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What Business Policies Does Every Company Need?

Categories
  • Improve Company Governance
Tags
  • business
  • business policies
  • company
  • policies

employment policies

What drives your customer service? Your mission and vision drive your overall company policy, in which you lay out your overall objectives that guide your strategic plan. 

From there come your sales and marketing plans, your operational plans, and so forth. You might think of your policy as a juncture of internal and external forces. Setting business policy is critical to a thriving company. How you use your business policies defines your governance model for your organization. Weak companies have weak governance models. What do we mean by governance?

Company Governance – Not an Afterthought

What is important to your company? Who do your serve? What types of rules, standards, or regulations do you need to enforce? Governance is critical to motivating your employees, answering questions, and defining the future of your organization. We are talking about the business policies every company needs.

A business is run by people and people need to know what the leadership stands for, what the leadership believes in, and what being an employee of the company represents. If you say one thing and do another then will your employee follow you? Will your employees really do what you say?

Ten Important Business PoliciesBusiness Policies

The 10 most important business policies are not just the most popular for every company, but they are also the most critical to your business survival – they are business policies every company needs.

1. Customer Quality Policy

Your customers are the single most important component of your business. Without customers you have no business, no sales, and no cash flow. Defining what is important to your customer is critical. This definition becomes your quality policy.

In your market how do you need to handle: Customer Returns, Answering Phones, or Order Turnaround time? If you have a No Returns policy then you are not very customer friendly. If your customers demand it or your competitors have generous returns policies then you have to have one too. What does you customer need from you?

2. Credit Policy

Accounting Policy Procedure Manual MS-Word Template

Credit Policy is available in the Accounting Manual

Besides your quality policy you should also define your customer credit policy.

For example, the accounts receivable department and the sales department are frequently at odds. Accounts receivable demands tighter credit to collect within 30 days. Sales wants to book sales and not lose customers.

Management must establish clear credit policies to minimize conflict. A good credit policy explains Credit & Payment Terms, how to open New Accounts, and what the criteria is for Collections.

3. Ethics & Conduct Policy

Customers demand more than quality and credit. Your customers also demand ethical dealings, privacy, and security. The people your company deals with expect fair treatment with no Conflicts of Interest. This means you need to establish clear Ethical Conduct at all times. You need an Ethics Policy.

4. Employment Policies

Customers are served by employees. Business must hire employees and therefore develop employment policies that address both business and employee concerns. Employees need to understand how Performance Reviews are conducted, what Work Hours are, and a clear policy on “At Will” & Termination rules. Most employment policies are covered in an employee policy manual or employee handbook.

5. Nondiscrimination Policies

Human Resources HR Policy Procedure Manual

Employee policies are available in the HR Manual

No business can tolerate Sexual Harassment. All business should offer Equal Opportunity Employment–EEO: No Age, sex, race, or cultural bias. And of course clear guidelines on how your business handles situations that include a Handicap, Pregnancy, or overall Diversity. You need a Harassment and Discrimination Policy.

6. Compensation and Benefits Policies

Nondiscrimination Policies explain what not to do, but your employees also want to know what’s in it for them. Yes, what do they get if they follow your business policies. What is your company policy on Holidays, Vacation, and Sick Leave? What are the Benefits like Insurance & Retirement plans. How are Payroll, Bonuses & Pay Raises handled. These issues are handled within your compensation and benefits policies.

7. Internet, Email, & Cyber-security Policy

We are now solidly in the internet age. In this information age we must have company policies on Acceptable Internet Use and a Social Media policy. Can employees use Third Party Software? What is your cyber-security policy on Malware & technical Support? If you have not thought of these things then its time… If you have, then you should have our IT policies and procedures manual.

8. Misconduct Policy

Computer IT Policy Procedure Manual

Internet and cyber-security policies are available in the IT Manual

Unfortunately, your employees will not always follow all the business policies and misconduct happens… Managers and employee will need to know what the Discipline Process is. To respond to employee misconduct, you need a clear discipline policy that explains the process. If there is Theft, Poor Performance, or a Substance Abuse problem. or what is the Appeal and Reinstatement Policy?

9. Purchasing Policy

You now have customer policies and employee policies. What’s next are some internal policies that protect the company. Purchasing policies are needed to clarify Spending Authorizations, authority for Check Signatures, and how Competitive Bids are handled. Your purchasing policy defines the standards for how employees spend company money.

10. Workplace Safety Policy

What business policies are left? A lot more are possible, but I will leave you with one last area. Workplace Safety Policies. In the United States we have Federal (OSHA), State & Local Requirements. A typical company response is to describe Safety Equipment & Clothing or prohibitions against unsafe Attitudes and Horseplay. Workplace safety is no joke. It is the company’s responsibility to provide a safe workplace. Both the employee and the company can get hurt. You need to define your workplace safety procedures to ensure your company and employees are safe.

Developing a good working governance model will motivate employees to higher standards. Your business policies drive home what is important to the company. But most importantly, it is how you communicate, enforce, and use company policy—for good or bad—that sends a message to your employees on how they are supposed to act. These are the business policies every company needs.

Free Sample Business Policies

Download 19 different free policies and procedures to get started on developing your own business policies for your company.

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