How To Write Policies Procedures Bizmanualz Inc

How to Write a
Policies and Procedures

Manual
How to Build Consistency, Reduce Errors, and
Communicate Your Business Processes Using a
Standard Operating Procedures Manual
By Chris Anderson
www.bizmanualz.com
How to Write Policies and Procedures
About Bizmanualz

Bizmanualz is a business publications, training and consulting
Company based in St. Louis, Missouri. We offer policies and
procedures manuals for Accounting, Finance, Computer & Network,
Sales & Marketing, Human Resources, ISO 9001 Quality, ISO 22000
Food Safety, Security Planning, and Disaster Recovery. Bizmanualz
also offers industry‐specific policies and procedures supplements for
Medical Offices, Banking, Software Development, Non Profit
Management and Construction Management. All content is available
as editable Microsoft Word ® files. All products are available via
download at www.bizmanualz.com . Bundled manuals are available
and provide substantial savings over individual manual purchases.

Bizmanualz is also speeding the evolution of SaaS delivered
document control by offering OnPolicy Procedures Management
Software. OnPolicy is designed for ISO 9001 document compliance
and is available with a full library of policies, procedures and forms
for many business departments.
Other Bizmanualz Books

ABR31 Accounting Policies and Procedures Manual ISBN 978‐1‐9315‐9102‐7
ABR42 Finance Policies and Procedures Manual ISBN 978‐1‐9315‐9104‐1
ABR34 IT Policies and Procedures Manual ISBN 978‐1‐9315‐9109‐6
ABR41 Human Resources Policies and Procedures Manual ISBN 978‐1‐9315‐9110‐2
ABR44 Sales & Marketing Policies and Procedures Manual ISBN 978‐1‐9315‐9111‐9
ABR32 Security Planning and Procedures Manual ISBN 978‐1‐9315‐9112‐6
ABR33 Disaster Recovery Planning and Procedures Manual ISBN 978‐1‐9315‐9113‐3
A490 Business Policies and Procedures Sampler ISBN 978‐1‐9315‐9114‐0
ABR211 ISO 9001 Procedures & Quality Manual ISBN 978‐1‐9315‐9141‐6
ABR213 ISO 22000 Food Safety Procedures Manual ISBN 978‐1‐9315‐9143‐0

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Inc. is not engaged in rendering legal, accounting, or other professional
services. Bizmanualz, Inc. cannot in any way guarantee the policies,
procedures, forms and other documents in this website are being used for
the purpose intended and therefore assume no responsibility for their
proper and correct use.

Copyright Notice
Copyright © Bizmanualz, Inc. Reproduction or translation of any part of
the documents available on www.bizmanualz.com beyond that permitted
by section 107 or 108 of the 1976 United States Copyright Act (17 USC
§107‐108) without the permission of the copyright owner is unlawful,
except that forms, agreements, and procedure statements may be
reproduced or modified by the purchaser for use in connection with his or
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further information should be addressed to the Information Requests and
Permissions Department, Bizmanualz, Inc.

Other company and product names mentioned herein are the trademarks
or registered trademarks of their respective owners.

ISBN 978‐1‐9315‐9160‐7
iii
iv
Table of Contents
TABLE OF CONTENTS

v
Table of Contents
TABLE OF CONTENTS.......................................................................................... v
INTRODUCTION ................................................................................................. 1
What is a procedure? ............................................................................................... 2
Procedure Definition ............................................................................................ 2
Compliance Procedures ....................................................................................... 3
Policies and Procedures ....................................................................................... 3
Employee Policy Manual ...................................................................................... 4
So What Is a Procedure? ...................................................................................... 5
Scope of this Book ................................................................................................ 5
CHAPTER 1 Building an Effective Management System with Procedures ........ 7
Evaluating Business Success ..................................................................................... 8
Policies and Procedures Are Your Business Success ............................................ 8
What are Procedures For? ................................................................................. 10
Procedures Are For Managers ........................................................................... 11
Five Phases to Building an Effective Management System ................................... 12
1. Discovery ........................................................................................................ 13
2. Planning ......................................................................................................... 15
3. Development ................................................................................................. 16
4. Implementation ............................................................................................. 17
5. Re‐Discovery .................................................................................................. 17
CHAPTER 2 Standard Operating Procedure (SOP) .......................................... 19
Standard Procedures .............................................................................................. 20
The Difference between Policies and Procedures ............................................. 20
Work Instructions ................................................................................................... 22
A Procedure for Making Dinner ......................................................................... 23
Procedure Users ................................................................................................. 24
Work Instructions for Making Dinner ................................................................ 24
Work Instruction Users ...................................................................................... 25
Procedure Details ............................................................................................... 25
Documentation Pyramid ........................................................................................ 26
Level 1 – Policies ................................................................................................ 26
Level 2 – Procedures or Processes ..................................................................... 26
Level 3 – Work Instructions ............................................................................... 27
Level 4 – Forms/Records .................................................................................... 28
The Need Policies and Procedures ......................................................................... 28
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Table of Contents
Compliance ......................................................................................................... 29
Operational Needs ............................................................................................. 30
Managing Risks ................................................................................................... 31
Continuous Improvement .................................................................................. 31
Why People Don’t Follow Procedures .................................................................... 32
Out of Date ......................................................................................................... 33
Hard to Find ........................................................................................................ 33
Too Simple .......................................................................................................... 33
Poorly Written or Designed ................................................................................ 33
Too Long ............................................................................................................. 34
Why Policies are Unenforceable ............................................................................ 34
Written for Problems That Don’t Exist ............................................................... 35
Employees Are Unaware a Policy Exists ............................................................. 35
Difficult to Understand ....................................................................................... 35
Unclear Who Owns the Policy ............................................................................ 36
Policy Enforcement Responsibility Unclear ........................................................ 36
Consequences of Violation Are Unclear ............................................................. 36
People Don’t Believe in the Policy ...................................................................... 36
CHAPTER 3 Identifying Your Processes ........................................................... 39
Processes and Procedures ...................................................................................... 40
Types of Processes .................................................................................................. 42
Ballistic Processes ............................................................................................... 42
Controlled Processes .......................................................................................... 42
Adaptive Processes ............................................................................................. 43
Core Process Flows ................................................................................................. 44
Cash Flows .......................................................................................................... 45
Manufacturing Flows .......................................................................................... 46
Design Flows ....................................................................................................... 47
Top Ten Business Processes ................................................................................... 48
CHAPTER 4 Mapping Your Processes ............................................................. 51
Understanding Process Maps ................................................................................. 52
Types of Process Maps ........................................................................................... 53
SIPOC .................................................................................................................. 53
PDCA ....................................................................................................................... 54
Document Your “Plan” ....................................................................................... 54
Using Your Plan Is “Do” ...................................................................................... 54
“Check” Your Plan .............................................................................................. 55
vii
“Act” On Your Results ........................................................................................ 55
Plan‐Do‐Check‐Act in Action .............................................................................. 56
Process Mapping .................................................................................................... 58
High‐Level Process Map ..................................................................................... 58
Low‐Level Process Map ...................................................................................... 60
Cross Functional/Swim Lane Process Map ........................................................ 61
Document Map .................................................................................................. 63
Activity/Value Stream Map ................................................................................ 65
Workflow Diagram ............................................................................................. 67
Rendered Process Map ...................................................................................... 69
Choosing a Process Map .................................................................................... 70
CHAPTER 5 Turning Your Processes into Procedures .................................... 71
Formatting Your Procedures .................................................................................. 72
Control Block ...................................................................................................... 75
Header and Footer ............................................................................................. 78
Procedure Metadata .......................................................................................... 78
Procedure Steps ................................................................................................. 80
Effectiveness Criteria ......................................................................................... 80
References ......................................................................................................... 81
Records .............................................................................................................. 81
Revision History ................................................................................................. 81
Working with Microsoft Word ............................................................................... 81
Margins .............................................................................................................. 82
Header ............................................................................................................... 83
Footer ................................................................................................................. 85
Control Block ...................................................................................................... 92
Procedure Metadata .......................................................................................... 96
Procedure Steps ................................................................................................. 99
Revision History Table ...................................................................................... 102
CHAPTER 6 Writing and Reviewing Your Policies ......................................... 103
Policy Review Process .......................................................................................... 104
Objectives ........................................................................................................ 104
Policy Achieved? .............................................................................................. 104
Feedback .......................................................................................................... 105
Fixing Bad Policies ................................................................................................ 106
Describe the Policy Problem ............................................................................ 107
Find the Policy’s Root Cause ............................................................................ 107
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Table of Contents
Summarize Policy Actions ................................................................................ 107
Identify Policy Roles and Responsibilities ........................................................ 108
Develop a Draft Policy ...................................................................................... 108
Review and Revise the New Policy ................................................................... 108
Writing Policies from Scratch ............................................................................... 109
Company Rules ................................................................................................. 109
A Policy in a Procedure ..................................................................................... 109
CHAPTER 7 Writing Your Procedures ............................................................ 111
Communication and Addressing Your Audience .................................................. 112
Active Verbs ...................................................................................................... 113
Active Voice ...................................................................................................... 114
Sexism in Writing .............................................................................................. 114
Organizing Your Thoughts .................................................................................... 115
Rule of Seven .................................................................................................... 115
Number Usage .................................................................................................. 120
Reviewing and Approving Procedures .................................................................. 120
Seven ‘C’s of Procedure Review ....................................................................... 121
Procedure Approval Process ............................................................................ 125
CHAPTER 8 Creating Your Policies and Procedures Manual ........................ 127
Why a Policies and Procedures Manual? ............................................................. 128
Distribution of the Manual ............................................................................... 129
Content of the Manual ..................................................................................... 129
Defining the Format of Your Manual .................................................................... 131
Design Features ................................................................................................ 132
Style and Mechanics ......................................................................................... 133
Manual Organization ............................................................................................ 134
Foreword .......................................................................................................... 134
Table of Contents ............................................................................................. 134
Policy and Procedure Statements .................................................................... 135
Optional Sections ............................................................................................. 135
Index ................................................................................................................. 136
Revising and Updating Policies/Procedures ......................................................... 137
CHAPTER 9 Automating Your Policies and Procedures ................................ 139
Controlling Your Procedures ................................................................................ 140
Document Control ............................................................................................ 140
Record Control ................................................................................................. 140
File Control ....................................................................................................... 141
ix
Why Invest in Document Management Software? .............................................. 142
Security ............................................................................................................ 142
Savings ............................................................................................................. 142
Efficiency .......................................................................................................... 143
Compliance ...................................................................................................... 143
Difference between Procedure Management and Document Management
Software ............................................................................................................... 143
Workflow ......................................................................................................... 144
Bizmanualz OnPolicy Software ............................................................................. 147
OnPolicy Features ............................................................................................ 148
Benefits of OnPolicy ......................................................................................... 149
A Closer Look at OnPolicy .................................................................................... 149
Home Screen .................................................................................................... 149
Documents Screen ........................................................................................... 151
Documents Details ........................................................................................... 152
Stages of Workflow .......................................................................................... 154
Reader View ..................................................................................................... 154
Appendix A Sample Procedure ..................................................................... 155
IT Project Management Procedure ITSW102 ....................................................... 155
Appendix B Job Descriptions ......................................................................... 161
WRITING JOB DESCRIPTIONS ............................................................................... 161
Purpose ............................................................................................................ 161
SCOPE ............................................................................................................... 162
Written Communication ...................................................................................... 163
Non‐discriminatory language........................................................................... 163
Active voice ...................................................................................................... 164
Action verbs ..................................................................................................... 165
Plain English ..................................................................................................... 165
Brevity .............................................................................................................. 165
FORMAT AND CONTENT ...................................................................................... 166
Job Title ............................................................................................................ 166
Effective Date ................................................................................................... 166
Department ...................................................................................................... 166
Summary of Functions ..................................................................................... 166
ESSENTIAL DUTIES AND RESPONSIBILITIES .......................................................... 167
Group Several Tasks into a Single Responsibility ............................................. 168
Writing results‐oriented job statements ......................................................... 169
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Table of Contents
Responsibility Statements ................................................................................ 169
Delegated Responsibilities ............................................................................... 170
Organizational Relationships ............................................................................ 170
Reporting Relationships ................................................................................... 171
The Organization’s Environment ...................................................................... 171
QUALIFICATIONS................................................................................................... 172
Mandatory requirements ................................................................................. 172
Key selection criteria ........................................................................................ 173
Developing Selection Criteria ........................................................................... 174
PHYSICAL DEMANDS ............................................................................................. 175
WORK ENVIRONMENT .......................................................................................... 176
Americans with Disabilities Act (ADA) .............................................................. 177
Job Performance .............................................................................................. 177
Section 503 of the Rehabilitation Act of 1973 ................................................. 178
Job Descriptions ............................................................................................... 179
Reasonable Accommodation............................................................................ 179
Accessibility ...................................................................................................... 181
Sample Job Descriptions ....................................................................................... 181
INDEX ............................................................................................................ 189
ABOUT THE AUTHOR ........................................................................................ 191

Table of Figures

Figure 1 Policy Deployment Process ............................................................................ 2
Figure 2 Process Procedures Journey Workflow .......................................................... 6
Figure 3 Dinner Process Steps .................................................................................... 24
Figure 4 Document Pyramid ....................................................................................... 27
Figure 5 Process Procedures Relationship Chart ........................................................ 40
Figure 6 Revenue Process ........................................................................................... 41
Figure 7 Three Core Process Flows ............................................................................. 45
Figure 8 Diminishing Returns Curve ........................................................................... 48
Figure 9 Ten Core Processes ....................................................................................... 50
Figure 10 SIPOC Diagram ............................................................................................ 53
Figure 11 PDCA Cycle .................................................................................................. 54
Figure 12 PDCA Process Approach ............................................................................. 56
xi
Figure 13 Process Map Symbols ................................................................................ 58
Figure 14 Order to Cash Process Map ........................................................................ 59
Figure 15 Credit Approval Flowchart ......................................................................... 61
Figure 16 Credit Approval Swim Lane ........................................................................ 63
Figure 17 Credit Approval Document Map ................................................................ 65
Figure 18 Credit Approval Activity Map ..................................................................... 67
Figure 19 Credit Approval Workflow Diagram ........................................................... 68
Figure 20 Rendered Process Map .............................................................................. 69
Figure 22 Procedure Format ...................................................................................... 73
Figure 23 Procedure Format pg2 ............................................................................... 74
Figure 24 Control Block .............................................................................................. 75
Figure 25 Procedure Header ...................................................................................... 78
Figure 26 Procedure Footer ....................................................................................... 78
Figure 28 Procedure Metadata .................................................................................. 79
Figure 29 MS Word Margins Menu ............................................................................ 82
Figure 30 MS Word Page Setup ................................................................................. 83
Figure 31 MS Word Header drop down ..................................................................... 84
Figure 32 MS Word Border dropdown ...................................................................... 85
Figure 33 MS Word Footer Dropdown....................................................................... 86
Figure 34 MS Word Footer Design ............................................................................. 87
Figure 35 MS Word Quick Parts dropdown ............................................................... 88
Figure 36 MS Word Field Names ............................................................................... 89
Figure 37 MS Word NumPages .................................................................................. 90
Figure 38 MS Word Border Dropdown ...................................................................... 91
Figure 39 MS Word Table Dropdown ........................................................................ 92
Figure 40 MS Word Table Tools ................................................................................. 93
Figure 41 MS Word Tables ......................................................................................... 94
Figure 42 MS Word Cell Height .................................................................................. 95
Figure 43 Document Control Block ............................................................................ 96
Figure 44 Procedure Metadata .................................................................................. 97
Figure 45 MS Word Table Borders ............................................................................. 98
Figure 46 MS Word Styles .......................................................................................... 99
Figure 47 MS Word Create Style ................................................................................ 99
Figure 48 MS Word Style Formatting ....................................................................... 100
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Table of Contents
Figure 49 MS Word Style Font .................................................................................. 100
Figure 50 Procedure Outline .................................................................................... 101
Figure 51 Procedure Revision History ...................................................................... 102
Figure 52 Primary Procedure Steps .......................................................................... 117
Figure 53 Secondary Procedure Steps ...................................................................... 117
Figure 54 Making Coffee Procedure ......................................................................... 118
Figure 55 PDCA Procedure Format ........................................................................... 119
Figure 56 Review and Approve Workflow ................................................................ 145
Figure 57 Release Workflow ..................................................................................... 146
Figure 58 Document Compliance Workflow ............................................................ 147
Figure 59 OnPolicy Home Screen ............................................................................. 150
Figure 60 Documents Tab ......................................................................................... 151
Figure 61 Documents Screen .................................................................................... 152
Figure 62 View Documents ....................................................................................... 153
Figure 63 Edit Document .......................................................................................... 153
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xiv
Introduction
INTRODUCTION
1

Figure 1 Policy Deployment Process
What is a procedure?
A “procedure” is a term used in a variety of industries to define a series of steps,
taken together, to achieve a desired result.
Figure 1 shows where procedures fit in the deployment of a company’s

strategy. Procedures explain how to accomplish a task, realize a policy, and help
the company achieve its strategy. A procedure is sometimes called a work
instruction. If you are preparing an ISO 9001 quality management system, then
the term procedure is used to describe a process, whereas a work instruction is
used to describe something more basic like a specific step in a process. For
example, how to fill out a form. Procedures are known in other ways too.
Procedure Definition
A procedure is a series of steps, taken together, to achieve a desired result. It
is a particular way of accomplishing something as in a repetitive approach,
process or cycle to accomplish an end result. To make an effective process
procedure we need to ensure that each repetition of the process has the ability
to achieve the desired or planned results.
2
Introduction
You may hear people ask about the SOP for purchasing new equipment. In this
context an SOP is a Standard Operating Procedure (SOP). In other words, what
are the steps for purchasing new equipment? These steps could be a checklist
or ordered list, which we may also call a Work Instruction. These steps may
include effectiveness criteria or controls to ensure the process is effective.
Can you purchase anything you want or are there controls like a budget, quality
standards, approved vendors, or engineering specifications? Customers of the
Purchasing Procedure are entitled to consistent service delivery based on
established and accepted procedures—not on any one worker’s personal
values, and not varying from one geographic area to another.
Compliance Procedures
Procedures are required by compliance standards such as ISO in quality,
Sarbanes-Oxley for public company accounting, or the Joint Commission in
healthcare. We also use procedures to train new employees on a process in
order to obtain more consistent results. Procedures are used to document
company knowledge to ensure important information is retained. We also use
procedures in process improvement to document the future state of a process
after we improve it so that we may communicate the new steps to others.
Over time, procedures improve and evolve into “best practices”. Sometimes
these are called Good Manufacturing Practices or GMP for short. A GMP is an
SOP that has evolved into a best practice. The medical device and
pharmaceutical manufacturing industry refers to a procedure as a GMP in their
quality system.

Procedures are often associated with or supported by other documents like
policies. What’s the difference between a policy and a procedure? The policy is
the goal statement and the procedure is the description of how to achieve the
goal. So basically, every procedure should be associated with a policy.
3
Other procedure supporting documents may include:
 Process Maps
 Business Manuals
 Job Descriptions
 Reports, Forms, and Checklists
 Business Objectives
 FMEA, Control Plans, Quality Plans
Employee Policy Manual

If you are writing a company manual or employee handbook, you will define
policies necessary to comply with various laws and regulations as well as your
own company standards. These employee manuals include policies and
sometimes also include procedures too.
As you grow you will require more than an Employee Handbook. Your
Employee Manual will grow into a full business manual. Keep growing and each
individual department will write their own policies and procedures manual.
Larger company’s write online policies and procedures because it is easier to
communicate them to all employees at once.
Bizmanualz produces a full range of easily editable Microsoft Word templates

covering your most important business departments:
 Accounting Policies for controlling assets

 Financial Procedures for managing cash
 Computer & IT Procedures for maintaining networks
 Sales & Marketing Plans for growing revenues
 Human Resources Policies to minimize employee liabilities
 Security Planning and Disaster Recovery to prepare for emergencies
 ISO 9001 Quality Manuals for customer satisfaction
 Policies and Procedures Supplements for industries
4
Introduction
So What Is a Procedure?
By now, I hope we have answered “what is procedure.” A procedure is a way
that you achieve consistent results. Procedures can be called a Standard
Operating Procedure, SOP, GMP, work instruction or a best practice.
Procedures are often required for compliance.
Your Workers will have greater confidence that their actions are supported by
management, underlying statutes and regulations by following established
procedures.
Your customers are entitled to consistent service delivery based on established

and accepted procedures—not on any one worker’s personal values and not
varying from one geographic area to another.
Your stakeholders pay for the mistakes, errors, or failures that result from
inconsistent performance to established procedures.
Procedures are helpful for training and procedures help to retain important
information. If your company desires greater consistency, improved customer
satisfaction, or better compliance then you will want to put policies and
procedures in place.
Scope of this Book

The rest of this book will explain how to put procedures in place. We will follow
the process procedures journey (figure 2). First, we will look where procedures
fit in within the context of the whole management system. Next, we will look at
the building blocks of your procedures, your processes and how to map them
out.
5
Figure 2 Process Procedures Journey Workflow
This is followed by how to turn your processes into procedures with tips on
how to make your procedures more useful. Lastly, we will end with putting
procedures together in a manual or online. We will cover the entire process
procedures workflow.
6
1. Building an Effective Management System with Procedures
CHAPTER 1
Building an Effective Management
System with Procedures
“All works of art should begin...at the end.” -- Edgar Allan Poe
7
Evaluating Business Success

Where does business success come from? Are great quarterbacks born as great
football players or did they have to learn how to play football? Great players
practice all week for the game on Sunday. But what do they practice? They are
already great. They practices plays – football procedures. In business,
employees are expected to perform their job all day long. But how much time
is allocated to practicing their job?
In football, teams have a playbook defining, step-by-step, every player's job on

every play. The team practices every play until it is executed correctly. Does
your company have a playbook or business manual? With step-by-step
procedures, job descriptions, reports and forms for every job? Does every
employee know exactly what is expected from them for the company to
succeed and keep its customers happy?
All large organizations have a playbook or business manual. Is that how they
got large? They standardize business processes to eliminate inefficiencies. They
find the plays that work and use them over and over to succeed.
Let's take sales – do your salespeople have a quota to fill? Do they have call
sheets to complete, month-end status reports, 30-60-90 day forecasts? What
about the rest of your company? Every employee needs the same detailed
process to be successful. Yet having clearly defined policies and procedures is
often an afterthought to starting a business.
Policies and Procedures Are Your Business Success

Policies and procedures are your business. Return policies, credit procedures,
sales and service policies, policies on vacation, healthcare, and sick leave.
Policies, documented or not, communicate your strategy, vision, and
understanding of the market to your employees and customers. It's not what
you say, it's what you do that is the essence of your company.
8
How many points could your team score if there was no playbook and positions
were not clearly defined? How would you communicate in the huddle what you
wanted to get done? Chaos would develop and the team that was better
organized would win.
If you are a manager of a group of people then you basically have two ways of
using procedures – either you are using them to drive consistency and
improvement or you’re not. If you are a manager that is not using procedures
then you are probably the type of manager that believes that everyone is doing
the best they can or at least you believe your employees when they say they
are doing the best they can.
How can anyone respond any better to all the daily interruptions, machine
breakdowns, supplier delays, and mistakes that “other” people make? Everyone
is doing the best they can under the circumstances. If this sounds familiar, then
you are like many managers practicing “fire drill management” focused on
putting out one fire after another, every day.
If you have not planned out the work then employees have no plan to follow
leaving them to get pulled in any direction to solve any problem that arises.
Orders have to get out so you have to solve the immediate problem, right? If
you do not have a daily plan with clear work standards defined, then how do
you know that anyone is doing the best they can?
For example, most companies measure On Time Delivery (OTD), or at least

should measure OTD. If your measure of OTD is less than 100% then your
people are not doing the best they can. The goal is 100% On Time! Anything
less is not the best, the best is 100% period. So do you have a plan for how to
get all orders out on time? What about a plan for how to prevent daily
interruptions, machine breakdowns, supplier delays, and mistakes that “other”
people make. Do you have a set of procedures that define the standard work
required to ensure that orders get out the door 100% on time?
9
What are Procedures For?

Some think that compliance requires management procedures or they are for
training to show new employees how a job is done. Some regulations like
Sarbanes Oxley require procedures to control risks and some organizations like
Toyota use procedures to document the current state for continuous
improvement.
Some common reasons to have procedures are:
1. Compliance
2. Operational Needs (i.e. consistency)
3. Manage Risks
4. Continuous Improvement
What do these four have in common?
 Compliance means the government or some standards body has

stepped into the market because some type of failure has occurred and
the authorities believe they need to get involved because it is not
getting fixed.
 Operational Needs means failures are costing the organization too
much money so it needs to get fixed.
 Manage Risks means that the potential or severity for failure is too high
so the risks needs to be managed or fixed.
 Continuous Improvement means that there is a good business case to
lower costs/increase profits, or increase market share by fixing the
current state.
Procedures are about fixing problems. Sure they provide compliance, can help
in training, they do reduce risks if used correctly, and they are great for
continuous improvement, but the real reason you need procedures is because
they fix problems. They make problems go away and if problems go away then
they reduce your cost of doing business.
10
Procedures Are For Managers

Mangers use procedures to reduce problems in the workflow to ensure that
people are not making the same mistakes. As a manager, if you are not using
procedures, then is consistency important to you?
Mangers also use procedures to ensure that preventive maintenance is

occurring regularly to stop machine breakdowns, that suppliers are selected
and managed to stop supplier delays, and other managers are also using
procedures to mistake-proof work to ensure that “other” people are not
making mistakes.
Procedures are for managers. Yes employees use procedures too, but it is the
manager or supervisor that must ensure procedures are correctly being used
and followed.
For example, let’s say we have a machine breakdown that is causing today’s fire
drill. Then the management response should be to ask:
 Why is this machine breaking down?

 When was the last time it was serviced?
 Do we have a lot of unplanned maintenance occurring?
 What does the preventive management procedure say about this?
 How effective is our preventive maintenance?
Management’s job is to ask questions and hold maintenance accountable to

its work standards, procedures, targets and goals. If the goals are not
preventing machine breakdowns, then change the goals and do more
preventive maintenance. If workers cannot perform to the standard then train
them. If the tools are insufficient, or there are not enough maintenance people
then change the budget, buy new machines that require less maintenance, or
consider another action.
11
That is what managers do inside the management loop. They see that work
standards are developed to accomplish the job, they ensure they are
documented into procedures, they allocate resources to achieve the work
standards, and then they follow up to ensure that planned work standard
results are achieved. The procedures are there to communicate what
management needs – 100% on time delivery – and how management has
planned out the achievement of the work standards.
Management procedures do not represent a onetime event where

management sits down and develops perfect work standards. Procedures are
meant to be dynamic and change in order to adapt to the environment,
competition, changing customer needs, or varying workforce competence. In
other words, circumstances change and so should your procedures.
The goal is continuous improvement, not perfection. Management does not

have to always be right to be good. Management just needs to take actions
that achieve planned results. Improvements happen as a result of iterations of
the management loop. Procedures are the foundation to an effective
management system.
Five Phases to Building an Effective Management

System
Now that you understand your organization's stated and unstated goals, then
you can start creating effective management systems to fulfill them. Rarely do
good things just happen by chance, and lack of a plan usually results in wasted
efforts and poor results.
Oftentimes, when a company attempts to establish an Effective Management

System for the first time, it takes longer than expected, involves more people
than planned, and grows in complexity. To control this trend, it helps to divide
the process into five (5) distinct phases, each with clear objectives:
12
1. Discovery
2. Planning
3. Development
4. Implementation
5. Re-Discovery
1. Discovery
Discovery is where the overall missions and goals are set, with clear
effectiveness criteria established. Each part of your organization must have
meaningful and measurable performance criteria mapped out in this phase of
building an effective management system.
Establishing objectives and criteria requires close scrutiny by management of

what really contributes to the overall company mission. Departmental goals
must be aligned with company goals.
Goals should be set throughout the business: with high level goals set by top
management, and then goals set within each department or segment (design,
sales, customer service, production, shipping, and so on). These goals should
align directly with, and ultimately lead to, fulfilling the high level goals. Then
goals can be set for groups or individuals within the department that align with
and fulfill department goals.
Departments and groups can develop additional goals outside of those that
connect directly to higher level goals, but it is important to focus on what is
important; you don't want to overwhelm your team. The key, however, is to set
goals that ultimately fulfill organizational goals. This is an important element in
having different parts of an organization pulling together toward common
purposes.
After setting a general goal, specific objectives are then established that guide
activities and provide metrics to know whether or not you are reaching your
goal. So if the goal is to introduce new products, objectives state more
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specifically what you need to accomplish. Objectives must be set considering

the needs of the organization, its capabilities, etc.
You may be familiar with the acronym SMART in terms of objectives, but let's
review what it means:
S - Specific: Very unambiguous, explicit targets

M -Measurable: Performance can be measured to compare with targets
A - Attainable: The capability is there to reach the targets
R - Relevant: Relates specifically to stated goal
T - Time based: Expressed or measured during a specific time period
So, if the goal is to introduce new products, the SMART objective might be to
introduce two new products in the coming year. It is specific and we can
measure how well we perform. This specific number should be set given the
organization's needs and capabilities, so it is reachable. It also relates directly
to the new product goal, and it is over one year's time. So this objective meets
the SMART criteria.
This process not only focuses the attention of the organization on high priority
activities, but it also creates metrics that can be measured and monitored in
order to see how well the organization is performing. It assists in creating
"dashboard" systems that displays performance, and allows managers to
recognize when things get off-track in time to make appropriate corrections.
For example, if half the year is gone and the design department has not made
one new prototype, then the goal of two new products each year is in danger
if corrective action is not taken.
In your discovery phase, once your objectives and effectiveness criteria are
agreed upon, you can create your action plan. This step is simply the broad
roadmap covering the remaining four (4) phases of building your management
14
system. The Discovery Phase generally takes from 2-4 weeks, and represents
approximately 12% of the total process.
2. Planning
Inadequate project planning can result in waste, delays and a shoddy end-
product. Building an effective management system is highly dependent on
executing a strong planning phase. Your firm must avoid moving too quickly
into the actual development phase of writing procedures that are the basis of
an effective management system.
The first step is typically called a GAP Analysis, or Business Assessment, because
it articulates what the "gap" between current reality in your organization and
your stated objectives. Recall that the objectives and measurable effectiveness
criteria were established in the discovery phase.
The results of the Gap Analysis are used as inputs to produce a project plan for
what procedures will be needed, updated, or discarded as obsolete. The Project
Plan details the materials and tools that will help management control the
project as well set budgets and schedules. Your project planning phase includes
producing these components that will greatly ease the Development and
Implementation phases and make for an overall solid structure.
Planning phase outputs include:
 Project roles and responsibilities

 Organization chart
 Activities, resources, dates
 Reviews structure
 Status reports
 Document control and format
 Process map
 Compliance requirements
 Training, implementation, testing and audit plans
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Before concluding the Planning Phase, a review is conducted of each

component with emphasis on the process map and effectiveness criteria to
ensure alignment with identified organizational goals. This check will help
eliminate project drift in the coming phases. The Planning Phase could take
from 2-4 weeks, and leads us to the Development phase.
3. Development
Your effort to build an effective management system requires a skilled Project
Manager. The role is especially critical in the Development Phase because it is
during this stage that the time, effort and expense of the entire project cost is
involved, and it can consume up to 50% of your project cost.
Your firm will want to conduct the Development Phase by organizing related
processes into a grouping and then completing these before going on to the
next set. Your development work will begin by establishing a policy and
procedures document control flow and format. Next, your assigned writers will
craft the actual documents from base materials. Document control is best
managed using an online procedure management software product.
Then, a process walk through is performed and tested for compliance and
effectiveness. Once this process grouping is completed, you move on to
another set. Throughout this process, you'll rely on valuable support
documents such as job descriptions, forms, technical manuals, training
programs and reference material to develop your new management system.
Be sure to complete the process documentation and a review of all your

processes as a completed system before moving on to the next phase. The
Development Phase should take 2-4 months, depending on the number of
processes, compliance requirements and skills of the writers/reviewers. Now
you're ready to put your effective management system into the action.
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4. Implementation
Implementation is all about information and assessment. You must be

educated, indoctrinated, tested, and graded in the ways of your management
system in order to graduate to effectiveness. The first step is a preliminary
assessment to see exactly where the focus of your improvement efforts will
need to be. This assessment of your employees' skills and competencies will
help determine the training gaps your people need to close.
Your training program will introduce your employees to the job descriptions,
processes, and procedures that compose the management system. Just as
importantly, your employees must be trained on the relationships between
themselves and your objectives and effectiveness. Then, a top-to-bottom audit
should be conducted of your entire system against your objectives and
compliance requirements.
You are working toward a stable system, and it will take time. Roughly 50% of
the project's total time, in fact; implementation usually takes 3-6 months to
complete. The exact amount of time you'll spend will depend on how many
employees, locations, and processes you have.
5. Re-Discovery
The Re-Discovery Phase completes the loop of the entire project, and then
overlaps with the Discovery Phase of the next year. Therein lies the "never-
ending cycle" of the project. The Re-Discovery Phase allows your organization
to migrate from a "fix it and done!" mentality to one of continuous
improvement because you will always be reviewing and assessing your
organization for ways to improve performance, compliance, and effectiveness.
When we pass down a street for the first time, our minds are focused on
reaching the destination. Upon returning, we are able to notice things that were
17
previously missed. Returning allows us to go through the same path of the

original Discovery Phase in this different light.
This will involve reviewing audit results, process measures, and customer
satisfaction to determine possible adjustments to the mission, objectives and
action plans as well as effectiveness criteria. You will want to assess the
appropriateness of these elements now that you have completed your
"outbound journey" through the Planning, Development and Implementation
Phases.
The Re-Discovery Phase culminates a project that started 6-12 months ago. As
in all phases, it is wise to identify a Project Leader to manage document
controls, lead the audits, and report to management. After all, your project goal
is to build effective management systems.
We’ve established that well-defined processes and procedures are the key to
an effective management system. The following chapters will explain how to
create them to ensure the success of your organization.

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2. Standard Operating Procedure (SOP)
CHAPTER 2
Standard Operating Procedure
(SOP)
“We learn from history that we do not learn from history.” ‐‐ Georg Hegel
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Standard Procedures
We’ve learned that procedures are critical to running a business effectively. So,
what exactly is a procedure? A "procedure" is a term used in a variety of
industries to define a series of steps, taken together, to achieve a desired result.
Procedures explain how to accomplish a task.
Procedures are used to document company knowledge to ensure important

information is retained. We also use procedures in process improvement to
document the future state of a process after we improve it so that we may
communicate the new steps to others. Over time, procedures improve and
evolve into "best practices."
A Standard Operating Procedure is just that, a standard. An important aspect

of any quality system is to work according to clear-cut Standard Operating
Procedures (SOPs). An SOP is a policy and procedure document which
describes the regular recurring activities appropriate to quality operations. If it
is Critical To Quality (CTQ) than it is a candidate for a standard operating
procedure. Consistency is the goal or purpose of an SOP, to carry out all
operations correctly and always in the same manner.
It is essential to have a written method of controlling a practice in accordance

with predetermined specifications to obtain a desired outcome. SOPs can be
applicable to many different departments: good manufacturing practices
(GMP), plant safety routines, and financial controls to secure assets, or IT
security measures that employees are to follow. SOPs are step by step
procedures on how to do an activity that is critical to quality, critical to safe
operations, or critical to security.
The Difference between Policies and Procedures

We’ve mentioned procedures, but what about policies? You may hear these
terms used frequently, and often interchangeably, but they are in fact different.
20
As stated before, a procedure is a particular way of accomplishing something.

It should be designed as a series of steps to be followed as a consistent and
repetitive approach or cycle to accomplish an end result.
Procedures provide a platform for implementing the consistency needed to

decrease process variation, which increases procedure control. Decreasing
process variation is how we eliminate waste and increase performance. To
better understand what a procedure looks like, see the example below.
Example Accounts Receivable Procedure:

1. Send the first notice-invoice immediately (same day) as the sale.
2. Produce a receivables aging report.
3. Send a second notice to all invoices outstanding for 30 days.
4. Call all invoices outstanding for 45 days.
5. Send a third notice to all invoices outstanding for 60 days.
6. Call all invoices outstanding for 75 days.
7. Send all invoices outstanding for 90 days to collections.
A procedure could be something as simple as a checklist. The goal of a

procedure is to provide consistency. Using simple checklists is the easiest way
to begin to get consistency in your business.
On the other hand, a policy is a guiding principle used to set direction in an

organization. It can be a course of action to guide and influence decisions. It
should be used as a guide to decision making under a given set of
circumstances within the framework of objectives, goals and management
philosophies as determined by senior management. But is it?
There are really two types of policies. The first are rules frequently used as
employee policies. An employee policy is a business rule that guides your
employee’s conduct and is included in your Employee Handbook. This includes
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things like no smoking, no drinking, and other business practices like dress
codes, vacation policy, or your company's codes of conduct. Clearly, employee
policies are human resource policies about your office rules used to support
your management philosophies.
Employee policies are used to set a standard for projecting your company
image or to communicate regulations that apply to all personnel. What kind of
image are you projecting as a company? They typically come from top
management as a result of interpreting the company mission and vision
statements, laws and regulations, or industry standards and practices.
The second type of policies are mini-mission statements frequently associated

with procedures. A policy in a procedure acts as a mini-mission statement
containing the customer of the policy, it's purpose, and a key performance
indicator (KPI) to communicate how users know the procedure is working.
Example Accounts Receivable Policy:
Accounts Receivable personnel shall ensure that all outstanding

customer invoices are paid in a timely manner.
So, what’s the difference? A policy is a guiding principle used to set direction
in an organization. A procedure is a series of steps to be followed as a
consistent and repetitive approach to accomplish an end result. Together they
are used to empower the people responsible for a process with the direction
and consistency they need for successful process improvement.
Work Instructions
Many people also confuse procedures and work instructions. In fact, most
people write work instructions and call them procedures. Knowing the
difference between procedures and work instructions can help you understand
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the documentation process much better and, therefore, develop great

procedure documentation.
Procedures represent your repeatable processes, while work instructions are

made up of the details depending on what’s repeating. An expert, one who has
used this process thousands of times, may not require a written procedure or
work instruction, while a new person will find such process documentation
immensely helpful. Let’s look at a simple example.
A Procedure for Making Dinner

Every night, most people have dinner. So the process of making dinner repeats,
nightly. But, have you thought about what the dinner process looks like? Figure
3 Dinner Process Steps is a basic dinner process, based on the PDCA model. It
consists of planning (P) the meal (perhaps based on the supplies available),
doing (D) or making the meal, checking (C) the results (perhaps you ask the
eaters what they thought of the meal), and then adjusting (A) the process for
the next time you make dinner or that meal.
Dinner may look different at every person’s house. Some expect dinner to
always be at the same time, some want a lot of menu variety, and some may
want it to be variable and as needed with no set time. But even with excessive
variability, you may expect some staples to be in the house so you can cook
something up as needed. So what are these staples?
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Figure 3 Dinner Process Steps
This dinner process repeats every night. A procedure for making dinner is at a
higher level. It should describe the important information for repeating the
dinner process and ensuring that your dinners are consistently made, meet
your expectations (i.e. timeliness, quality), and improve over time.
Procedure Users
Process documentation like this is written for the semi-experienced or part-
time cook so we do not need excessive documentation. They can cook but
need helpful reminders about the process.
Work Instructions for Making Dinner

The Making Dinner Procedure contains enough detail for a repeatable dinner
that meets expectations. Your work instructions contain the remaining details.
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So far we have focused on the dinner process, which is focused on meeting the
expectations for dinner itself. We have not talked about what’s served (menu),
how to literally cook the meal (recipes), how certain tasks are carried out like
cleaning, setting the table, or shopping. These might all be contained in work
instructions.
Work Instruction Users

Work instruction are written for the inexperienced, new person, or when
something is extremely complicated and we cannot make a mistake, so we do
need detailed documentation. In this case, they may not have cooked much
before and need more than helpful reminders about the process. They need
exact, step-by-step details of how to do something or operate a specific
machine or tool.
Work instruction details should include:
Pictures: What the meal looks like, a proper place setting, the exact
brand or item from the store, inventory locations, kitchen layout, etc.
Work Details: Recipes, cleaning methods, cooking methods recipes

refer to.
Safety: Material handling, protective clothing, sharp objects, etc.
Tips: Examples of when its right (i.e. should not stick to the pan).
Procedure Details
Procedures describe how to ensure repeatable processes, while work
instructions contain the details of what’s repeating. What literally goes into
your procedures depends on the skill level of your workforce, the maturity of
your processes, the amount of mistake proofing, complexity of your processes,
or the expectations of your customer. Everyone may have different
requirements.
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Keep your procedures high level and then adjust your work instructions to
provide the details that your process, workforce or training needs dictate. If you
put too many of the work instruction details into your procedures your
experienced workers won’t use them and the inexperienced workers will have
trouble separating the process from the detailed methods.
Documentation Pyramid
A good way to see where work instructions fit in is by looking at documentation
as a pyramid comprised of four levels (see Figure 4 Document Pyramid).
Level 1 – Policies
Your policies are at the top of the pyramid, like a beacon from a lighthouse.
They direct the procedure in the proper direction and provide a foundation for
the procedure's description of the process being documented.
Level 2 – Procedures or Processes

The procedure describes the process being documented with references to
appropriate work instructions to be followed and records that are used or
generated in the execution of the process.
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Figure 4 Document Pyramid
Level 3 – Work Instructions

Work instructions should be very detailed on “how” to accomplish a specific
job, task or assignment. Work instructions are action-focused. They may
include a "list” of steps, a checklist, or pictures of dials, switches, or computer
screen shots with annotations. Make sure to label the information in a way that
tells the user what to expect. Pictures may speak a 1,000 words but it's the
annotations that clarify the meaning.
Work Instructions focus on "how" -– typically being described to a person new

to performing the task vs a Subject Matter Expert (SME). While procedures
usually assume the individual has capability in the general area being
addressed – procedures and work instructions are NOT meant to be a
substitute for training!
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Work Instructions help fill in the blanks wherever information is needed to

support processes, procedures, or templates. Using structured On-The-Job
(OJT) checklists demonstrate the proper method of performing tasks
associated with a procedure.
The information for procedure or work instruction documents comes from

relevant SMEs. Don't forget these documents are not just documents; they're
also a way to group important information together.
Individual work instructions are very specific to an industry or company.

Supplemental documentation may be used including User’s Manuals,
Engineering or Technical Manuals, Technical Support notes, Manufacturing
Notes, etc., in order to create detailed work instructions.
Level 4 – Forms/Records
Some procedures will include corresponding forms. Forms are used to create
records, checklists, surveys, or other documents used in the creation of a
product or service. Records are a critical output of any procedure or work
instruction. They form the basis of your process communications, audit
material, and process improvement initiatives.
The Need Policies and Procedures

Now that you know what they are, what benefits can policies and procedures
bring to your organization? There are page-long lists of why policies and
procedures are necessary, but, of course, such long lists lose meaning and
value. By the time you read to the bottom, you don't remember what was at
the top of the list. Plus, such long lists have too much overlap and repetition. A
simple approach may be more useful.
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Developing policies and procedures help to communicate your business goals

and priorities, standardize processes, train employees consistently, and identify
acceptable and unacceptable behaviors.
As mentioned in Chapter 1, the purpose for creating an internal control system

through defining and documenting processes with well-written procedures
boils down to a few very basic reasons:
 Compliance
 Operational Needs
 Managing Risks
 Continuous Improvement
Compliance
Complying with laws and regulations should be the most basic function of an
organization. Even the smallest of organizations must comply with tax laws and
with state and local regulations (i.e. zoning, licensing), while some organization
must cope with a myriad of federal and state laws and regulations (OSHA, SOX,
EPA, DOT, FDA).
Other compliance issues may deal with quality standards like ISO 9001, ISO
22000, or UL. Some industries have voluntary guidelines that suggest a best
practice (OSHA VPP "Star" program, ISO quality, GAAP, IFRS, ITIL, to name a
few).
Organizations looking to become "World Class", the best in their industry,

demand them as part of defining their standard work. Company policies, six
sigma discipline, or engineering standards determine the need for exacting
consistency.
While procedures themselves may not demonstrate compliance, well-defined

and documented processes (i.e. procedures, training materials) along with
29
records that demonstrate process capability can make evident an effective

internal control system and compliance to regulations and standards.
Procedures protect workers and customers as well. Workers who are following
established procedures have more confidence that their actions are supported
by management, the underlying statutes or regulations, and that they are
following industry best practices. Using standard operating procedures
regularly leads to fewer corrective actions. If there are legal ramifications to
your work, then following your procedures reduces liabilities. Customers are
entitled to dependable product or service delivery based on established and
accepted measures – not on any one worker's personal values, and not varying
from one geographic area to another.
Let's face it; if your organization is having trouble in performing the

rudimentary function of obeying laws and regulations, then it is likely
struggling even more at being effective and successful in fulfilling its core
missions. If compliance is an issue in your organization, then creating well-
defined processes documented by procedures in order to meet your legal and
regulatory requirements should be a high priority.
Operational Needs
What is really important in your business? What is fundamental for its success?
Are practices associated with them being steered by top management? How
much visibility and transparency is there into the effectiveness of these key
processes?
This brings us to the next important role of procedures; to ensure processes

fundamental to the organization's success are properly guided by
management, are performed in a consistent way that meets the organization’s
needs, and that important related information and data are captured and
communicated.
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For example, if regularly introducing new and improved products is essential

to the success of your business, shouldn't you be in control of your sales and
marketing cycle that captures customer requirements and desires so they can
be translated into your product design? Shouldn't there be well-documented
design review and product launch processes?
Managing Risks
Every business must recognize and manage risk. In fact, risk assessment was a
key component of COSO's Internal Control-Integrated Framework, and COSO
even expanded the concept, developing a report titled Enterprise Risk
Management-Integrated Framework. COSO defines risk management itself as
a process to ensure all events can be managed according to an organizations
risk appetite. Established policies and procedures are identified by COSO as a
control activity needed to manage risk.
So whether it is a fire or a corrupt/incompetent accountant, procedures define

how reasonable measures are built into processes to prevent such events, and
they describe how the organization will manage and recover from such events
should they occur.
Another reason for procedures that fits well into this category is the
documentation of organizational knowledge. Key personnel leaving, perhaps
even joining a competitor is always a risk. That risk is diminished to a degree if
key organizational knowledge is documented in a procedure, as opposed to
important information being stored in a person's head, in their computer, or
simply jotted down in their notebook or journal.
Continuous Improvement
Continuous Improvement is one of the most important, yet frequently
overlooked reasons for developing an internal control system of policies and
procedures. One role procedures play in continuous improvement is
implementing a Plan-Do-Check-Act (PDCA) approach to processes.
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Clear policies (that should be developed or approved by management)

describe operational goals and direction, implemented by the Plan, which
includes SMART objectives and that describe best organizational practices. The
Do section carries out the plan and captures the data related to the stated
objectives. The Check phase reviews the data in relation to goals and objectives,
and Act means reflective changes in the process or the procedure that
improves the process effectiveness, or altering objectives to be more realistic
or meaningful.
Lack of clear communication is a common impediment to improvement and

success. Procedures can also build important internal communication practices
into processes. For example, the collection process can include notifying the
Sales Department which customers aren't paying their bills, so the Sales staff
isn't spending time making sales calls to customers who do not pay for what
they buy.
Improvement occurs when we compare the prior condition to the current

condition. By documenting your business processes with procedures, you will
have a foundation for improvement – a record of the standard work that was
performed at a point in time.
Why People Don’t Follow Procedures

Large organizations have a large number of procedures. They have a lot of staff,
business operations, and economy of scale to make their procedures work.
Smaller businesses should remember – the more business procedures you
write, the more business procedures you have to edit, implement, train, audit,
and review.
More procedures may also produce more audit findings in addition to more
updates, more documents to control, and more administration overhead. Many
companies fail to plan for this administration and procedure overhead, so it
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should come as no surprise that their procedures don't work as well as

expected.
Out of Date
One reason why people don't follow procedures is because they aren't up-to-
date. Information gets stale fast and it is difficult keeping procedures current
and relevant without becoming outdated.
Another reason is that they're not followed. If your people were using the
procedures as written and taught, they'd be more likely to notice when things
are out of date or out of sync with other company practices. Revisions are a
healthy indicator of ongoing use and revisions help to create effective
procedures.
Hard to Find
Perhaps your people can't find your procedures. Maybe they don't even know
you have a procedure. And when they go to look for one, if they can't find it
on the server, where it is supposed to be, they figure you don't have one (see
case study on page 85). That means your configuration management is suspect.
An uncontrolled procedure implies your system is out of control.
Too Simple
There's also the possibility that your procedures are too simple; that is, they're
too broad and general to suit a specific situation. If your procedures aren't
directly to the point and don't offer information specific to the process your
employees are working on, they won't be used.
Poorly Written or Designed

Poorly written procedures are as bad as generic procedures. If your procedures
are incorrect or confusing, your employees will not use them, either.
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Sometimes, procedures are not designed for ease of use. Either they're hard to
navigate in themselves, or their formats are inconsistent. Formats that are
inconsistent across departments and work areas are a frequent source of
confusion.
It helps to think about who procedures are written for when designing your
procedures. Procedures are primarily designed to be training aids: Frequent,
experienced users don't need procedures often, if at all. They should
periodically review procedures to be sure they're current, but on a day-by-day
basis, they're not your target.
Occasional users need reminding, but it's novice users who need procedures
the most. They'll need the guidance of a procedure until the process has
become ingrained.
Too Long
If you have 35-page-long procedures – especially if that's all text – it's probably
not fair to expect your employees to understand, let alone use, them. At that
length, there's the very real risk that your procedures are unclear, overly
complicated, and just plain boring. If your business procedures are really long,
it is probably a scope problem. You are adding too much information that
belongs inside a work instruction.
Why Policies are Unenforceable

We’ve learned why procedures outlining the company’s policies don’t work,
but what if the policy itself is unenforceable? Formal, written policies guide
appropriate (ethical) behavior in larger companies. Yet, everyone has had to
deal sooner or later with policies that are so poorly written that they're without
meaning and validity. In short, they're unenforceable. But if good policies are
so important to the company, what are the reasons why policies are
unenforceable?
34
Written for Problems That Don’t Exist

The first reason why policies are unenforceable is because the problem they
are written for doesn't really exist. Outside of the corporate policy statement –
which stems from your vision and mission statements – a policy statement is
generally a response to a problem. Policy is one aspect of a plan to rectify the
problem (a corrective action, if you will). One example of a policy written in
response to a problem is, "We will respond to every customer complaint within
24 hours."
You write such a policy not for an isolated complaint, but because complaints
are piling on top of complaints and customers are beyond "dissatisfied". If
you're introducing a new product or line of business and you have no
customers yet, what's the point of having a complaint policy? How would you
know if it's appropriate if you've never received a complaint?
Employees Are Unaware a Policy Exists

If you have a policy that no one knows about, it's as bad as having no policy.
The last time you wrote and implemented a policy, how did you get the word
out to employees? How do you notify new employees that the policy exists and
how do you train them?
Difficult to Understand
Your policies may be too long. Observe – but do not follow blindly – the Golden
Rule of Policy Writing. If it's longer than twenty words, make sure the point of
the policy is perfectly clear.
Additionally, the scope of the procedures may be undefined or unclear. Who

does the policy apply to? Under what conditions? If it's a blanket policy, it's not
an appropriate response to a specific problem.
Another Golden Rule of Policy Writing ought to be "stay away from buzzwords,
jargon, and platitudes". Get to the point, don’t make the policy too complex.
35
The policy may also be difficult to understand if it’s too vague. If the average
employee can't tell who the policy is meant for, what the point of the policy is,
or you use indefinite words like "sometimes" or "often", your policy will
eventually be misinterpreted.
Also, if your policy lacks specific terms of compliance (e.g., a definition of

compliance, how to monitor it, and what to measure), how do you know if
people are complying?
Unclear Who Owns the Policy

Who has additional information regarding the policy? Who is empowered to
make policy changes? If you're not empowered, but you see a need for a
change, who do you go to and how do you get it taken care of?
Policy Enforcement Responsibility Unclear

Whether the penalty for a policy violation is "a maximum of 30 days in jail,
$5,000 fine, or both", "probationary status, or a stern talking-to, who's going to
enforce the policy? What enforcement tools are you giving them?
Consequences of Violation Are Unclear

How do you reward compliance? How do you penalize noncompliance? Is the
reward or penalty appropriate to the noncompliance? (Or, do you figure on
using the "honor system?")
People Don’t Believe in the Policy

The last reason why policies are unenforceable is because people just flat out
don't believe in it. This ties together "not understanding the policy" and "who
owns the policy". If your employees don't understand the reason for the policy
– if they don't buy into it – they're not going to throw their weight behind it.
People need to have a vested interest in policy development, implementation,
36
and enforcement. They need to participate in – have a stake in the outcome of

– the process.

37
38
3. Identifying Your Processes
CHAPTER 3
Identifying Your Processes
“We are never prepared for what we expect.” ‐‐ James Michener
39
Processes and Procedures

The difference between processes and procedures can be summed up as
breadth and depth. A process defines the big picture and highlights the main
elements of your business – breadth. A procedure captures those elements and
adds more information for functional responsibilities, objectives, and methods
– depth. Taken together, they each have different roles to play in defining the
standard operating model of your business.
A process is the conversion of an input into an output. A process typically

operates at a higher level, possibly across many functions, and may cross
department lines. A process may contain one or more procedures and may
refer to procedures from other processes. Work Instructions provide even more
detail for a procedure. Processes, procedures, and work instructions expand
like an organization chart (see Figure 5 Process Procedures Relationship Chart
).
Figure 5 Process Procedures Relationship Chart
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Example Revenue Process
The revenue process starts when sales takes an order. The order is pulled from
inventory and shipped. But the revenue process is not complete until the order
goes through collections and is converted from merchandise into cash. In
Figure 6 Revenue Process, notice how the Revenue Process crosses various
department boundaries from sales, to the warehouse, to accounting.
Figure 6 Revenue Process
A process is in control when objectives are clearly defined, metrics are tracking
how well the process is achieving the objective, and actions are clearly taken
when objectives are not met. Clearly defined responsibilities, measures, actions,
and operating time frames help to establish the controls that are typically
found within a procedure.
The revenue process is complex and operates across many functions and
departments, which may result in a number of different procedures. The
revenue process may intersect with the sales process, inventory process, cash
process, and manufacturing process. Your business model defines what
processes and procedures are important and how they may intersect.
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Types of Processes
There are three types of processes, each exhibiting a different level of control:
(1) the ballistic process, (2) the controlled process, and (3) the adaptive process.
Ballistic Processes
The ballistic process is the most common of the types of processes, and the
least useful. Basically, any process that is not controlled and is not producing
consistent results is a ballistic process. A good example is "testing golf balls": a
person cannot hit a ball exactly the same way every time, so equipment makers
use robots for testing. Any process that doesn't provide adequate feedback to
allow you to correct problems and gain consistency is a ballistic process.
Perhaps you've seen the ballistic process at work in the educational system.
Teachers present material in the way they want – if you don't understand the
material, that's your problem. Results of this process include the need for
tutoring, students falling behind (and sometimes failing), losing interest, and
leaving the system. You know there's a better way.
Controlled Processes
The next type of process is a controlled processes. When we talk about
"control", we don't mean dominance or power. Process control means that "the
inputs of the system are manipulated or transformed to realize an expected
output." The key is monitoring the inputs and outputs, making corrective
changes to the process based on what you've observed in order to achieve the
desired "transformation of inputs" and/or output. How does this relate to our
classroom scenario?
In a controlled process, the teacher presents the material, then checks the
students' understanding. If students are not transforming the material into
knowledge, as expected (expectations based on statistical modeling of past
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student behavior), the teacher takes corrective action to fix the process, not the
students.
Note that the controlled process involves making adjustments to the process
to compensate for the variance of student behavior, while the ballistic process
requires the students make adjustments to their behavior to compensate for
their "learning problem".
The ballistic process is easier to create and use, and requires much less of the
teacher. But with a controlled process, the teacher has to figure out why the
student is not learning as expected. The key is "understanding what is
expected"; data on past performance frames our expectations, and helps us
determine what changes to make to the process or system.
So, if we respond to our students needs and the process is being changed, are
we done? Not quite yet.
Adaptive Processes
The ultimate process is "one that learns". This is an adaptive process – one that
"can change over time to improve effectiveness.” The idea behind this type of
process is to review all the changes being made to the process in order to
compensate for the student learning variance:
 Are the right changes being made?
 Are enough changes being made?
 How has the environment changed?
Step back and look beyond the process. Perhaps the learning methods
employed are twenty years old; new methods have probably been invented or
new technology has come out.
Over time, with enough input data and enough process changes, we eventually
reach a limit to the processes’ effectiveness. Changes become so incremental,
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so small that the effort required to change isn't worth the diminishing level of
returns. In that case, it's time to adapt, or evolve to a new state.
We don't want "change for change's sake": we want methods and technologies
that can improve process effectiveness. Going back to the classroom example,
this may mean a complete course redesign.
We must be open to new ideas. We can't dogmatically cling to the old ways,
especially if it can be proved that the new ideas are more effective. As you
might expect, an adaptive process is the hardest to create.
Organizations are groups of systems, all of which require systems controls. A

ballistic process is about dominance. A controlled process is about achieving
an expected outcome. The adaptive process is about the future: achieving an
expected vision for your organization and delivering the ultimate control
management is really seeking.
Core Process Flows

Historically, procedures only described existing processes – ballistic processes.
To really improve the process, we must understand the system, expected
outcomes, and have good data describing the process. In general, there are
three core process flows within your company: your cash cycle, your
manufacturing (or fulfillment) cycle, and some have a design cycle (see Figure
7 Three Core Process Flows). What is the difference between these important
cycles?
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Figure 7 Three Core Process Flows
Cash Flows
Your cash cycle reflects how cash is coming into your organization. It is
depicted in the green lines in the core process flows diagram and is comprised
of your accounts receivable, inventory and accounts payable processes. Your
cash cycle determines the health of your business.
A healthy business has a strong and positive cash cycle, which means that you
are collecting money from accounts receivable faster than you are disbursing
it through account payable and accumulating inventory. Your cash cycle also
determines your working capital needs.
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If your cash cycle is negative then you will need to finance your operations with
debt or equity capital. How do you know how much your operations need? Just
calculate your working capital.
Working Capital =
Inventory + Accounts Receivables - Accounts Payable
If you add the number of days of inventory to the number of days of receivables
outstanding, and then subtract the number of days of payables outstanding
then the result is the number of days of working capital your organization has
tied up in managing your supply chain.
Your working capital is the investment you are making in the inefficiencies of
your processes and procedures plus your investment in your suppliers' and
your customers' inefficiencies too. The idea is to balance your cash process
flows and drive down inventory to reduce your working capital needs. The
closer you can get to zero working capital days the more efficient your
processes are. Next, there is your manufacturing cycle.
Manufacturing Flows
Your manufacturing cycle is found in the blue lines in the process flow diagram
(Figure 7 Three Core Process Flows) and should include your purchasing,
production and sales process, which are your three inventory related processes.
The link between your supplier and purchasing determines your raw materials
inventory needs. The link between sales and your customers determine your
finished goods inventory. Your production process determines your work-in-
process (WIP) inventory needs.
In traditional manufacturing organizations, the elements of the production

process are separated into functional areas, each with individual goals to
maximize their own functional output. Subassemblies or finished goods are
built and held in inventory awaiting the next order.
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Lean thinking is used to create a demand-based manufacturing flow. Demand-

based flow is a form of build to order manufacturing that results in reductions
of 50% to 80% in inventory, production cycle time and order lead time. How is
this possible?
Balancing the purchasing, production and sales processes results in reduced

inventory and its resulting waste. With cash flows, an unbalanced cash cycle
produces negative cash flow and the need for increased financing. It is the same
with the manufacturing flows. Unbalanced manufacturing flows require more
inventory to compensate for all of the variation and unknowns, which increases
your inventory, and in turn, your working capital needs.
Do you see how closely the manufacturing cycle is tied to your cash cycle? And
yet some people believe more time, money, equipment or people is the answer.
However, you don't need more resources. If you carry inventory then you
already have plenty of capacity. Think about it, inventory comes from too much
capacity, not too little capacity.
Where else do you think it comes from? Raw materials: you bought too much.
Work-in-process: your process batches are too big. And finished goods: your
sales cycle is too long (probably because you don't know your customers very
well).
In manufacturing, it is all about replication. Increasing your cycle time and

making your products faster will reduce inventory, increase quality and bring
you closer to your customer. Just eliminate the delays in your processes.
Design Flows
Design flow is an iterative process. It differs from manufacturing and cash flows,
which are replication processes, where our goal is to work towards zero defects
and doing it right the first time. Both are laudable goals for replication
processes that are already designed, but how do we do that for iterative
processes like the design phase? The answer – you don't.
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With design flow, we do not expect to have zero defects the first time. In other
words, we expect that a new design will not be right the first time. So we
produce an idea and then refine it again and again until we are satisfied that
the new idea meets the requirements. Design is an iterative process of
refinements. It is the nature of the design process itself.
Ones paradigm limits your thinking by literally creating barriers to new ideas.
In the design cycle we try out new concepts which expand our paradigm
barriers. From these new vantage points we see more new ideas, which then
move our paradigm barriers farther out.
Figure 8 Diminishing Returns Curve
However, there are constraints (money, time) that limit the refinements we can
make. As we approach these constraints the design is considered "good
enough" and we move on until new information, perspectives or old constraints
are removed. This is the law of diminishing returns (figure 8) at work.
Top Ten Business Processes

The three cycles that we just discussed can be broken down into individual
processes. In any organization there exists a common set of core business
processes that must exist for the organization to function properly.
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Every organization needs a sales and marketing function Nonprofits,

governments and hospitals must identify their customers, manage the
relationship, and deliver a good or service in exchange for funds and services.
Once you have cash coming in you must account for that cash and complete
your tax return, which means you need an accounting process. Accounting
operates on technology, so in a small company a technology process often
time is part of accounting (unless you are a technology company and then it is
part of product development).
Next comes your product or service delivery process that you collected money
for. You have to deliver it and deliver it well, with a quality process, or else you
won't get more money from your customers in the future.
A business must hire employees, manage the operation, and finance the ups
and downs. And lastly, you have to have a product development process to
design products for your customers.
Small organizations start with this set of five processes: sales & marketing,
accounting & technology, quality & product/service delivery, HR & finance, and
product development. As the company grows, each of these small business
processes splits into two.
As seen in Figure 9 Ten Core Processes, include:
1. Customer Strategy & Relationships (Marketing)

2. Employee Development & Satisfaction
3. Quality, Process Improvement & Change Management
4. Financial Analysis, Reporting, & Capital Management
5. Management Responsibility
6. Customer Acquisition (Sales)
7. Product Development
8. Product/Service Delivery
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9. Accounting Management
10. Technology Management
Figure 9 Ten Core Processes
As an organization grows even bigger it will add more sub-processes or

perhaps additional core process like supplier management, strategy, or legal &
compliance.
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4. Mapping Your Processes
CHAPTER 4
Mapping Your Processes
“First I dream my painting, then I paint my dream.” -- Vincent van Gogh
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Understanding Process Maps

Processes are strategic assets of an organization that if managed well deliver a
competitive advantage. Processes also assist us in defining responsibilities,
internal controls, and work standards for compliance, consistency, and with
clear measurable performance indicators.
A "process map" visually describes the flow of activities of a process. A process

flow can be defined as the sequence and interactions of related process steps,
activities or tasks that make up an individual process, from beginning to end.
A process map is read from left to right or from top to bottom. We prefer to
minimize "Backflow" or arrows that go from right to left or bottom to top can
greatly confuse the reader and should be minimized.
Process maps are used to develop a better understanding of a process, to

generate ideas for process improvement or stimulate discussion, build stronger
communication, and – of course – to document a process. Often times a
process map will highlight problems and identify bottlenecks, duplication,
delays, or gaps. Process maps can help to clarify process boundaries, process
ownership, process responsibilities, and effectiveness measures or process
metrics. Process maps can be very effective at increasing process
understanding during training.
Process maps are not limited to a single department or function. For example,
the ISO 9001 Quality Management Systems standard requires some type of
process map of the organization's quality processes. Mapping should be the
first step in designing a process or in documenting a procedure. Why? To
improve a process you must understand it and most of us understand a
graphical picture better than a written procedure.
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Types of Process Maps

Process maps come in many different forms. They all tend to use a Supplier,
Input, Process, Output, and Customer (SIPOC) format and a standard UML for
symbols. The most common process map types include: High-Level Process
Map, Process Flow Chart, Document Map, Cross Functional or Swim Lanes
Process Map, Value Stream Map, Workflow Diagram, and a Rendered Process
Map.
SIPOC
It helps if a process map identifies a Supplier providing Inputs to a Process,
which produces Outputs for a Customer. We call this basic format a SIPOC
diagram (Figure 10 SIPOC Diagram).
Figure 10 SIPOC Diagram
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There are many variations of this SIPOC theme and does provide a useful
framework for understanding the critical elements, sources, and outputs of a
process.
PDCA
Plan, Do, Check, Act or PDCA.
Sounds easy in principle,
doesn’t it? Just plan your work
and work your plan. So, why is
“plan-do-check-act” so
difficult in practice? Using the
Plan-Do-Check-Act (PDCA)
method is like climbing a hill: it
starts out easy but gets harder
the higher up you go.
Document Your “Plan”

Figure 11 PDCA Cycle
The plan is really the easiest
part of plan-do-check-act.
Start with goals that are measurable (See Figure 11 PDCA Cycle). Document
your plan using objectives, policies, procedures, and forms. Assign individual
responsibilities, and you’re done. This is not hard at all. But it gets harder, and
pretty quickly.
Using Your Plan Is “Do”

The “Do” in plan-do-check-act refers to using the policies, procedures, and
forms to realize your objectives. This means collecting data, and populating
your forms. You have to use your procedures and follow your policies.
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While this may sound easy at first, keeping it up is the hard part — you may
start with good intentions (that’s the “plan” part), but your company has to
follow through on its intent, and follow-through — commitment — starts at
the top. Furthermore, management commitment isn’t an isolated event — it’s
part of the company philosophy.
That’s a large part of what makes plan-do-check-act so hard. As management,

you get so involved in running the day-to-day aspects of the business that you
forget that you started with good intentions (the plan). It is not that the plan
was ill-conceived; it’s that there’s more to it than a piece of paper. Plans need
continual reevaluation — you need to constantly “check” your progress and
adjust the plan accordingly, which mean updating your procedures.
“Check” Your Plan

In the “check” step of plan-do-check-act, you have to convert data into
information. Charting data can make this much easier but even so, a chart is
just a visualization of data. A chart is not information without a target. In
addition, you need enough data points to show trends. Furthermore, you need
to understand how to separate the “vital few” data points from the “trivial
many”.
Creating information from data requires “profound knowledge” about your

system, of course it helps to understand statistics, too. Creating information
out of data is not easy; often, it requires that you continually dissect the data
and look at it from many different points of view. Deciphering actionable
information from your data is hard. Statistical analysis will help you in
determining significant trends to ensure you are acting on objective data.
“Act” On Your Results

So, let’s say you started with a good plan, you were able to collect some
meaningful data, and you turned it into useful information. If you’ve
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accomplished this, the “Act” phase should be easy, if you have a stable
environment.
Today’s business world is an increasingly unstable environment — old and new

forces are continually changing the dynamic. There’s local and global
competition, widespread and affordable technology, weather and climate,
cultures, beliefs — a host of forces acting on your business.
Deciding what to do to compensate for or leverage external forces has always

been difficult; it’s just becoming more so. But if you do a good job at the first
three phases, the “Act” phase of plan-do-check-act becomes a lot easier. You
just need to make better information out of your data.

Figure 12 PDCA Process Approach
Plan-Do-Check-Act in Action
The Olympics happen every few years. Some Olympic records – and a few world
records – are broken over the course of the event. You watch these athletes
perform and you marvel at their power, their endurance, their finesse.
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How do they do it? What makes them so special? Are they that different from
you and me? Are they superhuman? No, not really. They’re just like you and me
— well, maybe not now. But we all start out on equal footing.
The big difference? With a few exceptions, the athletes got their start fairly early
in life. And almost from the day they laced up a pair of skates or strapped on
skis, they had an ambitious, long-range goal — to be a pro, maybe even the
next Wayne Gretzky or Herman Maier.
Family and friends encouraged and helped them. Their parents, and then their
coaches, made up their plan. They knew that to get the big goal, these future
stars had to accomplish a lot of smaller goals, and they had to do it in stepwise
fashion.
The plan included competition, proper nutrition, and physical and mental
training. Their coaches checked their performance in training and competitions.
They analyzed the athlete’s performance, noted where they were reaching
those small goals and where they weren’t, and revised the plan accordingly.
Then, they executed the revised plan to improve performance.
They repeated this stepwise plan (
Figure 12 PDCA Process Approach) over and over until they reached their big
goal, whether that was turning pro, making the Olympic team, making it to the
medal round, or standing on the podium at the medal ceremony.
Think about that. They made a plan, executed it, checked their progress, and
improved incrementally — just like your organization should be doing. Your
organization is just like that Olympic athlete. Improvement doesn’t happen
overnight. It happens in stages, over time, following a plan.
How do you get better? What will it take to make your firm stand out from the
rest — to get to the Games, to the medal round, and maybe even the gold,
silver, or bronze?
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Process Mapping
When writing a procedure, the first step in planning should be to outline the
process with a process map to make sure you have all the important
information regarding the process you are documenting. A process map can
be used to communicate responsibilities, flow, transfers of information, criteria,
and whatever is critical to a process. Process maps are one alternative to written
procedures and work well for training people about simple process.
Standard symbols are used within a process map to describe key process
elements. These symbols come from the Unified Modeling Language or UML,
which is an international standard for drawing process maps.
Figure 13 Process Map Symbols
There are many symbols that can be used. Figure 13 Process Map Symbols
provides some common UML symbols used for creating process maps. There
are also a variety of process maps to choose from to communicate a process.
The examples will demonstrate how these symbols are used to communicate
the details of the process.
High-Level Process Map

 Purpose: Perspective, Big-Picture, Systems
 Information Shown: Supplier, Input, Process, Output, Customer (SIPOC)
 Best Use: Building consensus on high-level process steps; establishing
clear hand-offs
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 Positives: Management, Quality Manual, good for adding metrics

 Negatives: Not enough details
A high-level process map describes all of the core processes within an

organization. For example, ISO 9001 requires that the sequence and interaction
Figure 14 Order to Cash Process Map
of the Quality Management System processes are determined. One way to
demonstrate that they are "determined" is through a high-level process map.
Figure 14 Order to Cash Process Map shows nine core processes that make up
the Order-To-Cash Cycle, their sequence and interaction, thus fulfilling the
basic ISO 9001 requirement. The color coded boxes show the three main
process flows or cycles in your business:
 Red is your Order Cycle (Purchasing + Production < Sales);
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 Blue is your Just-In-Time (JIT) Production Cycle (Shipping = Receiving

+ Production); and
 Green is your Cash Cycle (Inventory + A/R - Payables > 0); which taken
together make up your Order to Cash Cycle.
Inputs/outputs are labeled, information flows are indicated with a dotted line,
and the material flow is a solid line (black for inventory and red indicating the
primary material flow). If you need more detail, then each of the nine processes
can further be explained separately in a lower-level process map. The term
"process map" does not refer to the scope of a process being high-level, low-
level, or very detailed. A process map is focused on the activity flow, order, or
sequence and interaction.
Low-Level Process Map

 Purpose: Sub-processes, small-picture
 Information Shown: Detailed scope, documents, decisions, order, and
direction of flow
 Best Use: Look for missing steps; gain clarity on how work is performed
 Positives: Understanding flow, procedures, details
 Negatives: Unclear responsibilities, Not SIPOC, alternative flow
The main difference between a high-level and low-level process map is one of
scope. The process flow has not changed, just the scope of what we are looking
at. The Order-To-Cash Cycle has nine processes identified but each process can
be further subdivided into sub-processes. Each sub-process makes up a low-
level process map or process flow chart. A low-level process map is an area of
a high-level process map that we have zoomed into for more detail.
For example: the Accounts Receivable (A/R) Cycle is comprised of customer

billing, credit, and collections. If we take a look at just the credit approval
portion (see Figure 15 Credit Approval Flowchart) of the whole A/R cycle we
see that there are five main steps: sales call, order entry, credit check, review
A/R balance, and calculate credit terms.
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There are three UML symbols used: square for process steps, diamond for
decisions and an odd looking square with a curved bottom representing data.
Decision diamonds produce an alternative flow that here represents either an
"OK" or "Bad Credit" decision, which requires a new sales call to resolve.
Figure 15 Credit Approval Flowchart
Low-level process maps can provide a lot of detail for analysis and can be used
in place of textual procedures for simple processes. If you want to "lean out"
your documentation for ISO 9001 then flowcharts can simplify your procedures
and reduce unnecessary paperwork. Organizations with highly trained
employees can benefit by using simple process maps.
Cross Functional/Swim Lane Process Map

 Purpose: Responsibilities
 Information Shown: Roles, responsibilities boundaries and hand-offs
 Best Use: Establish responsibilities and hand-offs
 Positives: HR, job descriptions, job training, procedures
 Negatives: Alternative flow
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One problem with low-level process maps is that sometimes it is hard to

determine who is responsible for which activity. Another is that they may not
conform very well to the SIPOC format we prefer. In this case a Cross Functional
or "Swim Lanes" Map can be used to convey individual responsibilities or
departmental roles within an organization.
This type of process map has the same UML flowchart symbols used in the low-
level process map example. Only now, four cross functional swim lanes have
been used to identify who is responsible for each element, decision or data.
You can have any number of swim lanes in a swim lane process map, although
as a practical limit you may want to make it fewer than ten for clarity.
In Figure 16 Credit Approval Swim Lane, the first band, the customer is clearly
responsible for making a "buying" decision and must complete the credit form.
The sales department is the second band and must respond to sales calls,
receive the credit information (form), enter the order, and produce an order
form. The order form is sent to the credit department, which compares the data
to the credit criteria issued by management.
If everything looks "OK" then credit reviews the customer's existing A/R
balances for credit capacity, and then calculates the credit terms. Management
is responsible for preparing a "credit issued" report and overseeing the credit
approval process.
Swim lanes are really good at depicting responsibilities and with no loss in the
low-level process flowchart information. Suppliers and customers are obvious
and it does conform to our SIPOC format. Swim Lane Diagrams organize tasks
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Figure 16 Credit Approval Swim Lane
by role. A role gets a swim lane. You are responsible for every task, document
or decision shown in your Swim Lane.
Swim Lane Process Maps visually communicate the involvement of each role,
the Customer role for example. In simple processes, customers may provide
information at the beginning of a process in the form of requirements, and at
the end when they buy the product. In more complex products, customer
requirements may be injected more frequently.
In the case of co-development or co-creation of products, customers may have

responsibility for processes and therefore process steps would appear in their
swim lanes.
Document Map
 Purpose: Data management
 Information Shown: documents as inputs and outputs at each step
 Best Use: As an inventory or guide to documents that support a process
(excellent for preparing for audits and compliance regimes)
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 Positives: Document and record control

 Negatives: Not enough activity detail
A document map displays visually what information you should expect to
receive, and from whom. It also shows you what information you are expected
to produce for someone else. Document maps show all input and output
documents used. Document Maps are an expanded SIPOC format. Each row of
the SIPOC flow represents:
 Supplier ->
 Input (yellow) ->
 Process Step (light green) ->
 Output (blue) ->
 Customer
Effectiveness criteria and performance objectives are listed at the bottom (see
Figure 17 Credit Approval Document Map). Your effectiveness criteria represent
your Key Performance Indicators (KPI), metrics, or measures for your process. If
you are planning on continuous improvement to conform to ISO 9001 or other
requirements then you should identify your metrics and your performance
objectives also.
Document maps come in handy in quality systems like ISO 9001, which require
that certain records (like product requirements) be created and maintained.
Since they show the records your process creates, documents maps remind and
remind process owners to generate output documents without having to name
someone as the “document police.” And if you’re in the middle of the process,
document maps can tell you if you have the inputs you need to do your job.
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Figure 17 Credit Approval Document Map
Document maps provide a lot of data detail but can be short on activity details.
Text based procedures are much better at depicting individual tasks and
methods.
Activity/Value Stream Map

 Purpose: Process Improvement
 Information Shown: Detailed activities at each process step (including
value-added and non-value-added activities)
 Best Use: Leaning out a process, looking for waste, non-value-added
and value-added activities
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 Positives: Granular details good for work instructions and procedure

writing
 Negatives: Okay for training and communications
Activity maps or Value Stream Maps are used in lean implementations to depict
process tasks as single-piece flow and with as much detail as you can capture.
The whole purpose of an Activity Map is to capture enough information so that
you can identify the tasks that are clearly adding value and those that are of
questionable value. Activity maps are helpful for architecting and organizing
the text before writing a new procedure.
Each of the five activities in the Credit Approval process (see Figure 18 Credit
Approval Activity Map) are listed along the top row in light blue. Next, an
optional tally field totals the number of tasks below each activity (i.e. 4+1). The
first number represents the task total and the second number is the lean value-
added (green tasks) total.
Understanding your waste, which is also known as value-add and non-value

add tasks, is one of the most critical steps in the value stream map creation
process. The definition of value-add we are using is based on whether or not
the task transforms the product. Another way many look at it is whether the
customer will pay for it or not. Waste is not something the customer or for that
matter anyone else wants to fund.
The next step is to evaluate each task to see if the task transforms the product.
If it does color code it green to indicate value-add. If it does not then color
code it red to indicate non-value add. All the white boxes represent possible
waste, or steps that can be eliminated through lean process improvement
events. Lastly, the person or department responsible for the activity is listed
with a departmental color code.
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Figure 18 Credit Approval Activity Map
Activity maps provide sufficient details for process improvement and can also
be augmented with task timing data, which can be used to quantify time and
cost savings. All you need is a spreadsheet and you can start making activity
maps. Unfortunately, activity maps are just okay at training or communicating
how a process works.
Workflow Diagram
 Purpose: Training, communications
 Information Shown: Work process shown in iconic flow fashion
 Best Use: Easier to relate to than a flow diagram done in more
traditional Unified Modeling Language symbols (useful as a job aid)
 Positives: More realistic
 Negatives: Not enough detail
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Workflow diagrams translate abstract UML symbols of squares and diamonds

into graphical images, which are used to tell a more complete story than
engineering notation communicates. Engineers are used to thinking
conceptually and using symbols, but the workers in the field may need
something less abstract and more concrete. Task-level communications require
more clarity and work much better when we get closer to reality.
Figure 19 Credit Approval Workflow Diagram
Drawing the credit approval process in a workflow diagram format (see Figure
19 Credit Approval Workflow Diagram) brings the process to life. Workers
might see themselves in the workflow and may see how the process works.
Microsoft Visio contains various workflow images (including the examples
shown here) that can be used for drawing more than just process maps.
Workflow diagrams are great as a basis for developing MS-PowerPoint training

materials for workers and can be used in combination with other process map
types to provide process information from different perspectives.
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This same map could be drawn using swim lanes to communicate

responsibilities more clearly. Workflow diagrams are more realistic than
process flowcharts, but there might still be room for improvement.
Rendered Process Map

 Purpose: Training, communications
 Information Shown: Usually illustrates current state and/or future state
to highlight potential improvements
 Best Use: As a storytelling device, often used as part of the report-out
of an analysis
 Positives: Most realistic
 Negatives: More time-consuming
A rendered process map (Figure 21 Rendered Process Map) is similar to a
workflow diagram.
Figure 20 Rendered Process Map
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It uses many of the same symbols to communicate process flows and activities,
but it is not limited to just those symbols. Graphics, colors, and images can be
combined to produce a more detailed and realistic map that everyone can
relate to.
The material order request & receiving process depicts an inventory storage
location or warehouse that is not physically at or near the point of sale.
Activities are labeled "A" through "I" and are described at the top of the map.
Different process flows are color coded: green for customer approval within the
purchasing sub-process, purple for distribution, grey for order processing, and
orange for inventory picking. The orange triangles symbolize time waste.
Choosing a Process Map

Process maps are an alternative to written procedures. Choose the process map
that works well for communicating your process. The table below summarizes
the different types along with their best use, positives and negatives.
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5. Turning Your Processes Into Procedures
CHAPTER 5
Turning Your Processes into
Procedures
“Man can believe the impossible, but can never believe the improbable.”
-- Oscar Wilde
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Now that you’ve mapped your processes, it’s time to turn them into
procedures. Before you begin the actual writing, it’s best to create a style guide
or template that you will use for every procedure. This template will allow you
to standardize your procedures, get started quickly, and provide fast, easy
answers to common Standard Operating Procedure (SOP) questions.
A SOP template communicates to everyone the procedure format you want to

use. It will provide a handy starting point so you don't have to stare at a blank
page. And will save everyone a lot of time selecting the font, margins, outlining,
and answering questions about your company SOP structure.
Formatting Your Procedures

Your procedures format (Figure 22 Procedure Format and Figure 23 Procedure
Format pg2), which covers the key procedure elements:
 control block,
 header and footer,
 procedure steps,
 effectiveness criteria,
 references,
 records/forms, and
 revision history.
Certain elements may not be necessary for some procedures, only include them
if applicable.
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Figure 22 Procedure Format
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Figure 23 Procedure Format pg2
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Control Block
The control block can be a simple 3 x 4 table, which is used to house the
document control information required for configuration management and
compliance standards.
Some organizations use complex control blocks that require space of up to

one-third of a page or more and can include multiple approval signatures,
distribution information, structured tabular formats, and confusing retrieval
numbering systems and revision levels.
The simplest approach is often the best. Information should be kept to the
minimum necessary to accurately describe the statement, identify the revision
level, and demonstrate authorization, and it should be easy to produce.
A sample control block (Figure 24 Control Block) provides information about

the document revision level, effective date, author, reviewer, and approver.
Document ID Title Print Date

FA1000 FINANCIAL OBJECTIVES mm/dd/yyyy
Revision Prepared By Date Prepared
0.0 Preparer’s Name / Title mm/dd/yyyy
Effective Date Reviewed By Date Reviewed
mm/dd/yyyy Reviewer’s Name / Title mm/dd/yyyy
Approved By Date Approved
Final Approver’s Name / Title mm/dd/yyyy
Figure 24 Control Block
Document ID, Title, and Revision Level – If you don’t have a lot of procedures
to write, a numbering system for documents (chapters) may not be necessary
– the title alone may be enough. However, if your processes require a large
number of procedures, it is best to use a simple alphanumeric numbering
system. This makes it easier to identify, retrieve, and store documents in an
orderly fashion.
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The first two characters of each procedure ID are alphabetical and represent
the primary department, functional area, concept, or standard addressed by
the procedure. For example, document numbers may start with "FA", for
Finance Administration; “AC” for Auditing and Internal Control, and so on.
The remaining characters are numeric, assigned sequentially as statements are

developed and issued. For example, the first Finance Administration procedure
could be FA0001; the second, FA0002; etc. An alternative, used in procedures
from Bizmanualz, is to begin at 1000 and proceed to 1010, 1020, etc.; using this
method, an FA1005 can be inserted if it is more appropriate (for instance, if the
new procedure is complementary to FA1000 and is therefore better placed
second than last in order).
To allow for relative ease in updating procedures and for logical grouping or
sequencing, it is best to avoid putting original documents in back-to-back
sequential order (e.g., 0001, 0002, 0003). However, a decimal numbering
system may be implemented in revisions to insert a new procedure between
existing procedures (for example, a new SOP could be numbered A1.1 and
inserted between A1 and A2). The main thing is to try to avoid renumbering
documents at every revision, which increases the chance of reference error and
user confusion.
Once a procedure is issued, it is subject to change. Revision codes should be

used to identify current and obsolete procedures and statements. An SOP
begins with a revision level of zero (0 or 0.0) or the first letter of the alphabet.
If a new SOP supersedes this prior statement, the revision number should be
increased by one number or letter.
The decimal system is used to differentiate major and minor revisions. For
example, a revision of the procedure that changes its meaning or interpretation
would be "revision 1.0", whereas a revision to fix spelling or punctuation –
anything that doesn't materially affect the meaning of the document – would
be "revision 0.1", "1.1", etc.
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Effective Date - The date on which the SOP or Revision is to be implemented.

Note the effective date is not necessarily the issue date of the original SOP. The
effective date and all other dates should be consistently formatted (e.g.,
“mm/dd/yyyy”, dd/mm/yyyy”, “dd Month yyyy”).
Prepared By - It is useful to identify the primary individual developing the

statement by position and name, in the event questions arise during the
approval process or subsequent to issuance, where additional information is
needed or statements need clarification. This information can be either typed
in or initialed by the individual.
Reviewed By - It is also useful to identify the individual or department having

the primary responsibility for reviewing the procedure/policy, in the event
questions arise during the approval process or subsequent to the document
being issued.
Approved By - After the SOP has been properly reviewed and approved, the
title page of the hardcopy form should be signed or initialed by an individual
who is part of Top Management. This is done primarily to satisfy “Management
Responsibility” clauses of applicable regulations.
It is best to indicate one's approval by hand, in ink, rather than type it in. This
is done to clearly indicate that the SOP has been properly authorized and to
distinguish the final hardcopy version from any draft version that may be in
circulation.
For documents managed electronically (e.g., using document management

systems software), electronic signatures are accepted by many organizations
and by most governments. Consult your company's policy, industry standards,
and applicable regulations with regard to acceptability of electronic signatures.
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Header and Footer

Your header prints in the top margin and is a good place to put your company
name (see Figure 25 Procedure Header). If you are compiling your procedures
into a manual, this is where you will also include the title of the manual.
Figure 25 Procedure Header
Your footer prints in the bottom margin and is a good place for the name of
your procedure and page numbering (see Figure 26 Procedure Footer).
Figure 26 Procedure Footer
Procedure Metadata
The Introduction section provides the metadata information necessary for the
reader to determine content and the reason for the procedure, who it affects,
in what situation(s), the company policy covering this area, and the definition
of any new or unusual terms (see Figure 27 Procedure Metadata).
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A sample Introduction section can appear as follows:

Figure 28 Procedure Metadata
Policy: The policy should clearly indicate the company's or top management's
beliefs or protocol affecting this area (see the following chapter for more details
on how to write policies).
Example: It is the policy of (company) that all departments will prepare

and maintain standardized operating policies and procedures that
cover the performance of all major functions within their department.
Purpose: The purpose provides a brief description of the objective of the SOP;
complements the Policy statement.
Example: This procedure outlines the steps involved in preparing,

maintaining and approving standard operating policies and procedures
in order to provide consistent, informative and effective procedures to
the employees of the company.
Scope: The scope describes the areas, functions, individuals or departments

affected by the SOP and in what situations.
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Example: This procedure applies to all policies and procedures used or

written by all departments and individuals of the company.
Responsibilities: The responsibilities describe who, in generic titles or

positions, is responsible for implementing or maintaining the procedure or
parts of the procedure. It should correspond to a job description.
Example: All Personnel are required to understand this procedure,

regardless of whether they implement it.
Top Management is responsible for maintaining this procedure.
Definitions: Definitions describe any terms contained in the SOP that may be
new or unusual to the reader.
Example: Policy - A definite course or method of action to guide and

determine present and future decisions. It is a guide to decision making
under a given set of circumstances within the framework of corporate
objectives, goals and management philosophies.
Procedure - A particular way of accomplishing something, an

established way of doing things, a series of steps followed in a definite
regular order. It ensures the consistent and repetitive approach to
actions.
Procedure Steps
This is where your actual procedure content will go. Refer to Chapter 7 for
guidance in writing your procedures.
Effectiveness Criteria
Describe any threshold or standard used to evaluate the work product or
results of the procedure. In other words, how does the employee or supervisor
know the procedure was correctly implemented? (Refer to sample procedure
in Appendix A for help with formatting).
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References
List documents, procedures, manuals, regulations/statutes, or other sources
used to develop or influence the policy/procedure statement (Refer to sample
procedure in Appendix A for help with formatting).
Records
Describe the records, minutes, reports, notes, forms, or other documents
generated by or used in the course of implementing the procedure. Make sure
you attach the actual documents to the end of the procedure.
Revision History
List and describe revisions made to the procedure. Include a revision number,
revision date, brief description of changes, and who requested the change.
Refer to the light blue section on the following pages for a step-by-step guide
to creating a revision history table in Microsoft Word.
Working with Microsoft Word

Now that you know what the format for your procedures is supposed to look
like, how do you actually create the document? The simplest and most common
program to work with is Microsoft Word. This section will provide a step-by-
step guide to mirror the format explained above.
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Margins
Open up a new document to set up your margins.
Figure 29 MS Word Margins Menu
1. Click on the Page Layout tab.
2. Select the Margins drop down menu. Click “Custom Margins...” at the bottom
(Figure 29 MS Word Margins Menu).
3. Change the Top margin to 0.88” and the Gutter margin to 0.5” (keep all other
margins at 1”).
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4. Click the Multiple Pages drop down arrow and select “Mirror margins.” Press
OK (Figure 30 MS Word Page Setup).
Figure 30 MS Word Page Setup
Header
1. Click on the Insert tab.
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2. Select the Header drop down menu. Click on the “Blank (Three Columns)”
option (Figure 31 MS Word Header drop down).
Figure 31 MS Word Header drop down
3. In the left text box, type the title of the procedure manual (if applicable).
4. Delete the middle text box.
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5. In the right text box, enter your company name.
6. Highlight all text and change the font to Times New Roman 10 point (if not
already defaulted).
7. While the text is still highlighted, click the Border dropdown menu in the
Paragraph section of the Home tab. Select “Bottom Border” (Figure 32 MS
Word Border dropdown).
Figure 32 MS Word Border dropdown
Footer
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2. Select the Footer drop down menu. Click on the “Blank (Three Columns)”
option (Figure 33 MS Word Footer Dropdown).
Figure 33 MS Word Footer Dropdown
3. In the left text box, type the name of the procedure.
4. Delete the middle text box.
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5. In the right text box, type the word “Page” and press the spacebar once
(Figure 34 MS Word Footer Design).
Figure 34 MS Word Footer Design
1. Click on the Design Tab (under Header & Footer Tools).
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2. Select the Quick Parts drop down menu and click on “Field...” (Figure 35
MS Word Quick Parts dropdown).
Figure 35 MS Word Quick Parts dropdown
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3. In the “Field Names” list, scroll down and select “Page” (make sure you
have the “1, 2, 3, ...” format selected under Field properties). Press OK
(Figure 36 MS Word Field Names)
Figure 36 MS Word Field Names
9. The page number should now be present. Type the word “of” after it and
press the spacebar once again.
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10. Repeat steps 6 and 7.
Figure 37 MS Word NumPages
11. This time, select “NumPages” in the “Field Names” list and make sure you
have the same format selected as you did in step 8 (Figure 37 MS Word
NumPages).
12. Press OK. The total number of pages will now be displayed and carried
throughout the whole document.
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13. Highlight all text and change the font to Times New Roman 10 point (if not
already defaulted).
Figure 38 MS Word Border Dropdown
14. While the text is still highlighted, click the Border dropdown menu in the
Paragraph section of the Home tab. Select “Top Border” (Figure 38 MS Word
Border Dropdown).
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Control Block
2. Select the Table drop down menu. Move your mouse to cover 3 columns and
4 rows (Figure 39 MS Word Table Dropdown).
Figure 39 MS Word Table Dropdown
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Figure 40 MS Word Table Tools
3. Click the Design tab (under Table Tools). In the Table Style Options section,
be sure only “Banded Rows” and “Banded Columns” are checked (Figure 40 MS
Word Table Tools).
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Figure 41 MS Word Tables
4. Select the left column of the table by hovering over the top line until a black
down arrow appears and then clicking (Figure 41 MS Word Tables).
5. Click the Layout tab (also under Table Tools). Here you will be adjusting the
height and width of the cells (found in the Cell Size section).
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6. Set the height to 0.4” and the width to 1.43” (Figure 42 MS Word Cell Height).
Figure 42 MS Word Cell Height
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7. Repeat steps 4 and 5, first selecting the middle column (and changing the
width to 3.27”) then again selecting the last column (changing the width to
1.45”).
8. Fill in the document control block table with the document control
information explained in the “Formatting Your Procedures” section. Be sure to
make all text Times New Roman 12 point, bolding where shown (Figure 43
Document Control Block).
Figure 43 Document Control Block
Procedure Metadata
1. Create a table the same way you did in steps 1 and 2 of the Control Block
section, this time making the dimensions 2 by 5.
2. Change the Table Style Options so that all of them are checked.
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3. Adjust the height and width of each column the same way you did in steps
4 and 5 of the Control Block section, making them:
- Column 1: Height=0.55” and Width=1.45”
4. Fill in the table with the information explained in the “Formatting Your
Procedures” section. Be sure to make all text Times New Roman 12 point,
bolding where shown (Figure 44 Procedure Metadata).
Figure 44 Procedure Metadata
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5. Remove the border by selecting the table and then clicking on the Design
Tab (under Table Tools).
6. Select the Borders drop down menu and choose “No Border” (Figure 45 MS
Word Table Borders).
Figure 45 MS Word Table Borders
Press the enter button once and type “Procedure:” in bold font – this is where
the procedure content will go.
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Procedure Steps
Your procedure steps and activities should be separated with a numbering
system. To do so, you will create style headings (that can be easily applied to
every activity heading). Follow the steps below:
1. Click the “More” drop down option (circled in red below) in the Styles
section of the Home tab (Figure 46 MS Word Styles).
Figure 46 MS Word Styles
2. Select “Create a Style” (Figure 47 MS Word Create Style).
Figure 47 MS Word Create Style
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3. Give the style a name (example: “Activities Heading”) and press the
“Modify...” button (Figure 48 MS Word Style Formatting).
Figure 48 MS Word Style Formatting
4. Under Formatting, change the font to Arial 12 point, bolded. Press OK (Figure
49 MS Word Style Font).
Figure 49 MS Word Style Font
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5. Now you can use easily change any text to this style. Start off by typing
“1.0” followed by the name of the activity in all uppercase letters (
Figure 50 Procedure Outline).
6. Highlight the text and click on your custom heading in the “Styles” section.
7. Any steps below the activity heading should be numbered sequentially in

tenths (ex: “1.1”, “1.2”, “1.3”, etc.).
Figure 50 Procedure Outline
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Revision History Table

1. Type “Revision History:” in bold font.
2. Create a table by following the steps explained in the Control Block section
of the “Turning Your Processes into Procedures” chapter. This time make the
dimensions 4 by 8.
3. Adjust the height and width of each column, making them:
- Column 2: Height=0.3” and Width=1”
-Column 3: Height=0.3” and Width=2.5”
-Column 4: Height=0.3” and Width=1.31”
4. The first row is used for table headings: Revision, Date, Description of
Changes, and Requested By. Bold the text in order for this row to stand out.
5. The rest of the table will be filled out as revisions occur. See Figure 51
Procedure Revision History for example format.
Figure 51 Procedure Revision History
Your procedure template is complete. Now you are ready to begin writing your
policies and procedures.
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6. Reviewing or Writing Your Policies
CHAPTER 6
Writing and Reviewing Your Policies
“Always be sincere, even if you don't mean it.” -- Harry S. Truman
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Policy Review Process

Now that you know how to format your document, it’s time to start writing the
actual procedure content. As you can see in the outline, before you get to the
procedure steps, a policy is required. Your company may already have policies
written. If this is the case, you should review them to ensure effectiveness. Your
policies are the foundation for your procedures; if they are not written correctly,
this could impact the usability of your procedures.
Why do you review anything? To ensure the accuracy and completeness of

whatever it is you're reviewing and to make sure everyone has the same
understanding of the policy, process, or situation. In short, to ensure effective
communication, which will lead you to the desired outcome.
Effective communication is a big reason why the international quality standard,

ISO 9001, mandates design and development reviews. If you don't review, you
risk missing any number of product requirements, both stated and unstated,
and you risk losing customers.
Objectives
With the policy review process, start with objectives or requirements gathered
in the discovery phase. Were they clearly communicated to the technical writer?
Did he/she understand them? Do you? Were the objectives prioritized and
categorized? Were they SMART objectives (see Chapter 1 for guidelines)?
Policy Achieved?
Did the technical writer achieve the stated policy objectives/requirements?
(Have a list of the objectives in front of you as you review the document).
Also, list some important, yet unstated, review objectives. For example, correct
spelling and good grammar are often taken for granted. Don't make that
mistake.
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Did the tech writer go beyond the stated objectives? For example:
The procedure mentions a packaging machine that a first-time reader

may not be familiar with. The tech writer includes a long shot (photo)
of the machine and a close-up of the control panel. The pictures aren't
a requirement; furthermore, they (and additional photos) push the
document beyond the stated requirement of "six pages, maximum".
Which is the SMARTer objective, user understanding or document length?
Feedback
In your policy review process, whether it’s written or oral, be sure to lead with
those aspects of the procedure where objectives were met or exceeded. If
critical procedure review objectives were not, consider possible explanations
for that (the writer's level of experience, competing projects, the amount of
information provided them, clarity of the objectives, etc.).
The point is not to let the writer "off the hook" (or to find a hook to hang them
on). It's about encouraging the writer – praising what they did well and asking
them to do better. Tell them, "Here's what you did well."
Don't be vague or insincere, either. Don't fish for compliments – you're not
helping them by telling them that their capitalization was great, or they had all
the commas in the right places. Be truthful, be specific, and give them
something to build on.
Remember that the policy review process is an integral part of a design and
development process. After you've reviewed the document, the writer will
probably have to make some changes. After the writer has revised the
document, review it again for errors.
Don't review it to death, however. Four or more reviews of the same document
should tell you that the review process has broken down...somewhere. It might
be time – at least temporarily – to bring in another pair of eyes.
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As a reviewer, you're obliged to:
 Be sure that stated and unstated objectives were met;

 Be fair;
 Be consistent;
 Be thorough; and
 Point out strengths and opportunities for improvement in the
document and in the process.
Fixing Bad Policies

If you review your policies and they meet the criteria, you can begin writing
your procedures. Unfortunately, most of the time this is not the case. Often, the
policy review process uncovers changes that need to be made. So, how do you
fix these policies so that they meet your standards?
Some business policies are the result of undesirable consequences or

something happens that shouldn't. For example, a door isn't secure from the
outside and someone gets in your building who doesn't belong. Now
management creates a policy restricting the door's use. For example, "That
door is for exiting the building ONLY in case of emergencies. It is NEVER to be
used as an entry." Should we be enacting business policies or fixing the door?
A few – such as high-level, or corporation-wide – business policies are designed

to promote desirable consequences for an organization, as well as prevent
undesired ones. Bad business policies cannot be corrected by procedures, no
matter how well the procedures are written.
Undesirable business policies are best solved by taking corrective action and
eliminating the bad policy. And how do we take corrective action?
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Describe the Policy Problem

Describe the bad business policy problem in clear, concise language. Get
several points of view on the problem – no one sees everything and everyone
sees the same thing differently.
Find the Policy’s Root Cause

Once you've begun to understand the policy problem, delve into it further by
looking for its root cause. A commonly used tool for discovering root cause
(because it's simple, effective, and time-tested) is "5Y", or "the five whys’” - keep
asking "Why?" until you've found the root cause of the problem. It's called "the
five whys" because nearly all root causes are identified by the fifth "why".
By then, it should be obvious that a one-time "quick fix" won't solve the
problem. The bigger challenge is how to keep the problem from recurring.
Well, that's where developing business policies comes in. It's a high-level look
at the situation. What are we going to do (or not do), what do we want to
achieve (or avoid), and, most of all, why?
It's a reasonable question, so why not answer the question before they ask?
Doing so at the outset will save you countless (and sometimes massive)
headaches. When you get buy-in from stakeholders, your compliance rate goes
way up.
Summarize Policy Actions

A policy merely summarizes the corrective action system. You might call it the
"cornerstone" of a corrective action system. The corrective action itself is the
heart of the system, a system that follows the "Plan-Do-Check-Act" model:
 PLAN the corrective action;
 DO, or implement the action and collect data;
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 CHECK the corrective action – see if the data prove that the corrective
action is effective or not and if not, change what doesn't work...or make
changes because "good" isn't "good enough"; and
 ACT - continue with the system unchanged, because it's yielding the
desired results, or implement the revised system.
Identify Policy Roles and Responsibilities

Identify roles and responsibilities with respect to the business policy. Don't just
say "the company" or "we" (unless, of course, you're dealing with a high-level
policy). The last thing you want to hear is, "I thought you were going to do it!"
Develop a Draft Policy

Once you've developed a business policy draft, have a reasonable number of
stakeholders review it. You might think those who are responsible for carrying
out the policy and enforcing it have the greatest stake (and you'd be right) but
you can't overlook the other employees, including management.
No one works in a vacuum. For instance, let's say you're working on a

purchasing policy. Give the Purchasing Department employees time to make
comments, but make the end of the comment period absolute. You can always
change it – nothing, not even policy, is set in stone. Focus on continuous
improvement, not delayed perfection, especially if it takes forever getting a
policy "perfect".
Review and Revise the New Policy

Revise the business policy as needed and get Management's approval – which
should be easy, since you've had them involved in the policy-making process.
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Writing Policies from Scratch

If there are not already pre-existing policies in place, you will need to write
some before you can start developing procedures. We’ve previously mentioned
that there are two types of policies – those outlining company rules and mission
statements found in procedures. So how, exactly, do you write a business
policy?
Company Rules
Company rules are found in your Employee Handbook. One example would be
sexual harassment. It is illegal in the United States to subject others to
unwelcome sexual conduct in a work situation. If you are going to write a
business policy, you would start with the law or regulation issued by the Equal
Employment Opportunity Commission (EEOC). The EEOC provides definitions
and additional information that will allow us to describe a company policy.
Every company should have a sexual harassment policy in their company

manual that reads something like this:
The Company is committed to providing a workplace free from sexual

harassment and as such prohibits the sexual harassment, or gender-
based discrimination of any employee.
A Policy in a Procedure
A business policy in a procedure acts as a mini-mission statement containing
the customer of the policy, its purpose, and a Key Performance Indicator (KPI)
to communicate how users know the procedure is working.
An example of a policy for an Accounts Receivable Procedure:
Accounts Receivable Personnel are responsible for the timely

preparation, distribution, and collection of invoices to optimize cash
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flow and customer payments while maintaining accurate records for

proper internal control.
In this example you see the customer of the policy is the Accounts Receivable
personnel. The purpose is to optimize cash flow and customer payments while
maintaining accurate records for proper internal control and the KPI is
optimized, timely and accurate. The procedure needs to define what optimize,
timely and accurate means.
Try to keep it to a single paragraph. A longer business policy is more complex

and is harder to follow. Here we have three KPIs to follow.
You could just as easily shorten the policy to:
Accounts Receivable personnel shall ensure that all outstanding

customer invoices are paid in a timely manner.
A shorter policy is more focused on a single KPI and much easier to follow.
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7. Writing Your Procedures
CHAPTER 7
Writing Your Procedures
“To be believed, make the truth unbelievable.” ‐‐ Napoleon Bonaparte
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Communication and Addressing Your Audience

Once you have reviewed or written your company policies, you can begin to
write the corresponding procedures. In order for your procedures to be
effective, it is vital that they are clearly written and easily understood by all
employees in your organization.
A major objective of writing policies and procedures is to develop and improve

a system of internal controls and, hence, compliance. Therefore, the most
important rule to remember is that clarity and readability are much more
important than style, perfect grammar, and a large vocabulary.
When writing, you should try to put yourself into the position of the users at
all times. It is a good practice to define the information needed for your
audience’s needs.
While developing policy and procedure statements, some general guidelines

to keep in mind are:
 Explain new or unusual terms the first time they are used or in the
definitions section of the statement.
 Avoid jargon wherever possible, especially when training new

employees.
 Avoid unneeded, excessive verbiage – get to the point.
 Avoid complex writing. If your vocabulary is unusually large or you write

using complex sentence structures, the writing may be at too high a
level for a majority of users. Reader comprehension is far more
important than grammatical or syntactic correctness.
 Write the way you speak – use words and phrases that you would
normally use when expressing the same thought/concept/topic aloud.
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Active Verbs
Your procedures should be written in imperative sentences, or active voice. This
means your procedures are made of tasks that you want someone to follow.
An imperative is where we are expressing a command. Procedures are step-by-
step descriptions that are not optional, they are imperative, as in commanding
your workers to do something specific.
For example, The Payroll Manager issues paychecks.
Either the Payroll Manager does or does not, it's not an option. If it is an option
then we need to qualify who issues paychecks. Otherwise, it is management's
decision that the Payroll Manager is the one that issues the paychecks. Hence,
the payroll procedure includes this imperative.
A good standard operating procedure (SOP) uses good verbs. The idea is to
find a verb that answers the question: "What is the procedure task
accomplishing?" Are you documenting, recording, analyzing, approving,
opening, closing, managing or measuring?
SOP Verb Examples:
 Writes / reviews  Negotiates / approves

 Documents / records  Forecasts / balances
 Starts / completes  Estimates / calculates
 Plans / maintains  Collects / distributes
 Analyzes / inspects  Opens / closes
 Designs / programs  Manages / measures
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Active Voice
Tasks should be organized in subject verb object order. We call this “Active
Voice.” It's active because we are using a direct style as opposed to a passive
voice or indirect.
Notice that the verb is right up front with the subject (ex: “The President shall
form a committee…” not “A committee shall be formed by the President”). We
want the reader to see themselves right away so they know this task is about
them. The verb is prominently displayed and is in a commanding position.
Sexism in Writing
The Merriam-Webster New Collegiate Dictionary defines "he" in the generic
sense or when the sex of the person is unspecified. However, many people will
not accept "he" being used when referring to people in general. There have
been suggestions that the generic "he" be replaced with "he/she" and "him"
with "him/her."
Gaining acceptance in recent history – the use of plural pronouns to refer to

singular subjects, such as, “When the employee orders supplies, they must
complete...”.
Often, it is more practical to use generic nouns or recast sentences to include

positions or titles (e.g., Applicant, Manager, Accountant, Driver) to eliminate
the need for sexism in policy and procedure statements.
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Organizing Your Thoughts

To help formulate and organize ideas for developing and writing policy and
procedure statements, it may be useful to outline the material to be covered.
Outlining is a fast and effective way to show a great amount of information in
a concise, efficient manner with a minimum of writing.
To achieve well-written and easily understood policy and procedure statements

that flow in a cohesive and logical form, you should first outline your thoughts
before beginning to write a statement.
When outlining a policy or procedure statement, you should be able to answer

the following questions:
What is the objective behind the statement? What do you want the
reader (the person assigned responsibility for the process) to
accomplish?
What is the company's policy on this matter?
Who is affected?
When is the policy or procedure appropriate?
How does the reader accomplish their objective? Outline the process
and order components (tasks or duties) in stepwise fashion, preferably
in chronological order.
Rule of Seven
Procedures are made of a series of activities and each activity is comprised of
a series of tasks. Each activity is a label that groups the steps together. The
tasks are your steps you want someone to follow to accomplish the activity.
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An example procedure:
Activity One – Planning, preparation or setup
Step One
Step Two
Activity Two – Perform, execute, or realize
Step One
Step Two
Activity Three – Complete, review, or cleanup
The “rule of seven” refers to a simple writing style that means:
 No more than 7 procedures to a process

 No more than 7 activities to a procedure
 No more than 7 tasks to an activity
 No more than 7 work instructions to a task
 No more than 7 lines to a paragraph
Keep it simple and brief to ensure your readers can follow along and
understand your writing. Long paragraphs, activities, instructions, tasks, and
procedures make it hard for the reader to follow along.
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Example procedure outline for making coffee.
Figure 52 Primary Procedure Steps
Once you have finished mapping the primary procedure steps (Figure 52
Primary Procedure Steps), convert your process map into an outline with the
detailed secondary steps (Figure 53 Secondary Procedure Steps) for easier use.
Once a task has been mapped, it should be tested.
Figure 53 Secondary Procedure Steps
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Figure 54 Making Coffee Procedure
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Most procedures end up looking like Figure 54 Making Coffee Procedure, very
focused on the task of making coffee and not the process results – making
good drinkable coffee. Tasked focused procedures are ballistic processes or
work instructions. To focus on the controlled process of making coffee we need
to structure the procedure in PDCA format (Figure 55 PDCA Procedure Format).
Each step in the PDCA format could be another work instruction procedure like
Figure 54 Making Coffee Procedure. The PDCA structure adds elements for
planning how much coffee we need to be prepared to make, how to make the
coffee, checking the coffee process for results, and adjusting the plan for
improvement. It is important to collect data in a controlled process in order to
stay on track and consistently make good drinkable coffee.
Figure 55 PDCA Procedure Format
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Number Usage
Writing and development of procedures often necessitates frequent usage of
numbers in the text. The following rules cover how numbers should be used in
print:
 Never begin a sentence with a number. Use the word representing the
number, instead. For example, "Fifty states have been admitted to the
union…", not "50 states..."
 Spell numbers one through nine in words, 10 or larger in numerals
(some authorities prefer you spell out the numbers one through
twenty);
 Compound numbers, such as fractions, in numeric form (e.g., “2.5 x 11.3
meters” rather than “two and one-half by eleven and three-tenths
meters”);
 When showing ratios/odds, use hyphens such as “4-to-1” (except for
scientific/mathematical audiences, who prefer “4:1”);
 When the quantity is less than one, a zero should precede the decimal
point (e.g., “0.5 percent” rather than “.5 percent”);
 Use numbers for years ("the 1990's", "2009");
 Spell out “%” as “percent”; and
 Follow numeric time with “a.m.” and “p.m.”, except where the 24-hour
clock (military time) is the norm (e.g., “0:00 - 23:59”, “12:00 a.m. - 11:59
p.m.”).
Reviewing and Approving Procedures

Origination of policies and procedures usually begins at the unit level by
employees or department managers. Now that you’ve written your procedures,
they should be reviewed, corrected if necessary and approved before being
released as a corporate policy and procedure statement. The approval process
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generally consists of review for consistency and accuracy, conflict with

corporate policy or with other statements and general readability.
The goal is to confirm that all text is properly formatted, relevant to the actual
workings of the company, easy to read and understand, and in compliance with
the target objectives, standards, and regulations that are the reason for the
engagement
Seven ‘C’s of Procedure Review

One of the issues with reviewing your procedures is consistency of each
reviewer. Different reviewers will see different things wrong with a procedure.
Some might focus on grammar, others on the content or compliance.
How do you get all of the reviewers on the same page?
One way is to create criteria for review. The criteria should cover the key
elements that a good procedure must contain. We call these the 7 C’s, which
can be easily defined in a simple review checklist.
Context
Procedures must accurately and appropriately describe the activity to be

performed and they must not exist in a vacuum. There is no such thing as a
stand-alone procedure – all procedures affect, and are affected by, other
procedures so it's best if you put a procedure in context. Where do its inputs
come from and where do its outputs go?
Some common questions include:
 Does the text accurately describe the required actions?

 Does the text provide sufficient detail to ensure the task can be
consistently performed with repeatable results?
 Do the Index and Table of Contents incorporate the major headings
and keywords from the text?
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 Are effectiveness criteria defined with measurable results and feedback

mechanism identified?
 Are the steps distinct? (not compound actions)
 Does the text address the three user types: Experienced, Occasional and
Novice?
Consistency
People often refer to policies or work instructions as procedures, but they are
not if you actually use work instructions then they are not the same.
Consistency also applies to references to such things as your Employee
Handbook, or Employee Manual, or Employee Procedures. Are these the same
or different? If they are published with different dates then they may not be
the same.
It is important to be consistent in the use of terms, labels, and references. Some

common questions include:
 Are the same labels used throughout for records, references, job titles,
terminology, filenames, etc.
 Are the Index, Table of Contents, and other Tables up-to-date,
complete and contain correct page numbers?
 Are references to other documents and records accurate, used
correctly, and have a similar cross-reference back?
 Do redundant passages exist in multiple procedures
Completeness
For obvious reasons, your procedures cannot have any gaps in information,
logic, or design. Incomplete information and instructions mean you won't get
the planned results.
 Are all paragraphs complete (no missing text or TBD)
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 Are all personnel references summarized under the Responsibilities

heading? (are they consistent with the job description?)
 Are all metadata headings (Purpose, Scope, Responsibilities,
Definitions, Procedure, References, Records, Effectiveness Criteria,
Revisions) present and filled-in?
 Are all references and records included?
Control
Procedures must be controlled. Otherwise, how does anyone know what the
current procedure is? Document control is communicated through the control
block that contains metadata about authors, reviewers, and approvers with
dates or revision information so readers can know the document they are
reading is current.
 Is the correct control tag used and filled out?

 Is the revision level correct?
 Are the approvals correct and current?
Compliance
Every procedure is written to ensure compliance with something – user needs

(stated and implied), regulations, company requirements, and other. Address
all requirements, not just some, in your procedures.
 Does the text comply with the Project Mission (Policy)?

 Does the text comply with the Project Objectives?
 Does the text comply with the Documentation Procedure?
 Does the text comply with all other relevant Procedures?
 Does the text comply with the relevant (ISO) standard(s)?
 Does the text comply with relevant laws and regulations?
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 Are all records and work instructions controlled within the Records
Procedures?
Correctness
Your procedures must be grammatically and syntactically correct. If they're

written procedures, there should be no spelling errors. If you plan on audio or
video procedures, be sure the speaker pronounces words correctly, speaks
clearly, and uses a style acceptable to the intended audience.
 Has all text been spell checked and proofed for grammar and
punctuation?
 Are all numbered bullets numbered correctly?
 Are all margins 1” with a ½” gutter?
 Are headers and footers used correctly with accurate page numbering
(Page X of XX)?
 Are there an even number of pages with all blank pages using a “[This
page intentionally left blank]” comment?
 Are one (or two) spaces used following a period?
Clarity
Write your procedures so they're easy to read (or view) and easy to follow.
Readers can be easily confused when different people refer to the same thing
using different terms. When writing a procedure it is important to be precise
and not be cavalier with terms, acronyms, abbreviations, or jargon that can
easily confuse.
 Is the document easy to read and understandable?

 Does the document follow the “Rule of Seven”?
 Does the text answer the 6 questions: Who, What, When, Where, Why
and How?
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 Could a graphic, table, chart, or picture be used to improve

comprehension?
 Does the text clearly identify the subject and place the subject in the
beginning of each paragraph? (Third person)
 Are action verbs used to identify the activity/task at the beginning of
the paragraph?
 Are attached exhibits referenced, used properly and explained within
the text?
 Is all text clear and understandable with all jargon defined?
 Does the document “flow” forward over time?
 Are cause/effect relationships clear?
 Are the words “will” and “should” used appropriately?
(Note: if in doubt, use “should”; use “will” sparingly.)
Procedure Approval Process

The procedure approval process can vary widely between companies, but it is
recommended that you keep required approvals to a minimum. If too many
managers are required to authorize a statement, it can turn the development
of statements into a bureaucratic exercise, which will considerably slow the
release of policies/procedures, while adding little, if anything, of value to the
document.
A method for gaining the input of others while streamlining the process and
keeping authority at the functional or departmental level is to release draft
copies of proposed statements to a select number of individuals for comment.
It should be made clear to these individuals that they should confine their
suggestions to what they feel is essential to the statement's accuracy,
readability, and usefulness.
Who should receive a draft copy depends on the nature and content of the
statement. Sensitive issues or areas that deal with corporate exposure, such as
personnel issues, intellectual property, and trade secrets, should be reviewed
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by Top Management, including the President (or chief executive officer) and
perhaps financial and legal counsel.
For rudimentary procedures that affect only a small unit within your company
– and are likely to be of no interest outside that unit – the review process should
be kept to a minimum; however, it is advisable to have someone familiar with
the unit but operationally outside of it.
For example, your company’s finance officer may review a proposed

accounting SOP.
This type of review serves three purposes:
First, what makes sense to you (as a writer) directly involved in enforcing the
policy or ensuring conformance to the procedure may not make sense to
someone not as closely involved. You’re writing for a number of people, some
of whom are not yet working for the company. People of varying backgrounds
will have to implement the procedure.
Second, reviews by more than one department manager may prevent

conflicting policy/procedure statements. You could be preparing statement "A"
while another employee is preparing statement "B" and neither of you have
knowledge of what the other is working on. The potential for conflicting
statements, while not necessarily great, is always there in such circumstances.
Reviews by multiple managers can lessen that likelihood.
Third, it allows the input of multiple individuals while allowing the department
manager to maintain the integrity of the statement and drive its completion
and release in a timely manner.
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8. Creating Your Policies and Procedures Manual
CHAPTER 8
Creating Your Policies and
Procedures Manual
“The superfluous is the most necessary.” ‐‐ Voltaire
127
Why a Policies and Procedures Manual?

Once your procedures have been approved, you can choose how you want to
distribute them. Developing a policies and procedures manual is not necessary
if there are only a few procedures. However, if you have many procedures
across multiple departments, it may be helpful to organize them into a policies
and procedures manual. What are the benefits of a properly developed
manual?
Conveys Management Philosophy
Your manual should be used to communicate both corporate policies and the
appropriate procedures for implementation of the policy in a combined style
format. Policies should not be confused with procedures.
Improves Communication
A manual serves to translate the company's business philosophies and desires

into action. A well-designed manual is an invaluable communication tool for
efficiently running operations within departments and bridging the gap
between interrelated departments.
Reduces Training Time
Your policies and procedures manual will be a functional guide for training new
and existing employees and should prevent difficulties in performing duties
due to lack of understanding or inconsistent approaches from personnel
changes.
Improves Productivity
Policies and procedures speed up decision making by employees by having a

handy, authoritative source for answering questions. Well developed and
documented manuals can ensure compliance with regulatory agencies
affecting your business such as the Occupational Safety and Health
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Administration, Food and Drug Administration, government contracting

authorities, and independent certification organizations.
Strengthens Operations
A comprehensive manual covering all departments within your organization

can become a "quality" manual for the whole company. This will help ensure
optimum operations and consistent delivery of the finest in product or service
from your company.
Distribution of the Manual

Company Management should decide which departments or positions will
receive copies of the manual. Alternately, sections of the manual may be
distributed only to specific functions/departments to which they pertain.
However, if the manual is to serve as a communication tool, copies of the
manual should be available to all employees.
Since the manual contains many essential and vital operating procedures,
reflecting the company's business policies and practices, there should be
accountability for the manuals. Generally, one individual will maintain a list of
the number of copies in circulation and the personnel (by name and title) to
whom they have been assigned. When a supervisor or manager leaves the
company, they should have a strong incentive to return their copy of the
manual; some companies withhold final compensation until the manual has
been returned.
Note that more companies use electronic document management software to

simplify document control and ensure accountability and compliance with
document control policies and regulations.
Content of the Manual

The simplest way to begin is to list all policies and procedures that you or other
employees have written and feel are important to your business.
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Naturally you'll want to cover as many policy and procedural areas as possible,
but don't overwhelm yourself or the personnel in charge of writing sections of
the manual by trying to take on too much at once. Start with those areas in
which you feel policy and procedure statements are absolutely essential and
then plan on adding less essential ones later on as time permits.
Items that should not go into the policy and procedure manual are as follows:
 Confidential information or trade secrets that are specific to your

organization.
 Highly voluminous or detailed information that is too comprehensive

to easily include in the manual and would be better served under its
own cover.
 Proposed policies or programs that are still in the planning stage. It is

better to wait until they are final to avoid miscommunication or
unnecessary obsolescence of the manual.
 Seldom used policy and procedure statements or ones that are unlikely
to reoccur. Avoid cluttering the manual with policy and procedure
statements that employees will probably never encounter.
 Any information that is likely to change often. For example, exact

calendar dates of holidays, telephone extension numbers, names and
titles of individuals in the company, etc.
For more content, you may be able to draw on other sources of information to
develop a comprehensive manual that truly meets the needs of your
organization.
These sources can include:
 Industry or trade association publications

 Management Consultants
 The company's legal, financial and accounting counsel
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 Other related company's policy and procedure manuals

 Internal memos and records
 In-house experts
 Employee surveys (can be formal or informal)
 Regulatory agencies (e.g., FDA, OSHA, UL, etc.)
 Small Business Advisory Centers
Defining the Format of Your Manual

After reviewing the preliminary listing of statements to be included in the
manual and discussing with the personnel assigned to each section, you should
be able to determine the estimated length and usage of your manual. Use the
guidelines presented in this book and your own organization's requirements to
determine the format of your policy and procedure statements and the
organization of your manual.
The format and appearance of your policy and procedure statements are just
as important as the organization and content of the manual. A manual that is
appealing to the eye and that emphasizes the importance of the statements is
more likely to be taken seriously and used on a regular basis by employees.
However, it is important to remember that the true objective of the manual is

to disseminate information in a timely and efficient manner – not to impress
the reader with intricate headings or fancy printing techniques.
The simplest format is often the best. A simple format allows for the most time-
and cost-effective production and maintenance of the manual. It may be best
to avoid temptations such as including detailed corporate logos in headings,
making two-sided copies, using odd-sized paper, expensive and restrictive
binding techniques, materials, and so forth.
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Design Features
No manual or procedure should ever be regarded as "complete" – the best
ones are designed for change. The best are geared to continual, incremental
growth over time and incorporate design features that make this kind of
growth possible.
Use of standard paper sizes and types, housed in three-ring binders, is the ideal
form for a hardcopy Manual. The three-ring binder allows for statements to be
inserted while the manual is being developed and provides for easy updating
through simple removal and replacement of pages. Further, as the organization
grows, the use of standard three-ring binders allows additional copies of the
manual to be produced on an as-needed basis instead of having to be
concerned with minimum production runs required for hardbound versions.
Production of statements on a single-side, standard size paper medium

provides for easy reproduction of the manual by high-speed copiers. Use of
single-side printing also provides for easy updating of the manual with changes
by allowing for one or two pages to be replaced without affecting the order or
sequence of the manual.
(However, if the manual becomes too voluminous, it may be necessary to bind

the manual by sections or utilize two-sided printing.)
A window-type binder may be used to describe the contents of the manual on

the spine and front cover, for easy recognition from a distance. The outside of
the binder may be imprinted with the company name and logo, to give the
manual a more professional and authoritative appearance.
Divider tabs on heavy stock should be used to separate functional areas or

departmental sections for ease in finding a specific statement.
For electronic manuals, as in soft copy, a consistent look – establishing a

corporate identity – is important. So is a monitor-friendly layout. Simple and
uncluttered, with graphic images strategically placed but not overused, is best.
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If possible, use just enough verbiage to explain a concept – refrain from making
the reader scroll up or down. Try to fit it in a single screen at 100%
magnification. Refer to Chapter 9 to learn more about publishing your policies
and procedures online.
Style and Mechanics

The style and mechanics of writing include the paper, typestyle and print
quality.
Paper - Some organizations use color to designate different manuals, sections

within manuals, forms, memos, etc. Colored paper does not always provide
adequate contrast from the ink color for ease in reading. Nothing is better than
black ink on white paper.
The grade of paper is usually not important, since the manual is for internal
purposes only and is not intended as a public relations effort. Regular twenty-
pound (20#) copy paper is adequate for single-side printing; a heavier weight
paper with greater opacity (e.g., 24# stock) may be necessary if double-sided
printing is used.
Typestyle - Avoid unusual artwork or type styles which can be difficult to read
and do not reproduce well over time. Strive for consistency in the overall
appearance of the manual, regardless of what area or department originates
the statements, by selecting a common typeface (font). Courier, Elite, Times
New Roman, and Arial are commonly used and available in most word
processing software.
Avoid using small print, photocopy reductions, ALL CAPITAL PRINT, or fancy
script. These are often difficult to read and lead to unnecessary eye strain and
fatigue.
Provide adequate margins on the page. Recommended margins are one inch
(1”) on top, bottom, left, and right. Mirror margins with a one-half inch (1/2")
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gutter are best for three-hole punching (see the “Working with Microsoft
Word” section in Chapter 5 for guidance).
Manual Organization
Knowing how to organize your policies and procedures manual will be vital to
its readability and usefulness. In deciding how you will organize your
procedures manual, you need to be concerned with how it is going to be set
up, what policies and procedures will be covered, how to efficiently handle later
updates or supplements, and ease of employees to quickly find and gather the
information they need. A guide for the organization of your policies and
procedures manual is described briefly below.
Foreword
The Foreword serves as an introduction to your policies and procedures manual
as a whole by presenting a concise summary of the company's operating
objectives and management philosophy. Sometimes the foreword can be in the
form of a letter from the company president emphasizing top management's
philosophies and support for the company policies that follow. This serves to
unify and signify the importance of the operations manual and helps to
determine the "theme" of the procedures manual.
Table of Contents
A table of contents must be provided in order to allow employees to quickly
find their area of interest and to outline the organization of your policies and
procedures manual. The table of contents should be placed at the very
beginning of the manual, where it will be seen immediately. The table of
contents should, at a minimum, list headings of major groups or classifications
of policies and procedures. A secondary table of contents should then be
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prepared for each section of the procedures manual, listing individual policy
and procedure statements and their location.
As an alternative, if the length of the manual and the frequency of revisions will
be kept to a minimum, it may be useful to list the individual policy and
procedure statements under the major headings on the main table of contents.
This will allow employees to determine the location of the section and policy
and procedure statements quickly from the front of the manual.
Policy and Procedure Statements

Your operations manual could be organized according to functional areas or
departments. This will facilitate easier use of the policies and procedures by
employees relating to their area. This also allows the procedures manual to be
subdivided into volumes in order to deal with large quantities of policies and
procedures. Each volume becomes a department policies and procedures
manual.
A policy manual grouped by departments or functional areas also allows for

the authorization of new and revised policies and procedures to fall under a
department head or supervisor and ensures the consistent approach to policies
and procedures within areas.
Optional Sections
When you go to organize your policies and procedures, you may also want to
include additional sections to each department policies and procedures
manual that relate to other operational matters in your company such as
organization charts, job descriptions (see Appendix B for examples), company
forms, and internal reports. The addition of these sections can provide one
cohesive and informative source for employees to access for all questions
relating to the operations of the company.
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Index
Depending on the length of the resulting procedures manual, it may be
appropriate to have both a table of contents at the beginning and an index at
the end. The index comes in handy primarily when the number of policies is so
voluminous that it would be time-consuming to have to search through the
entire table of contents to find a particular area of interest.
An index is also useful when it is unclear what heading a particular policy and
procedure statement might fall under or when a policy and procedure
statement applies to multiple functional or departmental areas. An index allows
employees to cross-reference areas or to find the topical area of interest by
searching an alphabetical listing. Of course, if your procedures manual is large,
then you should consider using policies and procedures management software
to control all of your documents.
The index should not be completed until the majority of the policy and
procedure statements have been written and approved. An easy method for
accomplishing development of the index is to review the final draft of the
manual and write the subjects covered under each statement in a spreadsheet
with the description of the statement and page number. Then sort this list into
alphabetical order for development of the index. Microsoft Word also has
various advanced functions for creating indexes and tables of contents using
cross-references and fields.
When you are in doubt as to which word or words a specific policy should be
indexed under, put yourself in the user's place and decide which subject an
employee would be most likely to look under first. If there is no clear indication,
then the index should have multiple entries.
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Case Study: Procedure Mistakes Add Up Quickly
Without knowing it, employees at a local auto parts company were having a
costly problem determining when to accept customer credit. The company
actually had a detailed credit application procedure, including an exhaustive
error correction routine, but the procedure had one fatal flaw: it was not
properly indexed.
Indexing Improves Procedures Usability
Without a way to readily locate and reference the applicable procedure in the
operations manual, employees could not find it and were simply not using it at
all, leading to an inconsistent process and wildly varying output. Potentially
valuable customers were regularly turned away by some staff members, while
others accepted bad credit risks because they were unsure of which ones to
reject.
A small omission like this can add up to thousands of dollars in lost sales and
good will. Even the most thorough procedures inevitably have gaps that come
from being “too close” to the process or not following the basic rules of
effective procedure writing.
Revising and Updating Policies/Procedures

Your Policy and Procedure Manual should never be considered complete – it
needs to keep pace, just as your company does, with the ever-changing
demands of the business environment. Your company cannot sit still and
neither should your Manual.
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All employees should be encouraged to initiate changes or revisions to policies

and procedures affecting their areas of responsibility. This will help the
company greatly in keeping its Manual up-to-date and relevant.
In addition to being subject to continual review, your manual should undergo

a complete audit as often as conditions within the company and regulations
dictate. This audit may take place every year or every other year, depending on
the company's business environment. Standards bodies like IFSB and AICPA
recommend that your management system, as well as your books, be audited
regularly and as frequently as practicable.
A new policy/procedure should be issued if the existing one is to be modified

in any way. The revised policy/procedure should undergo the same approval
process as the initial policy/procedure and should be assigned a new revision
number (level), to indicate that it supersedes the prior revision.
Superseded (obsolete) policies/procedures must be removed from the manual

immediately and properly discarded and all copies must be accounted for.
Electronic document management systems, though not easy to implement
initially, eventually make document revision easier to implement and track.
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9. Automate Your Policies and Procedures
CHAPTER 9
Automating Your
“What we really want is for things to remain the same but get better.”
‐‐ Sydney J. Harris
139
Controlling Your Procedures

Now that your policies and procedures are written, you need to find a way to
manage them. Policies and procedures should not just be simply collected, as
we oftentimes tend to do. Add in records and you have the making of a
problem common to business – a lack of control.
Document Control
A controlled document is typically one that is Revision sensitive. If a controlled
document is changed, we must have a History of All Changes. If a document is
changed, people who use it must know about the change. Every employee
must know how to check to see if the documentation they are using is the most
current version.
Record Control
Control of records and documents is critical to compliance. ISO 9001 requires
document control, record control, and specific procedures that clarify how you
are maintaining control. HIPAA requires access control and Sarbanes-Oxley
requires access and revision control. Document and record control are at the
heart of many of the various compliance schemes businesses encounter.
Controls are needed to approve documents prior to use as well as to review

and re-approve documents after changes. Controls ensure document changes
and current versions are identified and available at the points of use. Document
controls help to prevent the unintended use of obsolete documents.
If yours is a small business, you’re probably using one of two basic solutions:
manual or server based file sharing to control your policies and procedures.
The manual system consists of a series of file cabinets that contain your
business policies, procedures, documents, and vital records.
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Everyone is familiar with these manual systems. In fact, most businesses still
use these today, even though they may not be very secure, are hard to back
up, and take up a lot of storage space (especially the older files that are kept
offsite). As a business grows, it may find that retrieving vital procedure
documents and records can be a nightmare. Yet, we stick with paper
documents and filing systems because the up-front cost is considered
inexpensive, paper is easy to use, and we’ve always used it. Manual systems are
better than having no system in place, but there are more efficient alternatives.
File Control
Modern businesses use some form of file server to store and share their
policies, procedures, documents and records. A file server is often a shared hard
drive on your local area network (LAN). Shared drives have several advantages
over manual filing systems.
They are searchable, don’t take up as much space, and can be made somewhat
secure by restricting access using various file permission schemes. But, shared
drives require training (to various degrees), it can be difficult to index non-text
files (images), and they require back-up systems to prevent accidental changes
or deletions. And, as soon as you add an electronic back-up system, you’ve just
increased the complexity of the solution dramatically.
This is where document management software comes in. Using document

management software provides more than just file serving. Your document
management system (DMS) should provide the document and record control
that most compliance standards require and do it in a more user-friendly
environment. In other words, you should get more benefits for less work.
What do you get with document management software?
 Back-up / disaster recovery

 Security / access control
 Search / document retrieval
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 Compliance / record control

 Revision / document control
 Approval / document workflow
 Consistency / ease-of-use and training
 Flexibility / scalability
 Filing / record scanning
Why Invest in Document Management Software?

Now that you know the need for document management software, let’s take a
closer look at the four main benefits: security, saving money, efficiency and
compliance.
Security
Electronic files are a lot more secure than paper files. Document management
software can provide an audit trail that tracks every document change and even
file views. Electronic systems can be easily backed-up in case of natural
disasters like fire and flood. Bottom line: your electronic files are safer and more
secure.
Savings
The cost of manually producing, storing, retrieving and transporting paper
documents and records is high, very high. People are expensive and using
people to file, find and move documents is just not practical anymore. Think of
all the money you can save, and office space you can free up, if you eliminate
paper documents and records. Document management software virtually
eliminates the cost of searching for, or worse recreating lost documents.
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Efficiency
Retrieving paper documents from your storage location (is it off site?) is a
ridiculous waste of time. How long do you have to wait to obtain paper files?
Document management software systems let employees quickly access
documents and records from their desks, over the internet. No matter where
you are you can now quickly and easily retrieve important documents and
records.
Compliance
If document and records control are a requirement for compliance with
Sarbanes-Oxley, ISO 9001, HIPAA, or some other regulations then document
management software systems are simply the fastest, easiest, and cheapest
solution. All of your policies, procedures, work instructions, forms, regulations,
and customer documents can be tracked, controlled, and managed per your
compliance requirements.
Document management software provides compliance at a glance, access

control, physical security, audit history, review and approval workflows, email
alerts, and comment tracking. Reduce your document audit findings and keep
you company in compliance.
The Difference between Procedure Management

and Document Management Software
Document management is primarily focused on version control – automated
logging, tracking, and control of original documents and their revisions.
Version control generally includes document archival, as well. But what about
policy and procedure management? How’s that different?
For starters, policy and procedure management software must work within a
compliance environment. That is, policies and procedures don’t just tell us how
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and why we do things (their primary purpose), but they can also show your
company’s compliance with regulations and/or standards. For that reason,
policy and procedure management software has to enable clear document
control. Auditors look for such things as:
 Evidence that a policy or procedure was approved by the appropriate

party prior to use;
 A system of periodic policy/procedure review (and update, if necessary,

with reapproval); and
 Appropriate release of legible, identifiable versions at the point of use.
Workflow
The big difference between document management and policy and procedure
management software is in the workflow. Document versions can be easily
logged and managed in a database – document workflow requires business
logic (a set of rules) to move the document along, with specific workflow state
endorsements, or approvals (see Figure 55 Review and Approval Workflow).
An example of workflow state is in WordPress: blog posts first exist as a “draft”,

then move to “pending” (where an editor is notified that it is ready for review),
and finally it’s “published”.
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Figure 56 Review and Approve Workflow
In a policy and procedure management system, emails may be sent, the

document may be transformed from Word to PDF format on release (see Figure
55 Review Workflow), and point of use distribution lists may be maintained with
“required reading” logging.
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Figure 57 Release Workflow
Document management software is readily available from a number of

vendors, but very few of these products provide full policy and procedure
management features. Fortunately, Bizmanualz has developed an easy-to-use
system designed specifically for policies and procedures with complete (Figure
57) Document Compliance Workflow.
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Figure 58 Document Compliance Workflow
Bizmanualz OnPolicy Software

OnPolicy simplifies your policy and procedure software management by
providing an easy online interface to upload, manage, control and share your
important policy and procedure documents over your local intranet (LAN) or
the Internet (WAN) worldwide. There is nothing for you to install or manage,
and you can access it from anywhere on the Internet.
Now you can focus on what is important to you – ensure that your documents
are used as intended, up-to-date, and provide the document control evidence
that your auditor requires.
As a user, you want to be able to edit your policy and procedure management
software online in Microsoft Word, publish your policies and procedures in
Adobe PDF to the web, and use your policies and procedures in your native
web browser (Internet Explorer, Chrome, Mozilla, Safari).
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OnPolicy Features
OnPolicy has special features that a typical document management system
does not, such as:
 Documents are controlled to the standards set by ISO, Sarbanes-Oxley,

HIPAA, JCAHO, IATF, AS, etc.
 Full audit trail with full history is kept of all documents and revisions
 Approval process ensuring that a document is reviewed and approved
by the appropriate people before it is released
 Easy online accessibility so all policies and procedures documents are
available online 24/7 and accessible to any user from any internet
connection, anywhere in the world
 Multiple location access means all users in all locations access the same
information
 Version control ensures only the current version of each document is
accessible by your users in all of your locations
 Required Reading on published policy documents (now you know if
everyone has read that document).
 Compliance tracking print reports that track compliance of the required
reading
 User notifications each time a document version is released in the
system
 Fast text searching of all documents so you don’t have to waste a lot of
time looking for policies and procedures.
 The ability to introduce enterprise hierarchies to support complex
corporate structures (holding companies, divisions, subsidiaries,
departments, groups, teams, foreign companies). Big companies have
a lot of policy procedure documents organized in different ways.
 Dynamic hyperlinking to related documents (referenced forms, work
instructions, other policies, procedures, regulations, job descriptions,
process maps, notes, comments, requirements, and a host of related
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information). Static file share systems do not allow an easy method for
maintaining related document links after any version changes or new
releases.
Benefits of OnPolicy
Bizmanualz OnPolicy manages procedure workflow and simplifies compliance
through the following:
 Quicker access, search and retrieval of important policies, procedures,

forms and other documents.
 Complete document management with version control and edit history.
 Fast review, approve, and release workflow for new policies, procedures
and forms.
 Worldwide access to upload and update policies & procedures across
multiple locations, departments, and authors with complete access
control.
 Swift and simple tools that demonstrate compliance to regulating
agencies.
 Large savings in employee time and reduced paper costs.
 Software-as-a-Service means no need to worry about IT support for
installation, updates, backup, data security, etc.
A Closer Look at OnPolicy

Workflow starts with drafting documents and includes reviewing, revising,
approving, and releasing documents. The following images demonstrate how
workflow is managed through this software.
Home Screen
 Navigation tabs for access to your documents, reports and
administrative functions
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 Your Dashboard of activity

 Quick Links to frequently used features
 Announcements to your users
Figure 59 OnPolicy Home Screen
Figure 59 OnPolicy Home Screen shows the Home screen, which displays
announcements posted by the administrator and other users of the system.
You can manage a document by clicking on the document tab (Figure 60

Documents Tab). The production department folder in the left-hand navigation
shows the production-departments documents (Bizmanualz templates that
you purchase come pre-loaded and you can upload your own documents).
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Figure 60 Documents Tab
Expand the folders by clicking on the plus sign in the Department navigation
on the left-hand side (Figure 61 Documents Screen) to show its contents and
browse for documents in the list in the main window.
Documents Screen
 The Document Tree is organized by department and category. View all
documents or click on a department or category to narrow your view.
 The Document List shows all documents or only the documents
associated with the department or category selected.
 The Document Information section lists the version number for released
documents along with the file type (Word, Excel, etc.) and Document
Type (Policy, Procedure, Work Instruction, etc.)
 Button to easily Add a Document to your system.
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Figure 61 Documents Screen
You can view document details by selecting the document then clicking on its
icon or on the Details tab (Figure 62 View Documents).
Documents Details
 Document Name and Description – Documents can be searched based
on words in the description.
 Document Information shows the system generated version number
and the latest release date.
 The Workflow buttons control the movement of the document through
the approval process – Submit Draft, Accept Review, Approve Revision
and Release Revision
 The History shows the revision history of the document.
From this screen you can also access a detailed Activity Log shows a history of
all of the activities that were performed on this document along with who did
them.
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Figure 62 View Documents
Document details (Figure 63 Edit Document) shows information about the

document, such as the title, description, when the document was released,
review/retention intervals, and the most recent revision number (dot release).
Information about the document is entered here.
Figure 63 Edit Document
Document details is also where document workflow and permissions for the
document are managed, via 'People' in the third-level tabs.
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Stages of Workflow
Workflow in the Bizmanualz OnPolicy system is essentially a three-stage
process of reviewing, approving, and releasing. OnPolicy allows you to submit
draft documents and assign users to review them. This creates document
revisions that you can approve or reject. Certain users (that have the permission
to do so) can then release the document for all users to see.
Reader View
Most of your users will be readers. Readers are allowed to view only the
documents which have been released in the departments to which they are
assigned. They cannot submit, review, approve or release documents. They
cannot perform any administrative functions. Readers have a simplified
interface with the system.
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Appendix A
Appendix A
Sample Procedure
This book has described how to write policies and procedures, but it’s often
helpful to have a frame of reference. The following section contains a
completed example procedure.
Keep in mind, this format is aligned with business best practices. However, you
can make changes to it that better suit your company, as long as your format
is consistent throughout.
IT Project Management Procedure ITSW102
155
156
Appendix A
157
158
Appendix A
159
160
Appendix B
Appendix B
Job Descriptions
Well-written job descriptions benefit your company as an organizational aid

and an aid to communication. They identify individual responsibilities, help
coordinate and apportion work, and can prevent duplication of effort.
Care and diligence should be used in drafting job descriptions for your
Company. Tailor your job descriptions as closely as possible to the specific
requirements for each position.
WRITING JOB DESCRIPTIONS

These guidelines should be used as a resource to assist organizations in writing
job descriptions. The following sample Job Descriptions are general in nature
and cover various positions within a company. However, these descriptions are
only guides and are not all-inclusive of a person’s abilities or the requirements
for fulfilling the position.
A job description describes the most important elements of an employee’s

position. A good description begins with a careful analysis of the main job facts
– purpose, job responsibilities, individual tasks, methods, reporting
relationships, and the qualifications needed for the job.
Purpose
 The job description also serves as the basis for outlining job training or
conducting future job evaluations, including:
 Recruitment and selection.
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 New employee orientation and training.

 Job evaluation and review.
 Performance improvement, planning, and review.
 Training needs analysis and workforce planning.
All of the processes listed above provide an excellent opportunity to review job
descriptions to ensure that they are current and meet the needs of your
organization and workforce.
SCOPE
Job Descriptions should be prepared for all positions in the company to serve
as an organizational aid for identifying and delegating responsibilities,
coordination, and division of work and prevention of duplication of efforts.
Supervisors should be responsible for initiating drafts or changes to existing

Job Descriptions. Whenever practical, supervisors should interact with
employees in developing or reviewing descriptions for accuracy and clarity.
Job Descriptions should:
 Be current and appropriately represent the position and the needs of

the company at all times.
 Be updated whenever reassignments of duties or organizational
changes are required.
 Mirror the growth and changes of the company. Supervisors should
not fall into a routine of allowing individuals or their operations to be
governed by pre-existing descriptions.
 Be filed behind the respective department’s organization chart in the
Organization Structure section of the Company’s Policy & Procedures
Manual.
162
Appendix B
Supervisors should then work in conjunction with the Personnel Coordinator to

finalize the Job Descriptions. The Personnel Coordinator should be responsible
for typing, printing and distributing completed descriptions.
Job Descriptions are not absolute. Employees can be required to perform work
outside of the job description. The Fair Labor Standards Act (FLSA) limits the
types of work employees age 18 and older may be required to perform.
However, there are restrictions on what work employees under the age of 18
can do. This is true whether the work asked of the employee is listed in the
employee’s job description or not.
Written Communication
Jobs are subject to change due to organizational development and/or the
evolution of new technologies. Flexible job descriptions encourage employees
to grow and make larger contributions to the company. A well-written,
practical job description will avoid refusals to carry out relevant assignments
because “it isn’t in my job description.”
For example: If your office manager is stuck;
“Routinely ordering office supplies for the company and keeping the storage
closet well stocked,”
then rewrite the task description to involve more initiative and scope.
Try:
“...developing and implementing a system of ordering office supplies that

promotes cost savings and efficiency within the organization.”
Non-discriminatory language
Discrimination is unlawful, unproductive, and inappropriate within a business
organization. It is important therefore that job descriptions do not contain
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discriminatory terms or result in a discriminatory outcome, both of which tend

to exclude potentially good candidates from job opportunities.
Non-discriminatory language is used to include rather than exclude people and

is typically concise and more accurate than the other terms. It sends a clear
message that your organization is unbiased and does not condone the use of
stereotypes. Using non-discriminatory language in your job descriptions
demonstrates equal employment opportunity (EEO).
For example, terms like “cleaning lady” and “foreman” tend to exclude on the
basis of gender. By using terms such as “cleaner” and “supervisor” instead, the
job description will be inclusive and nondiscriminatory. Also, be mindful of
using pronouns that tend to exclude, such as “his, he, him” or “her, she.”
Active voice
Active voice rather that passive voice is recommended when writing job
descriptions, particularly responsibility statements, because it is a more direct
and concise style of writing.
Passive voice example:
As may be necessary, to coordinate with suppliers, the incumbent

must answer telephone enquiries.
Active voice example:
Coordinate and negotiate with suppliers all equipment purchasing

and delivery.
Note that the active voice example is more direct and less focused on how
the task is achieved (i.e. by the telephone) and more focused on the
outcome (i.e. purchase and delivery of equipment).
164
Appendix B
Action verbs
Action verbs are used to directly and concisely describe actions and are more
effective in the present tense.
Active verb example:
“Approve and verify (action verb and present tense) financial reports to
comply with legislative and government financial reporting
requirements.”
This is an example of how action verbs are used in the present tense to keep
job responsibility statements short and to the point.
Plain English
Complex sentence construction and jargon is difficult for most people to
understand and tends to exclude potentially good candidates for a job, thereby
reducing the applicant pool. Plain English simply means writing in a way that
is direct, clear and concise.
Be aware that in our work most of us routinely use jargon and acronyms that
can be confusing to both internal and external people. For example, “EOE”,
“DIR”, “MGR”, “EEO”, and “QA” may not be universally recognized
abbreviations. Write in plain English by avoiding acronyms and/or explaining
what they mean at least once. Avoid long or complex sentences and phrases
that include redundant words. Use an active voice with action verbs to reduce
confusion.
Brevity
There are no rigid rules about how long a job description must be. It is
recommended however that job descriptions are concise. A good job
description would provide sufficient detail about the job to provide an accurate
165
and straightforward description of the job. This will enable applicants and job
evaluators to understand the key elements of the job and work environment.
The job description doesn’t have to include significant detail about the
organization because information about the organization is included in
documents sent to applicants and is available on the Internet. Applicants can
also obtain more detail about the job and the organization on request from
the contact officer.
FORMAT AND CONTENT

Job Descriptions should be prepared using a Job Description Format similar to
the samples at the end of this section. Any unusual needs or requirements for
the position should be added in a separate section. The format outline should
be completed as follows:
Job Title
The title should be short and simple yet as descriptive as possible. The
applicable department should be listed.
Effective Date
This is the latest revision date to the description or the implementation date.
Department
Identify the Department-by-Department Code and/or Department Name.
Summary of Functions
This should be a one or two sentence statement encompassing the basic
function and objectives of this position so the applicant or employee can grasp
at a glance the key reasons why the job exists. It should enable anyone
166
Appendix B
reasonably familiar with the organization to understand the primary purpose

of the position. Any constraints, particular emphasis or shared responsibility
can also be mentioned.
Below are some typical examples. Notice each begins with an action-verb
followed by specific details of what is done and why it is done.
Example: financial position
“Contribute to the planning, development and implementation of financial

policy that will ensure that income exceeds expenses.”
Example: managerial position
“Manage the human resources of the organization efficiently and effectively, to

achieve employment performance outcomes.”
Example: supervisory position
“Supervise and manage the maintenance staff to achieve effective and efficient
high quality maintenance services.”
ESSENTIAL DUTIES AND RESPONSIBILITIES

This section should briefly describe specific job tasks with details of the major
duties and/or responsibilities for performing the job. Whenever possible use
descriptive terms related to the objectives or action of a particular function
rather than to indicate merely what is done. It is very important to note specific
deliverables for a task.
For example, the statement:
“Supervises all personnel that process customer orders for shipment and
billing.”
Could be better stated as follows:
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“Supervises Telemarketers in taking phone orders from customers and

processes all orders within 24 hours to ensure prompt shipment and billing.
Manages daily activity reports to optimize resources for number of calls taken,
average call length, average call volume per hour, number of orders taken, and
average sales per call."
It is recommended that job descriptions contain no more than ten duties,

ideally five or six duties is best in order to make the responsibilities description
easier to understand. Try to describe all the specific aspects of each job in a
short space. Related tasks or activities should be grouped together to describe
what is to be achieved. Usually, the higher level jobs use broader duty
statements.
For example, the word “manage” incorporates a considerable range of separate

tasks that comprise a full set of managerial responsibilities.
Analyzing the job helps in developing brief statements that describe the duties
of the job. Start by listing all single activities or tasks. Then, list all the
outcomes or results to be achieved in the job. And finally, group together
related tasks to make up an entire process or service.
Group Several Tasks into a Single Responsibility

The separate tasks of writing letters, taking and making calls to customers,
dealing with customer complaints and giving them advice, can be grouped into
a statement like “Maintain good customer relations and provide a timely and
accurate advisory service to customers.”
Points to consider when writing clear, brief job statements:
 List the duties in a way that highlights their general order of importance.
 Include important but infrequently performed duties.
 Use active voice in the present tense.
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Appendix B
 Use action verbs which best describe the task or activity (see examples
are in Appendix 1, List of Action Verbs.).
 Refer to critical timeframes to be achieved.
 Focus on the results, outcomes to be achieved, or deliverables required
rather than the way a duty is to be performed.
The last point is important to consider because the way a job is described can
result in unlawful discrimination. Stating exactly how the job is to be done may
disadvantage specific groups of people such as those with disabilities. By
recognizing that job outcomes can be achieved in different ways, emphasizing
outcomes is more inclusive.
Writing results-oriented job statements

 The main action to be performed (action verbs are helpful).
 The result or outcome to be achieved (why it is done), and, if applicable:
 Include resources or equipment to be used and to whom the action
relates.
Responsibility Statements
Develop, deliver, and evaluate education and training programs to enhance
staff knowledge and skills that will result in improved service delivery to
Institute customers.
Provide computer-based administrative support services for the Director and

staff including: word processing, spreadsheets, database updating.
Monitor the budget and report to the Director on the current financial status
of the Faculty at the end of each month to ensure expenditure remains within
the Faculty’s budget allocation.
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Delegated Responsibilities
Many jobs include decision-making authority delegated under legislation or by
the Board of Directors or Top Management and can be a significant part of the
job. This information is important for job evaluators and applicants to gauge
the level of responsibility of the job.
Where a job has a significant number of delegated responsibilities far too

numerous to write in detail, the general statement such as the one below can
be used. Detailed information can be given to applicants on request,
particularly external applicants who do not have ready access to the
delegations manuals.
Other indicators that can be used to show the level of responsibility or influence
the job include:
 The total annual budget allocation.

 The annual budget for programs, salaries, administration, equipment,
and resources.
 The number and employee groupings of staff reporting directly and
indirectly.
 A sample of the key delegated responsibilities such as $100,000 for
contract approval.
 Significant advisory roles (e.g. policy advice to state, national, and
international forums).
Organizational Relationships
This section should outline the reporting relationships between this position
and other key positions including supervisors and positions supervised. This
statement should also include the requirements for coordination with other
positions or departments.
170
Appendix B
Reporting Relationships
Reporting relationships say a lot about the organizational environment. A
brief description of who reports to who, particularly in the form of an
organizational chart, helps to clarify job expectations and level of
responsibility. A simple organizational chart may be preferred by applicants
because a visual representation is often more effective than words in
conveying a message. In either case, the best rule is “Keep it simple!”
A useful guide for what to include is:
 The title and classification of the supervisor/manager to whom the

jobholder reports to directly, and the next job-level above.
 Other jobs reporting to the same supervisor/manager.
 Any jobs and their classification level reporting to this job.
 Any significant indirect reporting relationships (e.g. reporting but not
supervisory relationships).
The Organization’s Environment

Optionally, a statement about the organization’s environment can be added to
provide useful information about the nature of key challenges the organization
faces, particularly those directly affecting the work unit and the job. Keep this
as brief as possible in order to reduce confusion.
For example:
“The primary role of the Department, Region or Division is…”
“Major strategies promoted by the organization, its key goals or values are…”
“Primary objectives of the work unit, its functions and where the job fits in are…”
“Important environmental factors such as legislative or policy; client base;

nature of work and client demand; geographical location or changes impacting
the job and service provision are….”
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QUALIFICATIONS
If applicable, indicate the minimum requirements necessary to be able to fill
the position. Use this section to list the Selection Criteria for applicants.
For example, this can include a description of the minimum years of experience
or accomplishments in specific job categories or completion of degrees from
colleges, technical or trade schools necessary to perform this job.
Selection criteria are the factors against which job applicants are assessed for
their suitability to the job. It is therefore critical to develop selection criteria
that will clearly and accurately describe the knowledge, skills, abilities, and
qualifications required to perform the job successfully.
There are two types of selection criteria - mandatory requirements and key
selection criteria that relate to the purpose, duties, and responsibilities of the
job.
Mandatory requirements
A mandatory requirement for the job is included when it is considered
necessary to selection criteria. Specifying mandatory requirements when they
are not necessary to perform the job can reduce the applicant pool
considerably and may potentially result in indirect discrimination.
Educational qualifications are the most common mandatory requirements

specified in some job descriptions. Some others may be:
 An automobile driver’s license, commercial, or heavy vehicle license.

 A license or certificate by a registration board or professional body.
 Membership or eligibility for membership of a registration board or
professional body.
 A boat or captain’s license.
Example - Professional
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Appendix B
 Possession of a degree from a recognized educational institute,

diploma or associate diploma in [indicate specialist field such as
drafting], or agreed equivalent as determined by the Director of Human
Resources.
 Providing eligibility for professional certification such as a Certified

Public Accountant (CPA) or Professional Engineer (PE).
 Association or other qualification acceptable to the Director of Human

Resources.
When writing mandatory requirements, it is recommended that you indicate

the area of specialization (i.e. psychology, information technology) rather than
the specific name of the qualification (e.g. Bachelor of Arts – Psychology). This
will help to avoid unnecessary restriction on the applicants.
The Director of Human Resources should determine whether an applicant has

demonstrated learning equivalent to that which would have been acquired
through achievement of a relevant mandatory qualification such as a degree.
Key selection criteria

Key selection criteria are the key (but non-mandatory) competencies that job
applicants will be assessed against for employment.
It is recommended that job descriptions contain no more than five or six key
selection criteria. Job applicants and selection committees will benefit from
this because the tasks of applying for a job and assessing candidates is more
manageable if the number of selection criteria are limited.
The most important consideration is whether the selection criteria accurately

and comprehensively describe the competencies of the job in an easy to
understand way.
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Developing Selection Criteria

Some points are particularly relevant to promoting the Department’s key aim
of equal employment opportunity:
 List the selection criteria in a way that emphasizes their order of

importance.
 Use selection criteria that are measurable so applicants can be assessed
on how well they meet the criteria (i.e. typists must be capable of
accurately typing XX words per minute).
 Use active voice in the present tense.
 Avoid ambiguity and grouping unrelated competencies together.
 Apply the concept of transferable knowledge, skills, and abilities or the
potential to acquire such competencies on the job or with further
training.
 Specify the generic skills required for the job rather than specifying
organizationally-specific knowledge and experience.
 Include a selection criterion requiring awareness of or commitment to
your key organizational values (e.g., ethical standards of practice, equal
employment opportunity, non-discrimination, workplace health and
safety, quality customer service, etc).
NOTE: Testing for skills that are necessary to perform the essential
functions of the job must be administered to all applicants for the
same position, whether or not they have a disability. If testing is
performed then make sure the test criteria are well documented in
the job description.
Appropriate selection criteria can be developed by analyzing the particular

competencies (i.e. knowledge, skills, abilities, and qualifications, if any) needed
to achieve the outcomes of the job.
For example
 Skills, knowledge, abilities:
174
Appendix B
 Good written and verbal communication skills.

 Time management skills.
 Above average interpersonal communication skills.
 Problem-solving skills.
 Research and analytical skills.
PHYSICAL DEMANDS
The Physical Demands section can assist the company in identifying the most
qualified applicant available for a specific job based on reasons unrelated to a
disability. The documented demands of a job can be used as a basis for
Americans with Disabilities Act (ADA) compliance or workers compensation
claims.
Use this section to list the typical demands for applicants. Explain the primary
demands that require physical and/or mental activities with enough detail in
order to make a reasonable distinction for (see ADA below) and workers
compensation issues that may arise.
For example, consider each of the five senses (sight, sound, smell, vocal, and
touch) and determine how they may be necessary to perform this job.
 Ability to communicate orally with others. (co-workers, supervisors,

vendors).
 Regular use of the telephone and e-mail for company communication
is essential.
 Sitting for extended periods is common.
 Standing at a workstation for extended periods.
 Hearing and vision within normal ranges is essential for safe conduct
on the manufacturing floor.
 Ability to distinguish standard colors.
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 No heavy lifting is expected. Exertion of up to 10 lbs. of force

occasionally may be required (e.g., the approximate weight of 3 large
telephone books).
 Good manual dexterity for the use of common office equipment such
as computer terminals, calculator, copiers, and FAX machines.
Then consider the mental requirements that may be necessary to perform this
job.
 Good reasoning ability is required to solve a wide range of business

problems.
 Able to perform basic mathematics; addition, subtraction,
multiplication, and division.
 Able to apply statistical calculations, analysis of variance, correlation
techniques, and sampling theory as well as algebra, linear equations,
and other analytics as required.
 Able to understand and utilize financial reports and legal documents to
conduct business.
The documented demands of a job can become a very important element of a
company’s defense for ADA compliance or workers compensation claims.
WORK ENVIRONMENT
Describe the environment of the position. Explain any special circumstances
evolving the physical area that may be important. Is it load and noisy, quit,
dirty, dangerous, hot or cold, indoors, outdoors, an office or a factory.
For example, in an office:
The job is performed indoors in a traditional office setting. Activities include

extended periods of sitting and extensive work at a computer monitor and/or
calculator.
176
Appendix B
Americans with Disabilities Act (ADA)

The Americans with Disabilities Act gives civil rights protections to individuals
with disabilities similar to those provided to individuals on the basis of race,
color, sex, national origin, age, and religion. It guarantees equal opportunity
for individuals with disabilities in public accommodations, employment,
transportation, State and local government services, and telecommunications.
The title I employment provisions apply to private employers with 15 or more

employees, State and local governments, employment agencies, and labor
unions. The ADA prohibits discrimination in all employment practices,
including job application procedures, hiring, firing, advancement,
compensation, training, and other terms, conditions, and privileges of
employment. It applies to recruitment, advertising, tenure, layoff, leave, fringe
benefits, and all other employment-related activities.
Job Performance
An employer can hold employees with disabilities to the same standards of
production or performance as other similarly situated employees without
disabilities for performing essential job functions, with or without reasonable
accommodation. An employer can hold employees with disabilities to the
same standards of performance as other employees regarding marginal
functions unless the disability affects the person’s ability to perform those
marginal functions.
If the ability to perform marginal functions is affected by the disability, the

employer must provide some type of reasonable accommodation such as job
restructuring but may not exclude an individual with a disability who is
satisfactorily performing a job’s essential functions.
The ADA is not an affirmative action law. An employer is free to select the most
qualified applicant available and to make decisions based on reasons unrelated
177
to a disability. For example, suppose two persons apply for a job as a typist
and an essential function of the job is to type 75 words per minute accurately.
One applicant, an individual with a disability, who is provided with a reasonable

accommodation for a typing test, types 50 words per minute; the other
applicant who has no disability accurately types 75 words per minute. The
employer can hire the applicant with the higher typing speed, if typing speed
is needed for successful performance of the job.
The ADA does not restrict an employer’s ability to establish education related
requirements, such as “high school graduate,” provided the requirement is job
related and consistent with business necessity and not intended to screen out
persons with a disability.
Section 503 of the Rehabilitation Act of 1973

Federal contractors and subcontractors who are covered by the affirmative
action requirements of section 503 of the Rehabilitation Act of 1973 may invite
individuals with disabilities to identify themselves on a job application form or
by other pre-employment inquiry, to satisfy the section 503 affirmative action
requirements. Employers who request such information must observe section
503 requirements regarding the manner in which such information is requested
and used, and the procedures for maintaining such information as a separate,
confidential record, apart from regular personnel records.
A pre-employment inquiry about a disability is allowed if required by another

Federal law or regulation such as those applicable to disabled veterans and
veterans of the Vietnam era. Pre-employment inquiries about disabilities may
be necessary under such laws to identify applicants or clients with disabilities
in order to provide them with required special services.
178
Appendix B
Job Descriptions
The ADA does not require employers to develop or maintain job descriptions.
However, a well written job description that is prepared before advertising or
interviewing applicants for a job will be considered as evidence along with
other relevant factors and can help defend against charges of discrimination.
If an employer uses job descriptions, they should be reviewed to make sure
they accurately reflect the actual functions of a job.
A well-written job description can play an essential role in defending against

charges that someone with a disability was unlawfully denied employment or
was unlawfully refused an accommodation. A job description outlining
essential and non-essential job functions is the first step in identifying an
employer’s ADA obligations to an individual employee.
A job description should focus on the results or outcome of a job function, not
solely on the way it is customarily performed. A reasonable accommodation
may enable a person with a disability to accomplish a job function in a manner
that is different from the way an employee who is not disabled may accomplish
the same function.
Reasonable Accommodation
Reasonable accommodation is any modification or adjustment to a job or the
work environment that will enable a qualified applicant or employee with a
disability to participate in the application process or to perform essential job
functions. Reasonable accommodation also includes adjustments to assure
that a qualified individual with a disability has rights and privileges in
employment equal to those of employees without disabilities.
Examples of reasonable accommodation include making existing facilities used

by employees readily accessible to and usable by an individual with a disability;
restructuring a job; modifying work schedules; acquiring or modifying
179
equipment; providing qualified readers or interpreters; or appropriately

modifying examinations, training, or other programs.
Reasonable accommodation also may include reassigning a current employee

to a vacant position for which the individual is qualified, if the person is unable
to do the original job because of a disability even with an accommodation.
However, there is no obligation to find a position for an applicant who is not
qualified for the position sought.
How to Write a Job Description
to Provide Reasonable Accommodation
1. Start with an analysis of the job that
determines the essential functions.
2. Identify how a disability may affect the
essential functions of the job.
3. Identify possible accommodations needed to
overcome any limitations.
4. Determine the effectiveness and feasibility of
the proposed accommodation.
5. Select the appropriate accommodation that
satisfies the employee’s preference.
Employers are not required to lower quality or quantity standards as an

accommodation; nor are they obligated to provide personal use items such as
glasses or hearing aids. The decision as to the appropriate accommodation
must be based on the particular facts of each case.
In selecting the particular type of reasonable accommodation to provide, the

principal test is that of effectiveness, i.e., whether the accommodation will
180
Appendix B
provide an opportunity for a person with a disability to achieve the same level
of performance and to enjoy benefits equal to those of an average, similarly
situated person without a disability. However, the accommodation does not
have to ensure equal results or provide exactly the same benefits.
Accessibility
Access to application materials and interview sites must be provided to
applicants with disabilities. Accessibility and usability apply to the needs of all
qualified individuals with disabilities including those with visual, hearing, or
mental impairments.
Sample Job Descriptions

Sample job descriptions are included for the Chief Financial Officer and a
Technical Writer. These samples can be used as a template for developing your
own job descriptions.
181
182
Appendix B
183
184
Appendix B
185
186
Appendix B
187
188
Appendix C
INDEX
Accounts Receivable Policy .............. 22 employee handbook .................. 4, 109
Accounts Receivable Procedure .... 109 Employee policies ............................ 22
acronyms ....................................... 124 equal employment opportunity .... 164
active voice .................... 113, 114, 164 Equal Employment Opportunity .... 109
Activity maps ................................... 67 Fair Labor Standards Act ............... 162
adaptive process.............................. 43 flowcharts ........................................ 61
affirmative action law .................... 177 Gap Analysis .................................... 15
Americans with Disabilities Act ..... 176 high‐level process map .................... 59
ballistic process ............................... 42 HIPAA ............................................. 143
ballistic processes ............................ 44 ISO 9001 ........ 29, 52, 59, 61, 104, 143
business manual ................................ 8 jargon ............................................. 112
business policy ............................... 108 job descriptions ....................... 16, 161
cash cycle ................................... 45, 60 job training .................................... 161
checklists ......................................... 28 Key Performance Indicators ............ 64
continuous improvement .... 12, 31, 64 low‐level process map ..................... 60
control block ...................... 75, 96, 123 manufacturing cycle .................. 46, 47
Control of records.......................... 140 margins ............................................ 82
control tag ..................................... 123 material order request & receiving
controlled document ..................... 140 process ......................................... 70
controlled processes ....................... 42 metadata ....................................... 123
core business processes .................. 48 Microsoft Word ............................... 81
core processes ................................. 59 mission statement ......................... 109
COSO ................................................ 31 novice users ..................................... 34
credit approval process ............. 62, 66 Number Usage ............................... 120
Definitions ....................................... 80 Occasional users .............................. 34
design flow ...................................... 47 Order Cycle ...................................... 59
Document control ................... 16, 123 Order‐To‐Cash Cycle ........................ 59
document management software 129, Page Layout ..................................... 82
141 PDCA ................................................ 54
document map ................................ 64 policies ....................................... 20, 26
document workflow ...................... 142 policy ............................................... 79
Documentation Procedure ............ 123 policy objectives ............................ 104
Effectiveness Criteria ....................... 80 policy review process .................... 105
189
Policy Writing .................................. 35 revenue process .............................. 41
procedure ........................................ 26 revisions .......................................... 81
procedure approval ...................... 125 root cause ..................................... 107
procedure content ........................ 104 rule of seven.................................. 116
procedure format ............................ 72 Sarbanes‐Oxley ............................. 143
procedure management software 143 scope ............................................... 79
procedure review .......................... 144 sexual harassment ........................ 109
procedure steps .............. 99, 104, 117 SIPOC ......................................... 53, 64
procedure workflow ..................... 149 SMART ............................................. 14
procedures management software SMART objectives ................... 32, 104
.................................................. 136 SOP .................................................... 3
process flow .................................... 52 standard operating procedure ...... 113
process improvement ............... 22, 66 Standard Operating Procedure . 20, 72
process map ............................ 52, 117 Subject Matter Expert ..................... 27
processes and procedures . 18, 40, 41, supervisors .................................... 162
46 swim lane process map ............. 62, 63
Production Cycle ............................. 60 UML symbols ................................... 61
purpose ........................................... 79 Unified Modeling Language ............ 58
Quality Management System.......... 59 Value Stream Maps ......................... 66
records ............................................ 81 version control .............................. 143
References ...................................... 81 work instructions .... 22, 26, 27, 28, 40,
Rehabilitation Act of 1973 ............ 178 66, 116, 122, 124, 143, 148
rendered process map .................... 69 workflow ....................................... 144
responsibilities ................................ 80 Workflow diagrams ......................... 68

190

ABOUT THE AUTHOR

Chris Anderson is the managing director at Bizmanualz, Inc.,
which he started in 1995 to make established business
management tools easily available. He is the co‐author of
many of the policies and procedures manuals; assisting in the
process design, writing, and implementation of the
information. Chris is the primary instructional designer for
the business process training programs and is a Principal
Consultant and project leader on various Bizmanualz Lean ISO
Quality consulting assignments.
His background includes:
 MBA, Pepperdine University, Malibu, CA.
 BS Electrical Engineering, Southern Illinois University, Carbondale IL, Math
and Computer Science Minors.
 IRCA Certified ISO 9000 Lead Auditor and Internal Auditor Training.
 ISO/TS 16949:2009 Lead Auditor and Internal Auditor Training.
 Lean and Six Sigma Black Belt, (Advanced Manufacturing Specialist) Missouri
University of Science & Technology
 American Society for Quality (ASQ) Certified Quality Auditor (CQA), Certified
Manager of Quality/Operational Excellence (CMQ/OE), Certified Quality
Process Analyst (CQPA), and Certified Quality Improvement Associate (CQIA).
 Missouri Quality Award (MQA) Examiner (2007‐2009)
 ITIL version 3 certification.
 Instructor and consultant for Bizmanualz ISO 9000 Auditor training, Lean
Thinking, Innovation in Design, and Well‐Defined processes classes
 Industry experience within ISO 9001 manufacturing, AS 9100 Aerospace,
ISO/TS 16949 Automotive, 21 CFR 802/ISO 13485 medical device, Sarbanes‐
Oxley Accounting, and ITIL Information Technology compliance.
191

How To Write Policies Procedures Bizmanualz Inc

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How to Write a

Policies and Procedures

Other Bizmanualz Books

Figure 1 shows where procedures fit in the deployment of a company’s

Policies and Procedures

Other procedure supporting documents may include:

Employee Policy Manual

Bizmanualz produces a full range of easily editable Microsoft Word templates

 Accounting Policies for controlling assets

Your customers are entitled to consistent service delivery based on established

Scope of this Book

Evaluating Business Success

In football, teams have a playbook defining, step-by-step, every player's job on

Policies and Procedures Are Your Business Success

For example, most companies measure On Time Delivery (OTD), or at least

What are Procedures For?

Some common reasons to have procedures are:

 Compliance means the government or some standards body has

Procedures Are For Managers

Mangers also use procedures to ensure that preventive maintenance is

 Why is this machine breaking down?

Management’s job is to ask questions and hold maintenance accountable to

Management procedures do not represent a onetime event where

The goal is continuous improvement, not perfection. Management does not

Five Phases to Building an Effective Management

Oftentimes, when a company attempts to establish an Effective Management

Establishing objectives and criteria requires close scrutiny by management of

specifically what you need to accomplish. Objectives must be set considering

S - Specific: Very unambiguous, explicit targets

T - Time based: Expressed or measured during a specific time period

Planning phase outputs include:

 Project roles and responsibilities

Before concluding the Planning Phase, a review is conducted of each

Be sure to complete the process documentation and a review of all your

Implementation is all about information and assessment. You must be

previously missed. Returning allows us to go through the same path of the

Procedures are used to document company knowledge to ensure important

A Standard Operating Procedure is just that, a standard. An important aspect

It is essential to have a written method of controlling a practice in accordance

The Difference between Policies and Procedures

As stated before, a procedure is a particular way of accomplishing something.

Procedures provide a platform for implementing the consistency needed to

Example Accounts Receivable Procedure:

7. Send all invoices outstanding for 90 days to collections.

A procedure could be something as simple as a checklist. The goal of a

On the other hand, a policy is a guiding principle used to set direction in an

The second type of policies are mini-mission statements frequently associated

Example Accounts Receivable Policy:

Accounts Receivable personnel shall ensure that all outstanding

the documentation process much better and, therefore, develop great

Procedures represent your repeatable processes, while work instructions are

A Procedure for Making Dinner

Work Instructions for Making Dinner

Work Instruction Users

Work instruction details should include:

Work Details: Recipes, cleaning methods, cooking methods recipes

Safety: Material handling, protective clothing, sharp objects, etc.

Level 2 – Procedures or Processes

Level 3 – Work Instructions

Work Instructions focus on "how" -– typically being described to a person new

Work Instructions help fill in the blanks wherever information is needed to

The information for procedure or work instruction documents comes from

Individual work instructions are very specific to an industry or company.