LP Magazine

JAN-FEB 2019

LP magazine publishes articles for loss prevention, asset protection, and retail professionals covering shrinkage, investigations, shoplifting, internal theft, fraud, technology, best practices, and career development.

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29 LP MAGAZINE | JANUARY–FEBRUARY 2019 THE EVOLUTION OF LP TO SUPPLY CHAIN OMNI-CHANNEL EXPERTS for me it was being in a store where business was slow. It made me think, how can you have a high shrink number? Someone must be really hurting you, but you barely have any employees working on specific days. So you start looking at the paper. Then you realize that it may be a problem with respect to how the inventory control department is manifesting deliveries to the store. That sort of illustrates how my interest in finance manifested itself into loss prevention. EDITOR: Did you then move more into shortage control? SCROFANI: Yes, over time. But specifically, when I joined Bloomingdale's in 1995 as the LP manager of White Plains, there was quite a bit I needed to learn about shortage control. I was lucky enough to transfer over to corporate shortage control, and that's where I was able to dive into it head first. At the time, Bloomingdale's security department was headed by Bruce Williamson, the vice president, and shortage control was managed by Joe Medici whom I reported to. We really went after the whole audit piece first. We were able to break down the stores into traditional ABC classifications. We understood planogramming and its areas of opportunity. We understood the vendor view—which vendors do we have to pay more attention to than others and when. We worked with the security professionals and the merchants to reevaluate sales floor planogramming designs where we had buy-in, and multiple security technology tools were introduced to layer our shortage-reduction efforts. It was a great experience because that allowed me to really get my arms around the inventory control process and auditing compliance standards and practices. EDITOR: Eventually, you transitioned from the store side into supply chain, logistics, and risk management. How did you make that move? SCROFANI: I've always been the type of person who tries to understand things that people say are impossible to do or fix. Or why people are critical of a specific department. When you're in loss prevention and responsible for aspects of inventory control, you hear a lot of inventory management conversation about problems. In 1998, I moved to Babies"R"Us where I was lucky enough to work for seasoned LP professionals of the likes of Bob Serenson and Walter Palmer. At the time we were looking at all areas of opportunity. Bob was a pretty holistic thinker, which was refreshing for me. We were studying the merchant part of the business as well—how things moved and where they were going, essentially looking at the entire logistics side. That's where I made my transition out of sheer curiosity, and I was lucky enough to have a supervisor that supported it and celebrated the transition. I said to myself, "Okay, apprehension and investigation, I get it. I need to move over to the other pieces that might be opportunities for us to study." So I joined the merchandise flow team at Toys"R"Us into what the industry today calls "sales and operations planning." We really learned to leverage how freight was moving, what should've happened, and what wasn't happening when we needed to influence our partners in the buying side. For me, that was the continued galvanizing of, let's just say, the asset protection supply chain sword. What that did for me was allow me to see things from a completely different point of view and honestly different language as well. Instead of hearing about the words that dominated most of the LP discussions like "apprehension and shortage," now you're talking about an all-out assault on "defect management." What are the bits and pieces that you can absolutely touch and grasp that you can help manage and mitigate, expose, train teams, and fix? That's where allocation and sales and operations planning became a big to-do for me. I was a kid in a candy store and tried to absorb as much as they could throw my way. EDITOR: It sounds like that was a tremendous education for you. SCROFANI: No doubt. I learned quite a bit about SKU rationalization studies. How SKUs and categories were planned and forecasted. How purchase orders were written and how they were supposed to flow and from what origin to what destination and lead times. All the pain points that people scream and yell about were literally in front of me. And I could actually see the individual transactional problem in front of me and attack it. Then in a short window of time, I learned who to work with, and that allowed me to build smart strategic solutions and work with the people who were responsible for the systems and the processes. Sometimes it was the solution provider. Sometimes it was our wonderful databases and Excel spreadsheets [laughter]. Eventually, I moved over to logistics, and then I had all of the domestic inbound operations. I managed everything coming into the organization with a pretty substantial budget of a little over $120 million. That's where I began to really understand things like lead times, in-transit risk, capacity planning, and how your vendors are moving product and building consumer packaged goods and sourcing for raw materials when they tell you something's going to be made, and it's not on time. It was a continued eye-opening experience. I think, however, it's important to always acknowledge, "We're really not subject-matter experts. We're maniacally passionate students of the supply chain." The more you take that approach, the quicker you're going to learn because people will always share with you things that you thought you knew but didn't. That's the beauty of having an open mind and acknowledging that you're nothing more than a student for a long period of time.

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