What do I need to think about to introduce Total Retail Loss?

Those companies that have embarked on a TRL journey have identified 12 key issues to consider:

1)      Get the C-suite Onboard: Like most significant change initiatives, senior management support is key – generating urgency, facilitating financial support and ensuring compliance – all are important in making a TRL-based strategy a success.

2)      Develop a Business Case – Focus on the Size of the Prize: Making use of the available data and the organization’s appetite for change, build a strong business case that focusses on the financial benefits that might accrue from adopting a TRL-based approach.

3)      Adopt an Incrementalistic Approach to TRL: The TRL typology should be viewed as a palette of possibilities that can be tailored to any given organizational context – start small and build gradually – it is very easy to take on more than is realistically manageable in the first instance.

4)      Identify Quick Wins First: At the beginning, only focus on those areas of loss that are likely to generate successful outcomes and are readily deliverable – do not attempt too much too soon.

5)      Organize for Utilizing TRL: Think about who will be accountable for delivering a TRL-driven approach, what resources might be required (particularly analytical) and how to leverage support from across the business.

6)      Advocate for TRL – Act as Agents of Change: Pooling responsibility for the management of all the areas of loss covered in TRL is less than desirable. Ensure that those driving TRL act as ‘agents of change’ – collecting the data, prioritizing the work, and then recommending ameliorative actions to those best placed to deliver them.

7)      Review Reporting Structures for TRL: While there is little standardization on lines of reporting across the loss prevention industry, given the breadth and scope of TRL, a number of respondents to this research argued strongly that the Finance function is best placed to provide overall co-ordination.

8)      Prepare for Organizational Antagonism: The way in which TRL often cuts across a wide range of organizational responsibilities can cause the potential for functional disquiet based upon a perceived ‘land grab’ by those driving the TRL agenda. It is important, therefore, that an assessment of the likely reaction of those impacted by a TRL initiative is undertaken, with a view to taking pre-emptive actions to explain, reassure and support.

9)      Think About the ‘Right’ Name for your TRL: While the phrase Total Retail Loss has become relatively well known in the global loss prevention community, it is important that individual organizations develop their own label for their TRL-inspired initiative, based upon their particular circumstances and context. For a number of respondents, moving to ‘Profit Protection’ was regarded as a useful moniker that accurately described what the TRL-inspired initiative was aiming to achieve.

10)   Avoid Terminological Confusion: It is important that as a business embarks on a TRL-oriented journey, the language that is used is clear and focused – by all means continue to use the term ‘shrinkage’ as a proxy for unknown stock loss, but ensure that there is a clear distinction made between that and the broader loss picture that you are aiming to develop.

11)   Use TRL as an Analytical Lens: As well as providing a broad ranging and overarching framework for assessing and managing retail losses, the TRL concept can also be used in a much more focused way to evaluate the likely impact of any planned innovation and change by a business. By stimulating a more comprehensive assessment of the likely impact across a broad palette of losses, the TRL model can enable a more realistic and balanced ROI to be calculated for any given innovation or retail change.

12)   Remember Timing is Key: Finally, like most decisions in life and work, timing can play a huge factor in dictating the success or not of any given initiative. Reflect upon the current organizational climate and whether it is likely to be broadly receptive or not to the introduction of a TRL-based approach. Where the head winds are deemed to be too strong, and other priorities too dominant, then delay may well be right approach.