Understanding the Importance of Policies and Procedures

November 29, 2008 By Mary White

Is your company large enough to need a policy and procedure manual? This is a trick question, because it’s a fact that no company is too small to need formalized policies and procedures. It’s important for every business to have guidelines to follow when faced with making important decisions. It’s impossible to plan ahead for every situation that might come up, but having formal policies and procedures in place can provide a framework within which important business decisions should be made. As your company starts to grow, you’ll be very glad that you put the right systems in place when your organization was still small.

Basic Policies and Procedures
For most businesses, their policies and procedures evolve as time goes by out of necessity. As new situations arise, guidelines for responding to previously unplanned situations must be put in place. When you’re just starting out, it’s important to put some basic policy and procedure guidelines in place, with the understanding that they’ll need to be expanded over time.

Customer Service – Many of the problematic situations that business owners and employees deal with on a regular basis are related to customer service and customer relations issues. Don’t wait for a customer to ask for a refund to determine how such requests are going to be handled. Before you ever make your first sale, you should have a formal refund policy in place that is understood by employees and made available to customers.

Employment Policies – When you start hiring employees, it’s important to provide each worker with a policy manual that spells out the company’s policies toward common employee issues. At a minimum, this document should include the company’s equal employment opportunity statement, details about the employee discipline procedure, steps that employees should take in the event they feel that they have been harassed or treated in a discriminatory manner, company requirements for random drug testing, etc.

Application of Policies and Procedures
Having policies and procedures in place is only a small piece of the puzzle. Companies must also apply and enforce their polices and procedures in a systematic, fair manner. Once the standards for what is and is not considered to be acceptable behavior are put into place, it’s up to company management to see to it that the standards are applied in an unbiased and consistent manner across the board. It’s also essential to review company policies and procedures regularly, to ensure that they are current and consistent with the organization’s mission and values.

Posted in Operations