POLICY DEVELOPMENT

Companies develop policies generally to help them run efficiently in achieving their objectives. They also develop them to comply with the legal and social environment in which they operate as well as to build goodwill with both their employees and their customers. In this way, policies help shape the culture of an organization. They run the gamut from simple parking policies and dress codes to operational policies to complex policies involving benefits and legal rights. To help companies run efficiently, these policies must be appropriate, well written, and easily accessible. Furthermore, as management tools, they must be updated and maintained regularly to work effectively.

DEVELOPMENT METHODOLOGY

To create appropriate policies, companies must decide who is best for the job of creating policy, ensure that they are written clearly, and make them readily available to employees.

Who makes company policy?

Depending on the size and management style of a company, the task of creating and writing policy statements varies widely. A small, growing company may start with unwritten policies created by the owners and move to written ones as the need arises. In the early twenty-first century, many such companies purchase template policy manuals, adapting them as appropriate to their businesses. As companies grow larger, their need for formal policies grows. These policies help ensure consistency and fairness to all employees.

The management style of the company often determines who sets the policies. Typically, companies with a top-down management style tend to delegate the policy making. Boards of directors often create policies for executives, while executives and managers create them for their subordinates. Very large companies not only have written policies; they often have different policies for different groups of employees. A set of travel policies, for example, may apply only to those employees who travel, or there may even be different policies for international and domestic travelers. The policy may even vary by level in the organization.

As organizational structures have flattened, companies are moving toward more employee involvement in policy making. A poll of Fortune 500 companies reported that almost half (47 percent) of these companies involve employees in policy decisions. Sometimes policy ideas are solicited from all employees, and sometimes teams of employees create the policies. When policies affect only one department, the department's members contribute substantially to those policies. When policies affect several groups, cross-functional teams are often formed to create those policies.

How should policies be written?

One of the most important aspects of effective policies includes communicating them clearly to all affected by them. Two major objectives of well written policy statements are that they be clear and concise. Writers should use words their readers understand; after all, they want statements to be interpreted as they are intended. Also, the tone should be pleasant and the statements should reflect sound practices on such subjects as hiring and firing, pay, and benefits. Many companies also have policies about practices such as giving and receiving gifts, political and charitable contributions, e-mail privacy, Internet use, and health and safety. Some companies even have written policies for activities outside work hours and personal conduct.

Figure 1 gives some examples of original and improved policy statements. As you can easily see policy statements need to be specific and precise. A vague policy will not only lead to confusion but could also cause hard feelings, not to mention legal problems. Without the specific detail defining how the three days paid leave could be taken, an employee might expect to have three days tagged on to his or her vacation for the death of a spouse's distant uncle, or an employee could be under the false impression that vacation days could be accumulated without a cap. That employee might be not only extremely disappointed to learn that the trip to Europe this summer is off because forty days of vacation had not been accumulated but also extremely angry to learn that twenty vacation days were actually lost because they were not taken earlier.

Companies today are extremely sensitive to discriminatory policies. Law requires that women and men be treated uniformly. Most companies with maternity leave have rewritten their policy statements to include paternity leave, while others have rewritten their disability policies to include pregnancy. Discriminatory policies relating to age, race, and religion policies are illegal. Policies requiring someone to work on their religious holidays without telling them before they are hired are viewed as discriminatory. Of course, companies cannot have a policy that is illegal.

Level of flexibility is another factor to consider in writing policy statements. The objective in writing policy statements is to inform the reader about the content of company policy as clearly as possible. For first-line employees and customers, this usually means being very precise. However, management may want the flexibility to make some decisions on a case-by-case basis. Thus policies written for middle- and top-level management may be purposefully written to allow for flexibility and different interpretations. Also, some types of policies have so many acceptable interpretations that listing them all is both ridiculous and unmanageable. Other times companies will implement a new policy without fully understanding the level of precision it needs. However, there should be a plan to refine the level during rewrites of the policy.

The elder care example above might exemplify a new policy. Initially, an employer might intend that employees use these days to take their elders to doctor and dentist appointments. However, a perfectly acceptable use of this day may be driving elders around to various nursing and/or retirement homes to choose one for their future living. In any case, employers may decide to build in flexibility at the beginning, recognizing that most of their employees will not abuse this use of their accumulated sick days. However, companies might rewrite this policy to decrease its flexibility if they find that some employees are testing its reasonable limits.

What technological tools help in policy creation and dissemination?

Many technological tools help writers create and disseminate company policies. Most full-featured word processors include revision features. This tool allows policy writers to share their drafts with others, reviewing changes and suggestions others make and deciding whether or not to accept the change. Companies or groups using intranets can post policy drafts and solicit suggestions directly. Still others prefer to create policies using group software tools that allow users to brainstorm, rank, and create policies anonymously.

Many organizations make company policies available on their intranets. In addition to being readily accessible, these policies should be organized clearly and logically. Word processors include tools that can generate a table of contents and an index, two components that help make the policies more easily accessible. Another good idea is to create a glossary that includes unfamiliar terms, such as legal definitions, acronyms, and jargon.

Writing or revising policies can be a big project, involving many people and tasks. Project management software is an excellent tool for helping identify the tasks and manage them efficiently.

MAINTENANCE OF POLICY

One final but important aspect of policy development is to review policies periodically and revise them as necessary. Revisions are indicated when companies find they are continually being asked to clarify the statements. Keeping a log of questions as they are asked will help in the revision process. Another indication that updating is needed is frequent employee or customer complaints about a particular policy. While sometimes they do not understand the reason behind the policy, often they are complaining about its fairness or its harshness in comparison with the policy of other businesses.

Other reasons for revising and maintaining policies include both external and internal changes. Changes in the business, work, and social environments often influence needs. Sometimes business mergers, acquisitions, or spin-offs cause companies to revise polices for the new company. Technology such as the Internet, for example, has changed the way many companies do business with both their internal and external customers and suppliers, creating the need to add, delete, and revise policy statements frequently.

Another way to keep current with needed revisions is by keeping up with news items, such as government regulations, health and safety regulations, antitrust laws, morals laws, ethics, etiquette, and much more. Through reading, a company learns what other companies are doing or what problems they have experienced with certain policies. This allows it to take precautionary steps, revising its statements to avoid problems that others have encountered. Of course, keeping up with new laws or interpretations is critical. For example, laws have been passed regarding e-mail privacy, and courts have ruled in various ways on the rights of the employer or employee in regard to this issue. Undoubtedly, the courts will be hearing and interpreting more cases on e-mail privacy. Keeping up with current events with an eye to how they might impact a company's policy statements is a good idea.

SUMMARY

Policies are created to help business run more smoothly. Knowing how to develop complete and accurate statements for a specific audience will help organizations succeed in having up-to-date policies that work effectively for them.

see also Management

bibliography

Campbell, Nancy (1998). Writing Effective Policies and Procedures: A Step-By-Step Resource for Clear Communication. New York: American Management Association.

Kuiper, Shirley (2005). Writing Policies, Procedures, and Instructions. Contemporary Business Report Writing (3rd ed.). Mason, OH: Thomson South-Western.

Marie E. Flatley