Conducting an internal audit can be a very useful strategy to reveal cost cutting solutions that will help both big and small companies with the ever tightening cash flow and financial crisis. Here are 4 tips on how to use an internal audit to streamline your company's operational procedures.
Tip #1: Introduce internal audit concepts in your company employee handbook. It's important to set it up correctly from the start. If you have a group of employees who have been with your company for many years and suddenly the executives decided to do their first internal audit it may create a negative backlash in morale. First, add the audit concept into the handbook and explain how it benefits the company as well as how audits benefit the employees.
Tip #2: Make sure your standard operation procedures are specifically and clearly communicated in your employee handbook. Not only will your employees know exactly what is expected of their performance, but your company will save a lot of time and money if you first evaluate how your current way of doing things looks like on paper. Often times, you will find a number of stages and phases did not get addressed specifically enough. By crossing all your "t's" and dotting all your "i's" here it will make it simpler to run your on-site evaluations.
Tip #3: Designate 1-2 managers or supervisors to devote their full time energies towards the audit project. An internal audit is a big project. Every project needs a foreman. Don't expect your line workers to double duty as an internal audit project supervisor.
Tip #4: Consider hiring an outside consultant. Ideally, it is most effective when a company can contract an outside consultant for their perspectives and blend that with receiving internal suggestions. Often time people just get used to doing things the way that it has always been done. They can get stuck thinking inside the box. Outside consultants also do not have any preconceived notions, biases or involvement in the politics which can also cloud and impact decisions.
An internal audit is an important way to take a few steps back to really look at the whole picture and get a top view of how each department is working in tandem with each other. Internal audits reveal the overall efficiency and effectiveness of your company's production cycle. And in today's down economy, efficiency is king.
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Yoon Cannon is a systemic business growth coach, consultant and speaker based in Philadelphia, Pa. She specializes in helping entrepreneurs take their companies beyond the Million Dollar milestones through branding, sales & marketing, hiring and training. For more free articles and podcasts visit www.paramountbusinesscoach.com or call (215) 292-4947 EST.
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