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Blending policy and procedure with technology. (Technology).

Small companies and large corporations often have more in common than most people realize. Whether it's a mom-and-pop shop that loses a key employee or a huge company coping with frequent turnover, both could benefit from standardized policy and procedure, or "P&P."

Whether the policies and procedures are outlined in a manual stored on a bookshelf or are part of an interactive database on an intranet or website, every company can--and should--embrace the concept of standardizing their policies and procedures. Having a standardized P&P road map not only increases productivity but allows for alignment of a company's vision. The strategy is in some ways similar to employing manufacturing techniques: It helps create a manageable and continuous flow of work.

The primary purpose of standardized policy and procedure is twofold: It should support the company strategy, and it should deliver on the department's mission and vision.

A successful strategy combines tactical knowledge with strong leadership and the solid implementation of policy. Creating a strong tie between strategy and everyday policies and procedures develops the internal support your company needs to become--and remain--successful.

Of course this is true provided employees can see the alignment between the strategy and P&P. If the tie to strategy and P&P is not so clear, more times than not it points toward poorly written or, worse, lack of robust P&P.

As the mission and vision cascade from company leaders through divisions and departments, the alignment between the two must become stronger. Examine the P&P within the departments, and seek out the alignment. If it isn't there, the problem could be poorly written or nonexistent P&P.


One way to show how important it is to have standardized P&P is to examine what happens when you don't have it. The downsides include employee inefficiencies and a steep learning curve.

Imagine trying to accomplish a repetitive task from memory. Most management accountants would argue they are smart enough to remember how to do their daily, monthly, or yearly tasks. But as their manager, you must examine whether or not their time is better spent correcting issues or trying to remember how to complete the complex reconciliations needed just to determine whether there is an issue. Besides, they can use standardized P&P as a great reference guide.

A company that experiences high turnover is also a strong candidate for P&P. As new hires are trained, are their questions of "Why do we do that?" met with "Because that's the way I was told to do it."? If so, well-thought-out P&P presents an opportunity to reduce training costs, speed up transitions, and have your new employees contributing at a "veteran" level in record time.

No business is too large or too small for standardized P&P.

The benefits are clear for the corporate giant experiencing continuous change through promotions, turnover, retirement, and various other issues. Standardized P&P is one key ingredient to reducing the steep learning curve experienced by newly promoted or hired employees.

Now imagine a small company that suddenly loses a key employee who may be the only person who knew how to do a job. You can only imagine the frustration the replacement experiences trying to recover the lost knowledge and rebuild how the work was--or should be--flowing.

Standardized policy and procedure is an excellent benchmark by which the new person can reflect on the current position and reevaluate whether problems exist and whether changes are in order.

A reduction in month-end closings may be on your department's plan, and you can achieve that metric with the aid of standardized P&P for each closing activity, which also gives management a linear view of how the close is performed. By examining each procedure, management can determine whether the activity is or isn't a closing process:

* If it is a closing process, how can we make it more efficient and reduce the effort required?

* If it is not a closing process, can we move it to a more manageable time, streamlining the workflow?

Smoothing out the process improves productivity, lowers overtime, and reduces employee burnout.


With that said, it's time to bring your P&P up to date and into the Technology Age.

While it's helpful to have a P&P manual, it's even more beneficial to have it in an interactive database. Moving policy and procedure from written form to a software database management system can be daunting, especially if the current P&P is in the form of employee memory or poorly written notes.

Several tools and methods are available to bring your P&P up to date. The decision of which to choose should be based on company size, human resources, cost, maintenance, and IT support. Here are just a few you can use that your company probably already has available:

* Microsoft Word, a widely used word processing program.

* Adobe PageMaker, for desktop publishing.

* Lotus Domino.Doc, a knowledge-sharing system that tracks the dissemination of presentations, white papers, and intellectual property.

* Microsoft Access, a database management program.

* Visual FoxPro, for developing Web pages.

These packages, which require some skill to use, can help improve P&P documentation and interactivity. For example, with Access or FoxPro, instead of storing numerical data, you could create forms to store procedural information, then access it from the Web.

Another option is a turnkey package specifically designed for policy and procedure. One such program, ProcedureWRITE from Comprose (, is head and shoulders above its competitors in creating, deploying, and managing P&P. The package is scalable, allowing a small company to enjoy the benefits of a professionally delivered package. If the company grows, the package can grow with it.

It is also well suited for publishing to a company's intranet or the Internet, creating a virtual resource for workers across the office or across the continent. Figure 1 shows how the knowledge database receives content and manages the publication of the documents.

The time and effort saved by using the built-in online tutorial and authoring aids are extremely valuable. The authoring assistance can reduce costly labor and financial resources that would otherwise be spent on professional writers hired to assist with documentation. It benefits both the seasoned and rookie technical writer alike. It can also offer such special features as drop selection for forms, a contact list, frequently asked questions (FAQs), and a feedback form.

System administration can be performed on a laptop or a departmental server. Future enhancements may include forms with workflow capability to speed form routing and approval. The export function from ProcedureWRITE also creates the indexing and menu automatically. See Figure 2.

When it's finished, a simple click can transport you to your policy or procedure. Then all the elements you nee to accomplish the job--including required forms, screen shots, matrixes, tables, maps, flowcharts, and contacts--are just another click away.

The base authoring package begins at less than $1,000. Modules may be added at additional cost for policy and HTML generation to publish to the Web. In my opinion, this is the best tool for the value for a company whose knowledge database is P&P deficient.


Once your organization decides to move its P&P into the technological age, where do you start? As with any successful project implementation, you must have a plan. Success for your policy and procedure project is no different. From my company's experience I've developed some key points to address prior to starting such a proposition at your company. Here is where your project management skills will be most valuable.

At the management level:

* Identify the scope of the project early in the process.

* Identify the team members who will implement the project.

* Gain consensus throughout the organization, including upper management.

* Develop a feasible timeline to complete the project.

* Develop a budget for software.

At the team level:

* Assign a team leader to oversee the project and meet with management.

* Assign individuals responsible for all major areas, i.e., information gathering, project tracking, document review, document approval, Web design, and template design.

* Conduct regular meetings to monitor progress.

* Develop a resolution and escalation plan when issues arise.

* Decide whether a single contact will input the data or whether the entire group will contribute. If you choose a single contact, assign someone to gather P&P for later input. If multiple workers will be inputting data, consider a training plan.

In addition to developing P&P, this may be a good time to examine your standard reports, exceptions, graphs, flowcharts, and other media and bring them up to date.

While policy and procedure is helpful in the accounting/finance arena, it could also benefit other areas of the company such as ISO documentation, human resources, sales, and maintenance. The list is limited only by your needs and imagination.

Standardized policy and procedure is key to any successful company. It's also a good starting point for companies that want to interact with their customers in a consistent fashion. With robust policy and procedure in force, it's much easier for your workforce to resolve customer or internal issues.

No matter how you go about standardizing policy and procedure, the fact that you are fostering an environment to reduce ambiguity will win the allegiance of your customers and the support of your employees.

Bryant L. Caldwell is an asset management specialist for Toyota Motor Manufacturing of North America, Inc., in Erlanger, Ky.
COPYRIGHT 2002 Institute of Management Accountants
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Title Annotation:business software solutions
Author:Caldwell, Bryant L.
Publication:Strategic Finance
Article Type:Evaluation
Geographic Code:1USA
Date:Feb 1, 2002
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