Digging into the P and P manual

Does your department have a policy and procedure manual? As a procurement specialist are you aware of the content? In today’s world of internal websites, do you know where to find the P and P manual?

If you answered no to any of the above, it is time to act. What is the difference between a policy and a procedure? According to the user-based online encyclopedia, Wikipedia:

A “policy” is a deliberate plan of action to guide decisions and achieve rational outcome(s). Policy differs from rules or laws. While law can compel or prohibit behaviors (e.g. a law requiring the payment of taxes on income) policy merely guides actions toward those that are most likely to achieve a desired outcome.

A “procedure” is a specified series of actions, acts or operations  which have to be executed in the same manner in order to always obtain the same result under the same circumstances (for example, emergency procedures). Less precisely speaking, this word can indicate a sequence of activities, tasks, steps, decisions, calculations and processes, that when undertaken in the sequence laid down produces the described result, product or outcome. A procedure usually induces a change.

A policy is what is to be done. It provides guidance for managerial thinking as well as action. Procedures provide a step by step action on how to do something. For example, a procedure used to evaluate forecast quantities to place a purchase order with a supplier. Sometimes in an action like this, it is not totally detailed. This is okay for the experienced buyer in this position, however it is not detailed enough for a new hire.

In the computer age, we as buyers, do much more than place purchase orders. We are becoming more and more experienced in software programs such as Microsoft Excel. I never thought I would need to know how to do a pivot table. These kinds of procedures must be a step by step instruction.

I took a class a long time ago on how to write policies and procedures. I remember the procedure section suggested write down step by step as you perform the task. Second step is go back and see if you can perform the task following the steps exactly as written. This is the way to find out what you failed to document.

Changes occur daily, however policies and procedures don’t always get updated as we change our way of thinking and doing. How current is your Purchasing Policy and Procedure Manual and how is it updated? Post a comment here with your thoughts.