Having written and implied policies is an opportunity to define and clarify top management objectives. Policy statements are a means for executive management to communicate its leadership and views. Executive management should develop a series of high-level policy statements that provide guidance to employees at all levels.
Another advantage is that policies provide a framework for consistent decision making and action. In fact, one of the primary objectives of a policy is to ensure that personnel act in a manner consistent with executive or functional management’s expectations. Finally, an effective policy provides an additional advantage by defining the rules and procedures that apply to all employees.There are also potential disadvantages to policy development. First, a policy is often difficult to communicate throughout large organizations. Second, employees might view policies as a substitute for effective management. Policy statements are guidelines that outline management’s belief or position on a topic. They are not a set of how-to instructions designed to provide specific answers for every business decision. Third, policy development can also restrict innovation and flexibility. Too many policies accompanied by cumbersome procedures can become an organization’s worst enemy.Several characteristics of a policy render it effective. Effective policies are actionoriented guidelines that provide guidance. They provide enough detail to direct behavior toward a specific goal or objective but are not so detailed that they discourage personnel from following the policy. An effective policy is relevant (avoiding trivial or unimportant issues) and concise (stating a position with a minimum number of words). An effective policy is unambiguous, allowing personnel little doubt as to how to interpret the policy’s intent and direction. Policies that are subject to different interpretations will, over a period of time, result in several possible outcomes. This can lead to inconsistent behavior, as people will simply ignore the policy because it is so difficult to interpret. Another characteristic of effective policies is that they are timely and current, which assumes that they are periodically reviewed for clarity and conformance. A policy is ineffective or counterproductive if it is confusing, ignored, or outdated. For example, in the opening vignette, each cement plant was operating under a different set of rules, and everyone was essentially ignoring the fact that a common set of policies or procedures existed. Policy formation and review should be a dynamic activity undertaken at least once every year or so. A policy may be timely and correct but not properly enforced by management. In this case, it is management’s responsibility to reeducate the workforce about the policy’s intent. There is no other substitute for detailed training on policies, to ensure that everyone understands how to do their jobs. Saying that you have no human rights abuses in your supply chain, and actually being able to verify that you do not, are two different issues. Auditing and tracking of human rights compliance and violations is trickier than it sounds; auditors can be paid off in LCC countries. Even honest auditors typically announce their audits prior to arrival, allowing facilities to “sterilize” their operational environments for the day, and revert back to old habits. A more useful approach involves assessing the end-to-end sourcing process, which consists of supplier evaluation, contracting, and performance measurement, and is much more preventive in nature. Not only can organizations avoid establishing contracts with suppliers who do not manage their LHR processes, but a framework that provides ongoing monitoring and punitive measures for those who do manage to sneak through the security net is more likely to ensure compliance. But what are the criteria for assessing LHR violations? One of the most important frameworks that has emerged is the one provided by the International Labor Organization, which provides several key guidelines for assessing compliance to fair labor standards. These are listed below. The International Labor Organization (ILO) framework is useful, but applying it to the sourcing process is more problematic. There is a need for establishing guidelines that can be applied to the sourcing process (selection, contracting, and performance measurement) that ensure that ILO human rights guidelines are explicitly considered.