Importance of SOPs for Organizations

"SOPs Facilitate Better Planning".

There are many advantages of having SOPs (Standard Operating Procedures) for various operational aspects of an organization. Lets look at the ground realities that make SOPs completely indispensable for any progressive organization aspiring to be a leader in its category. 

Advantages of SOPs for Organizations 

1. Standardized Processes Lead to Predictable Quality:  An organization may hire highly competent professionals.These professionals may be capable of working out a large number of ways for carrying out various operations of the organization. If individuals are allowed to conduct operations based on their comfort , intelligence and style then it can possibly lead to unwanted and often unexpected consequences.These outcomes might be in stark contrast to the desired ones. All organizations are responsible for maintaining a specific quality standard at every stage of the organizational functioning.This quality standard may be in the form of recording accurate information , maintaining hygiene , delivering time bound service , final appearance of the product or its packaging at the time of delivery,etc.What ever may be the need to have a quality framework there is only one answer and that is standardization.Any call for standardization is possible only if quality benchmarks are defined in specific terms.Having defined the product/service delivery standards is just the beginning.This spirals up into a chain reaction leading to a host of activities that need to be standardized for guaranteeing desired quality outcome meeting predefined standards. 
2. Meet Ongoing Need to Reflect Brand DNA ;  Any brand is recognized by its DNA. Brand DNA must be reflected in its products/ services.Then only it can fulfill its quality promise. The market has expectations of the brand.These expectations must be met if the organization wishes to continue enjoying good reputation and recall. Moreover these expectations are set by the organization in question and must better be met.
3. Transparency in Processes: Through SOPs the domain knowledge is made open to the authorized actors within the organization. This openness lends clarity to the process input output cycle, including process management and implementation. Transparency  eliminates ambiguity, fosters trust & facilitates teamwork to carry out the process with optimum efficiency and effectiveness. Widely known SOPs lead to  greater transparency and accountability in the conduct of day to day operations.
4. Effective Knowledge Management ; Standardized processes get documented, systematic record is maintained with each improvement in the process.This facilitates creation of knowledge repository in the organization. It becomes more logical and scientific to raise the quality bar for different processes being followed in the organization. Documented SOP manuals lead to effective knowledge management by facilitating in-depth study of the processes and initiating improvements on the go.
5. Organization Wide Training and Communication ; Orientation & Process training gets more organized, ensuring that participating employees gain clarity regarding the steps involved, their multi dimensional interface and dynamic relationships among various constituents.SOP manuals become handy tools for organization wide communication & training.Standardized training formats thus evolved, lead to adoption of sophisticated training management system in the organization. 
6. Objective Process Audits ; Process audits become objective and free from personal bias. Healthy environment paves the way for a professional work culture geared towards meritocracy. The criteria for identifying quality performers gets objectively defined and the evaluation standards get communicated in advance to the employees.Such professional approach generates enthusiasm, healthy teamwork and win win for all concerned. 
7. Improved Planning; Documented SOPs facilitate better planning by imparting clarity on the process flow, steps,  human resources involved, estimated time frame to complete different steps to decide on the optimized turnaround time  , capacity optimization during peak and lean hours,etc. All these factors put together throw light on process optimization through cost benefit analysis of maintaining or not maintaining predefined quality standards. These insights may lead to simplification of the complex management decisions. 
8. Process Automation; Study of documented SOPs provides, process automation team, indications regarding the level of automation that can be achieved and the steps which can be optimized to help improve the efficiency of the operations by enhancing the productivity of responsible employees. Management may use the series of written SOP manuals in conjunction with the process M.I.S for evaluating the pros and cons of the applicable options while contemplating process automation.

Sanjay V Sharma

Innovation & Survival: Two Sides of the Same Coin

                                                 CHALLENGE THE STATUS QUO FOR INNOVATION                      Photo CreditDabra Larson

Business is a Two Way Street, Either Innovate or Perish

Any business organization is a highly complex system that is comparable to advanced machinery. Like a machine it has multiple components, interacts with the environment in which it operates, needs to be operated by skilled people, exists for a specific purpose and consists of intertwined internal processes culminating into intricate input-output cycles. It must be observed here that any machine needs to be upgraded to an improved version over a period of time. This is necessitated by a variety of factors including but not limited to emergence of a better technology, enhanced ease of operation, wider service objectives, increased competition, changes in the user tastes & preferences, etc. This up-gradation is necessary for the machine to remain relevant to the users it is designed to serve or there is a clearly defined path to oblivion by being labelled as obsolete. And the business world is no different, as we have numerous examples of huge businesses with highly successful product categories which were doing very well at one point in time but they failed to adapt themselves to the dynamic environmental changes over a period of time. Today these businesses stand relegated to the annals of business history as their glory has diminished with time.

“One Best Way” Becomes Ineffective with Onslaught of Time

The businesses must take a cue from this point that if they have been successful during the past years or decades the credit goes to their struggle which led to the winning innovation responsible for their success during their start-up phase, where they could come out with an effective strategy which worked very well for them in addressing the specific set of environmental forces prevailing at that point in time. As the time passes by, changes happen in the market, competition, technology, customer preferences, etc, which render the erstwhile success strategy redundant, it ceases to add any value in the changed circumstances, on the contrary it gets in the way of the progress of the business, because the executive team is overtly obsessed by the "one best way" of doing the things as that had always worked in the past. The real problem is the obsession of the executive team with the "one best way" of doing things. But they miss out on re-validating their set of assumptions which were deeply embedded into the development of that "one best way". The “one best way” which earlier worked for the business loses its relevance in the context of the changing business realities where the earlier assumptions do not hold any ground, as these assumptions need to be questioned on a continuous basis to successfully address the challenges posed by the dynamic environmental uncertainties.

Businesses Must Innovate to Safeguard against Extinction

As there is a continuous need to carry out maintenance of a machine, similarly an organization must also be continuously monitored for any ailing divisions that may be requiring surgery or some other treatment. The emphasis must be laid on innovation, as the executive team needs to conduct in depth research to decipher the prevailing business trends and generate improved solutions to create value for their business organization. A very critical point to be noted here is the concept of preventive maintenance, where the catch is to proactively maintain the machine through continuous inspection and ensuring that the machine is kept in an efficient working state by carrying out proactive repairs before any actual work loss or breakdown occurs. Here if any complacency sets into the approach chosen by the executive team of the business organization, it necessarily overlooks the highly critical innovation through preventive maintenance resulting in guaranteed inefficiencies in conducting its business leading towards the impending organizational failure. As compared to the proactive preventive maintenance adopted for up-keeping the machines, the business organizations must also prevent the organizational break down by converting the challenges faced by them into opportunities through proactive preventive maintenance leading towards effective innovation. If the proactive preventive maintenance is not adopted by the business organizations then sooner or later an epidemic or a catastrophe hits them, putting them in a distressful situation, where getting into the fire-fighting mode is the only option left with them. In such a state of distress, it is quite natural for the business organization to shift its complete focus & energy from its core business objectives towards the fight against extinction, but with little chances of survival.

Innovative Mind Set: Key to Business Survival

Innovation is not necessarily a paradigm shift bringing about business disruption as it may come in multiple forms. For a marketing division it may be an act of identifying new uses its products can serve with an entirely untouched market segment, for the production team it may be an equivalent of a more efficient production process capable of delivering better quality in lesser time & cost, for a chip design organization it may be introduction of a more compact sophisticated design capable of delivering better value, reliability & speed as compared to the previous versions, etc. So a progressive organization needs to continuously challenge the status quo. Its executive team must be intelligently obsessed with the idea of innovation by identifying organizational challenges and converting them into opportunities. This innovative approach needs to be an organization wide culture for an exponential impact on the overall functioning and well being of the organization under consideration. It is a very widely known fact that the organizations which were considered very successful for a series of decades eventually became obsolete because they could not adapt themselves to their changing realities. The real challenge for the progressive businesses lies in continuously reinventing themselves through an innovative mindset to ensure that they remain relevant to the changing business landscape by re-validating their assumptions and redefining their new set of values, beliefs & assumptions on which their complete organizational competencies, strategies, effectiveness, success and long term survival are based.

Sanjay Sharma