AFRICA NAZARENE UNIVERSITY

DEPARTMENT: CRIMINOLOGY

UNIT NAME: ASSET PROTECTION AND LOSS

PREVENTION MANAGEMENT

UNIT CODE: OSM 302

LECTURER: PATRICK MANDANDA

TASK: THE CONCEPT OF ASSET PROTECTION AND LOSS

PREVENTION

STUDENT NAME: JUMA SAHA MWINGA

STUDENT NO: 18S01ACRM016

DUE DATE: 13 MARCH 2020

INTRODUCTION

When it comes to store, construction site, property residence, warehouse or distribution

centre protecting your inventory from loss is crucial. Loss prevention officers help reduce the
costs, prevents loss or internal fraud and improve inventory management. Deliberate human
actions that cause loss to a retail company can be theft, fraud, vandalism, waste, abuse, or
misconduct. Inadvertent human actions attributable to loss are poorly executed business
processes, where employees fail to follow existing policies or procedures – or cases in which
business policies and procedures are lacking. Loss prevention is mainly found within the
retail sector but also can be found within other business environments. Asset protection and
loss prevention is composed of many components as discussed below.
THE CONCEPT OF ASSET PROTECTION AND LOSS PREVENTION

DEFINITION

Asset protection involves planning to protect asset from potential future setbacks such as
credit claims, business failure and family disagreements. It is thus a risk management
strategy, designed to provide individuals with a degree of protection. Assets can be almost
anything of value; real estate, cars, valuable personal possessions, stock, investment accounts,
wages and employees. According to Ifpo, S (2015), the mission of asset protection entities
(including the roles of safety and security) is an organizational management function
responsible for preserving management’s capacity for achieving their purpose by defending
the organization, its assets, and its relationships from non-market-based threats.
Consequently, asset protection is the application of risk management methodologies through
policies, procedures, and practices to ensure that any non-market-based unwanted outcomes
are within the organization’s risk appetite. That is, asset protection works to implement and
manage activities that strive to keep the unwanted results of loss events within the
expectations defined by organizational management, (Ifpo, S (2015).

Based Ifpo’s arguments, asset protection is an organizational function in that each

organization must engage in protective activities to some degree. The purpose of
organizational management is to maximize the wealth of the owners, and one part of this
purpose is the protection of existing assets. An organization that fails to engage in asset
protection activities will likely suffer losses from a variety of sources. Asset protection is also
represented as a duty or a task. There may be tasks or duties relating to asset protection
assigned throughout an organization. Individuals within an organization may have duties or
tasks that serve to protect the organization. Something as simple as a policy requiring that a
person ensure doors are secured or locked behind them demonstrates an asset protection duty
each employee would be expected to perform.

Asset protection may be considered from a number of different perspectives. It can be found
as a function, a duty, a job, and a field of study. It is an essential part of any organization
because it strives to avoid and mitigate potential losses outside of routine market or
operational environments. It represents the practical application of risk management
methodologies to ensure loss events are within organizational expectations, and it affects
nearly every aspect of an organization’s activities.
On the other hand, loss prevention is a set of practices employed by retail companies to
preserve profit. Loss prevention is the name given to the activities that help provide
anticipatory safety measures for the prevention of accidents. It could be described as any
implementation put in place by the management with the aim of effectively reducing the
occurrence of incidents within the workplace. This could include training and awareness
programs, routine inspections, engineering interventions, safe job procedure designs, and
other administrative procedures (Haight, J.2013).

HISTORY OF ASSET PROTECTION AND LOSS PREVENTION

The history of loss prevention reflects the dynamic nature of the industry and shows how it
has risen in importance in the retail world since its inception.  Back in the Sixties, retailers
called the departments that were engaged to impact loss security. Many of the practitioners in
those departments fit the nomenclature of their department in demeanour, behaviour, action,
and results. There was little communication between the security practitioners and the senior
management of the retailer.

According to Purpura, P. P. (2010), for decades, retailers employed security personnel to help
protect the investments that they had in their stores and provide a visual deterrent to would-be
shoplifters. Uniformed officers would monitor the stores, providing the perception of a secure
shopping environment where shoplifting and other criminal offences would not be tolerated.
Over time, retailers came to recognize that losses extended well beyond the limits of petty
shoplifting. The complexity of the thief progressed with the development of the retail
industry; escalating both the threat and the financial consequences. As losses continued,
enlightened practitioners and occasionally their enlightened chief financial executives began
to understand the value of prevention—a proactive approach versus the reactionary past,
Bamfield, J. (2004). According to Bamfield, as this concept became more commonly
accepted through the Seventies, retailers began changing the name of that department to loss
prevention. Those in charge of this function began to think of their responsibilities in
different terms. A significant metamorphosis continued through the Eighties and into the
Nineties.

Loss prevention executives learned to relate what they did to profit improvement. The bottom
line was impacted through measurable reduction in losses, such as inventory shortage, cash
loss, credit fraud, expense management, and the liability lines on the profit and loss statement
(general and workers’ compensation), Ifpo, S. (2007). As some of the professionals of this
emerging function continued to deliver results, they gained recognition and appreciation from
their companies’ senior management teams. Some of these departments were renamed once
again, this time to asset protection a designation that implies a broader scope of involvement
in the successful results of the retailer. Based on Haight, J. M, (2013), these asset protection
teams carried out their mission with a true client and service provider relationship. They
made certain their internal retail clients completely understood the role of asset protection,
what were the expectations, and how they were to measure performance. In addition, both
assets protection and the client learned how to work together to maximize the return on any
capital invested in technological solutions for prevention and detection.

Today, more than ever, there is a need for increased intelligent and effective ways to protect
assets. Access to data, analysis of that data, and using the results of the analysis to improve
productivity and efficiencies and detect potential theft, fraud, and other forms of loss is
essential. With the enhancement of technology today, closed-circuit televisions (CCTV) has
become common place in many department stores. Today, more proactive measures are being
employed to mitigate company losses. Theft deterrence through training and education is
more prominent, Haight, J. M, (2013).

WHY STUDY THE HISTORY OF ASSET PROTECTION AND LOSS PREVENTION

Philip. P, (2019), argued that we should study the history of security and loss prevention
because of the following:

1. We learn about the origins of the profession and how it developed.

2. We can learn about noted practitioners and theorists and their challenges, failures, and
successes.
 3. We can compare security in the past to security in the present to note areas of
improvement and areas requiring improvement.
4. The past assists us as a foundation from which to anticipate future events.
5. History repeats itself. We should thrive to avoid the mistakes of the past and continue
with its successes.
6. We can learn how social, economic, political, and technological forces have affected
security and loss prevention over time.
7. We can see how gaps in security and safety within society were filled by the private
sector.
8. We can learn how security services and systems have been controlled and regulated.
9. We can learn about the interaction of private security and public police over time.

IMPORTANCE OF ASSET PROTECTION AND LOSS PREVENTION.

The goal of a comprehension asset protection plan is to prevent or significantly reduce risk by

insulating your business and personal assets from the claims of creditors. An asset-protection
plan employs legal strategies, put in place before a lawsuit or claim arises, that can deter a
potential claimant or help prevent the seizure of your assets after a judgement, Bamfield, J.
(2004).

According to Haight, J. M. (2013), loss prevention helps in prevention. The mere presence of
a security system often deters theft. If a potential thief sees cameras or signs warning they are
being filmed, they will be less likely to attempt to shoplift. With a security system in place, it
becomes obvious that the retail store is taking loss prevention seriously, and become a less
likely target for thieves.

Loss prevention and asset protection also based on Bamfield, J. (2004), it gives a peace of
mind to investors. Because the obvious presence of a security system deters theft, business
owners will have peace of mind knowing that the likelihood of shoplifting is low. As such,
managers and owners can fully dedicate their attention to other aspects of the business, not
having to worry about retaining their inventory.
LOSS PREVENTION STRATEGIES

CLOSED CIRCUIT VIDEO

Organizations embrace closed circuit video (CCV) because it serves several important
functions directed at achieving annual organizational goals. CCV systems provide a reliable
means of monitoring and recording activity in and around the facility. CCV equipment has
dramatically improved over the years and continues to do so. The video is used to prevent,
respond to, and recover from incidents. Prevention is achieved through security officers
actively monitoring the video screens, and looking for potential problems at the earliest stage
of the incident. When something suspicious is identified, the officer alerts patrol officers or
the local police to respond and investigate. The recorded data allows the organization to assist
the police in a criminal investigation or the organizational lawyers with a civil action. The
protection of CCV data is extremely important to preserve it as potential evidence in a
criminal trial or a civil lawsuit Demonstrating the documented security program intent of the
CCV system is facilitated by the security officer performing his or her respective duties as
expected. A CCV system may be intended as proactive, reactive, or both. Proactive use of the
system requires the security officer to actively be engaged in the use of the technology; that
is, monitoring the cameras and acknowledging the alerts. Reactive use is based on the
recording of activity for future review in accordance with reported incidents. It is more
common that both approaches are used to provide a more robust and valuable security
measure to the organization. The placement of cameras is a carefully considered practice,
utilizing a security plan intended to achieve the primary goal of protecting personnel and
property assets of the organization, Ifpo, S. (2015). 

ELECTRONIC ACCESS CONTROL

According to Ifpo, S. (2015), electronic access control is a powerful management and

security tool to assign and track access into secured areas. The commercially available
systems are fairly consistent across manufacturers and provide the ability to manage
permissions into secured areas via an access smart card, key fob, or other access device. With
the right access card, it can double as a key and a source of identity verification. Photo
identification (ID) cards are very common and allow a security officer to verify that the photo
on the card matches the person using the card. Also, some card readers have the capability to
require a personal identity number (PIN) or biometrics to accompany the use of the access
device to verify the user is the assigned card holder. This is referred to as two-factor
verification and is very common in higher security areas, such as data canters or document
vaults.

INTRUSION DETECTION SYSTEM

Often referred to as a burglar alarm, an intrusion detection system (IDS) is used to detect
unauthorized access into a space or call for assistance. This security measure is another
opportunity to provide a layer or an added depth to the security protection for a facility. The
IDS countermeasure can be used to protect a single room or the entire external perimeter. The
IDS use a combination of sensing devices, such as motion detectors and glass breaks, to
determine if someone has entered the space. The system is armed (active) when the space is
empty and disarmed when the building is open. An added feature to the IDS approach is the
duress alarm (panic button) that allows a user to call for assistance.

COMPUTERIZED INVENTORY MONITORING

According to Guthrie, J. (2006), One of the many factors of retail loss is human error.to solve
this Guthrie proposed that there is need to keep an accurate count of your inventory as soon
as it reaches your store, but this can be a challenge when merchandise moves quickly through
your sales process. lightspeed allows for mobile store counts, so your employees can count
your merchandise without having to bring them to the scanner. This makes tracking easier
and less prone to loss by human error.

TRAINING

Training around sales and service include components that address general retail safety and
security, for example, floor spacing and movement, sincere and non-negotiable greetings, and
profit and loss education. This is merely a foundation. However, with the industry’s high
turnover rate, new team members should be onboarded consistently with monthly reviews in
regard to safety and security protocol: duress buttons, alarm handling, safety phrases, and so
on. There also needs to be motivation for employees to be proactive and take responsibility
when it comes to identifying potential theft. This means encouraging them to get involved
while having a sound knowledge of how to identify shoplifters as well as your store’s
procedures.
PRINCIPLES OF LOSS PREVENTION

Shrink, or loss reduction requires more than understanding―it requires action. A well-
structured loss prevention programs should be designed around six principles: Prevention,
awareness, compliance, detection, investigation, and resolution. Below, we explored each of
these six principles and how they fit together to reduce shrink. According to Philip, p. (2019)
these principles are as discussed below;

PREVENTION

It’s quite obvious that the objective of any loss prevention function should be the prevention
of loss, which is why it is the first and most important of the six principles. Prevention is a
critical element of a loss prevention program that promotes healthy results. Often, programs
are launched on the idea of “catching bad guys” or “putting out fires.” While these are
important elements to shrink reduction, successful programs must also consider the long-term
goals. When you view loss prevention as a long-term solution, you’ll create an environment
that reduces opportunity, builds safeguards, and ultimately reduces the number of resources
and efforts required for successful loss control. Prevention serves as a reminder within each
additional principle that the actions we take should include thoughts on both today’s need and
tomorrow’s prevention.

AWARENESS
Moving counter clockwise around the circle, the second principle is Awareness. There is a
good reason why this is the closest principle to the key principle of Prevention. As a retailer
begins to develop a preventative program, it is important to begin with the education of its
workforce. Successful loss prevention programs share a key ingredient: Culture. In order to
generate awareness, it’s important to create a culture that communicates the message that loss
prevention is everyone’s responsibility and each person contributes to reducing shrinkage.
Awareness centres, newsletters, payroll messages, meetings, and webinars are some of the
most successful vehicles to raise awareness and deliver the message in a clear, consistent and
regular basis.

COMPLIANCE

You can’t have a successful loss prevention program just by creating a list of programs and
proclamations.  In order for loss prevention programs and processes to work, you have to
implement and consistently adhere to them. The only way to gain certainty that loss
prevention programs are being executed and the only way to measure those results is to
ensure compliance. You can measure compliance simply by asking good, open-ended
questions. (This also helps you understand if associates understand what they’re required to
do.) However, the most effective method to ensure program success is by conducting audits.
Frequent audits ensure compliance, while also providing an opportunity to correct
misunderstandings, further educate, and identify troublesome management practices.

DETECTION

Detection requires more than mere observation. Detection is the process by which we
discover and correct the small problems before they become big problems. In order to detect
problems, it is important to first have a clear plan for how things should be completed and
how to identify the signs to look for if something is incorrect. You will then need to make
regular, consistent, and objective observations to discover exceptions, from simple
observations and inspections to more advanced processes like cycle count systems and
exception-based reporting analysis.

INVESTIGATION

 Investigations are a part of the cost of doing business. While with the first four principles
you can reduce the number of loss prevention incidents, it is unlikely you can eliminate the
need to investigate. Investigations are the reactions you employ when your pro-action has not
prevented a loss. Although an investigation means you have already lost product or capital,
its purpose is to “stop the bleeding” and to reduce future losses. As critical as investigations
are to a loss prevention program, they also pose a potential for liability if improperly
executed. An investigator should be a highly trained professional who understands the rules
of evidence and understands how to properly evaluate the difference between what is “fact,”
what is “evidence,” and what is the “truth.” Like the other principles, investigations can
employ several tools. You can have discussions with those involved or potentially involved in
an incident, conduct mystery shops to report on behaviours, employ the use of cameras to
make and record actions, and audit paperwork for clues and patterns. The better our first four
principles, the easier the process for investigation.

RESOLUTION

Resolution is the action we take to correct the course, to eliminate the problem, and to
implement solutions that prevent reoccurring issues. The critical component of resolution is
to ensure your actions are based on the main goal: Prevention. How you resolve loss
prevention issues greatly determines the future success of your program.  In this way,
resolution is not just a plan for today, it’s a long-term strategy that will assist in your future
efforts.

LOSS PREVENTION IN THE FUTURE

Loss prevention is a dynamic career field that must continuously evolve in order to meet the
progressive needs of the ever-changing retail industry. According to Philip, P. (2019), the
following items hold strong possibilities for the future:

Significant harm from adverse events will cause a loss of confidence in certain protection
strategies, for example, inadequate cyber security is overwhelmed by attackers today and the
future will consist of many losses and successes.

Three key factors to assist protection professionals today and in the future, are a broad-based
education (e.g., business, security, cybersecurity), the skill to show that protection strategies
have an ROI and the flexibility to deal with rapid change.
Security managers are gaining new duties, including risk management, safety, background
investigations, travel security, parking lot management, and volunteer services, among other
duties.

Numerous specializations will grow in importance. Examples are resilience, life safety, fire
protection, protection of critical infrastructures, cybersecurity, fraud prevention and
investigation, workplace violence prevention, human resources protection and information
security.

CONCLUSION

In conclusion, asset protection and loss prevention aim at preventing retail losses in a
business organization. However, in order to achieve this the field of asset protection and loss
prevention need to be understood. Based on what was discussed above companies and
security officers will understand the concept of loss prevention and hence be able to derive
strategies to prevent these losses and various threats to retail organisations.
REFERENCE

1.Guthrie, J., & Todd, S. (Eds.). (2006). Retail crime and loss prevention. New York: Oxford.

2.IFPO, S. (2007). Security supervision and management: The theory and practice of asset
protection. New York: Oxford Publishers.

3.Bamfield, J. (2004), “Shrinkage, shoplifting and the cost of retail crime in Europe: a cross-
sectional analysis of major retailers in 16 European countries”, International Journal of Retail
& Distribution Management, Vol. 32 Nos 4/5, p. 235.

4.Purpura, P. P. (2010). Security: An introduction. Retrieved from

https://ebookcentral.proquest.com

5.IFPO, S. (2015). Security supervision and management: Theory and practice of asset

protection. Retrieved from https://ebookcentral.proquest.com

6.Haight, J. M. (Ed.). (2013). Handbook of loss prevention engineering. Retrieved from

https://ebookcentral.proquest.com

7. Purpura, P. P. (2019). Security and Loss Prevention. Loss Angeles. Oxford Publishers.