4 Guidelines to Procedures That Actually Work

The words “procedures manual” is enough to make most people groan. But procedures are a critical part of any effective operation. A manual that lays out what needs to be done, when, and how can preempt queries, act as your company’s institutional memory, help you manage when someone’s out sick, and facilitates training.

Of course, getting your procedures manual to live up to that responsibility is easier said than done. Where do you start? What do you include? How do you make sure it doesn’t just sit on the shelf?

Our team at Accusource LLC, a back-office and reporting specialist, believes that an effective procedures manual should include four critical components:

  1. Contain basic background information
  2. Be able to accommodate different users with different levels of detail
  3. Record key discussions and known issues
  4. Implement a routine, comprehensive audit program

1. Basic background information

Accusource creates a procedures manual for every client that describes their core business and needs. The needs of a large institutional money manager are very different than the needs of a small family office, and having the story of each client at the outset helps put the rest of the procedures in context.

It’s just as important to have this information internally. A high-level overview of who you are and what you’re doing will help everyone who opens the manual — whether it’s a new CEO, an auditor, your compliance consultant, or an outside service professional.

We recommend answering these questions:

  • What’s your business and whom do you serve?
  • What activities do you need to accomplish?
  • Why are they important?

2. Accommodate different users with different levels of detail

Accusource CEO Ryan Kerry says that there are a couple of schools of thought when it comes to designing procedures. Some argue that you should keep the detail out of it, and others believe that a procedures manual should also act as a highly detailed step-by-step guide to getting the work done.

He also suggested a third route: offer different levels of detail to accommodate different users and needs. You can break it into two parts. “Have the full detailed procedures — as granular as you can get — and towards the end you have a checklist for someone who doesn’t need that level of granularity.”

For example, let’s say you need to run five different reports each day and save them in a particular place. First write a keystroke-by-keystroke description of how to run and save each report with the idea of essentially training someone who’s never used the program before.

Complement those instructions with a high-level checklist. In this case, you could list each report you need to run and where it needs to be saved. Someone who has extensive experience in carrying out the procedures can rely on this checklist alone, without getting bogged down in unnecessary detail.

If they don’t know how to do something, they can always turn the page and find out.

3. Record key discussions and known issues

Keeping good records of your company’s policies or decisions — especially for those that seem like common knowledge — is one of the best things you can do for your procedures manual and your organization as a whole.

Everyone has made a decision such as, “We don’t do cost basis reconciliation.” But, months or even years later when someone new arrives on the scene, they look at the reporting system and ask, “Why not?” If it is documented, you will have the answer available.

The problem is that, by then, no one can remember who exactly made the decision, when they made it, or why. So everyone ends up scrambling to figure it out.

Avoid these kind of scenarios by writing those decisions down.

Keep a record of when a reporting-related decision was made, who made it, and the reasons for it. You’ll eliminate both confusion and the wasted time and effort required to reverse engineer a decision-making process that might have occurred years earlier.

4. Implement a routine, comprehensive audit program

Procedures change, priorities change, and people come and go. Your procedures must adapt accordingly. Accusource recommends conducting an annual audit to accomplish this, something that they’ve made into an internal best practice for each of their clients. When prospective clients are told about audited procedures, it often gets a raised eyebrow. But for Accusource, it’s a critical part of ensuring excellent service.

Well-documented procedures ensure continuity across the people who are helping to back up the client. The idea is that anyone in the company can pick up the procedures and perform the work for a particular client.

Procedures audit should be focused and intensive. It is important to double check the work on a regular basis. Someone else who knows the process should read through everything to check for errors.  It is recommended that a third staff member, one who doesn’t work in the department or with the client, should act as a proofreader. Putting three sets of eyes on the audit ensures that the procedures are accurate — and readable by a newbie.

It is a process that might seem a little bit daunting at first, and to a certain extent it is. But doing it right saves untold amounts of time and energy in a number of other areas, such as training new hires, engaging with service professionals, or just helping someone fill in for another staff member while they’re out sick.

All in, a great procedures manual takes more effort than a shoddy one. But the result is a manual that’s actually… useful.

So, tell your company’s story, accommodate different sophistication levels by dialing up the detail, keep a record of your decisions, and check in on your procedures about once a year. It’s a little bit of legwork, but it’ll give you a procedures manual that’s much more than just a paperweight.

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