LPRC - CrimeScience – The Weekly Review – Episode 45 with Dr. Read Hayes, Tom Meehan, Tony D’Onofrio & Featured Guest John Voytilla (LP-FOCUS)

Episode Date: February 18, 2021

On this week’s episode, John Voytilla, global loss prevention and subject matter expert in developing scalable and actionable strategies, joins our co-hosts to talk about the LPRC STRATEGY@ program, the importance of collaboration in the retail industry, acute vs. chronic LP issues, erosion of consequences, and much more. John Voytilla has a verified approach to risk identification and mitigation. He has over 20 years of leadership experience in the office products industry, where he led the loss prevention and safety organizations at OfficeMax/Office Depot. Through mergers and acquisitions, John developed synergistic strategies that improved the profitability of the company. John joined Party City in 2017 as Senior Vice President to lead the development of the loss prevention and safety program, store development, facilities, and procurement functions. Recently, John launched his own consulting practice LP-FOCUS, LLC. There he will apply his critical thinking and financial/business acumen to help organizations improve their profitability. John has been an active board member and past chair of the BOA for the LPRC.  The post CrimeScience – The Weekly Review – Episode 45 with Dr. Read Hayes, Tom Meehan, Tony D’Onofrio & Featured Guest John Voytilla (LP-FOCUS) appeared first on Loss Prevention Research Council.

Hi everyone, welcome to Crime Science. In this podcast, we aim to explore the science of crime and the practical application of this science for loss prevention and asset protection practitioners, as well as other professionals. We would like to thank Bosch for making this episode possible. Be a leader in loss prevention by implementing integrated solutions that enhance safety, reduce shrink, and help to improve merchandising, operations, and customer service. operations, and customer service. Bosch Integrated Security and Communications Solutions spans zones one through four in the LPRC's zones of influence, while enriching the customer experience and delivering valuable data to help increase retail profitability. Learn more by visiting Bosch online at boschsecurity.com. Welcome everybody to another episode of Crime Science, the podcast. This is our latest episode of the weekly series. Joined today by our partners in crime here at the LPRC Crime Science, Tom Meehan and Tony D'Onofrio, our producer Kevin Tran,

and today we have a very special guest, John Vojtela, former chair of the LPRC Board of Advisors, former chair of the LPRC Board of Advisors, longtime LPAP expert and senior leader. And we're going to hear and get to experience some of John's wisdom later on when he has a conversation with Tony D'Onofrio. So starting off real quickly, you know, latest estimates are that in the United States, Real quickly, you know, latest estimates are that in the United States, when it comes to COVID-19, the disease that between 40 and 90 and maybe even more million Americans have been infected by the SARS-CoV-2 virus. And those are just estimates, just reported cases at somewhere around 40 plus million. Eight more months to go till at the vaccination rate we're at right now to achieve 75% vaccinations. Other, of course, epidemiologists are telling us that between the native infections that we just talked about, 40 to 100 million plus vaccinations that really by spring or summer, they believe that a very significant amount of

Americans, such a significant amount will have been infected or vaccinated that they're immune. They'll have some strong to very strong immunity potentially for weeks or months. And that that'll achieve some sort of community immunity, some sort of herd immunity level. So stay tuned. Super spreaders, a lot of studies have been going on. What's that look like? Those that seem to distribute up to three times the amount of droplets. As we all know, what transport the viral particles, why we're trying to stay somewhat

away from each other and create obstacle courses for the droplets containing the virus by masking in different ways on both sides. But older, less healthy, higher BMI individuals, for some reason, seem to distribute much more in the way of droplets, and so are designated super spreaders by some. So more to come on that. Right now, worldwide, on the vaccine front, over 180 million doses have been administered. Roughly six and a half million per day are being administered. The United States, it looks like close to 56 million Americans have received at least one dose. And now we're up to about 1.6 or so million doses being administered per day. A lot of good research around combination of vaccines in case a vaccine is no longer available or somebody forgets what they got in their first dose. So they're looking at that hetero administration of two different types of vaccines. But the idea again is the first dose,

if it's a two dose series, is to first prime our immune systems or at least bring it to the next level. And then the second one to further boost for more durable or longer-term immunity. There's also been some good research coming out of Israel where such a large percentage of the population, almost 1.5 million citizens have now been vaccinated. They've seen about a 94% drop in cases of symptomatic disease, which was really the main endpoint of the first two mRNA vaccinations or vaccines. In this case, it's the Pfizer package that seems to be producing that kind of response. That's the response everybody's been looking for. So now we've gotten, you know, well over a million and a half people in the real world where the data seem to show about the same thing as the initial phase three trial in the earlier phases.

So 92% less likely to get severe illness, which again is another endpoint. So symptomatic disease and then finally a very severe disease from the virus. Vaccines have been, and therefore too, there's a lot of research on the therapeutic use of vaccines. Should they hold some and make it available if somebody comes in with serious disease? They're very seriously ill. And now maybe that vaccine dose will start to confer some immunity to them or at least boost their native immune system. So

the vaccines have been set or prepared to be sent to 21 national and independent drug stores as part of the plan that's been ongoing. So now with the vaccines becoming available at deeper and deeper to non-governmental agencies, into the drug stores, both independent and national chains, that should start to make a big difference. We also are hearing that other pharmacy companies, particularly the big manufacturers that don't have vaccines in the game, like we've mentioned before, Merck, are now offering or cutting deals to help also produce the vaccines so that they are being produced at a much higher rate to get them out there. There are about 37 vaccines in phase one, dose ranging and safety trials, 27 vaccine candidates

in phase two, larger scale dose ranging and safety and efficacy trials, and then 20 vaccines currently in phase three. Again, six have emergency use authorization, four approved overall. So on the vaccine front, a lot of huge progress. The positivity testing rates are all over the place. I can tell you at UF, I get tested every week. We went from about 6% positivity rates to now well below 1%. But where some are hitting positive is when they break them down molecularly, they're seeing some of the new variants are here. And again, the more humans that have the native infection, the more likely to have variations going on,

the mutations that are going to occur as errors and replication happen. So it's another reason to kind of race and get people immune as much as possible so we stop having these new variants and strains coming out. So on the LPRC front, we're continuing to go through Operation Next Level. We're excited about it. More videos coming in from senior APLP leaders demonstrating their excitement and energy and why they're part of the LPRC and encouraging fellow retailers to get them and their teams involved and engaged in the LPRC

at all the levels and the working groups and so forth, the events. So stay tuned on that. But if you hear from anybody from the LHC Lighthouse Consulting Team or one of our BOA members, that's probably what it's about. They just want to get an idea of where you are and see if you want to get involved. Working groups, all seven have their strategies. They've all had their first calls. We've got some new co-leaders joining the current leaders in each of those working groups. And again, those include Organized Retail Crime

Working Group, Data Analytics Working Group, DOG, as we affectionately call it. We've got the Violent Crime Working Group. We've got the Supply Chain Protection Working Group, which continues to grow. That's an exciting group. And they're taking on more safety issues. So if there's a safety issue that you're working on or want to work on, that's the group to be engaged in. We've got the Innovation Working Group. We've got the Product Protection Working Group, Retail Fraud Working Group. So a lot going on. So get involved.

Get engaged in one or more of these working groups, get to know people, fellow retailers, top-notch solution partners, providers, and work together with them throughout the year with our science team. And then we've got special events for each of those working groups as well. So we're preparing for Ignite, which is our winter planning meeting. And part of that will be strategy at Ignite. And you're going to hear John talk a little bit about what strategy at means, what it's for, how it works, and a little bit about it coming up soon. So if I may, Tom, I'm going to hand the mic over to you and take her away. There's a couple of different things we're going to talk about today.

And one is we're always talking about cybersecurity and kind of potential hacks and breaches. But just last week, there was a report out of a Florida water treatment facility that was hacked using a remote access server. So this is one of those things we talk about all the time, the potential that occurs. And this is something that really did occur. It wasn't a test. It wasn't a drill. So sometime in early February, there was a Florida water treatment facility

that some hackers used their vulnerability in a remote access software called TeamViewer. A lot of listeners probably have heard of TeamViewer before. It's pretty widely used. It's something that is out there and people use it often to access remote computers. Remote software in its entirety isn't really a bad thing. As a matter of fact, we all use it in every business. The key is to make sure your credentials are strong. And this particular hack, the hackers went into the water treatment facility plant and actually changed the levels of lye that was acceptable in

the water and allowed it to get to really a very dangerous level. And one of the kind of keynotes here is this was actually something that the Secret Service, the FBI, and the actually Israel Defense Services worked on together. There was some information sharing. One of the key things here is there was a crisis averted, but it really shows the vulnerability to the United States water supply. Today, there's about 54,000 distinct water drinking systems throughout the United States. 54,000 distinct water drinking systems throughout the United States. Almost all of them use some level of remote monitoring software. And what I would say is, and this is somewhat anecdotal, most of these facilities are unattended, underfunded, and don't have an actual IT person watching them altogether. Now, this is something probably as long as I can remember as utility and

infrastructure is the risk in cybersecurity. In this particular instance, someone happened to see the particles per million increasing and looked at it, and it wasn't until much later on that it was actually identified that this was a true cybersecurity hack. What we often talk about on this show is during COVID and all the other things, COVID and the political climate, a lot of these things, while they do make the news, kind of get less attention than they probably deserve. So this on February 10th was on pretty much every publication in the United States and actually outside the United States as well. But it didn't hit that front page. CNN had it as the story of the day. All of Wired did a post on it. The Washington Post did a post on it. But it kind of fell to the waste side. And why I think

that's important is that this is a real risk for us. We talk a lot about cybersecurity breaches and the impacts it has on brand and people's financial situations, but this is a cybersecurity hack that really could have had some serious, serious implications. There are some reports that suggest because the Super Bowl was in Florida, there were more people paying attention to that. But that's anecdotal, both on the good and the bad guy side of it. So the nefarious actors and federal and state law enforcement. This is a case where some cybersecurity experts are saying the fact that there is open lines of communication and sharing between multiple agencies, this was able to be identified. The National Cyber Director in Israel actually talked about the fact that information sharing was important and was openly sharing with

the Secret Service. If you're asking why the Secret Service is involved, the Secret Service does investigate computer crimes as well. So I believe there'll be a lot more to come on it of this story. We'll obviously cover it here. I'm not sure that it'll be a lot more to come on it of this story we'll obviously cover it here i'm not sure that it'll be as much in mainstream news with everything that's else is going on um one of the things that you know i found in the research is was how ridiculously easy it was to find out what remote software and what was going on with these water supplies throughout the United States. So again, I think it's one of those things that just we forget about and run through. And I know every once in a while it comes up, but more to come on that story. A little bit scary, but

definitely something just to keep in mind. And then switching gears, and I know I've been talking about this and Reid is talking about COVID and where we're at. And we're now starting to see a much more outward influx of information surrounding COVID-19. I'll start with Facebook. There are multiple groups on Facebook today that are selling counterfeit and bogus vaccines, very well packaged company, you know, real company names, and they're actually shipping products. So the thing here is that this is not just a scam where someone's trying to take your money and your information that we talked about before, but this is, you know, an e-com site set up that's shipping you something that is not a COVID vaccine,

although it looks like it. One of the topics of discussion around social media is what is Facebook going to do about this? There's a lot of negative or press, if you will, around how Facebook is picking and choosing what they're attacking. And because these are on Facebook marketplaces, Facebook actually is making money when these are sold so this is something that's run through um the three that i physically saw were all from chinese manufacturers um that you know basically have setups of sites and if you looked at this and didn't really you know know about it you would you'd actually looks it looks very legitimate it very legitimate. It clearly isn't, but it definitely does look outwardly good, you know, official. And then the second, the second

social media network or communications network that there's an influx on, which is not, you know, not like Facebook in the sense that as a traditional marketplace is Telegram. And we talked a lot about Telegram and the fusion net and Telegram is an encrypted communications or chat service, similar to a WhatsApp. And what we're seeing is exactly the same information being posted on Telegram that's on Facebook, mirroring the websites, mirroring the costing structures. And again, the pictures are remarkably authentic looking. You're going to a website that is taking payment and it's actually going through what I would say are more official channels. And then I think the scariest thing of all is they're sending

a syringe with something in it. I don't have any idea what that would be, but it just reminds us all. And I know globally, this is not just a US thing. This is a global thing. And outside the U S I think it's actually a bigger problem that, um, to date, there are no vaccines that you can buy online to get sent to your house. Uh, same thing with, with, um, there are, you know, there are no therapeutics that are approved that you can get to your house. There is, there is one thing that is approved. And this is why I get concerned is that it is approved and there are some test kits available. So as we get further along with this, I think this will continue to be a challenge because you'll have folks selling test kits that are counterfeit and don't actually provide value versus folks that do. I know that

we've talked about this before, but I think the concern today is that these are very, very legitimate looking. And unlike some of the other ones that are just taking your money, they're sending something which obviously poses a bigger risk. So without further ado, I'm going to turn it over to Tony to talk to our guest. Thank you very much, Tom, both of you for that great update. Let me start by introducing our special guest, and it's really a great pleasure to introduce John Wojtyla. And John is a global loss prevention and subject matter expert in developing scalable and actionable strategies. He has 20 years of leadership experience in office products industry where he led the loss prevention and safety organizations at Office Max, Office Depot. Through mergers and acquisitions, John develops and adjusts

strategies that improve the profitability of the company. John joined Paris City in 2017 as senior vice president to lead the development of loss prevention and safety programs, store development facilities, and procurement function. Recently, John launched his own consulting practice, LP Focus LLC. John has been active board member and past chair of the board of advisors for the LPRC. John has also been a speaker at the NRF L Prevention Conference, contributing to all leadership on topic, including team development and training. So great pleasure to have you with us, John. Welcome. Tony, thank you so much. And Tom and Reid, it's a pleasure to be here.

Well, let's jump right in. Let me ask you some questions here. John, you facilitated a conversation with over 40 LP leaders last fall with LPRC before the Impact Conference entitled Strategy Act. What is that strategy act and why was it initiated? Sure. Great question. Tony, one of the things that the Loss Prevention Research Council and the Board of Advisors wanted to be able to continue to do throughout the year is engage senior loss prevention AP leaders in a dialogue or a conversation, if you will, on thought leadership. And in speaking with Reed and Paul Jekyll, who's the current chair of the Board of Advisors, I went out and I talked to several LP leaders over a course of probably six to eight weeks

and really solicited their input in the midst of the pandemic and saying, okay, what would be value add for you to spend a couple hours, a virtual Zoom type meeting to talk with your counterparts across the country and the globe for that matter, in terms of international programs. And so what we ended up doing was we built on Strategy Act, which was done in person a year and a half ago. And we created this virtual conversation where we had over 40 leaders actually stay connected for over two hours, sharing their thoughts and actions as they were managing through this pandemic. That's great. Can you highlight the takeaway from the session?

Yeah, sure. First, we had a very collaborative discussion on how the pandemic has put LP and AP in the spotlight in their companies. You know, not surprising to me, having been a former practitioner, is you have to be able to get information and flow it through your company. And what happened this past year is you realized how important it was, and what we learned in this session is how important it was to have feet on the street and connection at the local level. One of the things I think became very evident as we worked through the pandemic, and even though we're still in the midst of the pandemic, is that oftentimes federal,

state, and local guidelines did not align. And so if you're a national retailer and you have stores in 50 states, you have not only 50 different governing guidelines, but you perhaps have different guidelines even at the local level. So that was one of the most significant underlying discussions. It became a very, you know, the bottom line is LP leaders learn very quickly how to manage and leverage the flow of communication in their organizations and their companies. And again, I can tell you firsthand that when a senior leader of LP tells the CEO information, it has to be vetted, it has to be factual, and the information that a CEO and the senior leadership teams can make decisions. That was probably one of the biggest takeaways from that particular strategy at session. The other thing that I would add on is what Tom said earlier about information sharing. One of the neat things about the LPRC and the group that's involved from a retailer and a solution provider standpoint is collaboration and sharing.

It's a very diverse group. You have senior leaders that have been in a role for multiple years that have a lot of credibility in their organizations, have very good processes and team members that this shifting, if you will, or this pivot to the pandemic management just continued to do what they do normally. However, you also had a group of individuals that this might be the first acute issue that they had to deal with. And we're going to talk about that in a few minutes, but where they had to learn on the fly. So the playbook was being developed on the go. That's great input. You're going to facilitate a session at the end of the month with the board. And can you speak about

the acute versus chronic issues LPAP leaders are facing? Yeah, this is really a discussion. Again, one of the things that we wanted to do with the LPRC Board of Advisors and Strategy Act a couple times a year is make this a continuous learning and opportunity for sharing. So one of the takeaways that we really heard from LP leaders was about the ability and the need to pivot to the acute issues that were occurring. So let's just take a little recap over the last year. So not only the pandemic, which certainly was an immediate onset of change and impact in the retail industry, LP and AP professionals had to spend more time on safety protocols, employee communication. Again, as I said earlier about vetting communication flow from multiple agencies,

understanding and interpreting guidelines. But then you also had the civil unrest that started as protest and then moved to civil unrest. And you had to go from monitoring to perhaps boarding up your facilities, making decisions and collaborating with other other retailers on what you were going to do. And then go go back. It all starts with safety of your customers and of your employees. So so the acute issues, you have pandemic, you have civil unrest. And then we get into the back half of the year and we go right into preparing for

potential violence with the election. And nobody would have really quite honestly thought about the insurrection that occurred in January. And that really, those acute issues, some move into the chronic phase. But what happens is, and this is what we're going to talk about in a couple weeks, the chronic issues sometimes get put on the back burner, at least for a short period of time. So when I talk chronic issues, we're talking about things like shrink, lost, waste. When everyone shifted and pivoted to the acute issues of the pandemic, stores closed, inventories were canceled. the pandemic, stores closed, inventories were canceled. And now what's happening in 2021 is this is all kind of starting over again. So the retail cycle starts over.

Companies are inventorying their stores. They're getting their shrink results. And part of it is understanding the chronic issues of what's changed. So you think about things like the rapid onset of changes to if companies didn't already have a curbside pickup, expansion of e-commerce. You just take those two things, the personal shopping and delivery. No one's really had the opportunity to study the potential impact of shrink and loss. So that's a big opportunity that we're going to talk about here in a couple weeks. And so acute is the pain of the moment. Chronic is the long-term piece, and including things like erosion of consequences. Well, actually, that's top of mind for a lot of people. So can you explain more about the erosion of consequences and what are retailers doing to combat that erosion?

Yeah. Erosion of consequences is a terminology I think that Reid has been talking about the Lost Prevention Research Council here for the last year or so, but we're seeing it more and more in the retail environment. And really what we're talking about there is the bad guys or the fraudsters are not deterred as much in the past, perhaps because of a couple of things. Number one, changes in laws at the local, again, local and state level on, for instance, the difference between the raising the thresholds of felonies versus misdemeanors. You have the issues that really started last year coming to more to the surface and out for public dialogue of defunding law enforcement. And, you know, we've always had in some of the bigger cities, slower response or threshold differences for responding for shoplifting as an example. So those are a couple examples where retailers now have to have to think differently as they're

connecting the dots and meeting with local, state, and federal law enforcement. And, you know, so that's a big part of what we're going to talk about. Tony, I really appreciate it. Maybe Reed can give a little more perspective on erosion of consequences. It's such a key, important topic. We're going to cover that in strategy out a lot. We invite the ones out there, the pyramid heads, to reach out and engage and let us know if you have interest in that. Real quickly, John, yes. I can't describe it any better than you did. It's just this confluence just coming together of all these factors that are real and present. And so offenders would be thieves, fraudsters, and

violent people or intimidators just don't feel as much of a consequence as presidents. It's not going to deter them. You know, they don't feel like they're going to get in trouble. So I think that's the biggest problem we've got right now. Thanks, Reed. Any closing comments from you? No, Tony, I really, really appreciate you guys having me on today. I'm real excited about the opportunity to continue the work of the LPRC and the Board of Advisors. I will tell you

and your listeners that one of the organizations that when I was a practitioner and today as a consultant will get the most value is the independent science and research and the scientific approach that Reed and his research team takes at the University of Florida and the Loss Prevention Research Council. It gives everyone an independent voice to take back to their companies. So I'm looking forward to the upcoming session. And again, thank you all for having me on today. Thank you very much, John, for those great insights. And we're also very much looking forward to your next LPRC moderated session. So thank you again, John. Really great to have you on this podcast.

Let me now switch by closing with some industry data, and I'll keep it shorter this week as we had our guest. So first some good news from ChainStorage and a forecast from customer growth partners, which projected that in 2021, retail sales will rise 8.1% up to $4.26 trillion. This 8.1% increase would mark the fastest growth pace this century, easily topping 2004's 6.4% increase.

56% of the increase will be through digital channels. So what customer growth partners is forecasting a lot of pent-up demand as we come out of the COVID-19 crisis. Let me switch to Statista, which share the four-quarter GDP growth numbers. which shared the four-quarter GDP growth numbers. China was the first country to bounce back from its coronavirus losses, recording an amazing 6.4% growth in the fourth quarter of 2020. USA was down 2.5%, Germany was down 3.9%, France was down 5%, and my little country of Italy was down 6.6 percent. Switching to the IHL group, they have some really interesting data in terms of which vendors are retailers aligning with in terms of growing their investment with in 2021. Microsoft was number one with plus 59%. Oracle was number two with plus 42%.

Amazon amazingly was number three, plus 36%. Cisco was number four, 29%. And Salesforce was number five, plus 28%. These were ranked by the percentage retailers increasing business with this particular solution provider in 2021. So with that said, it's going to be a great year for Microsoft in the retail space, and I'm already seeing that actually all over the place. And let me close actually tying back to where we started and talked about, especially with Reed and the pandemic,

actually tying back to where we started and talked about, especially with Reed and the pandemic, some new data this week from First Inde Insight on consumer shopping behaviors as vaccines are rolled out. 31% of consumers won't get or are not sure that they want to receive a vaccine. Most consumers will not rush back to stores after getting vaccinated. 45% will go less or the same amount in the beauty stores. 45% same in footwear. 43% same in accessories, jewelry, and electronics. 41% same or less in luxury, and 40% say more or less in apparel. So you can see which sectors will continue to struggle as we speak right now. Spikes in COVID-19 are influencing in-store shopping and spending. 61% of consumers indicated that they would significantly or somewhat cut spending if a national lockdown was enforced.

60% state that spikes in COVID-19 cases are deterring them from shopping in stores. 71% still don't feel safe testing beauty products. 62% don't feel safe trying products in fitting rooms. 60% still don't feel safe trying products in fitting rooms. 60% still don't feel safe trying on shoes. And 59% don't feel safe working with a sales associate. So with that, I'm going to turn it over to Kevin to close. Thank you, everyone, for tuning in. Thank you so much, John, for being our guest today.

And of course, thank you to Tony and Tom, as always, for your insights this week. Keep an eye out for more info about Strategy At and Ignite on our website at lpresearch.org. And as always, keep in touch. Stay safe. Thank you. Thanks for listening to the Crime Science Podcast presented by the Loss Prevention Research Council and sponsored by Bosch Security. If you enjoyed today's episode, you can find more Crime science episodes and valuable information at lpresearch.org. The content provided in the Crime Science Podcast is for

informational purposes only and is not a substitute for legal, financial, or other advice. Views expressed by guests of the Crime Science Podcast are those of the authors and do not reflect the opinions or positions of the Loss Prevention Research Council.