Sawmill fixed $1M theft by letting workers borrow equipment

A sawmill employing roughly 1,000 hourly workers was losing an estimated $1 million a year in stolen tools and equipment, and management's standard levers — tighter surveillance, disciplinary action — were both weak (a strong union made termination or serious discipline for theft nearly impossible to enforce) and, organizational psychologist Gary Latham's interviews revealed, aimed at the wrong problem entirely. Workers weren't stealing because they needed the equipment; most items taken went unused or unsold.

Latham's intervention skipped enforcement entirely, since enforcement can only reduce the cost of getting caught, not the reward of successfully stealing something worth bragging about. Instead, the mill set up a library-style check-out system: employees could freely borrow the same equipment for personal use, openly and with permission, simply by checking it out and returning it later.

Let workers borrow the same equipment openly, turning theft into an ordinary transaction and eliminating the bragging-rights motive.

Interviews revealed theft was for bragging rights, not need.

Enforcement only raises cost, doesn't remove the status reward.

Open borrowing made the act ordinary, killing the status value.

Behavior stayed same but meaning changed, so motive vanished.

Before escalating enforcement, find the real reward; if it's status, make the benefit openly available to all.

Theft dropped to near zero within days of the check-out system's introduction and remained inconsequential by the company's own accounting for at least three years afterward; a later amnesty day, framed in the same library-return spirit, saw employees return truckloads of previously stolen equipment — some reportedly returning items because a spouse wanted the stolen gear out of the garage once keeping it no longer carried any social cachet.