5 Startling Facts About Human Capital Risk

By Lowers & Associates,

Human Capital Risks

People are often referred to as the greatest asset of an organization. While this may be true for your organization, the greater truth is, people also represent an organization’s greatest risks. The actions, inactions, and mere presence or influence of people, present a potential for loss across the spectrum of business activities.

Perhaps no source of risk is more perplexing, hurtful, and damaging than those caused by intentional harmful acts. Consider just a handful of startling facts:

1. 30% of business failures are due to employee theft.

Employee theft costs businesses an estimated $50 billion a year and is rising at a rate of 15 percent per year, according to the U.S. Department of Commerce. The Commerce Department and the American Management Association say that 30 percent of new business failures are due to employee theft and it is believed that 75% of employees steal from their employers at least once. (source)

2. Organizations lose 5% of revenue to ‘fraud from within.’

According to the Association of Certified Fraud Examiners (ACFE), occupational fraud is fraud committed against the organization by its own officers, directors, or employees–an attack against the organization from within, by the very people who were entrusted to protect its assets and resources. In its 2018 Report to the Nations, the ACFE projects that organizations lose 5% of their annual revenue to fraud. Of these cases of fraud, corruption represents one of the most significant fraud risks for organizations, with 70% of such cases perpetrated by someone in a position of authority (managers and owner/executives).

3. Workplace violence is the fastest-growing category of murder in the U.S.

According to OSHA, every year, 2 million American workers report having been victims of workplace violence. The Center for Applied Learning reports that workplace violence incidents have tripled in the last decade and is now the fastest-growing category of murder in the United States. And according to the Bureau of Labor Statistics (2016), fatal work injuries involving violence and other injuries by persons or animals increased by 163 cases to 866 in 2016; workplace homicides increased by 83 cases to 500 in 2016; and workplace suicides increased by 62 to 291. This is the highest homicide figure since 2010 and the most suicides since data collection began in 1992.

4. One in five American adults have experienced sexual harassment at work.

A CNBC survey found one-fifth of American adults have experienced sexual harassment at work. By age group, 16 percent of those ages 18 to 34 said they have been victims, while 25 percent of 50- to 64-year-olds say they have been. What’s more, according to a 2003 EEOC study, 75 percent of employees who spoke out against workplace mistreatment faced some form of retaliation.

5. 80% of active shooter incidents occur in the workplace.

The Center for Applied Learning reports active shooter incidents tripled in the last eight years, with an event occurring in the U.S. once every three weeks; furthermore, workers are now 18 times more likely to encounter workplace violence and an active shooter situation than a fire. According to FBI statistics, of 160 active shooter incidents in the United States between 2000 and 2013, over 80 percent (132) occurred at work.

Where there are people, there are risks. The actions taken by employees and even subcontractors representing your organization have a direct impact on the productivity, safety, and success of your organization. When those actions turn bad, either through negligence or intentional acts, the damage to people, brands, and profits can be significant. What are you doing to identify, prepare for, and mitigate your human capital risks?

  Category: Risk Management
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5 Current Threats to Hospital Security

By Lowers & Associates,

Treating patients is far from the only concern faced by hospitals today. To protect the safety of patients, visitors, and staff, hospitals must now take extra efforts to anticipate and prepare for security threats.

Hospitals are vulnerable to crime and violence from patients, visitors, and occasionally their own staff members. Therefore, security systems in hospitals must include proactive measures to create and reinforce effective security protocols geared towards accountability, readiness, and responsiveness.

The first step to designing an effective security system is understanding the threats themselves.

Here are some of the top security issues concerning hospitals today:

1. Abuse and battery towards medical staff

Assault and battery towards medical staff are the most common types of abuse-related injuries to occur within healthcare facilities. 80% of serious violent incidents reported in healthcare settings were caused by interactions with patients and were usually caused by patients hitting, kicking, beating, and/or shoving medical staff. There are many reasons that contribute to this. For one, patients may be victims of an incident caused by a dispute, creating a hostile or volatile environment inside the hospital. In other cases, patients may suffer from instabilities due to addiction or mental health issues.

At highest risk of patient-inflicted violence are psychiatric aides, who are more than ten times at higher risk than nursing assistants, the second-most affected group. Other high-risk groups include emergency departments, geriatrics, pediatrics, and behavioral health providers.

2. Active assailant attacks

Researchers at Brown University reported 241 hospital shootings between 2000 and 2015. Breaking this down, the majority of in-hospital shootings happened in the emergency room (29%), next to the parking lot (23%), and in patient rooms (19%).

As recent stories exemplify, simply having a plan is not enough. A recent active shooter situation at Dartmouth-Hitchock Medical Center exhibited the need for a much more comprehensive security approach. When the shooter entered the hospital and shot a patient, “Code Silver” was announced to all staff members. However, most staff did not know what the code meant, let alone how to react. The code has since changed to “Active Shooter,” along with other modifications to improve overall hospital security.

Bethesda Butler Hospital in Hamilton, Ohio is working to enhance training. They hired actors to practice emergency response to a hospital shooting. As Ronald J. Morris, the Director of Corporate Security for Tri-Health puts it, “It’s all about preparation and telling people about developing the right mindset so they can be more prepared.”

3. Infant abductions

Infant abduction is the most common type of abduction in healthcare facilities. According to the National Center for Missing and Exploited Children, 317 cases of infant abductions occurred between 1965 and 2017. The majority of cases of infant abduction occur in the mother’s hospital room, with violence inflicted on the mother in 8% of cases. Before more advanced security protocols came to form, many of the perpetrators disguised themselves as medical personnel to steal a child, usually from the hands of the mother.

In response, hospitals have cracked down on security measures and patient education practices that directly address this type of risk. The system does not need to be complex, but it should be effective. For example, access to maternity wards should be limited to qualified personnel or individuals who can prove their relationship to a patient. This can be further reinforced with badges that identify the security clearance of medical staff.

4. Supplies and property theft

From drugs, food, and medical supplies, you could make an A-Z list of items that are stolen from healthcare facilities. In 2009, hospitals reported 272 incidents of theft. By 2015, this number rose to 2,926 – a 166% increase. The result can be extremely costly. As a single example, the Santa Clara Valley Medical Center in San Jose, CA counted 383 stolen pieces of equipment between 2010 and 2014, totaling to over $11 million in value.

Culprits include patients, visitors, and also staff. An employee at the Christus Santa Rosa Hospital-Westover Hills in San Antonio, TX admitted to stealing over $400,000 worth of equipment because “it was easy and no one asked any questions.” Hospital theft is a good indication of a vulnerable security system, and also contributes to unnecessary overhead costs.

5. Pressure to cut costs

While 49% of hospitals reported an increase in crime between 2016 and 2017, nearly 1 in 4 hospitals (23%) reported a decrease in its hospital security budget over the same period. Part of this involves a reluctance to hire more security staff. In an anonymous survey, hospital workers mentioned “more [security threat] incidents, no increase in staff,” as a key challenge for hospitals.

Given its impact on security measures such as employee training, staffing, and security equipment, the pressure to cut costs is one of the most devastating restraints to an effective security solution. With $3.6 billion in federal budget cuts announced for 2018, hospitals need to prioritize security measures that combine effectiveness with cost-efficiency to strive for the best return on investment and highest possible level of security.

Security demands are changing, and hospitals must keep up to protect the security of their patients and staff. To address the increasing risk of in-hospital crime, hospitals must prioritize prediction and prevention of crime just as much as how they respond to and manage incidents. Solutions to achieve this include more advanced technology and data collection, increased security visibility to deter criminals, and bolstering in-house security presence and security response.

Now is the time to examine and refresh whether your hospital is in need of updated practices. Explore our healthcare security and risk mitigation solutions.

  Category: Healthcare Security
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