Getting back to basics: Some people who are new to the business world often ask, "What are policies and procedures?", or more specifically "What's the difference between policies and procedures?".

Many people consider policies and procedures to be a kind of corporate guidebook available to all staff so they can refer to this, as if it were some kind of oracle telling them how they should perform their work, and how they should address a decision they have to make.

But let's look at policies and procedures more closely. Firstly, what exactly is the difference between policies and procedures?

Policies and procedures are different in important ways that relate to how the business operates. A policy is very similar to the "rule book" of the organization. It states the boundaries of what is acceptable to the company, and often outlines penalties that would be sanctioned if those policies are breached.

Procedures, on the other hand, are guides on how to perform specific operations in your day to day job.

Lets say you were going to take a public bus to town. When you get to the bus stop there is posted a list of 5 steps to use the bus: 1. Purchase a ticket. 2. Find the bus route number for your destination. 3. Look up the schedule for when the next bus arrives. 4. Board the bus. 5. Hand the ticket to the driver.  This is a procedure.

When you board the bus you may see a sign posted that says something like: "No standing. No smoking. No food or drink. No animals. Front-most seats are for disabled passengers only. ". This is a policy.

Companies can have many, many procedures that outline the different tasks for their day to day operations. Collectively these are often called "Standard Operating Procedures", shortened to S.O.P. This is another term you will likely hear quite often.

The above example of a procedure to take a public bus leaves a lot of room for choices in how the steps are carried out. If the procedure was more detailed than this, removing all ambiguity in how exactly the procedure is carried out, then it would be called a work instruction. For example, the first step is to purchase a ticket. If this instead specified which method of payment must be used, the price that should be paid, and where the payment is to be tendered, then this could be considered a work instruction instead of just a procedure. Often the difference is subtle, and so more often than not you will see the term procedure more than the term work instruction.

Policies and Procedures are the DNA of an organization. They are the blueprint for how the organization works, both specifically (procedures and work instructions) and broadly (policies). Because they are so critical to the continued operations of a business, they should be protected. This is why it is so important for your organization to have a Policies and Procedures Management System.