I’ve been thinking a bit about operations science and quality assurance for a few weeks now.  I think there could be some parallels to performing loss prevention.

If no one counted the cash at the end of the day, how much would go missing?  The answer: you can’t tell if you’re not measuring it.

So one must at least collect some information.  Great, now you have an idea of how much might be missing.  If you collect that data over time, and compare it, you may also find out if you’re doing better or worse.  But one must go further to actually get to the root cause and determine accountability.  This is where video is an important complement to one’s point of sale data.

If one can consistently demonstrate the ability to detect and correct a problem, then the corrective action provided is not simply a momentary act of containment.  In operations science it’s most desirable to create an “irreversible corrective action” (ICA).  The goal of an ICA is to create a solution to a problem that eliminates the problem in such a way that it cannot reoccur.  However an “ICA” can be invalidated when change occurs.  So when dealing with change, (such as new employees, new sales promotions, new application features, new processes and so on) the corrective action may need to be modified or be re-introduced.  Quality control and loss prevention are a continuous process.

If you just install cameras and a POS monitoring system, but never look at it,  at best you won’t know if you’re reducing “shrink”.  At worst, a reduction in shrink is likely only temporary as people figure out that it’s not being used.    If you want continuous prevention, your employees need to know the system exists and see it being used.  You need a easy, quick, repeatable process you can continously apply.  One that tells you what to look for and where, so you don’t have to spend too much time searching.

In a recent post, I wrote about the economic impact of hitting and not hitting store level KPIs. It’s imperative that everyone involved in the business process have the same goals in mind - those that govern daily behaviors towards the ultimate reward of profitability. This includes, management, staff and yes, vendors (or as I like to call them, business partners).

Let’s face it, operating a profitable restaurant or retail business is a difficult task. Success lies in the ability to flawlessly execute upon well defined business processes and procedures with little to no variance, every day. The wage level employed in these environments is often ill-equipped to consistently execute due to inexperience or lack of maturity. What one gives up with inconsistency is sales and expense, and that translates directly to decreased profitability.

There are several tactics to ensure the proper beahviors are on display at all times to ensure flawless execution. I personally advocate the following: Training, followed by monitoring, measurement, correction and improvement. This cycle repeats itself indefinately in the spirit of a constantly improving business process.

So how does MVaaS help one achieve KPIs? It’s one of the five steps noted above - monitoring. Leveraging MVaaS in a routine store audit process will ensure that behaviors which compromise the ability to achieve KPIs are eradicated from the business process. I will follow up soon with several specific examples of how this works, the economic impact to the bottom line and ultimately, the Return on Investment.

Recent discussions with current clients and prospects have primarily focused on one simple question - “How do you measure success?” Nearly all companies have a set of Key Performance Indicators (KPIs) that are used as a health check and management incentive. Ultimately, they are created and measured to ensure one thing - profitability.

What is the economic impact if these KPIs are not achieved? What is the economic impact if they are? I do know one thing - hitting them all at the same time in a month/quarter is a very difficult task. When it did occur, it was as if the planet and stars aligned and there was a pot of gold in the bottom line of our P&L. When it didn’t occur, we we’re lucky to break even after an entire month’s effort.

Stay tuned. I will explain how partnering with Envysion’s MVaaS helps retail operators and management achieve KPIs across the entire enterprise.

I’ll caveat this by stating the Today Show is not my top source for hard hitting news. However, they featured a news story this morning that illustrated the power of video surveillance in a residential setting. Would it be possible for these guys to plead not guilty?

Dan Caruso has an interesting blog series on Unintended Consequences (”UC”) (I, II, III, IV, V).  With Star Trek as the backdrop, he challenges the recent governmental interventions designed to help the current economic situation.  Great posts and also great comments.

This got me thinking about UC in other contexts.  Take MVaaS, for example.  By merely introducing video, certain things change.  Employees may work harder.  Customer may feel safer.  Would-be bad guys may target other stores.  Operators may utilize the system to improve profitability.  These, of course, are the intended benefits.

But are there UC to consider?  Any suggestions?

Sandi Mays has a funny post on her blog Businesstoolsblog.com.  For anyone who lacks patience, there are some useful tips.  Which got me thinking…

I am one of those people who lacks patience.  I can actually feel my body temperature rise when the person two spots ahead of me whips out a checkbook, after all transaction items have been rung up, and starts to fill out the check.  Some still even ask for cash back.  It’s all a flashback to decades gone by that I would rather avoid.

In many cases I just wait it out, with some relative minor side-effects (comment 3).  But there are times that I leave.  As an off-site owner/operator, I would be very interested in understanding the impact of this lost revenue.

Video, trained on the queue and tied to POS data (including wait time data), would allow someone to watch, and quantify, this lost revenue.  It would also provide insight into the mood of the customers waiting.  While some people are polite, others show visible signs of disgust (guilty).  This may be a customer that won’t be back.

01-14-2009, Louisville CO.

At approximately 3pm this afternoon, Envysion Office Manager, Bridget Hamilton, was notified by a fellow building tenant that a suspicious vehicle was parked in a spot normally reserved for this tenant’s moving truck. After dispelling the implication that the suspect vehicle belonged to anyone at Envysion, Bridget quickly reviewed our parking lot video leveraging Envysion’s Motion Mask technology.

With a few clicks of the mouse, Bridget was able to retrieve two-days of recorded video. Within seconds, Envysion’s Motion Mask technology jumped right to the video showing the suspect car entering the lot at 10:08am Tuesday morning. Using a different camera view and the same Motion Mask technology, Bridget witnessed the tenant’s moving truck pulling away at around the same time. Hmmmm…..

At 3:40pm on 1-14-09, Bridget noticed that the moving truck was back in the parking lot and the suspect vehicle had vanished. Again using MVaaS, the perp was witnessed walking from the moving truck back to the suspect vehicle and driving away.

No further attempts were made to contact the suspect and nobody was harmed during the process, just a good lesson learned.

If you have a network (and who doesn’t these days?) IP cameras sure are a lot easier to access than analog cameras.  But this ease of access also makes it easier for un-authorized users to access IP cameras .  Imagine if someone in the back alley could stream video of your back office using your wireless network.

Most IP cameras I’ve worked with lack a number of enterprise grade security features.  They need to implement SSL for encryption and they need to integrate into a central authentication system such as RADIUS or LDAP.   However, even without those technologies, there are a couple of basic things one can do to secure your cameras.

The first thing to do is to change the factory default passwords.  The latest firmware revisions for some cameras force one to configure a password the first time a camera is accessed after being powered up.  That’s good.

The next level of security that might be worthwhile is to configure a VLAN just for video surveillance network.  Done correctly, this will help mitigate several risks when IP cameras don’t have good security features built-in.  This will add to administrative overhead and possibly additional equipment costs, but it’s not as high overhead as some of the next additional steps.

To additional key elements of security that are often missed are to:

- Perform logging on your network by having all devices log important events, scanning and alerting on these events.  (Especially logins, configuration changes, etc)

- Regularly audit your network infrastructure to make sure it’s configured correctly

Both of the above tasks can be large undertakings given the large number of IP networkable devices in an IP video network.

Additional layers of security that are possible, but have signficant overheard are MAC based access control takes you even further.  802.1X technology offers a strong way to control who can plug into your network.  802.1X offers perhaps the strongest layer of security for getting access to a network, it is also difficult to manage and operate.  So difficult that it’s not seen much deployment in networks. There are some companies like Cloudpath networks who offer a management tools for wireless networks.  Few cameras support this (Axis with firmware v4.4+ does however).

Today begins the post-Christmas retailing season.  While sales have been sluggish (understatement?), retailers will no doubt be inundated this weekend by those looking to scoop up bargains or return/exchange merchandise.

I’ve had the displeasure of being part of this annual tradition in the past.  The returns desk takes on the look of a busy dry-cleaning store, with unfolded clothing draped over empty shopping carts.  A truly horrifying scene for those of us hoping for only a quick visit.

While waiting in line, I’ve often wondered how retailers maintain order.  How much is lost in the hustle?  Perhaps a better question:  How much could be saved by recording video of these transactions, linked to the return receipts, for discreet loss prevention auditing after the events?

This is one of the compelling value propositions available for MVaaS customers.  It may not shorten the lines, but it would help to protect the bottom line.

Fall is my favorite time of year; the leaves are changing, it’s cooling down and most importantly it’s football season.  For the past few years I’ve anticipated the start of the season with much more enthusiasm.  The reason for this new found enthusiasm has been my involvement in a fantasy football league.  Fantasy football, takes something that I already have a passion for and makes it even more exciting by giving me a reason to be involved in several games in order to track my team’s performance.  It also gives me the opportunity to put on my GM hat and make decisions that can help or hinder my team’s performance. 

Effectively managing a team requires time, effort and an understanding of information (e.g. trades, injuries, trends) that is crucial to a successful season.   A GM has a lot of information to dissect each week in order to give their team the best chance to win.   The first couple of seasons I found it difficult to keep up with all of the trades, added/dropped players, injuries and the progress of free agents, which one can add to their team if someone on their team has a bye week or isn’t performing.  Finally, I activated a feature on the Fantasy Football web site that I had never used before, “Alerts”.  The second that I enabled this setting I became a much better GM and could make decisions that would affect the outcome of the game days in advance.  The alerting function of this website takes information that is being gathered about each NFL player and proactively alerts (sends and email) each GM based upon criteria they have designated as important.  A GM can be alerted to set their line up, player updates, league trades, and scores.  This information can be vital to the planning of your starting lineup each week and if acted upon can give your team a competitive advantage.

MVaaS acts in much the same way as the Fantasy Football website.  Through the integration of software based business applications e.g. POS systems, access control, temperature sensors etc. an owner or manager can set up reports with specific business rules, that if broken, can generate an alert that proactively prompts a user to log in and review video from a specific location.  For example if I have an MVaaS solution integrated with my POS system I can define a rule that if a site has more than ten voids in a day I want to be alerted.  This type of capability can come in very handy when making tough decision about your Fantasy Football team, and more importantly your business.  I find it to be a great asset to be able to make decisions based upon up to date information.