Skip to content
SuperMoney logo
SuperMoney logo

Best Practices: Definition and Steps

Last updated 03/14/2024 by


Edited by

Fact checked by

Best practices are efficient and prudent guidelines for optimal business decisions. They can be set by authorities or established internally by companies. These practices provide a roadmap for businesses, helping them navigate challenges and opportunities. Best practices span various sectors, from inventory management to education and customer service. Developing effective best practices involves research, communication, defining measurable metrics, managing change, customization, and ongoing evaluation. Examples include “just in time” inventory management and the Kaizen philosophy. Implementing best practices enhances productivity, transparency, and customer satisfaction.
Best practices are guiding principles that offer efficient and prudent courses of action for business decisions. Whether they’re recommended by industry authorities or devised internally, they serve as crucial frameworks for optimal functioning within an organization. In this article, we explore the concept of best practices, their significance, development steps, examples, and their application across various industries.

Compare Home Loans

Compare rates from multiple vetted lenders. Discover your lowest eligible rate.
Compare Rates

Understanding Best Practices

Best practices encompass a range of guidelines, ethics, or strategies that represent the most effective ways to navigate business situations. They can originate from external authorities like regulators or be internally established by a company’s management team. By adhering to these practices, businesses can streamline operations, make informed choices, and address challenges proactively.

Implementing best practices

Best practices offer a flexible framework applicable across diverse situations. For instance, businesses can employ them to enhance task efficiency and employee safety. In fields like accounting, adhering to established standards like Generally Accepted Accounting Principles (GAAP) ensures transparency and consistency in financial communication.

Customizing best practices

Customization is vital when implementing best practices to ensure alignment with a company’s unique characteristics and goals. Corporate governance and ethical codes can serve as best practices, fostering responsible business conduct.

Industry benchmarks and knowledge sharing

Best practices also serve as benchmarks, allowing companies to share effective solutions with others. Sharing actionable solutions can lead to improved efficiency and problem-solving across industries. However, sharing proprietary information should be approached cautiously.

Steps to Develop Effective Best Practices

Developing impactful best practices involves a systematic approach:

Research and analysis

Research industry practices and gather insights on customer service, hiring, promotions, and production. Understand what works and what doesn’t to shape your approach.


Share identified best practices with key individuals to ensure alignment and understanding throughout the organization.

Measurable metrics

Define metrics that enable tracking progress and accountability. Measurable benchmarks contribute to successful implementation.

Managing change

Anticipate resistance to change and formulate strategies to navigate it effectively. Implementing new practices requires a well-managed transition.


Modify identified best practices to fit your business’s unique characteristics, ensuring they align with your goals and objectives.


Involve everyone within the organization to ensure widespread awareness and agreement to follow the best practices.

Alignment with stakeholder needs

Seek guidance from other businesses or customers to refine and enhance your best practices for maximum impact.

Continuous evaluation and refinement

As your business evolves, regularly assess your best practices and adapt them to reflect organizational changes.

Examples of Best Practices

Just in time (JIT)

JIT focuses on efficient inventory management by aligning material orders with production schedules. This minimizes waste and reduces costs while requiring accurate demand forecasting.

Kaizen philosophy

Kaizen promotes continuous improvement in productivity and operations. It involves creating an efficient workplace, improving procedures, and fostering employee engagement.

Best practices in different sectors


Staying proactive, encouraging communication, and setting clear goals are key best practices in education. These strategies enhance classroom engagement and student learning.


In healthcare, staff training, patient education, and creating a care-oriented environment are essential best practices. These practices improve patient experiences and outcomes.

Customer service

Effective employee hiring and incentivization, managing customer expectations, and creating strong first impressions are crucial best practices for providing exceptional customer service.
Recognizing these challenges and devising strategies to address them is vital for a successful best practices implementation.
Best practices serve as invaluable guides for businesses, offering a roadmap to navigate the complexities of decision-making and operations. Whether derived from external authorities or tailored internally, they represent the most effective and prudent courses of action in various industries.
Customization, alignment with stakeholder needs, and continuous evaluation are key factors in ensuring that best practices remain relevant and adaptable to your organization’s unique characteristics and goals. By embracing best practices, your business can achieve enhanced efficiency, transparency, and decision-making, ultimately leading to greater success.
Here is a list of the benefits and the drawbacks to consider.
  • Enhanced efficiency: Best practices streamline operations and decision-making, leading to improved efficiency.
  • Improved decision-making: Guidelines provide a structured approach, helping businesses make informed choices.
  • Transparency and consistency: Following established best practices promotes transparency and consistency, aiding communication.
  • Problem-solving framework: Best practices offer solutions for common challenges, reducing time spent on troubleshooting.
  • Employee engagement: Clearly defined practices engage employees by providing a roadmap for success.
  • Risk of rigidity: Overemphasis on best practices can limit adaptability to unique situations.
  • Resistance to change: Employees may resist new practices, slowing down the implementation process.
  • Complexity and overwhelm: Developing and implementing comprehensive best practices can be time-consuming and overwhelming.
  • Lack of customization: Generic best practices may not fully align with a company’s specific goals and values.
  • Potential for Stagnation: Overreliance on established practices can hinder innovation and creativity.

Frequently Asked Questions

What exactly are best practices?

Best practices are guidelines, ethics, or strategies that represent the most effective and prudent courses of action in business situations. They offer a framework for optimal decision-making and problem-solving.

Who establishes best practices?

Best practices can be set by external authorities such as regulators or governing bodies, or they can be internally devised by a company’s management team.

How can best practices benefit my business?

Implementing best practices can enhance efficiency, transparency, and decision-making within your business. They provide a structured approach to addressing challenges and optimizing opportunities.

Are best practices the same across industries?

No, best practices can vary based on industry, business type, and specific goals. Customization is important to ensure alignment with your company’s unique characteristics.

What are the challenges in developing best practices?

Developing effective best practices can be time-consuming and may face challenges such as employee resistance to change and the need for ongoing customization and refinement.

Key takeaways

  • Best practices offer efficient and prudent courses of action for business decisions.
  • Customization ensures best practices align with a company’s unique characteristics and objectives.
  • Sharing best practices can enhance industry efficiency and problem-solving.
  • Developing best practices involves research, communication, metrics, change management, and ongoing refinement.
  • Examples include JIT inventory management, the Kaizen philosophy, and sector-specific practices in education, healthcare, and customer service.

SuperMoney may receive compensation from some or all of the companies featured, and the order of results are influenced by advertising bids, with exception for mortgage and home lending related products. Learn more

Loading results ...

You might also like