wonder what would the downturn look like if we weren’t constantly reminded of how bad things are.  Now the pendulum seems to be going the other way and we get this other news.  How deep and how long will it go depends on the little microbes and how they evolve, the outcome can be highly affected by how the world responds.

On the surface it seems that all of the planning that went into planning for an Avian Flu Pandemic seems to be working.  This planning included lessons from the Spanish Flu the Swine Flu pandemic of 1968 and the SARS outbreak.  Mexico quickly encouraged social distancing and the WHO has stepped up surveillance through the Health agencies in the individual countries.  All good things that show how proper planning and training can lead action in a real situation. 

I am sure that across boardrooms throughout this country today this is a topic of discussion.  Especially those in the food industry, the “what if’s” are flying around.  I am also sure that in many of those discussions a sense of anxiety is building due to poor planning and exercising.  I hope we don’t get to a full blown Pandemic, but I do believe that situations such as this present an opportunity.  The opportunity to test and evaluate disaster response and continuity plans.  Times like these remind us that with proper planning and practice we can better cut through the noise created by all of the media around us and make educated decisions.

I for one am planning to attend the upcoming RILA show and am looking forward to seeing old friends and making some new ones.  Hope you will cut through the noise as well and continue on with your normal life and business knowing that you’ve planned for the worst and are optimistic about the future.

The true value of physical audits

We spend a lot of time on designing audit programs which are executed on a regular basis by our teams.  Have we stepped back from the data and asked if we’re getting the best value possible?  Have physical audits and their regularity become predictable and are the ones being audited only performing tasks to get positive audit scores.  What is the true correlation between audit scores and shrink, does anyone have some good data points that support the relationship of the two?

I think that we can leverage the current video infrastructure to remotely audit store processes.  This will require the redesign of the audit process and using sample data as a means to measure compliance.  The results will be more dynamic because we can perform audits more frequently and therefore adapt to the fast changing conditions in retail.

For example if we take a comprehensive store audit that may take several hours to complete and break it down into interchangeable modules.  So an audit module for the second quarter may be different than in the fourth quarter to adjust for seasonal merchandising or changing weather conditions in the area of safety.  The modules can be done quicker and across more stores to provide more dynamic data points for decision making.  The one limitation is travel and time, requiring our teams to travel more will waste time and money on road trips.  But if we leverage remote video and think about more strategic camera placement during the system designs then we can accomplish this more easily.  I believe that we need to continue thinking about new means of capturing value from our existing technologies this will continue to prove our value to our organizations and gain additional respect from our management peers. 

How relevant is our data given the speed of change

Recently a retail veteran and I had a conversation about the current environment.  We talked about the economy mostly and how companies in order to survive are taking drastic steps primarily in job cuts.   That will be an entry for another day, today I want to talk about the speed of of recent events.  Not only did we talk about the economy but we were both equally amazed at how quickly things changed.  Not only in regular retail but everywhere, one only needs to look at autos to clearly see the decimation .  It was an eerie set of events that triggered this whole storm, in the span of several weeks in the Fall of 2008 the American consumer literally STOPPED.  This is unprecedented because economies don’t stop they’re gradual and usually slow and rise over long periods of time. 

So what does this have to do with LP you may ask.  Well FMI recently released their 2008 report and what it showed in the shrink category is that Supermarkets gave back in one year all of the shrink gains they’ve made in past years.  Also relevant was the quick change in mood from the participants and according to FMI the last minute phone conversations with participating companies suggested  that the data in the report may already be understating the real current shrink number.  So let’s ask the question with the speed that everything moves today are annual surveys, bi-yearly and yearly inventories  the best measures for running our businesses or are we in for a hell of a surprise.  I am not suggesting that we spend small fortunes in consulting fees or monthly inventories.  But my conversation companion and I agreed that by the end of this year we may see shrink and all other loss categories double if not triple.  I am not suggesting that we spend small fortunes on consulting fees and monthly inventories.  Furthermore I am a cautious fan of instant information, sometimes it can be more noise than useful,  but we need to identify a means of providing more dynamic data upon which to make decisions.  What are you thoughts?

Welcome to rethinkLP

Welcome to my Blog, rethinkLP is my first foray into the Blog world and the Twitter world as well www.twitter.com/rethinkLP.  Let’s have open conversations about Retail and LP.  I now have a great opportunity unlike ever before in my career.  One of the greatest things about my new career is that I meet so many talented LP professionals and get to see from the inside all of the creativity going on out there in the LP world.  These experiences are shaping my views about LP and Business in general and I will share my thoughts openly and respectfully of all around me.  Please join in and do the same.