corporate approval matrix?

Here at Business Ready we feel strongly about your feedback - both good and bad.  We recently received the following feedback from a reader on the Approval Matrix template: “it provides no valuable insight on what to include, it is very basic and high level.“  Which got me thinking:

what makes a good approval matrix and how do we correctly set that expectation for the product?

An approval matrix is typically a grid (a table or spreadsheet) that shows who at the company can approve certain activities (for instance: purchases or commit the company contractually) and up to what threshold (e.g. how large of a purchase or non-disclosure agreement vs. an enterprise agreement).  I’ve seen matrices for: corporate governance requirements, legal documentation, sales discounts, the procurement process (this is a large company thing), and general business processes.

To get even more specific, technically an approval matrix includes rows and columns where each row defines a potential condition or action and each column defines an approval role.  The body of the grid contains information defining whether the approval role in the corresponding column is required for the business process or action when the potential condition in the corresponding row is met.

To build the matrix a set of conditions that apply to the business process, or actions within the company that require approval, are determined and these conditions and/or actions are included in the rows.  All the approval roles within the company that are appropriate for the conditions and actions in the approval matrix are then determined and included in the columns.  Finally, for each condition you associate the roles required to authorize that step.

The beauty of the matrix is twofold: (1) it is a clean, concise visual that is meant to quickly convey steps/conditions and the roles required for approval; and (2) provides supporting documentation as a check and balance to your internal controls (process and approvals to be compared against and verified by your auditors).

So, what should we expect in the Business Ready Approval Matrix?

Our template provides guidance for a small technology company to think about who can approve: contracts, offer letters, purchasing options, expense reports, travel, cash transactions and cash management.  It’s meant to get you started and combines them all onto one page as the approvals are mainly required of the CEO, CFO, Controller or Department Manager.  An approval matrix should be customized for your specific environment.  We’ve got you started but you need to make it unique for your environment.

hmmm, sounds pretty straight forward.  Is there someway I can test drive it?

Fortunately the Approval Matrix is included in the Finance Ready Starter Pack which is available for FREE for a limited time. Really, it’s a great way to try us out and get some basic tools under your belt before you buy the meatier options.