Policy and Strategy: A Comparison

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Policy and Strategy: A Comparison

The strategy is now the more common term for what used to be called policy, though there is no consensus on this also. For example, some writers make a distinction between the two referring as the general or grand strategy as policy and competitive; strategy as the strategy used in a military sense. The situation is, therefore, still confusing. Steiner has observed that for some years and after much travail, the term policy was fairly understood. Then the game theorists began to use the term strategy with re result that management literature now is thoroughly confused about its meaning and relationship to policy. However, in this text, two terms have been used with fairly different meaning and based on that, the difference between the two can be identified.Policy
A distinction between policy and strategy is made on the basis that former is a guideline to the thinking and action of those who make decisions while the latter is concerned with the direction in which human and physical resources are deployed in order to maximise the chances of achieving organisational objectives in the face of environmental variables. Ansoff makes difference between policy and strategy by putting that “policy is a contingent decision whereas strategy is a rule for making a decision. A contingent event is recognised because it is repetitive but the specific occurrence cannot be specified. For such repetitive events, it is not worth while to decide every time what to do when such a contingency arises. It is better to decide in advance what I’ll be done in such a case.

Features of a policy can be identified

1. A policy provides guidelines to the members of the organisation for deciding a course of action and, thus, restricts their freedom of action. The policy provides and explains what a member should do rather than what he is doing. Policies, when enforced, permit prediction of roles with certainty. Since a policy provides guidelines to thinking in decision- making, it follows that it must allow some discretion, otherwise, it will become a rule.
2. Policy limits an area within which a decision is to be made and assures that the decision will be consistent with and contributive to objectives. A policy tends to decide issues, avoid rt:; peated analysis, and give a unified structure to other types of plans, thus permitting managers to delegate authority and still retaining control of action. For example, if the organisation has framed a policy that higher positions in the organisation will be filled by internal promotion, the managers concerned can deal with the situation in this light whenever a vacancy at higher level arises. Thus, the organisation gets the assurance that higher positions are filled by internal members without further control.
3. Policies are generally expressed in the qualitative, conditional, or general way. The verbs most often used in stating policies are to maintain, to continue, to follow, to adhere, to provide, to assist, to assure, to employ, to make, to produce, or to be. Such prescriptions may be either explicit or these may be interpreted from the behaviour of organisation members, particularly at the top level. When such a behaviour is interpreted as policy guideline, it is normally known as precedent, that is what has happened in the past on a particular issue if there is no clearly specified declaration.
Policy formulation is a function of all managers in the organisation because some form of guidelines for a future course of action is required at every level. However, higher is the level of a manager, more important is his role in policy making. Similarly, policies may exist in all areas of the organisation from major organisational policies to minor policies applicable to the smallest segment of the organisation.