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Unlike many people, I can genuinely say I love creating a good standard operating procedure! While I totally understand why most would think it is a boring admin task, I am a bit of a process obsessive and get huge satisfaction and peace of mind out of knowing that I (and my clients) have the safety net of clear, documented business operating procedures.
They have a huge number of benefits, from increased productivity, cost-saving and more effective and engaged teams, as well as protecting your business and your clients in an emergency situation.
If you’re thinking that your business is too small to benefit from implementing standardised processes, I respectfully disagree; even if you are still working as a solo-preneur, they are an essential foundation for your business.
Consequently, implementing standard operating procedures is one of the first things I recommend that my clients work on when they are looking to systemise their business in order to scale sustainably and become more efficient. Trying to achieve this and operating without them I can only liken to trying to build a palace on the edge of a slowly collapsing cliff.
What Exactly is a Standard Operating Procedure?
A standard operating procedure (SOP) is a documented set of instructions on how to perform a task or a process in your business. This can be in written, video or image form, although personally, I like a mix of all three.
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My Own Lesson in the Importance of Documented Standard Operating Procedures
Working predominantly in logistics operations in my corporate life, hammered home the importance of establishing written processes, particularly when I moved into management roles and saw how much easier it was to manage my team when they were in place. It was my very first “proper” job when I was 21 though that I learnt the hard way just how wrong things can go when they are not in place!
I covered the maternity leave for a highly operational role; I was accountable for the management of inbound deliveries from ports and airports into distribution centres. When I came in, my predecessor had already left and I quickly discovered there was not a single process written anywhere (I did get log on details for a tracking system I didn’t know how to use on a post-it note though).
On my first day, two buyers came up to me and asked when their stock was going to be in the distribution centre as they needed to get it into store. I had no idea how to answer their questions and they were understandably not impressed.
It was a horrific couple of weeks trying to keep my head above water; I had to work out how to choose what containers to move when, which hauliers to book in line with our contracted agreements (couldn’t for the life of me actually find the contracts though), what and how to pay them, how to book the inbound deliveries into the depots while keeping the 20 or so buyers (my key stakeholders) whose stock I was managing informed at all times.
The Cost of a Lack of Documented Processes
The team that I worked in was lovely, but they could only help with bits as they didn’t know exactly how everything was done either and they had their own jobs to worry about. Lots slipped through the net and every time I had a failed delivery, it cost the business anywhere between £150 – £350, plus the cost of missed sales as the product was available in the store to be sold AND the associated cost of staff downtime in the distribution centre when the container they were expecting to unload didn’t turn up or turned up at the wrong time.
I dread to think what the final bill was, but I learnt my first (of very many over the years) valuable lesson about business operations, SOPs are the absolute foundation.
As soon as I worked out how to actually do my job, I set about writing my very first SOP that I continued tweaking up until the day my six months cover was up and I moved onto a different role in the business.
After seeing what I went through, my manager (who was very understanding and knew the situation wasn’t my fault) insisted that every other member of the team also did the same for their roles (which I don’t think took much persuasion either). I left a printed copy on my desk for the lady returning from maternity leave and I can guarantee she had an easier time getting back into it than I did!
Why Should You Have Standard Operating Procedures in Place for Your Small Business?
Well as you may have guessed, I could write a novel on this, but I’ll try and keep it as simple as possible!
Having standard operating procedures, templates and forms in place BEFORE you bring team members and clients on board will allow your business to scale successfully and sustainably. Without them, both you and your team will struggle.
Establishing consistency in all areas of your business from team management, following processes and your company culture/values is absolutely critical to for success. It helps present a cohesive brand and build trust both internally and externally and ensures tasks in your business are performed efficiently.
Implementing SOPs in your business ensures that no matter who is working on a particular task, it is performed the same way. It allows you to clearly set your business standards and reduces errors.
2. Increased Productivity
It is extremely time-consuming to try and train someone else in your business when they have to email/phone/text you every 5 minutes while they try to perform a process you want them to do. This dramatically decreases their (and your) productivity, which reduces efficiency and costs your business more money. Plus, it is frustrating for you both.
3. Effective Training
In the same vein of the above, training new team members will be absolutely draining for you both if you have no established baseline from them to learn from. Having SOPs in place means they can almost completely self-train as far as performing processes go. This also means that a good portion of training is automated for every team member you bring on board. It also ensures that nothing gets missed if a team member leaves and they forget to tell you about an essential process that you have no idea how to perform; it’s written in the SOP!
4. Reduces Cost
Not having SOPs in place is going to cost you money. It will take new team members A LOT longer to get up to speed with what is required of them and if you are paying them hourly, results in you paying them more for tasks that could have been completed a lot quicker if they had an SOP to follow. It also will have taken more of your time up to train them manually and how much is your time worth?
5. Better Employee Engagement
The vast majority of people turn up to work every day wanting to do a good job. If they know what’s expected of them, know they are delivering to the required standard and your expectations are consistent, they are more likely to remain motivated and have greater job satisfaction.
If they don’t know what is expected of them, or the message is inconsistent, communication will break down, essential tasks will slip through the net and everyone will be frustrated and dissatisfied.
An engaged team is a happy, confident and more effective one. This, in turn, reduces turnover and your team will be much lower maintenance in terms of communication and requirements, giving you back more time as well!
6. Team Management Will be So Much Easier
Trust me on this one, SOPs are the number one essential when it comes to managing your team’s performance. As someone in a management position, you have a duty to clearly communicate consistent expectations to your team. SOPs are an excellent way to do this because if you disagree on something, you can refer to a document, rather than you both trying to recall the exact words said on a phone call a couple of weeks ago (which I am sure you both have differing memories of) to attempt to work out where communication fell down. SOPs get you out of the “he said she said” situation and is the baseline from which to manage your team.
If you have a documented process for something with a clearly defined outcome, it heads off a lot of potential performance issues before they even arise. If you do still identify a performance issue, it makes answering the “I didn’t know how to do that process”, “why did you not follow that process?”, “why did you not hit this deadline?” kind of conversations VERY easy when there is a document in front of both of you that severely limits the excuses that can be given in these circumstances.
You will also find it very difficult to undergo any (legal) disciplinary action if you as the manager can’t demonstrate adequate training, part of which is having documented processes and procedures.
7. Effective Business Continuity Plans
Out of everything on this list, not having written processes and procedures for emergency situations is the most critical (to be honest, I personally think they should be part of all business plans).
Having SOPs in place prevents potentially catastrophic effects on your business from these potential scenarios and ensures you don’t have a single point of failure.
- You or one of your team members has a health issue/family emergency and becomes understandably uncontactable while they work through it, but they/you only know a certain process that needs to be performed in their/your absence. Your business should still run effectively if you or a team member takes some time away from it.
- You have a GDPR or data security breach. If you haven’t set out processes to your team on how to manage data, it is more likely you will have an issue at some point. If you do have a breach, it is reported and anyone affected is in the EU (this could be a team member, client or even someone on your email list), you will be asked to submit your company process on data handling. Unsurprisingly, there isn’t an option to talk to someone over the phone and explain it verbally to them because “it’s all in your head”.
- Your new team member is saving everything to their desktop rather than the cloud. Their computer just crashed and all the important client documents they have been working on for the last month are gone. You had mentioned storing all documents in the cloud along with a million other things during a rushed phone call in their first week, but understandably some of it they had forgotten and they had nothing to refer back to remind them.
- You forgot to tell your team member to update your WordPress plugins regularly and your website just got hacked. It’s going to cost you thousands to employ a developer to try and recover it and in the meantime, you cannot sell anything from your website/your clients can’t log into their portals or membership sites.
These are more extreme consequences, but none are beyond the realm of possibility. Find out more about how to create a business continuity plan here.
That’s A Wrap! The Importance of Standard Operating Procedures
I will admit that implementing SOPs can be time-consuming and if you don’t like that kind of thing, frustrating. The outcome though, is completely worth it, whether your goal is to increase revenue, improve efficiency, protect your business or just be able to take some personal time. Find out how to create SOPs for your business here!
If you would like some help implementing SOPs within your business, click here to apply and find how we can help!