A side effect of this is that you can hire inexperienced (i.e., cheap) staff.

It’s also the “Is it a job or a business?” test. You can sell businesses, but not jobs.

Your’restatement was much better than the book, which is terribly written and frustrating. Why don’t you write a book?

But be aware too much of documentation will prevent innovation which is very important to become competitive and successful in this global competitive market. Documents also make your associate more followers then the leaders.

So, my conclusion is that keep documentation flexible enough so that there is room for innovation. Find out which task need to be fully documented and which need to be flexible. Make a strategy and succession plan for it. For example: It can be like this: Write step-by-step documents for the routine and daily works to improve efficiency and quality. But always make flexible documents for company strategies, plans, objectives and goals which needs to be evolved as the situation demands.

The author calls what you have described as the “Franchise effect.”

Not all documentation is equal. The key is to document the right things and ignore the rest. How do you tell what the right things are? Well, experience helps. If you got shafted by not having documented it before, you’ll probably make sure it’s documented in the future!

I believe it’s important to stress that in more creativity oriented companies – like software companies – documentation can be a stopper. My belief tells me that documentation should only be written down if is has a purpose, which it clearly did in your case. Documentation for the sake of documentation will only lead to bureaucracy and a comprehensive compilation of documents that constantly screams to be updated. In the latter case, your company might suffer from the infamous “death by documentation”…