Background Screening: Reducing Risk and Improving Performance

Copyright © 2015 TRAK-1 Technology, Inc. All Rights Reserved.

The Basic Truths About Background Screening, Part 19



Background Screening:A Critical Tool For Deucing Risk and Improving Performance



Your Host: Rick ColtmanDirector of Strategic Marketing and Alliances,

TRAK-1 Technology, Inc.

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Your Presenter: Nancy Roberts, Esq.

Owner/COO

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What Risks Does Your Organization Have To Manage?

ONE PRIMARY RISK IS FRAUD



What Does a Fraudster Look Like?

Employee

Manager

CEO/Executive

Fraud By Position Loss By Position

42%

36%

16%

$75,000

$130,000

$500,000



What Does a Fraudster Look Like?

FEMALE

MALE

67%

33%



Executive/Management12%

Customer Service8%

Purchasing7%

Finance5%

All Other De-partments

23%

Operations17%

Operations15%

Sales13%

Fraud By Department



What Is The Cost Of Fraud?

Revenues The Typical Organization Loses To

Fraud Each Year

The Median Loss Caused By A Single

Case of Fraud 22% of

Occupational Fraud Causes

Losses of

5%

$145,000

$1,000,000

=

=

>



What Is The Cost Of Fraud?

Organizations That Have Less Than 100 People Experience

Loss Due To The Fraud Of One Perpetrator

28% HIGHER

$80,000=

Median Losses Due To Fraud

Loss Due To The Fraud Of Two Or More

Perpetrators

$300,000

=



Results In

EFFECTIVE RISK MANAGEMENT

Intermediate Outcomes Ultimate Outcomes

• Compliance• Business Process Continuity• Working Environment• Resource Allocation• Internal Reporting• External Reporting• Reputation And Brand Image• Earnings Volatility

• Reduce Short Term And Long-term Costs

• Increase Revenue• Improve Program

Effectiveness• Achieve Greater

Organizational Success• Improve Overall

Shareholder Value



HOW CAN BACKGROUND SCREENING HELP MANAGE RISK?

PEOPLE



People Risks• Criminal Conduct• Unsafe Or Negligent Behaviors• Illegal Or Non-compliant Behavior• Unsafe Conduct• Poor Productivity• Bad Attitudes• Inability Or Refusal To Follow Instructions• Violent Behaviors• Offensive Attitudes Or Behaviors • Conduct That Can Result In An Unsafe

Environment

What Are The Key Behavioral Risks You Want To Minimize Or

Avoid At Your Organization?



People Risks

Background Screening Has Become A Critical Tool For Evaluating Or Predicting The Future

Behavior And Performance Of

Employees



Cost Of Wrong Hire

Negligent Hiring Case

Embezzlement

Sexual Offenses

Fraud Theft

Wrong Person Chosen / Wrong Decision Made

Workers Compensation Claims



Cost of Choosing Wrong Tenant

Lost Rents

Scare-Off Good Tenants

Non-Payment

Reputational DamageDrugs

Violence

Sexual Assaults

Property Damage

Theft



Cost of Choosing the Wrong Volunteer

Unforeseeable Damages

Reputational Damage

Inappropriate Behaviors

ViolenceSexual Assaults

Wrong Message

Theft



ROI Of Background Screening

• Lower Turnover And Reduced Absenteeism

• Less Property Damage And Loss Due To Theft, Lower Accounts Receivable

• Fewer Incidents And Claims To Manage

• Decreased Exposure And Liability

Direct Cost Savings Indirect Cost Savings• Improved Morale• Higher Quality Environment• Higher Quality Candidates

Engaging With The Organization

• Overall Improvement To Revenues Due To The Improvements To Culture And Performance Of The Organization



ROI Of Background ScreeningThe Small Business Administration Conducted A Study That Showed:

$5to $16 ROI



Background Screening & Culture

Your Hire Must Fit Your Organization’s

Culture



Next Step You Can Take

Tailored and Comprehensiv

e Screening Packages Tailored

REAL RISK REDUCTION

Comprehensive Screening

Program (Policy, practice,

compliance, forms,

accredited vendor)

+

=



Reducing Risk & Improving Profits

The Greater The Savings And The Back-end Profitability

for Your Organization

The More Checking You Do Up Front

=



Next Step You Can Take

But It Is Critical That Continuous Monitoring Is

Implemented

Background Screening Today

Snapshot of the past



Reducing Risk & Improving ProfitsComprehensive

Screening Programs • Culture Of Accountability• Truth And Transparency • Improved Profitability• Lowering Risk• Reducing Costs• Improving Overall

Productivity



Take Away Points– The payoffs for effective risk management and controls include both intermediate and

ultimate results. – However, every organization shares in common one risk – the risk of introducing PEOPLE into

their organizations. – A quality professional background screening gives you a look at someone’s past behaviors

and patterns as one critical tool for evaluating or predicting their future behavior and performance.

– The risk of failing to take the appropriate precautions in hiring can certainly be great. – the Small Business Administration showed for every dollar invested in a background

screening program, the organization will see a return on their investment in the form of cost savings equal to $5-$16.

– the way you define your ideal candidate and what you say about your background screening program will help set the culture you want to create for your organization.

– Thus, comprehensive screening programs put into place both at on-boarding and for ongoing monitoring can truly create a culture of accountability, truth and transparency as well as put your organization on a path for improved profitability



Coming Up Next…

Continuous MonitoringSAVE THE DATE: May 7, 2015

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Contact one of Trak-1’s FCRA-certified screening professionals to begin

Ruling In The Right People!

Recruiting & HR

Background Screening: Reducing Risk and Improving Performance