How To Minimize Internal Theft In The Office

When the cat is away, the mice will play. They will play and sometimes engaging in dangerous game, especially when the cat is unaware of what happens under its nose even when it gets back. Just recently, I received a news from a distressed friend saying that she just fired several people from their company, including some of her most trusted staff—her executive assistant. After several investigations, it was found out that: Some of her employees were leaving earlier than their closing hours and the same group of employees had stolen an accumulated Php 100,000 worth of sales undetected. This is only based on what she had found out after the investigation.

What upsets her the most is that she trusted everyone too much to the point of complacency. She left the store for long periods of time and did not even have any security measure until it was already too late. Being the strong person that she is, she told us that this is a lesson to be learned and a stepping stone for improvement.

Incidents like this may happen, especially to small companies with a train wreck for an internal control system. Even in the big leagues, as long as security measures are the least of priorities, there will be pilferage—be it from profit, to even small office materials. Here are some tips to avoid or at least mitigate the damages from this kind of incident:

Audit. The most basic way for you to save yourself from wondering whether your inventory magically grew a pair of legs, or just vanished is to audit. Every time that there will be an inventory coming in and out of your, or the company’s possession, there must be a record. An example of this is an inventory record. Input the number of items that went in. When any employee wishes to request for an item, he or she must first indicate the specific item and quantity. By doing so, you can identify who is requesting unreasonable amount of items, or if there is a difference between your record and the actual number of remaining items, this is an indication that you must conduct an investigation on who might be taking items without permission.

Install CCTV cameras. Closed-circuit televisions (CCTVs) are good investments. They can do a lot for a company: Record the activities, provide evidence for possible anomalous activities, and deter them at best. Some CCTVs can also include sound-recording devices, though this might be over the top. High-end CCTVs can be connected and accessed through the Internet, which is a necessity for business owners who are often away from their offices. My sister was able to catch a few of her people slacking and partying when she was an island away using this feature. Just remember: Always post in your office premises that the area is equipped with CCTV cameras. This ensures that anyone who will enter your establishment is agreeing to be video-recorded in the store. Also, make sure that your employees are fully aware that you have installed them.

Have someone you trust take control. If you have someone you know you can really trust, why not consider putting him or her in a supervisory position. This way, you can have a round the clock monitoring of the day-to-day transactions and someone who will bravely report anomalous activities happening under your company. Just make sure that you are trusting the right person. Trust is the same reason why people can take advantage of the company, so choose well.

Audit some more. Consistency in checking is good, unless you want to see some action and drama. If you want to find out a few things regarding vanishing items and money, try letting the mice play a bit then conduct a random check every now and then—when they least expect you to do so. However, if you show patterns of your auditing activities, those planning to pilfer will just be able to device a new way and time to carry out their plan.

Truth is, there is simply no practical way to totally avoid loses from internal theft. There comes a point where the cost of too rigid controls will outweigh the benefits. You really cannot run a big business without some measure of trust. Just make it clear as early as possible that nobody would be exempted from being checked.

*Originally published by the Manila Bulletin. C-6,Sunday, October 11, 2015. Written by Ruben Anlacan, Jr. (President, BusinessCoach, Inc.) All rights reserved. May not be reproduced or copied without express written permission of the copyright holders.