There is a general believe that sole entrepreneurs, and or small to medium size businesses do not have to have written systems, procedures, processes and policies in place. Nothing is further from the truth, every organisation whether you a sole business owner, a small company, a medium size company or a large enterprise, every business requires and needs written systems, procedures, processes, and policies.
From business owners to directors to management and personnel, all react differently to systems, processes, procedures, and policies. Some naturally embrace them, some do it with guidance, others struggle, preferring to wing it and hope for the best. However, if you’re looking to grow and sustain your business, it’s vital to not only have systems, processes, procedures and policies in place but to have them well documented, dated and signed.
Everyone in the organisation should have access to them, be trained on them and everyone needs to follow them – from the top down and the bottom up. The systems, processes, procedures, and policies, need to be reviewed regularly and updated when required as organisations do not remain static, they change over time, for example implementing new computer software or improving production, etc.
How do each of these differ from one another
Systems, processes, procedures, and policies are all terms that are often used interchangeably. However, each one is very different from the other, it relates to different terms that refer to the same thing: the set of guidelines within an organization that define how it operates. Each of these terms refers to a unique aspect of these guidelines, which makes them all necessary in order to create a complete system that is effective and efficient.
Each aspect of these policies serves a different purpose. Systems are guidelines for how things should be done in an organization; processes refer to how things actually get done; procedures are detailed instructions for how to execute processes; and policies are rules about what is acceptable behaviour for employees and all other stakeholders of the business.
System
Systems are a set of interrelated components of parts that work together in an organisation to produce a desired result. Systems are the way in which a company or organization is set up to perform and complete specific tasks. They describe how tasks are performed, who performs them, and why they are performed.
A system is just what it sounds like—a collection of “high-level” related elements that work together to achieve a goal. For example, a computer system might be made up of the monitor, keyboard, mouse, and processor. A business system might include an accounting process, marketing process, and sales process.
Processes
The steps of how a system works. Processes are sets of related activities, steps taken in sequence or tasks that occur over time, to achieve an outcome or to produce a result. Most processes cross departments or functional areas, with each process designating the connecting points and where it crosses department lines, with the required documentation that presents the total process.
Processes normally include multiple people working together to achieve a goal. A process can also be automated or automated with human assistance. A process refers to how your business works as a whole, how product development flows from idea generation through design and testing until it becomes an actual product on your shelve. It might seem like this would overlap with procedures and policies, but processes aren’t specific enough for most people who work in an organization, they need more detail than just “designing” or “testing.”
A process map is a useful tool to graphically display the process and to indicate where there is a separation of responsibilities and control points and to address who is responsible to perform the process (which department, division or team), what and when major functions are to be performed. For example, an accounting process might include entering income into a ledger book and reconciling accounts with customers on a monthly basis. A marketing process might include conducting market research on new products or services before launching them into the marketplace.
Procedures
Procedures are written instructions on how best to perform tasks or carry out activities within an organization. Procedures are usually very specific and may even include step-by-step instructions on how something should be done correctly. It is the detailed instructions that are given to an employee or group of employees to perform a particular task. These actions may be automated through computers or performed manually by people.
Procedures usually are structured by subject, for example, system instructions or process tasks and usually addresses only a single task. Separation enables procedure components to be compiled into special procedure manuals for specific audiences, end users, and purposes, detailing who performs the procedure, what steps are performed, when the steps are performed, and how the procedure is performed.
A procedure is a step-by-step guide to completing a task or achieving an outcome. Procedures should be clear and easy to follow, and they can be used by anyone in your organization—whether they’re new to the company or have been there for years.
Policies
Policies are sets of rules put in place that cover employee/employer behaviours and attitudes. A policy sets out how things are done in your company, but it’s more than just guidelines for employees—it’s also how you communicate with your customers, clients, suppliers and other stakeholders.
Policies are important because they let people know what’s expected of them, which makes it easier for them to do their jobs well and ensure everyone is working toward the same goals. They are an important factor in a well-run business, as it allows a business to run smoothly.
Policies are guidelines that outline what is acceptable and unacceptable behavior within an organization. They outline the rights, responsibilities, and restrictions of employees within an organization and define what is expected of them in their day-to-day activities, as well as how employees should respond in certain situations such as emergencies or theft of company property.
The value of documenting every system, procedure, process and policy is that it allows your business to be sustainable, to improve and keep on improving. It’s a competitive world out there, and continuous improvement is essential to the profitability of your business. If you want to outperform your competitors, it all starts with mapping out what your business does and how it does it.
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