The Five Fatal Errors Organizations Make When Having Equipment Securely Destroyed
By Arman Sadeghi, CEO, All Green Electronics Recycling
There are five common errors that companies make when having equipment securely destroyed. Organizations such as retailers, electronics manufacturers, and government entities often require that equipment be securely destroyed. The reason for destruction varies from the destruction of defective goods, to that of seized government goods, the destruction of older equipment that companies do not want competing with their current stock on the marketplace, as well as the destruction of returned goods via reverse logistics channels.
Error One: Not properly auditing secure destruction vendors.
When selecting an equipment destruction vendor, it is critical that you tour their facility and vet their processes completely to ensure their standards meet your expectations. In your process, what you want to look for are ways that your equipment can end up leaving the facility without 100% destruction. One of the key ways of doing this is conducting interviews with individual line-level employees about the way that the processes occur within the warehouse. Do not simply listen to upper management and your sales representative. Instead, ask to go into the warehouse and talk to the people of your choosing.
When you are in the warehouse, ensure that you pick the random worker on the floor, as opposed to a lead supervisor or manager; this employee will give you the reality of what happens. If possible, conduct the one-on-one discussion with the employee in a setting where the management and ownership are not present. As you are discussing the process with this individual, keep in mind that much of the bigger picture items can be addressed if you chose a company that is certified to the industry’s highest standards. Therefore, what you want to be looking for are practical things that you see within their warehouse and practical systems that are going to ensure your equipment will not leave their facility without being processed and destroyed 100%.
Error 2: Thinking that the destruction of equipment can be done at a bargain rate.
The reality of secure electronics equipment destruction is that it is a very labor-intensive and expensive process. On the other hand, if the vendor you are using “skims just a little bit off of the top” by taking some of the equipment and either not processing it and pushing through as scrap, or by taking it and reselling it on eBay and in other markets, they can substantially increase their profit margins.
As we have seen in recent times, there have been several very high-profile cases where companies claiming to perform secure destruction of electronics equipment at a bargain rate have been caught by the federal government. Instead of destroying equipment entrusted to them, they sold these items on. Experience has taught us that when a company claims to be able to destroy your equipment securely for a bargain rate, it is usually because they are reselling some of your equipment or at least pushing some of your equipment through without processing it at all.
Error 3: Not selecting an adequately certified vendor.
In the electronics recycling industry, there is a gold standard for certifications, and that is e-Stewards certification. There are lower standards, such as R2 Recycling, which is certainly better than no certification at all, but it does not go as far as e-Stewards certification to ensure proper recycling and data security measures. By selecting an e-Stewards certified vendor, you are selecting an organization that has been vetted and audited extensively by a third-party organization committed to ensuring proper recycling, proper data security measures, and 100% compliance with all safety measures. Once you select an e-Stewards certified vendor, conduct your additional auditing, as mentioned above.
Error 4: Thinking that the only way your equipment is going to end up on the marketplace is due to a “bottom-up” problem.
Many organizations make the mistake of thinking that the only way for their equipment to end up resold on eBay or on the market somewhere is if a line-level employee steals the equipment and attempts to sell it. In reality, over 90% of the time these incidents occur, it is because of a top-down approach. In other words, someone at the top of the company, including high-level management, is typically involved in the systematic diversion of equipment for destruction into resale channels. Therefore, it is important that you focus on how the company assures equipment is not diverted systematically, as opposed to focusing on how they protect individual items.
Error 5: Not putting guidelines and systems in place to systematically and regularly audit the quality of work your vendor conducts.
It is worth some additional expense and work to audit your vendor and ensure they are doing their work. There are many ways of conducting ongoing audits with your vendors. One of the simplest ways of doing this is asking your vendor to track serial numbers and having your vendor report them back to you. The key is to ensure that you are not providing your vendor with the “answers to the test” by providing them a list of serial numbers for the equipment you are giving them.
Instead, you should create your own list and then ask your vendor to produce the list they received at their facility and match their results to yours, to ensure that nothing is slipping through the cracks. By doing this, you will ensure that the vendor has good processes in place for tracking your equipment. You are also letting your vendor know that you are tracking your items closely. This also sends a strong signal to upper management that any foul play would be detected quickly by your auditing systems.
The key to ensuring proper destruction of your electronics equipment is making sure that you select the right vendor. This selection process is almost always dependent on doing your due diligence and conducting proper audits. Most importantly, always remember that when it comes to secure destruction, you absolutely get what you pay for. Therefore, selecting a vendor that offers the lowest price, or even selecting a vendor who is in the bottom half of the pricing, usually guarantees that some of your equipment will be resold. Keep in mind that secure destruction is a labor-intensive and costly process; therefore, the costs are going to be higher than you would like. At the same time, ensuring your equipment does not end up sold online or at an auction is worth the additional cost, so do not cut corners.
Arman Sadeghi is the CEO of All Green Electronics Recycling.