Although rarely addressed openly, employee theft is a major issue in India. In fact, a 2009 survey shows that India topped the chart among 41 countries in retail shrinkage rate – a term that comprises of shoplifting, employee theft and process failures for the second consecutive year. Retailers in the country had the highest shrinkage rate – up to 3.2% of sales, which amounts to $2.6 billion in 2009. Even conglomerates like Reliance and Essar are desperately trying to find solutions to this problem.
Now that we have your attention, let us delve into the issue.
Employee theft is an extremely common occurrence, and however much you trust your employees, there will always be a few bad eggs along the way. Office trust only extends to a professional relationship, and it is not uncommon for employers to mistake it for something bigger.
Of course, overdoing it Big Brother style is not the solution. No productive work can germinate in a totalitarian environment. Instead, it is good to extend professional trust to your employees while keeping an eye out for discrepancies. Here are a few things you should watch out for.
Signs that Your Employees are Stealing from You
Significant Changes in Work Habits/Behaviour
You don’t need to be Sherlock Holmes to spot dishonesty. Simple observational clues can tell you whether an employee is hiding something from you. Look for changes in work patterns, timings, etc. Of course, these changes don’t necessarily mean that the employee is stealing from you. But it gives you a reason to keep an eye.
Problems with Payroll, Travel and Expenses
Account discrepancies can be tracked down, especially if they are honest mistakes. If they aren’t, a little digging can tell you whose shoulders the responsibility lies on. Especially when it comes to something like expense accounts, discrepancies have a tendency to be forcefully buried by dishonest employees.
Inventory and Warehouse Inconsistencies
Same goes for inventory and warehouse. With a multi-channel inventory management system, it becomes very easy to spot inconsistencies and track down the responsible personnel. Since all movements of the items are stringently recorded, there is negligible chance of any leakage. Consider investing in one for your own security.
Increase in Damaged and Misplaced Products
Damaged products when found in the warehouse will usually be taken out of circulation. A neat way to steal is to tamper with the product package, and once the product is taken off the supply chain, pocket it. Beware of this situation and investigate thoroughly if you find a spike in your product damages.
Changes in Employee Habits or Lifestyle
Changes in habits or lifestyle are a pretty common tell that something is going on. An otherwise regular employee may take extended vacations, or spend money impulsively. An uncharacteristically alleviated lifestyle can also be suspicious. Of course, there may be a lot of reasons why any of these changes might happen, but its up to you to investigate matters thoroughly.
Finally, it is very important to know how to deal with your employees once you find out that theft is involved. In many cases, the act is committed out of desperation more than anything else. It is always best if you deal with the situation in a deft manner. Here is an old article that can guide your conscience. For any more queries, get in touch with Browntape!