PSU Insight

Writing Your Business Plan

Why You Need a Procedures Manual

Just as an individual needs a set of “good” habits or practices, a business — even if it’s a one-person operation — needs a clearly defined set of procedures. The Procedures “section” of your business plan should document as many of your activities as possible. (There are several good reasons for this.)

What activities do you perform? Do you submit credit card charges? Answer e-mail? Make “cold calls”? Whatever your normal activities are, they should be documented, along with a description of how to do them.

“Why is this important?” you may protest. “I already know how to do these things! Why should I take the time to write them down?”

For one thing, you certainly have some activities that you don’t do on a daily basis, and it’s frightfully easy to forget how to do them. It’s embarrassing, if nothing else, to return from vacation and discover that you’ve forgotten how to access your merchant account, how to update your blog, or how to change the ink cartridge in your printer. You’ll eventually figure it out, of course; but it’s so much easier if you’ve got everything written down so that you can refer to it whenever a memory lapse occurs.

Here’s another good reason — what if your business grows, and you hire people to help you with your business? If you take the time to show the new people how to do everything, it slows you down tremendously. But if you can give your new hires your Procedures Manual and tell them to follow the directions that you’ve written, you’ll save yourself a lot of training time!

Just because you’re writing a “Procedures Manual,” don’t fall into the formality trap! Your Procedures “Manual” doesn’t have to be an actual manual — in fact, in many cases, it works best if it’s not a list of written instructions kept in a binder or saved in a disc file. Procedures work best when they’re conveniently accessible whenever and wherever you’re performing the process that they describe.

Here’s a simple example — let’s assume your computer printer requires that you load your letterhead stationery “face down, top edge in.” If you’re like many people, you forget how the paper should be loaded, and so you take the standard approach — you take a chance, load it one way, and try it and see what happens. If it prints wrong, you insert the paper the other way.

But wouldn’t it be so much easier if you taped a note to the side of your printer that had four simple words written on it — “face down / top in”? Now you’ll never again load the paper the wrong way! That little scrap of paper is a “procedure” — and it’ll help get your business organized and save you time in the process.

Other areas of your business require procedures. What is your process for billing clients and customers? What is your procedure for performing order fulfillment? What steps do you follow to update and upload pages to your web site?

Some of your activities will be ongoing for the life of your business. The more you have a standardized system for performing them, the more efficient your business will be.

  • How (and when) will you do your marketing? Your research? Your product development?

  • What are the specific steps you take whenever you land a contract for a speaking engagement?

  • Do you have a checklist of potential problems to investigate on-site before you actually give a speech? What do you do after the speech is over?

  • What do you do when you receive a product order?

  • How do you keep track of your historical data? You need to keep copies of your financial records and your tax filings for several years in case you’re audited by the IRS (or whatever government agency is responsible for collecting taxes in your country). If you’re going to apply for your CSP (Certified Speaking Professional) designation from the National Speakers Association, you’ll need to keep a record of your speaking engagements for several years. What records do you save, and what records can you discard?

    Of course, saving your records is one thing; finding them when you need them is another. What system do you have for organizing your historical information? Suppose the IRS wants to know if your trip to Hawaii three years ago was business or pleasure. How can you document its purpose? Where are those documents? How can you locate them when you need them?

It’s impossible to anticipate every activity you’ll be performing. But every one that you can anticipate — and document — will make your business operation that much more effective.