Rumors are flying around the Internet that British Petroleum is considering removing Tony Hayward from the company’s top post. Apparently investors like the idea, as BP’s stock price has steadily risen since the rumors began.

People may feel like it’s a good start, as Hayward seems to have become a greater liability than an asset to the oil giant. However, one grand, symbolic gesture — one more sacrificial lamb — doesn’t get to the root of the problem. We have much further to go. Hayward is at the top of the company but the failures that led to the oil catastrophe have not nearly been all his or his company’s doing.

BP’s failure was part of a systemic failure: there is plenty of blame to go around. Rather than blame everybody (which helps no one), we have to correct the system in which this fiasco occurred or devise a new system.

Where to start?  We might take care of the problem this way:

• Compile lessons learned and share them with the industry.
• Rewrite industry (and other) standards to put a greater emphasis on safety.
• Enforce existing regulations before writing new ones.
• When writing a new bill (and this goes to any bill, not just those dealing with oil and gas), the legislature cannot be allowed to hide laws by combining them, related or not. One bill for one issue.
• Spend money on enforcement (i.e., hire qualified people, train them well, and pay them what they’re worth).
• Break up the MMS and organizations like it. The Materials Management Service has been responsible for gathering rights fees, etc., and they’ve been responsible for enforcing oil-and-gas-related statutes and requirements. Often, these two work at cross-purposes: as we saw, the MMS didn’t want to enforce laws that might put the brakes on revenue. Those functions have to be kept separate so there’s no confusion about what’s important.
• Restore “reinvestment in the company” as a business tenet. Paying out profits to shareholders and executives while infrastructure and technology lag isn’t sustainable.
• Fine anyone or any organization that misled anybody at any point (misinformation, late or no information, deflecting blame, covering up problems, etc.). This alone could raise enough money to put the issue behind us.
• Get the world on the same standards. It’s too easy for a company to say, “We don’t like the tax laws here, so we’re moving offshore” or “It’s cheaper to operate “over there”, so we’re going over there.” Artificially low wages and taxes, as well as lax standards and enforcement, relocates the problems and potentially intensifies them. Relocating a problem doesn’t solve it and it can create more.
• Accept responsibility. Management can certainly do its share but so can the rest of us. We need to find our collective moral compass and use it all the time.

Do you have any suggestions or ideas for preventing a recurrence of this unfortunate situation? What would your corrective or preventive actions be? Should compliance with ISO 9001 and ISO 14001 be required of all oil and gas companies (and their subcontractors)? Should policies and procedures be transparent?

Thanks for your time.

Customers Say They Want A System for Sharing their Day-to-Day Operating Documents while Maintaining Control, Traceability and Compliance

Our customers cite ‘organizational improvement’ as their main reason why they purchase policies and procedures. From many conversations we have gleaned that customers want to implement a system for continuous improvement and compliance. In a system, procedures are continuously reviewed, revised, and updated. New issues need to be identified, now procedures written. Old procedures need to be replaced by new procedures.

To remain compliant with your industry standards, government regulations, and quality requirements such as ISO, document changes must be managed and traceable through the document management cycle: DRAFT | REVIEW | APPROVE | RELEASE. This cycle is the heart of compliant document work flow.

So Bizmanualz is currently testing an on-line document management software for driving document management and compliance. Because the software is available as an on-line service, organizations of any size can manage and share their policies, procedures, work instructions and other operating documents.

During this test period, Bizmanualz is providing a few customers with access to a prototype of our new document management software. The customers are providing feedback which is helping us improve the first release of the product which will take place soon (If you are interested in testing the software, please read this post. Also, see our frequently asked questions (FAQ), or call us at (314) 863-5079.)

For more background on how document management software can help you, please see our blog.

Walking Through Bizmanualz On-Line

In our pre-release testing program, we’re asking testers to perform common operations, such as logging in, setting up users (assigning permissions, etc.), loading documents, and organizing them. The work flow starts with drafting documents and includes reviewing, revising, approving, and releasing documents.

The following “use case” illustrates work flow in our new software. Use cases like this are provided to testers so that all testers are following a similar path, which makes it easier to evaluate their responses. As the software matures, users will need less instruction and use-cases will be more general.

To log in to the Bizmanualz On-line editing module, click on a link and enter a user name and a password that you received via e-mail. When logged in, users will see the following ‘Home’ Screen (figure 1), which shows announcements posted by the administrator and other users of the system.

Figure 1: Click screen shots for larger images.

To manage a document, click on the document tab (figure 2), which is the second tab from the left. Then click on the production department folder in the left-hand navigation to show production-department documents (Bizmanualz templates that you purchase come pre-loaded and you can upload your own documents).

Figure 2

Expand the folders by clicking on the plus sign in the Department navigation on the left-hand side (figure 2) to show its contents and browse for documents in the list in the main window (figure 3).

Figure 3

Figure 4

Figure 5

The document itself may be viewed from this window by clicking on the binoculars icon, or edited by clicking on the document-edit icon. Delete the document by clicking on the delete icon, which will issue a warning before deleting the document.

Managing Document Workflow

Workflow in the Bizmanualz On-line system is essentially a three-stage process of accept/reject review, approve/reject revision, and release/obsolete revision. We will look at the basics of each step here.

This guide assumes that you have created users, and set permissions at a department level. See those use cases for full information.

Set up Document Permissions

Here we will review the optional step of setting permissions at the document level, which override department-level permissions governing access to a group of documents.

System administrators can set all permissions for themselves and all users. They can submit drafts (DRAFT), accept or reject reviews (REVIEW), approve or reject revisions (APPROVE), and release documents (RELEASE).  This cycle—Draft | Review | Approve | Release—is consistent with all document management protocols, industry standards, government regulations and quality standards.

By default, authors cannot review or release their own work. But administrators can change work flow permissions and defaults for single documents in the People tab (figure 6), overriding department or group-level permissions. If you are logged in as an administrator, you will have access to the People tab while you are on the Details view of any document.

Figure 6

In this example, the administrator has granted himself full permissions, and another employee Approver and Reviewer permissions, overriding permission defaults.

Accepting and Rejecting Reviews

Dan has permissions as an author, which means that he can ‘Submit draft’, which causes the ‘Accept Review’ and ‘Reject Review’ buttons to light up (figure 7) per the permissions he set in the previous screen.

Figure 7

E-mail Notification

Reviewers are notified by e-mail when documents are ready for them to review. E-mails are sent when the document has to be submitted for review. All users who have review privileges for the document will receive an email (Figure 8).

The document may be attached to the e-mail so you can read it right away. But documents can only be released through the system. Any revisions you make to the attachment will not be reflected in the controlled draft or released document unless you upload it to the system.  If you do that, it will cause another work flow cycle to occur on the document you have uploaded. To avoid proliferation of documents, we suggest using the attachment for reference only doing all your revisions while logged into the system.

Figure 8

In this example, the revision number is still 0.0.0.0 because the document review has not yet been accepted. Clicking on the ‘Accept Review’ button which is lit up in figure 7, will create a document revision.

If you ‘reject draft’ you get a message that prompts you to enter a reason (figure 9).

Figure 9

Approving and Rejecting Revisions

Ultimately, revisions can be released by clicking the ‘release revision’ button (figure 10). You will only be able to release the document if you have permission to do so, per the settings on the ‘People’ tab. Talk to the document author or system administrator to find out what permissions you have.

Figure 10

When you click ‘release’ you will be asked if you would like to send the document via  FTP to a server other than the Bizmanualz server (figure 11). Select ‘yes’ if you are pushing released documents to SharePoint or another local server other than Bimanualz. If you are not sure, ask your administrator or Bizmanualz.

Figure 11

When you release a document for the first time, the version number changes to 1.0.0.0, indicating that the first release of the document has been achieved (figure 12). Note that many reviews may have occurred before e the first release.

Figure 12

Unreleased documents cannot be seen by the general user population. They will only see what you released to your customized Bizmanualz web site or to your SharePoint or Intranet. Only users of the Bizmanualz On-line editing module can see the drafts.

So, what do you think? Are you ready for Bizmanualz document management software?

A little while back, we wrote about the keys to improving employee performance. The issue of performance was discussed from the manager’s viewpoint.  Managers often have a lot to do with their employees’ performance, or so conventional wisdom goes. They’re responsible for motivating their employees to turn out quality and perform at their best, as well as for organizing, training, and so forth.

However, motivation is a “soft” skill that many managers just don’t come equipped with. Some have never been instructed at length on the topic of motivation, and it’s not a skill one easily picks up on their own.  Therefore, many employees need to motivate themselves from within. If not, they lose interest and momentum.

So how do you, as the employee, take the initiative when your manager is unable to provide it?

1. If your manager does not provide you the “what, when, and why”…ask! Valuable project time is lost when employees don’t have a clear sense of purpose or direction.

Ask your manager for an example of what the finished product should look like. What are the project objectives? Are they SMART objectives? What are the milestones? Do you understand what’s expected of you?

2. Continually ask for your manager’s feedback. Don’t allow your manager to isolate him or herself. The manager may say, “You handle it”, but do they really mean it? Project review should be a required part of every process — in fact, the quality standard, ISO 9001. mandates reviews! Always ask (of yourself and your manager) what can be improved.

3. Be honest about your skills and training. Do you have enough for the job in question? If not, can you get more — or more specific — training? Can anyone mentor you in this area? And does the company have a training plan in mind for you?

4. Assess your resources. Specify what you will need to complete the project. Ask your manager how resources will be allocated and be sure you will be adequately supplied.

5. If a problem (setback) occurs, tell your manager as soon as you have the facts to rationally discuss the case. Present the facts clearly and logically. Present opinions, too, but be sure not to pass them off as facts. Try to offer one or more potential solutions, as well.

6. Be an influential team member. Be part of the team. Don’t hold back on any of your ideas. Each team member must contribute something to the success of any project…otherwise, it’s not really a “team project”, is it?

7. At the end of the project, ask your manager for feedback. There is always room for improvement, so learn from the praise and the criticism and incorporate it in subsequent projects.

You can’t always rely on others to provide you the guidance and incentive you need to be an outstanding performer. Sometimes you have to take the initiative.

So, what do you think? What makes your employees outstanding performers? Is it that they’re strongly self motivated, or that they’re well managed? Or is it something else we didn’t discuss here?

Let us know what’s on your mind.

In the Lean Business System group on Linked In this month, Paul Lowe of Brush Transformers Ltd., Nottingham, UK, asked, “Do SOPs hinder creative thinking which can ultimately stifle innovation?” The short answer is “No.” Standard work, creative thinking, and innovation are three separate concepts, all necessary in any healthy organization. Let’s look at how they relate to one another in an example at Bizmanualz:

Sometimes customers call Bizmanualz inquiring about our policies and procedures for sale, saying that their companies need documentation to increase their quality and gain compliance. Of course, we’re able to provide them with policy and procedure templates. We also suggest that quality is the result of teams working out the best way to do something, and quality is supported by documentation. Sometimes we hear, “We don’t have time to develop our own processes or documentation.” So, they start their project with our templates and we make it a point to check back with them later.

Focus on a small number of SOP’s. If it seems that your teams don’t have time to develop or even customize SOPs, they’re probably trying to document way too much. Only the work that repeats and is subject to continual improvement benefits from standardized documentation. Work groups can be overwhelmed by more than a handful of SOPs; anything more than that will be referenced rarely, if ever.

Developing SOP’s is creative. Developing SOP’s requires a clear sense of what activity is essential and what is nonessential, or “non-value added”.  With that understanding, you can create a focused procedure. Improving an SOP is also creative, in that a refinement must be conceived that drives out even more nonessential activity. The revision has to be drafted, reviewed, and released. It’s an iterative, creative process.

Process improvement will buy you incremental improvement. You might pass along single-digit cost reductions to your customers, or response times might improve by double-digit percentages. But even if your customers love every improvement, incremental approaches will only get you so far when customer’s expectations fundamentally change.

When your competitor delivers in seconds what takes you days, or sells for $100 when the going price is $1,000, the customer’s expectations shift and the rules change.

Like it or not, game-changing innovation must be on your agenda. Incremental improvements won’t get you there. So don’t confuse creativity applied to incremental improvement with innovation, another form of creativity entirely.

At Bizmanualz, we’ve applied incremental improvement to our policies and procedures business, improving for years. But now customers want tools to manage their SOP’s, policies and procedures. So we had to innovate and find a way to deliver what customers want.

Focus your innovation by asking your customers why they buy your products

We focused our innovation by asking our customers why they purchased our policies and procedures. As mentioned earlier, one reason is that they don’t have time to develop their own. But more often customers cite organizational improvement as their main reason. From many conversations we have gleaned that customers want to implement a system for continuous improvement and compliance.

Policies and procedures documents, per se, are not a system of continuous improvement. In a system, procedures are continuously reviewed, revised, and updated. New issues need to be identified, now procedures written. Old procedures need to be replaced by new procedures. With a deeper understanding of our customer’s needs, we came to understand the direction that our innovation must take.

Customer needs bound our innovation

Our customers told us they wanted a system for managing policies and procedures, so Bizmanualz is currently testing an on-line document management software for driving compliance, among other things. Looking carefully at customers’ purchase behavior and listening to what customers have told us has provided important boundaries for our creativity so that resources can be applied effectively. No amount of creativity will compensate for a lack of focus.

Our initial software release focuses on the document management features that will help our customers transform their static policies and procedures into a dynamic management system. For a discussion of features, please see our Bizmasterz web site. Also, see our frequently asked questions (FAQ), or call us at (314) 863-5079.

Incremental improvement helps you do a better job in your current business, but it won’t help you when the rules of the game change and innovation is your only option.  Creativity is a skill that you bring to work every day whether you’re taking small steps of making big leaps.

I wonder how many of our clients, on receiving our policy-and-procedure manuals, have asked themselves what in heck they got themselves into. (”There’s a lot of stuff here…where do I begin?”) Well, like a lot of things, it’s probably not as difficult as it looks initially. First, you took a step in the right direction by using our templates to develop your company policies and procedures. It’s always easier to start with some of the work already done for you, rather than you having to start from scratch.

Now, how do you proceed?

Understand Why You Need Policies and Procedures

You don’t need policies and procedures merely to comply with regulations or industry standards (like ISO 9001). Sure, there’s nothing quite like the threat of fines, legal action, and the scorn of the business community to motivate you, but that’s far from the best reason. Much better reasons for developing policies and procedures include:

• Communicating your business goals and priorities;
• Standardizing processes, behavior, and results;
• Training your employees consistently; and
• Identifying acceptable and unacceptable behaviors (and encouraging or discouraging them).

Prioritize Your Needs and Set Goals and Timelines

Now that you understand “why”, you need to decide “what”.  Of the policies and procedures you could work on, you have to determine which one(s) are going to provide:

• The biggest bang for the buck;
• A quick return on your investment; and/or
• The greatest good for the greatest number.

Only you know what you need.  I can offer you suggestions (like “start with a fairly simple process”) but only you have the intimate, day-to-day knowledge of your organization. It’s your company: you decide.

So, decide which process you’re going to document first.  If you have absolutely no idea (you have no metrics and no historical basis for evaluation), try any Bizmanualz policy or procedure.  Document your initial design and development process and use it as a baseline for further development.

Give the first procedure a fair evaluation.  Don’t look at your first policy-and-procedure development, point out all the flaws you can find, declare the project an abject failure, and pull the plug.

Introduce discipline into the development process by setting clear and meaningful (aka, “SMART“) goals and timelines.

Analyze Your Existing Procedure

If you already have a de facto¹ procedure in place, don’t throw it out in favor of so-called best practices that may or may not work for your firm.

“If it ain’t broke, don’t fix it.” (Anon.)

Now is as good a time as any to document your process.  Diagram it quickly in any manner and medium with which you’re comfortable. Simple is best (“Don’t make a big production out of it!”, Mom used to say).  Next…

Compare Your Process with Bizmanualz Best Practices

Bizmanualz has already looked at many companies’ procedures, blended them together to describe “best practices”, and reasonably modeled these procedures on the Deming, or “Plan-Do-Check-Act”, cycle. You may find that your procedure already looks very much like the PDCA model:

• You develop a set of objectives and a plan (process) for realizing those objectives;
• You implement the plan and immediately start collecting process data (in-process, end-of-process, etc.);
• You routinely analyze the data, to see if the process is performing in line with expectations; and
• You make changes to the process (procedure) in order to improve it and improve your results.

If that’s the case, you don’t have far to go at all. Next…

Make Our Procedure Your Procedure

Make the obvious and necessary changes to the Bizmanualz policy and/or procedure.  We wrote them generally, like ISO standards, so they’d have the widest possible application.  Any resemblance between our procedure and your process is coincidental; that is, you’ll have to customize our procedures – make them your procedures.  For example:

• Change every instance of “Bizmanualz” or “the company” to your company;
• Where you have an existing form (e.g., purchase order, customer order, invoice), use it – and make sure field names, etc., on the form and in the procedure agree;
• Change job titles in the “Responsibilities” section and in the procedure itself to reflect your circumstances;
• Change diagrams² as needed;
• Add visual aids – they add impact and meaning and they complement verbal descriptions very well (especially when they come from your office, your shop floor, your staff, etc.); and
• Leave out what you don’t need.  An entire procedure or just part of one — if it doesn’t apply to your situation, delete it.  Make your policies and procedures simple and direct.

Verify and Validate the Procedure

The people responsible for implementing the procedure have to put it to the test.  Oh, you could write a procedure and thrust it on an unsuspecting workforce but until it’s subjected to “real world” conditions, the results you see may not be the ones you want or expect.

And there’s more to it than procedure verification and validation. Some people call it “getting buy-in”. Whatever you call it, recognize that your employees are stakeholders in the company. They have a vested interest in the company, too – if it does well, they do well. So, keep them in the loop on matters that directly affect them, to ensure their understanding and cooperation.

Even if they’re not directly impacted by the procedure in question, keep all employees informed of this — and most — company matters.

Implement the Procedure

Now, publish the tested-and-verified procedure.  Distribute the procedure to those responsible for executing it, analyzing it, and training employees.  NOTE: A document management system, or DMS, will help you address publication and distribution, as well as improve document control.

Hold a training session on the procedure – make sure trainees are not only capable of doing the work, but that they understand the process and the objectives, as well.  Finally, execute the process.  Collect the data from measuring devices and routinely analyze it.  Look for anomalies and trends in the data, evaluate the process, and aim for continual improvement.

Yes, ladies and gentlemen, it’s just that simple! Any questions?

NOTES

¹Just because you haven’t documented it doesn’t mean you don’t have an effective process in place.  Example: my wife and I came to a quick understanding some time ago that I would clean tubs, showers, and toilets and balance the checkbook. It’s very effective, plus there’s no point in documenting such processes because (a) they’re easy and (b) she won’t ever do them.

²We’ve been using Microsoft Visio to build diagrams. Unfortunately, Visio is not automatically included with any version of MS-Office, so far as we know. There are many alternatives to Visio, though – any search engine will help you find them – so your organization need not be constrained by a lack of Visio³.

³No, that’s not a typo.

I think of Lean and Six Sigma as having many similarities and differences. If you see waste happening, you can eliminate it. A lean visual factory helps us to remove obvious waste.  Takt times help us to balance lines, while standard work, total preventive maintenance, and 5S help us reduce variation.

Lean is more than a set of tools, however: it’s about culture, the work environment, and a way of thinking.  Lean works well at the beginning of any quality program, where you want to sensitize the company to waste and teach continual improvement.  Lean is fast, agile, and prepares people for change.

If you are blessed with a high transaction environment and can easily recognize defect data and trends, you can eliminate the defects.  Statistical process control helps us to remove obvious control limit violations, detect instability, and monitor process drift.  DMAIC, DOE, and DFSS help us to filter out noise and methodically remove less obvious waste.

Six Sigma presents a different way of looking at issues and can help your employees get over intractable problems.  Six Sigma works well in the middle of any quality program, where you want to move the company to higher (i.e., world-class) levels of performance.  Six Sigma is sophisticated, technical, and removes performance obstacles.

Both Lean and Six Sigma require discipline, time, and a subject matter expert to deploy and manage. Neither requires a lot of money relative to the cost of poor quality they reduce. Each can eliminate obvious waste and reduce variation, though what is considered obvious or a variation may differ in each program.

Lean and Six Sigma by themselves can play a valuable role in any continuous improvement program, but it’s when they’re used in combination that companies will see the biggest, longest lasting payoffs.

We are currently testing our new policies and procedures document compliance software, and plan to release it for customer testing in the near future. Potential testers have been asking a number of questions. Here are questions, and the answers:

Is your software accessed as a service over the Internet (Software as a Service - SaaS) or must software be installed on our computers?

Our software is in fact a ‘software-as-a-Service’ available as a subscription over the Internet. The first time a user accesses the service, a small amount of code loads on the client machine in about 30 seconds, similar to when using GoToMeeting or any number of on-line services. The user never is required to install, launch or maintain any software.

Can we upload our existing documents into the system?

You can upload all your existing documents into our system, and open them, so long as your local machine has the software that was used to create the document. For example, MS WORD documents are can be uploaded. In fact, we publish the world’s most complete set of pre-written policies and procedures, all in MS WORD format. Any policies and procedures templates that you buy from us come pre-loaded in our software. We keep the templates up to date; but we don’t change any documents that you save, upload or change, even if the document started as a Bizmanualz template.

Are documents easy to update?

Documents are edited in their native software on your local machine; they are saved to our server. Our system tracks and controls all document revisions so everyone accesses the latest version. It’s easy to roll back to a previous version if necessary.

Are employees or other users notified when policies are changed or updated?

Notifications of changes are sent by e-mail to document authors and ‘followers.’  Administrators and document authors can assign ‘follower’ rights to any user for any document. Users can independently follow any document to which they have permission. Followers receive e-mail notifications of all changes. There are also announcement and action item screens within the software that can be used to communicate information about documents.

Can multiple users access policies and procedures at the same time?

Yes, any number of users can access your documents. If two people work on the same document at the same time, their work will be saved (but not released) as two separate drafts. Built-in workflow assures that only one draft can be released, so there are never multiple releases of the same document floating around.

How do you price your software? Do you charge by the seat, or do you sell one license for the whole organization?

We charge per seat for administrative and add/change/delete privileges. Released documents are published to a web site which can be viewed for free by anyone you want. Typically, that would include all your employees and your auditors if you have a formal quality system.

We have an Intranet for reading our documents on-line. How does your software work with Intranets?

If you already have an intranet or a document publishing platform (SharePoint for example) and want to keep using it, our editor module can ftp documents to your existing publishing platform so that user’s viewing habits don’t have to change. But your editors and document managers would benefit from using our editor module for document control, workflow, version control, notifications, etc. while your general employee population would continue to read documents as they’re doing now.

Can I assign different levels of access to users and documents?

We offer a full access control at the document, user and department level. That is, all users assigned to, for example, the accounting department can be granted permission to all accounting procedures with a global command. Additional restrictions can be placed on individuals within a department. Access privileges can also be set at the document level.

Is your software compliant with my quality management or document control requirements?

Yes, our software is consistent with the document control requirements of all quality management systems, government and industry standards and regulations.

Policies and procedures provide the framework and direction for addressing many common business problems your organization might face.  Let’s look at the top ten business problems solved by Policies and Procedures.

1. Accounts Receivable procedures to reduce accounts receivable (A/R) aging and ensure even cash flow.  Every company needs Strategies for Writing Accounts Receivable Procedures.  Your accounts receivable process is the heart of your cash cycle.  Salespeople can find plenty of customers but without cash-paying customers, you can’t pay your bills, which is part of your Strategies for Writing Accounts Payable Procedures.

2. Sales procedures to standardize sales pipeline management and ensure a consistent sales pipeline.  Sales procedures allow you to take control of the sales and marketing cycle.  Developing measurements, sales assignments, and target markets are all important elements of your sales process.

3. Disaster Recovery procedures will assist in an orderly and timely response to emergencies your company may face, as well as control the inevitable chaos that occurs.  Every company needs to effectively respond to disasters or emergencies in a timely manner; if not, they could be out of business.  In recent months, we’ve had ample opportunity to learn the lessons of the Gulf oil disaster, such as “having a disaster recovery plan before the need arises”.

4. Human Resources procedures ensure non-discriminatory practices; specifically, well-defined employee hiring and termination practices will help you avoid costly litigation.  Human resources procedures address diverse topics such as recruiting, hiring, training, retention, termination, and — most importantly –complying with local, state, Federal, and even international employment laws.

5. Quality procedures (nonconformance, corrective action, and auditing) improve product and process quality.  The ISO 9001 quality standard addresses quality control, quality assurance, and quality management practices.  Learning how to meet quality standards with ISO 9001 will help your organization reduce costly rework and overtime, thereby improving quality, satisfying customers, and contributing to your competitive advantages.

6. Customer communications procedures, like collecting data from customer feedback and complaint handling for process improvement.  ”Poor customer communication” is the root cause of much customer dissatisfaction.  If you know what your target customer wants, your business has all the information it needs to satisfy the customer. Implementing communication procedures will help you act on your customers’ wants, improving sales.

7. Shipping and receiving procedures are needed to track materials purchased and sold.  Most of shipping and receiving revolves around inventory or assets, which requires processes for handling, inventory management, asset acquisition, and asset disposition.  Specific supplier requirements — and the policies and procedures that flow from them — ensure that you receive what you want, when you want it, in the quantity you want, and with quality built in.

8. Management procedures can improve poor meetings, poor internal communications, and poor reporting.  Management is really about communication — that’s why improving internal communication benefits the whole company.  One of the best ways to improve communications is to develop, document, implement, and monitor a procedure for communications.

Also, it’s important that management shows its commitment to the highest standards, whether those standards have to do with internal processes or processes that directly involve your customers.

9. You also need compliance procedures to ensure your company conforms to the requirements of various regulations, statutes, and standards.  This is where policies and procedures can help your organization.  Compliance is one of the primary problems solved with policies and procedures.

10. Accounting procedures ensure that you fulfill your fiduciary responsibility to your shareholders.  Accounting is a process to track transactions of items, cash, and information.  Accounting procedures help to ensure consistency, reliability, and accuracy of those transactions, which (in turn) helps to build trust in your financial statements.  What Are the Top Ten Accounting Policies and Procedures?

Prewritten policies and procedures from Bizmanualz help solve many of these common business problems.  The Top Ten Core Business Policies and Procedures you will need can be found in the Bizmanualz CEO Company Policies Procedures Manuals bundle.

Top 10 Business Problems Solved by Policies and Procedures

1. Accounts Receivable procedures, to reduce A/R aging and ensure even cash flow.
2. Sales procedures, to standardize sales pipeline management to ensure consistent sales.
3. Disaster Recovery procedures, to control the response to chaos in an emergency.
4. Human Resources procedures, to ensure non-discriminatory employee hiring and termination.
5. Quality procedures, to improve quality.
6. Customer communications procedures, to collect data from feedback and complaint handling for process improvement.
7. Shipping and receiving procedures, to track materials purchased and sold.
8. Management procedures to improve poor meetings, communications, and reporting.
9. Compliance procedures to conform to regulations, standards, and laws.
10. Accounting procedures, to fulfill your fiduciary responsibility to your shareholders.

What do you think? How quickly could your most urgent problems be solved by implementing effective policies and procedures?

Remember when Ford’s tagline was “Quality Is Job 1″? No? Well, maybe this will jog your memory.

Back in the 1980’s, Ford, GM, Chrysler, and AMC¹ were quickly losing ground to Japanese automakers². Rumors that U.S. auto workers were deliberately sabotaging cars on assembly lines gained traction; these rumors were alleged to have been started to divert attention from the obvious and growing inequities between American and Japanese vehicles.

Fact is, American car buyers were turning away from domestic cars simply because their Asiatic counterparts were cheaper to buy and much cheaper to operate. The bad reputation American cars were saddled with then — a consumer perception of poor quality — persists to this day, even though Toyota — which leapfrogged all American automakers in 2007 to become the world’s #1 vehicle producer precisely because of its reputation for quality — has turned out to be the modern-day emperor with no clothes.  It looks as though quality took a back seat to profits.

Then there’s BP, whose failed wellhead in the Gulf of Mexico “will live in infamy”³, mainly because it appears the company would not spend a little on safety because that might eat into profits. This story has been thoroughly covered in the news, on blogs (including ours), and in company emails.

Now add the computer maker Dell to the list. Dell is now in court for allegedly selling millions of defective computers from 2003-2005 — computers that it supposedly knew were defective — hurting companies that relied on its reputation for quality manufacturing and customer service.

What’s the common thread running through all of these cases? Corporate hubris? Maybe.  A message running throughout these companies that “quality be damned — just get it out fast and make a big profit”? Quite possibly. Is their profit more important to you — the consumer – than a quality product and your satisfaction?

When do we, as consumers, demand that quality be placed before price? It catches up with the producer — eventually — but why wait for the inevitable? Why chase the elusive promise of “newer and better”? (Look at what Apple’s going through with the iPhone 4.)^{4, 5} Also, when do we, as corporate citizens, begin to see that our responsibility to give our customers quality isn’t incompatible with healthy profits?

It’s often said that we get what we deserve. If you think you deserve better, demand — and hold out for — quality.

Notes:

¹ Yes, they were still around, though not for long. AMC was put down for good in 1988.

² Except for body rust; that problem plagued Japanese auto makers for decades. My first two new vehicles were Japanese-made and I logged 18 years and several hundred thousand miles between them. If not for the severe case of “car cancer” they both caught, I believe they would’ve given me 20 or more years, combined.

³ My apologies to the late Franklin D. Roosevelt only.

⁴ http://abcnews.go.com/Technology/apple-iphone-hit-class-action-suit/story?id=11066239.

⁵ http://news.cnet.com/8301-30677_3-20008919-244.html.

Further Reading/Viewing:

1. Enderle, Rob, “Dell and the Cost of Cover-Ups“, IT Business Edge post, 30 Jun 2010.
2. Evans, Joel, “Is Apple Covering Up the Real Problem with Its iPhone?“, ZDNet blog post, 4 July 2010.
3. “Product Recalls“, Back in Black, The Daily Show, 6 July 2010.

I recently posed this question to the “Bizmanualz Policies Procedures Network“, or group, on LinkedIn:

“The same teams (Brasil, Italia, España, Deutschland, etc.) are perennially among the top contenders for the FIFA World Cup. Do you think it’s the personnel or the system that makes these teams consistently great?”

I’d like to know what you think, and why. To me, it’s sort of a “Heredity or environment?” question: it isn’t one or the other. I mean, you could have one or the other and you might do well. However, if you have both good personnel and a good system that optimizes their individual skills and experience and blends them…

Look at some of the great individual performers of all time, in team sports – Pelé, Michael Jordan, Wayne Gretzky, and Babe Ruth. As capable as they were, they didn’t reach the zenith of their respective sports until they were surrounded by other capable people and learned to work as a team, using a system. (I wish I could have John Facenda narrate those last two sentences.)

Strangely, we forget how much their coaches — and the systems they designed and implemented — had to do with their successes. Feola, Jackson, Sather, and Huggins — all devised systems that ensured quality and consistency. Management also scouted well and hired not just talented and hard-working player personnel, but those who understood the “team concept” and put the team ahead of individual accomplishments.

The same is true in business, of course. Some of your employees are undoubtedly star performers but until they have a system that coordinates — meshes – their actions with those of other capable people, and until everyone buys into the concept of “team first”, they’re never going to reach their potential. And as a result, neither will your company.

You have to have a management system that fosters quality, consistency, and ongoing improvement to the system and the people using it. And, you have to have the right players.

By the way, I may as well get a plug in for our LinkedIn policies and procedures group. We’re at http://www.linkedin.com/groups?gid=86367. If you’re not part of our group, or if you haven’t joined LinkedIn yet, consider this your invitation to join us.

I look forward to your comments — here, by email, and on LinkedIn. I’m especially excited when you challenge my “knowledge” or my way of thinking. (Or as they say in my favorite sport, ice hockey, “You wanna go?”)

Let’s get it on!