Planning Your Virtual Business: Establishing Standards and Policies - dummies

Planning Your Virtual Business: Establishing Standards and Policies

By Steven D. Peterson, Peter E. Jaret, Barbara Findlay Schenck

You need a consistent set of policies in your virtual business’s plan. The virtue of a virtual company is that employees have tremendous freedom in their working lives. Managed well, a virtual company can be more flexible and efficient than a traditional nine-to-five, office-based enterprise. But with employees working as free agents distributed around the country — and sometimes around the world — virtual companies must establish specific standards and policies for operations and procedures, so that employees know how the business runs and what is expected of them.

The specifics will depend on the kind of business you plan to run. In the area of human resources, policies range from how prospective employees are hired and trained to how and how often their performance will be reviewed. If your business involves contracts with clients or customers, you need policies in place to establish who is authorized to sign on behalf of the company.

Plus, you’ll need policies for how products are produced, how and when outside supplies or services are purchased, how timelines are created and tracked, and more.

The online company Etsy provides a marketplace for artists and craftspeople to sell their wares. Sellers are essentially distributed employees who create the products sold on the company’s website. Etsy’s claim to fame is that it is a marketplace for handmade or individually designed products.

Recently the company came under criticism because some people were hiring others to make the products and in some cases even selling (and sometimes reselling) manufactured goods. In response, Etsy established specific standards — “Our House Rules,” the company calls them — for what constitutes “handmade” goods and manufactured products.

Your business plan won’t include every standard and policy relating to how you do business. But definitely give some thought to the most important standards and policies you’ll need in place to run your operation. Those that are essential to defining your business and how it will operate should be described in your plan.