Improve Store Audit Efficiency

Monitoring store compliance is time-consuming, especially if done manually. Many retailers' internal audit departments inspect the execution of store procedures and adherence to standards in areas such as POS transactions, security, HR, payroll, and regulatory compliance. Three internal auditors at Tractor Supply Company (TSC) regularly perform these tasks at its 700 retail locations. While the discipline varies, the approach is the same for its LP department, which audits stores' adherence to LP standards. Additionally, the retailer's district managers perform standard reviews/assessments of its stores. Each department uses checklists to track the completion of specific tasks, and each department manages its audit information differently. Kurt Barton, director of the internal audit department, wanted to automate standard checklists used by all the aforementioned departments.

In an attempt to improve the internal auditing process, Barton's team populated Excel spreadsheets containing auditing information. "Using spreadsheets was better than using paper, but it still wasn't very efficient," says Barton. "We also saw the need to accumulate data, provide historical data, and calculate the percentage of compliance for store locations over time." As a result, the audit team members input data from a Word document into an Access database that supplied historical data and company-wide averages. Barton deemed the process 'clunky' and felt it required too much administrative time, specifically 10 to 12 hours per week. His auditors periodically extracted data from Access, created reports, and sent them to stores, district managers, and regional VPs. But, administrative tasks hindered auditors' time to perform core auditing tasks. That's when Barton searched for a solution.

Barton found LP and auditing tools, one of which was the COMPAS mobile audit solution offered by Creative Options, a Protiviti company, that summarized information, created reports, and automatically sent e-mail messages to predefined employee lists. "After I realized that the tool was global enough to meet the needs of other areas in the company, the decision was easy," states Barton. "The cost was quickly justified after proving that the tool could benefit district managers and the internal auditing and LP departments. Furthermore, the entire company would benefit from the availability of historical information." Phase one of the implementation, which took place in early 2006, included the automation of audits performed by internal auditors, LP managers, and district managers. Phase two will take place in 2007 and includes the automation of a safety walk checklist, which is conducted by store employees. This checklist was delayed until phase two because of the time needed to train all store managers.

Eliminate 10 To 12 Hours Of Administrative Time Per Week
Today, managers and auditors access COMPAS through TSC's audit Web site, which Creative Options hosts. They complete templates from laptops or PDAs, while offline, and synchronize the data with the Web version as soon as the audit is complete. With one click of a button, audit information is confirmed and reports are sent directly to those employees' e-mail addresses contained in a predefined list for each type of audit. "We've eliminated the 10 to 12 hours auditors previously spent administering audit information," says Barton. "With the improved efficiency of the audit process, auditors conducted 30% more audits the first year after implementation. The historical information we now have available is indispensable. We are able to pull data for a regression analysis and quickly identify trends at the store and management levels." Barton also feels confident in the information he provides to executive management and the board of directors. COMPAS provides the internal audit department and LP the ability to make the company aware of potential risks and prioritize them.

LP has several initiatives underway to reduce shrink. The implementation of COMPAS is just one of them; however, the system has contributed to the retailer's improved inventory management and reduction in shrink. In other areas of the company, TSC employees are reviewing existing tasks to determine whether other events and reviews can be tracked through the COMPAS application.

For More Information On Creative Options
Go To www.creativeop.com