Page 618 - Encyclopedia of Business and Finance

eobf_P 7/5/06 3:18 PM Page 595

Policy Development

PHISHING
Original Improved revision
SEE Cyber Crime; Electronic Mail; Privacy and Security
If a member of your family If a member of your immediate family
dies, you will receive three dies, you will receive up to three days
days off. paid leave for travel to and from the
funeral or for funeral and estate business.
Your immediate family includes spouse or
PLANNING significant other, parents, grandparents,
stepparents, step-grandparents, aunts
SEE Strategic Management and uncles, sisters and brothers,
stepsisters and stepbrothers, first
cousins, sisters-in-law and brothers-in-
law, and children and stepchildren.
POLICY DEVELOPMENT After you work for the After you successfully complete your
company for six months,
probationary period, you may begin
Companies develop policies generally to help them run you are entitled to one day accumulating paid vacation days. For
of vacation for every each month you work after the probation
efficiently in achieving their objectives. They also develop month worked. period, you will earn one day of paid
them to comply with the legal and social environment in vacation. You can accumulate a maximum
of 20 paid vacation days.
which they operate as well as to build goodwill with both
their employees and their customers. In this way, policies Employees may use their You can use your sick leave to take care
help shape the culture of an organization. They run the accumulated sick leave for of your sick children or stepchildren. You
childcare or eldercare. can also use it to attend to special needs of
gamut from simple parking policies and dress codes to your parents, stepparents, grandparents,
operational policies to complex policies involving benefits or step-grandparents.
and legal rights. To help companies run efficiently, these
policies must be appropriate, well written, and easily
Figure 1
accessible. Furthermore, as management tools, they must
be updated and maintained regularly to work effectively.
As organizational structures have flattened, compa-
DEVELOPMENT METHODOLOGY
nies are moving toward more employee involvement in
To create appropriate policies, companies must decide policy making. A poll of Fortune 500 companies reported
who is best for the job of creating policy, ensure that they
that almost half (47 percent) of these companies involve
are written clearly, and make them readily available to employees in policy decisions. Sometimes policy ideas are
employees.
solicited from all employees, and sometimes teams of
employees create the policies. When policies affect only
Who makes company policy? Depending on the size and one department, the department’s members contribute
management style of a company, the task of creating and substantially to those policies. When policies affect several
writing policy statements varies widely. A small, growing
groups, cross-functional teams are often formed to create
company may start with unwritten policies created by the those policies.
owners and move to written ones as the need arises. In the
early twenty-first century, many such companies purchase
How should policies be written? One of the most impor-
template policy manuals, adapting them as appropriate to
their businesses. As companies grow larger, their need for tant aspects of effective policies includes communicating
them clearly to all affected by them. Two major objectives
formal policies grows. These policies help ensure consis-
of well written policy statements are that they be clear and
tency and fairness to all employees.
concise. Writers should use words their readers under-
The management style of the company often deter-
stand; after all, they want statements to be interpreted as
mines who sets the policies. Typically, companies with a
top-down management style tend to delegate the policy they are intended. Also, the tone should be pleasant and
making. Boards of directors often create policies for exec- the statements should reflect sound practices on such sub-
utives, while executives and managers create them for jects as hiring and firing, pay, and benefits. Many compa-
their subordinates. Very large companies not only have nies also have policies about practices such as giving and
written policies; they often have different policies for dif- receiving gifts, political and charitable contributions, e-
ferent groups of employees. A set of travel policies, for mail privacy, Internet use, and health and safety. Some
example, may apply only to those employees who travel, companies even have written policies for activities outside
or there may even be different policies for international work hours and personal conduct.
and domestic travelers. The policy may even vary by level Figure 1 gives some examples of original and
in the organization. improved policy statements. As you can easily see policy

ENCYCLOPEDIA OF BUSINESS AND FINANCE, SECOND EDITION 595