Have Formal Policies and Procedures that are Practical and Reasonable

In an effort to eliminate waste, in many organizations the supervisory and project control systems can cost more than they save. Management oversight of processes and budgets is essential, but it shouldn’t be more expensive than the  operations it is helping to control.

Congressional Investigation of NASA about Viking Photos is a Colossal Waste

Supervision is crucial in every kind of organization, and over the years there have been numerous instances of government agencies that have wasted public funds through corruption or incompetence. Obviously there must be oversight. Without an application of common sense, however, scrutiny can itself result in ridiculous levels of waste.

There was a news story this week was about some silly photos of Nordic Vikings charging through marshlands. The pictures were taken as part of a student project intended to celebrate the NASA space program. Even after credible evidence that no government funds had been spent to do the project, Senator Charles Grassley (R-IA) insisted on further inquiry into the matter. Estimates show that the resulting investigation cost more than a middle class family spends in a year. Government time and money were squandered for no purpose.

Oversight of organizational activities, projects and employee performance should NEVER exceed the costs of no regulation. It makes no sense to spend a dollar to pick up a penny.

Written Policies and Procedures are Essential

There is no doubt that having a comprehensive Policies and Procedures Manual is necessary for smooth operations in an organization. The enterprise’s guidebook will help the company to be consistent in the way it directs staff as employees are selected, motivated, managed and leave the workplace.

When you craft the policies and procedures, lay down standards about all the major functions of the organization but do not dictate every detail of each activity. Why? Despite the consistency that internal regulations provide, they also limit discretion when there are unique conditions. Excessively prescriptive policies can severely undermine employee creativity and reduce innovation.

When rules are informal and unwritten, and it is just assumed that they are understood, there will be misunderstandings and inefficiencies that will lead to mistakes and frustrations within the workforce. Confusion is inevitable and can easily result in intra-office morale problems and even lawsuits against the company.  People do much better when guidelines for performance are formalized and enforced so that everyone understands.

Procedural Regulations that Lead to Micro-Managing

On the other hand, many organizations seem to believe that, if you have a set of rules, every contingency must be spelled out. That will result in an unwieldy and unenforceable document that can lead to managerial and employee abuse. It will be so long that employees will not read it or remember to consult it before every action and they will inevitably break the rules. Supervisors will have to make difficult choices when they notice infractions. In the worst cases, managers can selectively enforce the policies as a way to manipulate employees or to make themselves feel important. Inevitably, too many details to control will result in confusion about priorities too.

Of course it is possible to micro-manage whether there are regulations or not, but overly restrictive policies will make micro-management a fact of the system and not an individual supervisor’s idiosyncrasy. This will waste everyone’s time and divert the attention of executives from focusing on the larger picture.

How Much Regulation is Too Much?

There were only Ten Commandments. There were originally only 10 articles in the Bill of Rights. The limited size of these documents define the principles of conduct but allow enough flexibility so that behavior can adapt to rapidly changing social and competitive conditions. They are great examples of useful guidelines that have stood the test of time even though Policies and Procedures Manuals will need to be more detailed than those short documents.

On the other end of the spectrum, rule books that become overly specific don’t allow the kind of  flexibility. Think of the complicated U.S. Tax Code. Overly restrictive social media policies or other kinds of business regulations limit the ability of employees to be innovative and responsive to business needs. It is also important not to be so zealous in our enforcement that we overly scrutinize activities that incur negligible cost or risk in ways that are reminiscent of the NASA photograph incident.

Yes, regulation is necessary but make sure that oversight is not so overdone that it hobbles the organization.

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