Management plays the biggest role in preventing losses in any company, and proper training is a crucial element to any loss prevention program, Lynch, Alden and McHale agree. A company can buy any security tool, device or program, but if the "management team continues to manage in the same way that encourages and allows employees to steal, you will never see a change," says Lynch.
A recent study by the Association of Certified Fraud Examiners (ACFE) revealed that the lack of adequate internal controls was most commonly cited as the factor that allowed fraud to occur.
"Proper internal controls - a mandatory system for any company - require that transactions are properly authorized, recorded and reported, and that all assets are safeguarded, Plante & Moran's McHale says. "These safeguards include securing company assets within controlled areas; random, periodic inventory counts; new vendor verification; and review of the banking activity through online access or checking over the bank statement.
"Also, it may be warranted to install video surveillance over certain areas, such as storage areas and parking lots, to monitor activities. Since this option requires a cost to the company, verifying that the benefits will outweigh the costs is important before embarking on this endeavor.
McHale, Lynch and Alden say loss and fraud prevention requires an ongoing commitment. "It's crucial to continually think about how to improve the internal control environment and the company's ability to detect and deter fraud and theft," summaries McHale.
"According to the ACFE study, a typical company loses 7 percent of its annual revenues due to fraud - typically much more than most businesses can bear," she notes.
When it comes to keeping tools and assets from "disappearing," there is a wide range of lockable storage, as well as complete systems for tool and asset control.
The CribMaster Inventory Management System from WinWare is one such control system. It incorporates RFID technology and tracking software to help keep tools and equipment from being misplaced, hoarded or stolen, and provides full accountability, says the company's Robert Holmes.
WinWare, a company involved in creating enterprise-wide systems that manage tools and other indirect material in the industrial workplace, has partnered with Stanley Works to offer additional value to their product line. For example, Stanley Works' Mac Tools subsidiary offers the CribMaster Accu line of modular RFID systems that ensure tools are accounted for.
Basically, the CribMaster Accu-Cab cabinets and Accu-Drawer toolboxes work in the following manner. To check out a tool or piece of equipment, a technician needs to scan his badge or enter in an employee code, making him accountable for the item, Holmes explains. The time spent using the tool, calibration schedules, inspections and more can also be monitored through the tracking capabilities of the inventory control
If there are missing items or items checked out for an extended period, the software reports what is missing, for how long and who is accountable, he says. This is done through an e-mail alert and through an on-screen notification of the toolbox or cabinet. The same types of notifications take place when items are due for calibration or inspection.
Snap-on Industrial's proprietary NTC (Networkable Tool Control) keyless entry system allows employees access to the tools they need and tracks access based on employee ID key cards. All tools in the system can be serialized and linked to a specific box with the bar-code mechanism used for check out and return, says the company's Dale Alberts. After an employee scans a tool, a record is generated, so inventory is managed in real time.
The NTC system interfaces with Snap-on asset management software to ensure complete security and coverage, he notes. The software package manages not only tool check in and check out, but also repair and calibration schedules.