With the start of 2016, take the opportunity to plan for a strong and successful year for your business. It is easy to get caught up managing day-to-day operations and overcoming regular business challenges, so make a New Year’s resolution to reflect on the business operation as a whole and create a checklist of important items to accomplish throughout the year.
As you prepare the list, be sure to prioritize and schedule a deadline to complete each item – make the timeline reasonable and attainable, such as tackling one item per month. Below are checklist ideas to strengthen and improve over the next 365 days:
- Customer and Client Agreements. Determine whether the documents being used are the product of forms cobbled together from the internet, borrowed from instruments used by other companies, or tailored to your company’s needs. Make sure all terms reflect how the company operates, include all matters that need to be addressed, and do not contain provisions detrimental to the business. This includes formal contracts, terms and conditions, and point of sale invoices and receipts.
- Vendor Agreements. Vendors may be updating their contracts with new, and potentially unfavorable, terms. Vendor agreements may also refer to terms and conditions that are not part of the document being signed or which are posted on the vendor’s website (and forever changing). Review all applicable documents to determine the potential adverse impact on the business. If the company is a longstanding or valuable customer of the vendor, negotiation of terms may be possible. Be wary of “auto-renew” clauses which will bind the company to additional periods of time, and be mindful of the termination clauses and notice requirements.
- Security. The past couple of years have seen the likes of retail giants Sony and Home Depot suffer data breaches. Small businesses often do not view themselves as targets for hackers; however, the bots that troll the internet look for unlocked doors (regardless of how large or small the company). The law continues to evolve in this area, with penalties and the cost of damage control being significant. Meet with your IT professional to have a security audit performed and implement recommendations to keep company and customer data secure.
- Insurance. Policies easily renew when a business has been claim-free over the years. Thus, insurance coverage may not keep up with the needs of the business, or the agent may not have knowledge of recent changes. Schedule a meeting with the company’s insurance agent to review all equipment purchases, employee driving requirements, operational changes, and growth to determine if coverage increases and changes are warranted.
- Personnel Policies. Employees can be a company’s most important asset, but may also cause much discord if policies are inconsistent with actual practices or simply do not exist. Businesses large and small should have an employee handbook in place, tailored to the business. A handbook should include policies to address employment laws, as well as policies that offer direction to employees on various workplace matters. A business without a handbook or one with outdated policies may find itself in an unfortunate position when attempting to take action against employees or in the event of a lawsuit. Not to mention unhappy employees relying on incorrect policies. Frequent and significant changes occur in employment law, making annual review and updating a necessity.
- Job Descriptions. As a business expands to meet industry and customer demands, reorganizes its workforce, or reduces its staff, the duties placed on and performed by employees evolve. Duties may also change due to employees having exceptional skills or below par skills. Job descriptions need to be fluid and updated regularly to reflect the actual duties being performed. Depending on the position, job descriptions can also include physical demands, required qualifications, working conditions and other criteria. Accurate job descriptions not only assist employees in understanding their position, but are also valuable in conducting performance evaluations, dealing with performance issues, and in litigation.
- Accounting and Financial. While many businesses only consult with their accountant at tax time or to prepare financial statements, business owners should meet with their accountant periodically throughout the year to review financial matters and obtain proactive advice, all of which may help the bottom line.
- Short and Long Range Planning. Business owners and managers are busy dealing with daily operations and managing crises, leaving little opportunity for thoughtful planning. Time needs to be set aside each year to examine the business, its competitors and industry to establish short and long term goals. Effective strategic plans will include input by owners, officers and managers. Short-term plans are quickly measured over the course of the year. Once a long-term plan is structured, it should be reviewed periodically to consider the company’s progress, then adjusted according to changes in vision and both internal and external factors.
- Training. Successful companies have owners and managers who expand their knowledge base and look for new perspectives to operate. Training can have valuable returns, as well as help prevent internal problems. Consider engaging a third party to perform internal seminars for sales staff, managers and other employees. Irrespective of whether the training is to expand the customer base, recognize and handle employment law matters, improve methods of operation or reduce injuries, it enhances the overall strength of the business. Plus, employees appreciate a company investing in them.
Regardless of the item on the checklist, a business that questions its business practices and seeks to improve is one that should find itself stronger with each item it marks off the list.
For additional information on this or any business law topic, please contact KDDK attorney Shannon Frank at sfrank@KDDK.com or (812) 423-3183, or contact any member of the KDDK Business Law Practice Team.
About the Author
Shannon S. Frank, a Partner at Kahn, Dees, Donovan & Kahn, LLP (KDDK), in Evansville, Indiana, has more than 25 years’ experience in the practice of business law, construction law, estate planning and probate administration, health care law, and real estate law. Shannon takes prides in giving exceptional service to her clients, recognizing that relationships with clients play a significant and essential role in providing tailored and comprehensive legal advice.