Magazine

PT the Auditor

The Ultimate Punishment Ė Termination

My job is like cop and court rolled into one. I discover the problem; then Iím involved in the fix. The second part can be harder than the first.
Consider this. I do an audit and find that a garage manager has been less than forthright with the numbers. This is a case of malfeasance, not simple incompetence. I have him dead to rights.
He has cooked the books and taken his customerís money. Remember: This manager works for a private operator. The operator has been hired by the owner. So the relationship passes from the owner, through the operator to their employee, the manager.
Whose responsibility is it? The operator? The manager? The owner?
I can make a case for each.
First, the operator. The company has sold the owner on the concept that it is a manager of garages. It knows its business. It signed a contract to take fiduciary responsibility for the ownerís garage, his money, his service Ė the whole enchilada. The operator tells the owner that it is all-knowing about parking garages, that its employees are the best-trained and best-managed.
The operator allowed malfeasance to go on under its very nose. In this particular case, the operator didnít even notice that the manager had employees on duty in the garage that didnít exist, that he was turning in their time cards and cashing their paychecks.
The manager was caught when one of the ghost employees called to enquire about a lot more on her W-2 for last year than she worked. A simple audit caught him. However, in reality, it didnít. It took an outside query.
Obviously, the operator is the one at fault.
But just a minute. Certainly there is culpability. But the operator instantly began an investigation on its own. They audited the garage, found the problem, fired the manager, and reported to the owner with a check in hand for the entire amount lost due to the ghost employees, and it wasnít a small number. The operator was honest, quick to act, and cleared up the problem when it was discovered.
So the fault was the managerís. Of course, he is a thief. But in the parking industry, we put low-paid staff in very tempting positions. The main way we keep them honest is through very close supervision and training.
The fact that this manager stole stunned the operator. He was very good at covering his tracks. It wasnít an obvious problem. He was a long-time employee and very trusted. He had a very good act. The average city or branch manager, overworked and underpaid, could very easily have missed the problem.
So we get to the owner. How can they possibly be held to account? They hired and trusted a company to do a job and they didnít do it. But then ÖThey also hired the low bidder. They hammered and hammered and got the lowest possible price.
When the operator wanted to raise the managerís salary, the owner said no. When the operator wanted to install a new accounting and revenue system, they said no. When the operator recommended a refurbishment of the parking office, new lighting in the garage, they said no.
The operator asked for the tools it needed to run the garage properly; the owner said no. Perhaps it did the best it could with what resources it had.
Certainly the operator is honorable. They didnít cover up the problem. When they discovered it, they reported it instantly to the owner. They didnít have to. They could have very easily fired the manager and let it go. They did the right thing. Now do they pay the ultimate price Ė termination?
If thatís what is done, where is the motivation of operators to come clean? Why should they even try to keep their acts in order?
In some societies, they kill the messenger when bad news arrives. When that happens in business, we are all less for it. Terminating an operator when they report and fix problems is the wrong approach.
You might say, ďWell, if there was this issue, how do I know there arenít others?Ē I concur that when a problem such as the one described above takes place, a close look at the operation is in order.
But if the company acts honorably, perhaps you should let it go at that. For now.
Set up a schedule with your operator and have outside audits done regularly. Look for ways that you as an owner can help the operator run your operation more efficiently. Ask the operator for their ideas and take them.
Like a well-run university I know in the mid-Atlantic region, or an excellent airport parking operation in the Midwest, make the operator an extension of your internal staff.
Hold regular meetings including the garage managers and supervisors. Put someone on your payroll in the parking office once a month. Let them work with the operator in solving problems. Donít expect perfection if you are not involved in the process.
WOOF!

Article Abstract from February, 2009




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