Systems & SOPs

How SMEs benefit from having standard operating procedure?

By June 1, 2019 December 21st, 2023 No Comments
SOP | The Spark Group

The fastest way to transfer knowledge from a person to another is through writing down and teaching that to the person.

Standard Operating Procedure to SME is not a one-size-fits-all proposition, because each SME has their unique ways of operating. Even though they look similar, they are different. They are different due to many reasons. It might be the experiences, theoretical knowledge level that the owner has, the ways the owner manages the business, risk taking level of the owner, or the complexity level of departments. Most SMEs only have 3 to 4 layers of organization hierarchy. Some might only have 1 layer. Further more, they are at different development stage and might have difference in capacity and financial issues.

Most SME will operate chaotically due to the surge of clients and sales to drive revenue. When that happens, members in the organization who support sales and marketing will start to experience congestion and blockage along with growth. The only thing they can do is to wish that they have more manpower.

What most SME will do is to start hiring managers to solve the internal chaos. Hiring is a risk as well, because if the business owner doesn’t know what is needed actually, it might be costly if it fails. When it comes to growing the team, most business owner will put up job advertisements to start looking for people with similar experience to fill up the empty space or department. But human resource experts will advise you to hire people based on what you want them to do, but not what they have done before. Organizations are suffering from hiring the wrong talents. Organization ended up having to pay for the cost to get rid of that person, and they will start blaming HR for not doing their job well. The main point is, business owners always don’t understand why the manager can’t deliver even they had told or personally guided him or her.

So, what is the difference between hiring an experienced purchaser and a junior executive to become the organization’s purchaser? “Purchaser” itself generally means a person who buys things for the organization to produce and deliver to the customer. As what the sales person has told the customer. Therefore, hiring an experienced purchaser should be able to take care of the organization’s purchase department. Ideally, the answer is yes, unfortunately is NOT REALLY. Different organization has different purchasing habits and favorites. That includes the business owner’s habits, authorization, cost and risk tolerance level. The best way is still to define your purchasing process, including your terms and conditions, and authorization level to support the next purchaser that you are going to hire. This will provide them a guideline to carry out their work with minimal error.

Mapping down business process provides a visual to help business owners to clarify and define their operations and activities. By mapping down their processes, the business owner now has a clearer view of the work load and the work flow, including the documents flow. Business owner or managers can now delegate their work more effectively (but not verbally) to the subordinates and FREE themselves from daily operational work load without the need to worry whether their subordinates are capable enough to handle those assignments. They now have to start thinking and planning for better solutions that can add more values to the customers for continuous improvement.

Share this:

Leave a Reply

Chat With Us
Scan the code
Hello, how can we help?