We all know that a Standard Operating Procedure (SOP) is a step-by-step set of instructions written by an organization to help workers carry out complex routine operations. Each SOP is aimed to achieve efficiency, quality outcomes and uniformity of performance, whilst reducing miscommunication and failure to comply with policy, regulatory and statutory matters. We also know SOPs are an intrinsic part of an organisation’s governance and control.

It is no surprise that regulation such as the USA Sarbanes–Oxley Act of 2002, also known as the "Corporate and Auditing Accountability, Responsibility, and Transparency Act" clearly states that organisations are retrospectively accountability for their procedures due to their importance upon behavioural conduct. Similarly, the UK Financial Conduct Authority, Senior Managers Regime is aimed at holding management accountable for past misconduct that falls within their area of responsibility, including the conduct of individuals working at all levels. When alleged misconduct occurs both individuals and the SOPs come under forensic scrutiny.  

It is therefore not a surprise that SOPs are at the core of the move towards the digital transformation of governance.

The reality is that in many industries such as Financial Services and Health, the state of documented SOPs is so poor that they have become a barrier to the digital transformation of governance. Nowadays, many documented SOPs are not fit for purpose. This was clearly the findings by Dame Judith Hackett investigation into the SOPs related to building regulations because of the Grenfell fire.

There are two major chasms between SOP perception and reality.

The first chasm is that executives and senior managers generally believe that their SOPs are properly documented. This perception is because the SOPs are well controlled and audited creating the belief that the SOP substance in the form of narrative are fit for purpose. The reality is the substance of the SOP narrative is underpinned by weak algorithms. In other words, the decision science has been compromised when it comes to the use of choices, which determine the instructional step-by-step pathways leading to a plethora of outcomes.

Over the past few decades, as knowledge complexity increases it has typically led to the SOP narrative becoming weaker and weaker. Such knowledge complexity is driven by regulatory, statutory, policy, product, services and practices. As the gap increases between the complexity of knowledge and the SOP narrative, the greater the level of subjective decisions being made by workers. This in turn leads to systemic risks, which manifest themselves ‘unexpectedly’ as executives and senior managers grapple with the increasing numbers of ‘left-field’ exposures.  

The second chasm is that the workers have been so long used to SOPs not reflecting reality that they have become used to making subjective decisions. This has created several generations of workers used to being empowered without due consideration to safeguarding themselves, customers and the organisational brand. This normalisation of procedural subjectivity continues to weaken organisations. Without addressing causality, executives address the problem with increased compliance checks that gradually constrains the organisation, whilst detrimentally impacting productivity that counter balances the rapid changes in technology automation.  

The normalisation of procedural subjectivity has led to not only excessive compliance overheads, but also an increase in cases related to negligence, errors, falsehoods and handoffs.  Yet the purpose of a SOP is to achieve efficiency, quality outcomes and uniformity of performance, while reducing miscommunication and failure to comply with policy, regulatory and statutory matters.

The digital transformation of governance, starting with SOPs, will enable more self-service and self-sufficiency paving the way for a more agile and adaptive workforce, with compliance assured. It is time to challenge the normalisation pf procedural subjectivity.