Fraud and Theft Guard #16 – As a business coach, I recommend you restrict access to your corporate credit cards to a very small number of trusted people
Not Fun Fact:
“Fraud and theft occurs in more than 35 percent of all small businesses.”
Unless you want to end up buying your employees candy bars, Red Bulls, gasoline, alcohol and random adapters that they feel they need for their personal homes, I highly recommend being very strict about who gets to use your company credit card. I would require detailed receipts to support all credit card purchases that they turn in. Work off of the assumption that everyone is lying to you and create a system that requires them to prove their innocence each week by turning in detailed receipts. Require your employees to turn in a detailed monthly expense report that they sign and guarantee is both accurate and truthful. If you implement this system, honest employees will have no problem complying and dishonest employees will be rooted out and caught.
Fraud and Theft Guard #17 – Pass out paychecks at the actual worksite to verify that you don’t have any bogus employees
“A new survey from CareerBuilder.com of more than 2,500 hiring managers found that 56% have caught job candidates lying on their resumes. The most common fib seems to be embellishing skills or capabilities.”
As a business coach, I have seen this scam attempted over and over in the construction industry. A new employee at a huge job site realizes that people get paid but the boss and management never see them. He gets the idea to create a fake person and begins to turn in fake hours that were “worked” by this fake person. The boss is out of touch with who is who on the job site, so this con artist gets an extra paycheck whenever they need it. To prevent this from happening to you, pass out the actual paychecks at the job site so that you can catch any bogus employees playing this game.
Fraud and Theft Guard #18 – Require that all overtime must be approved by management before being worked
“The number of people who now admit to wasting time at work every day has reached a whopping 89%.”
There are many slugs and dishonest people out there who love to work as slowly as possible so that management must pay them overtime in order to just get the job done. However, as a business coach, I have learned that in well-run companies, management knows how many hours it should take to complete a job and requires their managers to actually sign off on the working of overtime hours before those hours are allowed to be worked.
Fraud and Theft Guard #19 – Verify that all software is registered to your company
“The U.S. Chamber of Commerce estimates that 75% of employees steal from the workplace and that most do so repeatedly.”
-“Employee Theft: Are You Blind to It?” – Rich Russakoff and Mary Goodman – CBSNews / MoneyWatch
Many times employees will attempt to license the software that you are buying for your business in their personal name so that they can use the cloud-based software from home. If they’re allowed to do this, it will mean your business has to purchase an extra license of the software. You need to make sure that all software that is purchased is licensed to your business.
Fraud and Theft Guard #20 – Work off of the assumption that most people are evil and you are looking for the few good people
“The industry where interviewers have discovered the most phony claims on resumes: financial services (73%), followed by leisure and hospitality (71%). Information technology and health care, both at 63%, tied for third place.”
I see it every week as a business coach – Thrivers all around the world who have been totally blindsided by an employee who has robbed them blind. Having been robbed by an employee multiple times, I really do empathize with you if this has happened to you. However at a certain point, we have to become smart about the people we hire and bring into our businesses. Give everyone a shot regardless of their race, age, gender, and worldviews, but you must be relentless about paying for professional background checks for each and every member of your team. Have your employees sign an employment agreement that states that you have the right to insist on random drug tests and credit checks whenever you see fit. When you ask people who routinely scam their employer to sign this type of form, they will resist, which is a great way to fire them before you hire them.
“Nearly one-third of all employees commit some degree of employee theft according to the Department of Justice.”
30.3 – Set up Systems to Prevent the Temptation for Fraud the Ability for Massive Theft to Occur and Then You Can Get Back to Focusing on Your Business
I wrote this portion of the book to empower you so that you won’t get robbed blind. I personally have been the victim of employee theft and fraud and when it happens, it totally pulls your focus away from growing your business. While you and your leadership team search for the source of the fraud, the trust that every other member of your team has earned can potentially be killed. By setting up these systems, you won’t have to be super-paranoid every second of every day. This is preventive maintenance. However, if you choose not to set up these systems, you may as well start now to emotionally and mentally prepare yourself for the day you will be robbed blind because I promise you, it’s coming.
Now that we have thoroughly tackled nearly every aspect involved with handling the financial aspects of growing your business in a scalable and duplicable way, let’s focus on helping you build a team of employees that you can win with.
31.0 – Booming Business Foundational Principle #4 – Human Resources Team
31.1 – How to Hire, Inspire, Train, Empower, or Fire People
Once you have learned how to consistently sell something that your ideal and likely buyers are eager and happy to pay for, you are going to have to learn how to manage people. This section of the book deals exclusively with how to recruit, hire, equip, train, empower, evaluate, compensate, coach up, and fire people when needed. I’m also going to devote some time to discussing how to stay in compliance and meet all of the requirements imposed on us by the state and federal governments when hiring employees.
Although I am going to keep this section of the book simple and pragmatic, I want to take a moment to dive into what I have discovered, as a business coach, to be, for the majority of business owners, one of most difficult areas of scaling a business once they learn how to systematically sell a product or service – the management of people. I have witnessed many business owners (most business owners, actually) struggle to manage people because it involves doing everything that you were told not to do as a kid by your parents and your teachers.