Four bucks for a gallon of gas + Four bucks for a gallon of milk + no pay raise = a potentially very expensive problem for companies.
No matter how your business is faring in this economy, beware: Employees may be more likely to take some extra liberties with your money than they ever have before.
A few extra miles added on that expense report, a few handfuls from the supply closet, some buddy-punching on the time clock – they’re little indiscretions that add up fast.
While you’d hate to think that any of your own employees would be taking advantage, remember that people are feeling more pinched than they have in a long time. Desperate times make people lose some of their normally sound judgment.
And your company can end up paying for it.
No need for an uber-militant crackdown. Making people feel like they’re in a police state can easily backfire.
But it probably is a great time for a few extra strategically placed internal controls – and some good publicizing of them – to keep people from making the wrong call.
Here are three areas worth shoring up:
- Office supplies
- Inventory, and
- Expense reporting.
Secure those supplies
When the cost of living is higher than ever but paychecks aren’t getting bigger, it’s tempting to develop a kind of entitlement mentality. People feel a lot less bad about using the supply closet as their own personal Staples or Office Max.
There’s a simple fix here: Centralize all office supply ordering. When every request for more paper, toner and Post-Its go through a single person, employees are significantly less likely to put in requests for their home offices as well.
Having a single point person also gives you the chance to better monitor ordering patterns to see if there’s any spikes for certain supplies indicating there’s someone helping themselves to the old five-finger discount.
Immunize against inventory invaders
You can take a similar approach with the even more expensive cookie jar in your company: the warehouse.
The best practice here, recession or not: Lock it down. The companies with the fewest “shrinkage” problems keep the warehouse clear of all non-inventory personnel.
If someone needs an item from the warehouse, a member of the inventory team goes and picks it for that person. That puts an end to free roaming in the warehouse … and sends the message that you’re not BJ’s or Costco.
Yes, you may get some grief from warehouse workers for adding to their job description. But remind them of the personal payoff: It keeps their counts more accurate when there are no “unauthorized grabs” (a particular headache for this bunch).
Exorcise expense report padders
Head closer to home for the final control: Accounts Payable. Yes, you probably have a slew of protections for your T&E process. But with gas prices the way they are, biz travel is a particular pain point for employees personally, so the temptation may be greater than ever to take a few extra liberties here.
There are some simple little tricks that can keep this in check. One great example: Have A/P staffers bookmark an online mileage calculator to make sure the mileage total on that drive from Cincinnati to Pittsburgh is accurate.
The other great weapon at your disposal: Random expense report audits. The key here: Make sure employees know you’ll be doing these spot checks at any given time, on any given report.
As much as people would like a few extra dollars in a reimbursement check, they want to keep their jobs a lot more. If they know you’re watching, they’ll be a lot less likely to step out of bounds. And everybody wins.