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On the recommendation of SecTrainer I picked up the book "The Cheating Culture, Why More Americans are doing Wrong to get Ahead" by David Callahan. My review of the book is mixed because it is pretty clear that David Callahan is pretty anti-capitalism, but he does raise some very interesting questions, even if he has trouble proving things he claims as fact. The basic premise of the book is that more people are cheating in all walks of life than ever before because of pressures to be financially successful, and the fact the benefits of financial success are more significant than ever. People who are basically honest people will cheat in various areas, such as tax evasion, cheating in school, stealing, fraud, and much more when they are pressured to be financially successful.
SecTrainer offered this quote in another post:
"A corporate culture and unyielding demand for absolute integrity, from the top down. This is supported by the findings of David Callahan in his brilliant book (*must* reading for all LP people who want to understand motives) The Cheating Culture: Why More Americans Are Doing Wrong to Get Ahead. Awareness programs that incorporate a strong element of expectations in this regard are part of building this culture."
Now, I did not find anything in this book that supports the idea that a corporate culture demanding integrity is what keeps people honest. In fact, I found much more evidence that shows that regardless of the corporate culture, people WILL cheat anyway if there is significant enough pressure to be successful, and the financial benefits outweigh the risks.
Callahan shared an old accounting fable of a bookkeeper who was denied a raise of $100 a month. Several years later, when the bookkeeper retired, it was discovered the he had stolen $100 a month from the point he was denied the raise to his retirement. Callahan made this quote about this story.
"The story is told to illustrate a point these investigators know all too well: that people are prone to invent their own morality when the rules don't seem fair to them. This tendency explains a lot of cheating in America today."
I have claimed that employees will steal, primarily based upon how they are managed by their direct supervisor. This is more important than anything the Loss Prevention department will do to control the losses. Which is why I am such a firm believer in education being the key to success.
Callahan went on to say:
"There are roughly four reasons why people obey the rules. First, we may toe the line because the risks of breaking the rules outweigh the benefits. Second, we might be sensitive to social norms, or peer pressure - we follow the rules because we don't want to be treated as a pariah. Third, we may obey rules because they agree with our personal morality. And fourth, we may obey rules because they have legitimacy in our eyes - because we feel that the authority making and enforcing the laws is just and ultimately working in our long-term interests."
Callahan also discussed the social theorist Max Weber and his ideas on how "legitimacy" of rules shapes peoples views on whether to cheat or not. Callahan wrote, "He argued the commonsense point that peopel are more likely to follow rules or laws that seem fair and are made by an authority that deserves its power."
When you think about it, this is more the idea behind a community oriented police program. The idea is to get the community support behind what you are trying to achieve by getting them to understand why you are trying to achieve it, and understand that the police are going to be fair about it. I have been supporting this concept in the Loss Prevention industry for years. Kicking ass and taking names is not effective in police work, in LP work, or in any area where cheating comes into play. Max Weber's theories have shown to be more accurate in later years through such studies as in Tom Tyler's book "Why People Obey the Law".
Callahan discussed the idea of employee theft due to unfair treatment. "There are no surveys that reveal the motives of thieving employees, and it is risky to generalize about people's rationalizations for their behavior. But perceptions of fairness do seeem to play a big role here. 'If someone feels inadequately compensated or poorly treated, they might look for other compensation,' comments Joseph Wells, who is found and chairman of the Association of Certified Fraud Examiners...'Companies who treat their employees badly generally have a bigger fraud problem,' he says."
One other interesting point that I found in the book, and this actually helps support many of my conclusions from my article "Admitting We Have a Problem". In my article, I made a point that the only real shrink reduction is due to natural declines in shoplifting rates. However, I never came up with a clear theory as to why shrink was rising throughout the 90's, despite the fact that crime rates were declining. However, Callahan offers a theory which may be very valid. He says that more employees will steal during boom times than during down times for businesses. This is due to businesses becoming more dilligent in controlling money when times get tight, but are a little more carefree when times are good. When you look at the rise and fall of shrink rates through the 90's, you can see a pattern that is similar to the economic boom of the 90's, and matching trends of consumer confidence.
Thanks for the reading recommendation SecTrainer. I always find it interesting when people offer up resources in order to contradict what I say, yet the resources actually help to prove what I keep saying. Managing employees is the most crucial aspect of Loss Prevention. Loss Prevention's primary role should be one of teaching Ops managers how to be better managers.
SecTrainer offered this quote in another post:
"A corporate culture and unyielding demand for absolute integrity, from the top down. This is supported by the findings of David Callahan in his brilliant book (*must* reading for all LP people who want to understand motives) The Cheating Culture: Why More Americans Are Doing Wrong to Get Ahead. Awareness programs that incorporate a strong element of expectations in this regard are part of building this culture."
Now, I did not find anything in this book that supports the idea that a corporate culture demanding integrity is what keeps people honest. In fact, I found much more evidence that shows that regardless of the corporate culture, people WILL cheat anyway if there is significant enough pressure to be successful, and the financial benefits outweigh the risks.
Callahan shared an old accounting fable of a bookkeeper who was denied a raise of $100 a month. Several years later, when the bookkeeper retired, it was discovered the he had stolen $100 a month from the point he was denied the raise to his retirement. Callahan made this quote about this story.
"The story is told to illustrate a point these investigators know all too well: that people are prone to invent their own morality when the rules don't seem fair to them. This tendency explains a lot of cheating in America today."
I have claimed that employees will steal, primarily based upon how they are managed by their direct supervisor. This is more important than anything the Loss Prevention department will do to control the losses. Which is why I am such a firm believer in education being the key to success.
Callahan went on to say:
"There are roughly four reasons why people obey the rules. First, we may toe the line because the risks of breaking the rules outweigh the benefits. Second, we might be sensitive to social norms, or peer pressure - we follow the rules because we don't want to be treated as a pariah. Third, we may obey rules because they agree with our personal morality. And fourth, we may obey rules because they have legitimacy in our eyes - because we feel that the authority making and enforcing the laws is just and ultimately working in our long-term interests."
Callahan also discussed the social theorist Max Weber and his ideas on how "legitimacy" of rules shapes peoples views on whether to cheat or not. Callahan wrote, "He argued the commonsense point that peopel are more likely to follow rules or laws that seem fair and are made by an authority that deserves its power."
When you think about it, this is more the idea behind a community oriented police program. The idea is to get the community support behind what you are trying to achieve by getting them to understand why you are trying to achieve it, and understand that the police are going to be fair about it. I have been supporting this concept in the Loss Prevention industry for years. Kicking ass and taking names is not effective in police work, in LP work, or in any area where cheating comes into play. Max Weber's theories have shown to be more accurate in later years through such studies as in Tom Tyler's book "Why People Obey the Law".
Callahan discussed the idea of employee theft due to unfair treatment. "There are no surveys that reveal the motives of thieving employees, and it is risky to generalize about people's rationalizations for their behavior. But perceptions of fairness do seeem to play a big role here. 'If someone feels inadequately compensated or poorly treated, they might look for other compensation,' comments Joseph Wells, who is found and chairman of the Association of Certified Fraud Examiners...'Companies who treat their employees badly generally have a bigger fraud problem,' he says."
One other interesting point that I found in the book, and this actually helps support many of my conclusions from my article "Admitting We Have a Problem". In my article, I made a point that the only real shrink reduction is due to natural declines in shoplifting rates. However, I never came up with a clear theory as to why shrink was rising throughout the 90's, despite the fact that crime rates were declining. However, Callahan offers a theory which may be very valid. He says that more employees will steal during boom times than during down times for businesses. This is due to businesses becoming more dilligent in controlling money when times get tight, but are a little more carefree when times are good. When you look at the rise and fall of shrink rates through the 90's, you can see a pattern that is similar to the economic boom of the 90's, and matching trends of consumer confidence.
Thanks for the reading recommendation SecTrainer. I always find it interesting when people offer up resources in order to contradict what I say, yet the resources actually help to prove what I keep saying. Managing employees is the most crucial aspect of Loss Prevention. Loss Prevention's primary role should be one of teaching Ops managers how to be better managers.
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