Policies, Processes and Procedures:

Governing Standards and Information Architecture

By Cherie Fairburn

What’s Driving Policy Proliferation?

The purpose of policies is to provide management guidance for day-to-day operations. Policies can be thought of as a mechanism through which to implement an enterprise’s published mission statement. For example, one driver of policies is the desire to implement identified business, social, charitable, and educational goals and objectives. A second driver is a perceived gap in business objectives or in business processes. Policies that develop in either way are internally driven.

Of greater concern are the forces from without prompting the emergence of new policies from a third direction. For the sake of convenience, I’ll refer to this category of policy development as externally driven. An implacable truth of our times is that government regulation is a growth industry. The inevitable result is control of numerous industries and even business practices that were formerly unregulated. Creeping government regulation thus drives policy growth exponentially - both on a national and on an international scale.

Closely related to government is governance, a fourth driver of policy proliferation. A host of national and international standards organizations, industrial councils, NGOs, professional associations (AIA, ABA, AICPA, ACORD), and watchdog groups promulgate governing standards and measurements unique to their particular industries or professional areas of interest.

A fifth driver of policy proliferation is the growing recognition in all industries and professions of the need for objective measurement of outcomes. In the absence of:

1. formal, stated objectives in the form of a Policy statement
2. augmentation by an identified Process description specifying parameters and standards of measurement to evaluate outcomes in relation to known Policy objectives
3. A Procedure summary documenting each component of a given job in chronological sequence of task performance, the ability of management to assess business goals achievement must necessarily remain elusive and subjective

Contemporary business practice has come to recognize the important contribution of W. Edwards Deming to the field of process management. father of total quality management, Deming exported his theories and processes to the Japanese people to help rebuild their industries following World War II. So pervasive are these practices today that, indeed, scientific business process management is now the norm.

Governing Standards, Regulations & Benchmarks

Whatever the driver, policy proliferation is here to stay as one stratagem in the risk management initiative. Following are five examples representing the kinds of government regulations and governance standards that result in the institution of policies: HIPAA, ISO 9000, COBIT, SAS 70, and SOX (Sarbanes-Oxley). The above listing is only a drop in the proverbial bucket as compared to the hundreds, perhaps thousands of international, national, state, and nongovernmental regulatory standards and compliance benchmarks now in existence.

Policies & Procedures

The nature of "Policies & Procedures" is often misconstrued. Because these documentation items are referred to in one breath, the general assumption is that they are a single document, inseparable in the same way one might conceive of 'peanut butter and jelly' as a single unit. In fact, they are separate communications and serve separate purposes. Equally important, they are hierarchical in nature. A Policy + Process + Procedure documentation suite accurately reflects the correct conceptual framework as follows:

My personal conceptualization of enterprise documentation as an integrated system prompted me to reformulate and restructure our P&Ps to reflect that interrelationship and structural hierarchy.

The result is the creation of an integrated series of document suites. It reflects a cutting-edge, systematic approach to documentation, and one that is attracting the attention of other professionals, including the National Accounts Division of Policy Tech International.

Policy Tech, the developers of our Policy & Procedure Manager software application, are now recommending the BCBSLA concept, taxonomy, and integrated approach to other BCBS licensees who purchase the application.

Editor’s Note:

This article was originally developed for Blue Cross Blue Shield. Look for Cherie Fairburn's article to continue in the next edition of Direction with a discussion on the application of P&Ps in a specific context, illustrated with templates that can serve as a model for other professionals who want to begin exploring the idea of integrated document systems. To learn about the author, see Cherie’s profile in this issue. You can contact her at Cherie.Fairburn@bcbsla.com.