Building internal control processes, lessons from lax management
Building a workflow is a must-have if you want your business to run smoothly and efficiently. Underestimating the importance of processes in business management, in the long run, becomes a major obstacle to the development of the business.
"Pain" from lax management
After a period of rapid growth and only focusing on expanding production and business activities, many businesses "fall back" when accounting books. The books hardly reflect the real situation of business, the data are not updated in time, even many problems even the accountants do not know to explain.
In addition, it is only when the tax office makes tax finalization that business owners begin to care about books. But up to this point, almost no one still holds the old data, the accountants answer around, push the responsibility and in the end the real person is the business owner.
More worrisome, many businesses suddenly fell into bankruptcy when suddenly receiving huge debts that need to be paid. Meanwhile, even the owner of the business did not know the existence of these debts until the accountant announced it or someone came to collect the debt.
The cause of the "pain"
When starting a company, business owners are focused on the business of expanding the market, ignoring the importance of other divisions. Focus on developing the business too quickly but without the right business structure.
Putting too much confidence in the staff and having no control that makes the work done not complying with any specific standards is also the cause of the business owner in a "bad situation. cry and laugh ". Assign too much power to a group of people, leading to them having the opportunity to make decisions beyond authority and posing risks to the business such as fraud, embezzlement, even collusion with third parties to perform acts of redemption.
Enterprises do not build management processes, internal control systems to inspect and supervise the activities of various parts of the business. This reason stems from the employee's psychological fear of change, unwillingness to be supervised, along with the fact that the business owner does not appreciate the importance of building internal control processes.
At the same time, personnel often change in many departments but there is no transfer of supervision, leading to no one knowing the correct data or being able to explain the origin and nature of the data. This causes the risks of debt collection tracking, asset tracking and even tax risks for business owners.
Prevent or minimize risks from letting go of management
First, business owners need to realize the importance and urgency of having an effective workflow management and control system. From there, building a specific reward and discipline regime to encourage and deter individuals from complying with the issued process.
Next, to prevent these "pain", there is no other way that businesses must build a specific working process of each department. Building an internal control system suitable to its size, business lines, and operating culture is the key for businesses to maintain stability and develop sustainably.
Finally, finding a management tool that suits the needs and conditions of the business. Currently, on the market, there are many useful job management software to make the choice of the business much more favorable. However, enterprises need to properly understand their needs in order to choose the right software or application, to avoid the case of choosing software beyond its needs and not fully exploiting its applications.
Specific solutions to overcome the loosening of corporate management
- Business owners need to clearly identify the problems they are facing and understand their exact expectations before building the process;
- Find out and use work management applications and software in accordance with management needs;
- Perform audited financial statements periodically to identify gaps in tax accounting and improve reporting accuracy.
- Standardize operating procedures, working in each stage of the entire enterprise;
- Staff need to adhere to and strictly follow the issued process;
- Develop and apply a clear and transparent reward and discipline mechanism to ensure the process is fully operational;
- Monitor the operation of the process to promptly detect inappropriate problems, immediately correct to optimize the efficiency of business control.
The problem of building a process has never been easy, each business will have its own characteristics. Combined with human factors, management tools make it difficult for businesses to come up with the right solution. If you have any problems in managing and building processes, please contact Vieter's Consulting Department for support.
