“In looking for someone to hire, you look for three qualities: integrity, intelligence, and energy. But the most important is integrity, because if they don’t have that, the other two qualities, intelligence and energy, are going to kill you.”
He went on to summarize his lesson: “When you hire someone to run your business, you are entrusting him or her with the piggy bank. If these people are smart and hardworking, they are going to make you a lot of money, but it they aren’t honest, they will find lots of clever ways to make all your money theirs.”
Consider these facts:
In retail: Employee theft is estimated to be responsible for 47% of store inventory shrinkage.That ‘s over 17 billion dollars per year! Employee dishonesty is the greatest single threat to profitability at the store level.
It’s not all money and goods: A recent national survey found that 59 percent of employees who quit or were laid off or terminated in the last 12 months admitted to stealing company data, and 67 percent admitted to using their former employer’s confidential information to find a new job.
Banks and Credit Unions: The banking industry reports losses of over one billion dollars annually because of employee theft, greater than the amount taken in bank robberies many times over.
Lots of ways to do it: Faking on-the-job injuries for compensation, taking merchandise, stealing small sums of cash, forging or destroying receipts, shipping and billing scams, putting fictitious employees on payroll, and falsifying expense records.
Across business types: Security experts predict that up to 30 percent of the nation’s workers will steal at some time in their career. Difficult economic times, lack of salary increases and the threats of downsizing and cutbacks make it even more tempting for employees to help themselves.
This threatens your existence! It is not unusual for a small business to be bankrupted by one employee’s theft . The Association of Certified Fraud Examiners reports that small businesses suffered a median loss of $100,000!
You just won’t know: On average, it takes 18 months for an employer to catch an employee who is stealing.
How can you protect your business?
As devastating as these possible losses are, two simple and inexpensive processes, inserted in your hiring system, can dramatically reduce the possibility that you will experience them:
Perform background checks before you hire. While background checking is far from flawless, it’s a valuable tool to learn about past problems and possible risks–and it doesn’t cost much!
Use an honesty-integrity assessment. A valid, predictive honesty-integrity assessment will help you avoid hiring someone likely to cause you this kind of problem–again, it doesn’t cost much!
Combine these two tools to help protect yourself from mostly preventable business disasters!
To learn more about using background checking and honesty-integrity assessments in your hiring process: Contact JLSeibly@gmail.com. We’ll show you the tools, explain the low costs and high benefits, show you real-life examples of how they work, and arrange a demonstration, if you like!
Written by John W. Howard, PhD
Sources of statistics
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