04.25.2008 — A thorough and comprehensive company manual is essential to when the owner is absent for an extended period of time.

No company owner wants to be hit by a bus. But if it happens, how would the company operate?

Would all employees lose their jobs? Who would be in charge? If there is a person designated to be in charge, will they know where to start?

A company manual that clearly defines all company positions’ roles, while assigning and defining all company tasks and anticipating potential obstacles, may provide answers to these essential questions.

Ideally, however, a company manual isn’t a secure “break glass in the event of emergency” type of tool. Companies can benefit year-round by working on and referring to a policy manual, according to Brad Nelson, president of Kennewick, Wash.-based System Solutions Northwest.

He says it helps both company owners and employees by documenting what they should expect from one another.

“It commits to paper the shared understanding and eliminates errors of memory that can occur with purely verbal communication,” Nelson says.

Lack of precision in determining employees’ roles and designating tasks can be costly to companies’ bottom lines, Nelson adds. He says not having a company policy manual is risky.

“The risks can be as simple as confusion and inefficiency and, therefore, the potential loss of profit,” he says. “They can also be as critical as employee resentment—if management actions aren’t performed fairly and equally. This can result in losing employees.”

Nelson probably won’t get much of an argument from most integrators. After all, having a company manual that articulates all the intricacies of how a company operates would, of course, be useful.

Finding the time to create one, however, is easier said than done.

Take Quadrant Systems for example. The Portland, Ore.-based integrator has 39 employees. That’s 39 positions.

The idea of jotting down all the responsibilities associated with each position (including guidelines for how the company expects each responsibility to be handled) is pretty daunting. Still, the company has made it a priority to write down its procedures because it’s important, says Kathleen Dintruff, vice president.

“The task is overwhelming if you look at it as a whole,” Dintruff says. That’s why Quadrant has been meeting for a couple of hours almost every week, dividing the enormous task into manageable segments.

“It’s like an elephant; you have to eat it one bite at a time.”

This type of documentation is new to Quadrant, a 23-year-old company. Dintruff says documentation becomes more important as companies grow.

The average size of a custom electronics company, according to EH Research, is seven employees. It’s conceivable that many company owners feel comfortable keeping procedures in their heads for a company that size.

If they plan to get bigger, they might want to rethink that, based on what Dintruff says.

“A manual of company policies becomes important as you grow. You want to maintain consistency in what you do, how you do it, how you treat customers, how you treat employees, etc.,” Dintruff says.

“As the number of employees grows and the amount of direct communication with the owner decreases, [a written manual] becomes one of the significant ways of communicating the company expectations.”

Without that reference, the company owner runs the risk of being “on a leash to the business” if he wants things to run smoothly, Dintruff adds. Now we’re back to the whole getting-hit-by-a-bus thing.