What is the SOP and why it is important for Business ?

Definition of SOP by Wikipedia- A standard operating procedure is a set of step-by-step instructions compiled by an organization to help workers carry out routine operations. SOPs aim to achieve efficiency, quality output, and uniformity of performance while reducing miscommunication and failure to comply with industry regulations.

What is an SOP document?
An SOP is a procedure specific to your operation that describes the activities necessary to complete tasks following industry regulations, provincial laws, or even just your own standards for running your business. Any document that is a “how-to” falls into the category of procedures.

What is an SOP manual?
A standard operating procedure manual is a handbook that lists all the written instructions for an organization’s essential tasks. An SOP manual houses all an organization’s individual SOPs in one place. The manual provides a comprehensive guide for overall operations.

What is a Standard Operating Procedure (SOP)? 
An SOP is a procedure specific to your operation that describes the activities necessary to complete tasks following industry regulations, provincial laws, or even just your own standards for running your business. Any document that is a “how-to” falls into the category of procedures. In a manufacturing environment, the most obvious example of an SOP is the step-by-step production line procedures used to make products as well as train staff.

An SOP defines expected practices in all businesses where quality standards exist. SOPs play an important role in your small business. SOPs are policies, procedures, and standards you need in your business’s operations, marketing, and administration disciplines to ensure success. These can create: 

  • Efficiencies, and therefore profitability 
  • Consistency and reliability in production and service 
  • Fewer errors in all areas a way to resolve conflicts between partners 
  • A healthy and safe environment 
  • Protection of employers in areas of potential liability and personnel matters 
  • A roadmap for how to resolve issues – and the removal of emotion from troubleshooting – allowing needed focus on solving the problem 
  • The first line of defense in any inspection, whether it be by a regulatory body, a partner or potential partner, a client, or a firm conducting due diligence for a possible purchase 
  • Value-added to your business should you ever wish to sell it 

Developing an SOP is about systemizing all of your processes and documenting them. 

Every business has a unique market, every entrepreneur has his/her leadership style, and every industry has its own best practices. No two businesses will have an identical collection of SOPs. Below is a listing of just a few typical SOPs, which you will want to consider writing for your own small business. 


  • Company Registration Document
  • Government Licensees
  • Logo/Trademark
  • Management /promoters/partners Documents
  • Company Vision Mission Document


  • Production line steps
  • Equipment maintenance, inspection procedures 
  • Quality Control
  • Raw material 
  • Purchase and Procurement
  • Store process
  •  Supply process

Finance and Administration 

  • Accounts receivable – billing and collections process 
  • Accounts payable process – maximizing cash flow while meeting all payment deadlines 
  • Fund Flow
  • Annual, quarterly, and monthly Balance sheet 
  • Pre-budgeting

Marketing, Sales and Customer Service

  • Price list
  • Product description
  • Sales process
  • approval of external communications: press releases, social media, advert, etc. 
  • preparation of sales quotes 
  • service delivery process, including response times
  • warranty, guarantee, refund/exchange policies
  • acknowledgment/resolution of complaints, customer comments, and suggestions 

Employing Staff 

  • job descriptions and KRA
  • Appointment letter Terms
  • Employee orientation and training 
  • Corrective action and discipline 
  • Performance reviews, Increments, and allowances
  • Employee welfare (PF, ESIC, Medical, Bonus, Gratuity, Pension)   
  • Use of the Internet and social media for business purposes 


  • Customer /User policy
  • Company legal status
  • privacy – an explicit privacy policy is required, specifying what information you will collect, why you are collecting it, how it will be used, and how long you will keep the information on file. Ensure that everyone in the organization is only asking for the information they need to do their job.
  • accessibility – having accessible locations, goods, and services will be a legislated right of all Ontarians, with the definition of accessibility going well beyond traditional concepts, like providing wheelchair-accessible washrooms. Companies with fewer than 20 employees are required to create a plan for how they will comply with the Customer Service Standard and then train their employees. Companies with 20 or more employees must also put their plans in writing and report to the government on how the company is doing.


  • Establish before opening; review at least annually 
  • Develop procedures in the language, style, and format best for the establishment (your Industry/operations knowledge is crucial here) 
  • Write SOPs in clear, concise language so that processes and activities occur as they are supposed to 
  • The level of detail in SOPs should provide adequate information to keep performance consistent while keeping the procedures from becoming impractical 
  • Keep written SOPs on-site so that they can be used by supervisors and employees 
  • Drafts should be made and tested before an SOP is released for implementation
  • The more decision-makers, employees, and complexity in the business, the more SOPs are required

If you want to improve your Business we must be recommended to established SOP in your Company. The team of EXPERTGRAPGH will surely advise you as best suitable for your organization. You can Contact US for personalized support

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