Importance and Benefits of Standard Operating Procedures

by QuickBooks Canada Team

2 min read

Standard operating procedures (SOPs) are step-by-step instructions that act as guidelines for employee work processes. Whether written up in numbered steps or formatted as flow charts, effective SOPs are complete, clearly written, and based on input from the workers who do the job. When employees follow the SOP for a particular job, they produce a product that is consistent and predictable.

If creativity is key to your business functions, SOPs may not work for you. Strict adherence to standardized rules can restrict creative flow. However, if your goal is to produce the same product over the long term and increase your business productivity, the implementation of SOPs can have many benefits.

Readiness for Future Growth

If your long-term goals include expanding your business to branch offices, ready-made SOPs make your proven work processes portable. New employees at new locations can uphold your reputation by using the SOPs to replicate the products and services provided at your original place of business.

Standard Operating Procedures Simplify Performance Management

Managers can use the SOP framework to develop target ranges and make assessments of individual performance. Employees who work in compliance with SOPs know exactly what is expected of them, and they plan their work schedules to meet their goals with efficiency.

When all employees follow the same processes, it’s an easy matter to measure them against the same standards. Performance can be fairly appraised. This is especially important in cases where high-performing employees are rewarded, and low-performing employees are retrained or placed on probation.

Control the Quality and Consistency of Your Product

When your business generates a product that you’re proud of, you want to maintain a high standard of quality. Standardized procedures guide workers and reduce the possibility of missed steps or other errors that impact the quality of the completed product. Meticulously followed SOPs ensure that your product or service is created in the same way from start to finish. Providing a blueprint for the line of production creates consistency and protects the integrity of your product.

Protect Yourself from Knowledge Loss

If the details of your business processes are stored in a key employee’s head and not in a procedures manual, the loss of the employee can be disastrous. Documentation of job processes survives employee attrition due to retirement and resignation, and allow your company to carry on as usual. It’s hard to replace experienced, skilled workers, but comprehensive well-written SOPs ensure that your valuable business processes stay with your business.

Save on Training Costs

Depending on the complexity of the task and the experience of employees, SOPs may not completely substitute for training. Documented procedures are a valuable component of the new-hire toolkit, and can reduce training time. They act as reference guides and allow new employees to work independently without excessive reliance on supervisors.

New hires make ideal testing grounds for the effectiveness of SOPs. If the documented steps enable the new employee to complete the task, the procedures are sound. If any steps are unclear, confusing or no longer in use, the SOP should be updated.

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