Senior management may have a vision and strategy for the organization, however without clearly communicating it to the personnel responsible for execution, it may never be successfully implemented.
One of the key components needed to support a company’s strategy is to have a strong governance platform to set the ‘tone at the top’. A crucial part of the governance platform is a set of policies to guide the teams to have consistent execution of the vision and strategy set for the organization.
What exactly is policy management? Simply put it is the process of creating, communicating, and maintaining policies within an organization. Policies exist in every organization; however, the degree of formality varies widely. Best practice dictates a comprehensive, well documented, published and easily accessible policy manual which is periodically but consistently reviewed and updated.
Organizations most likely have some form of policies, however the company is exposed to excessive risk if the policies are not documented or periodically reviewed and updated. For example, while management believes to have set the expectation for everyone, the employees might execute based on their own interpretation or based on outdated information.
Senior management ideally should periodically synchronize their vision and expectations with their teams’ understanding. This should include a review of the company’s policies to ensure that the key areas are up to date and communicated to all employees.
While developing and updating policies is a difficult and tedious task, the most critical aspect of creating a documented corporate governance manual is determining the content based on the internal and external environment the organization is operating in and where it should be headed.
This blog post was written by Veronika Fritz. Veronika is a Managing Partner with Vonya Global, a premier provider of internal audit consulting services. Veronika is a CPA with over 18 years of audit and management experience. Her experience covers all areas of business including compliance, financial, operational and IT. She has led the planning, development and successful execution of financial audits, Sarbanes-Oxley Engagements, pre- and post-implementation ERP system reviews, and business process evaluations. Veronika has expert knowledge in evaluating the design, integrity, effectiveness and reliability of internal controls for financial reporting processes and Enterprise Resource Planning software. She has been a trusted advisor to companies spanning various industries.