Difference Between Strategy and Policy

Strategy vs Policy

The success of a business is strongly linked to how the management of the company perceives the goals to be achieved and the ways devised to achieve those goals. There are two different but interrelated concepts of strategy and policy that are very confusing for outsiders to a business. There are many who feel that there are enough similarities and overlapping to use these words interchangeably. However, strategy and policy are two different concepts and these differences will be highlighted in this article.


Strategy of a business organization is reflective of the thinking of those at the top of its management and the action that the management plans to take. It is the job of the management to set goals that are sought to be achieved and the strategy is a statement that lets stakeholders know the thinking of the management as to how they plan to achieve these goals. To an investor or a shareholder, the strategy document is an important reminder regarding the thinking process of men who matter in a company.

In sports, different players are known to adopt strategies of defense or attack or make moves to confuse their opponents. In team games, strategies are made beforehand where there are plan A, plan B, and plan C ready to be applied in different circumstances.


A policy lies at the core of all decisions taken by the management of a company. It serves as a guide while taking decisions though the policy is not a statement that is written in black and white that has to be applied in day to day operations. Policy statement is like a guidebook that helps management to take important decisions and clears all doubts as to the direction a company should take.

If a company has made it a policy not to make use of services of middlemen, it sticks to its decision and becomes famous for its policy. Honesty is the best policy for success in any endeavor, they say, and this holds true even today.

It is not just business where policies are required; even governments have well defined policies such as foreign policy, investment policy, defense policy, and so on. People vote for political parties as they know their viewpoint reflected in their policy statements.

What is the difference between Strategy and Policy?

• The plan of action devised by the management to achieve the goals set forward is termed as the strategy of a company

• Broad ideas or official line taken by a company, organization, or a government is termed as its policy

• There can be different strategies to achieve the goals set by a company following the policy guidelines though the policy is a long term concept that remains the same in a constant manner

• Strategy is better labeled as plan of action while the policy is a guideline that is to be kept in mind all the time

  • http://www.facebook.com/faizan.wasi Faizan Wasi

    Policy is related to operational department and strategy is related to top level management