Successful companies don’t make it up as they go along. For your business to be successful, you need a set of policies, procedures and systems.
Whether written or not, every company has policies. Policies cover things like whether a product can be returned, under what circumstances an employee will be fired, how long an employee needs to be on the job before being eligible for health insurance, and whether company computers may be used for personal emails. Here are some guidelines:
Procedures and Systems
Can you imagine a fast food restaurant that allowed each employee to decide how to make a burger? Or a bank without formal processes for accepting a deposit? I’m not suggesting creation of unnecessary red tape or nonsense. I am suggesting that …
Let’s take hiring. You might have a procedure for conducting an interview. (I use the word “procedure” pretty loosely. It might just be a simple checklist. In my mind, a procedure is anything in writing – even in pictures – to guide the steps someone takes to accomplish a task.) You also have a job application and a form asking for the applicant’s approval to perform various background checks.
All of these checklists, procedures and forms make up a hiring system.
Please don’t get hung up on these terms. Feel free to give these things different names. The important concept is documenting:
Let’s say you hire a new store sales employee, Kathy, and you want her to take over the purchasing process. Your training choices include:
If you go the route of most small businesses – which is to show rather than write a procedure – eventually Kathy “gets it.” She starts doing the job, becomes good at it, and over time probably adopts new approaches to the job that you don’t even know about. These changes may impact important things like your cost or delivery lead times. But, none of her improvements get written down.
After a year on the job, Kathy quits. All of this knowledge that Kathy gained – which belongs to you – walks out the door.
So you hire her replacement and show him how to do it the old way. You haven’t been involved in purchasing for over a year. Kathy handled it. You don’t know anything about all the changes she made to the process. You’ve lost a year’s worth of important business knowledge … because nobody bothered to write down a few simple bits of information.
So, even if you’re the only employee, take the time to write down what you do and how you do it. Put it in your computer and print it out. By the time you have your first employee, you will probably have a good start on an procedures or operation manual. Think how much easier it will be to train your folks and how much smoother the operation will run.
Remember: Successful companies – like yours – don’t make it up as they go along.
I write about business, small business, marketing, management, leadership, a little bit of travel & other topics of interest to business people.