Policy

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Policy is a deliberate system of guidelines to guide decisions and achieve rational outcomes. A policy is a statement of intent and is implemented as a procedure or protocol. Policies are generally adopted by a governance body within an organization. Policies can assist in both subjective and objective decision making. Policies used in subjective decision-making usually assist senior management with decisions that must be based on the relative merits of a number of factors, and as a result, are often hard to test objectively, e.g. work–life balance policy. Moreover, governments and other institutions have policies in the form of laws, regulations, procedures, administrative actions, incentives and voluntary practices. Frequently, resource allocations mirror policy decisions.

Policy is a blueprint of the organizational activities which are repetitive/routine in nature.

In contrast, policies to assist in objective decision-making are usually operational in nature and can be objectively tested, e.g. password policy.^[1]

The term may apply to government, public sector organizations and groups, as well as individuals, Presidential executive orders, corporate privacy policies, and parliamentary rules of order are all examples of policy. Policy differs from rules or law. While the law can compel or prohibit behaviors (e.g. a law requiring the payment of taxes on income), policy merely guides actions toward those that are most likely to achieve the desired outcome.^[2]

Policy or policy study may also refer to the process of making important organizational decisions, including the identification of different alternatives such as programs or spending priorities, and choosing among them on the basis of the impact they will have. Policies can be understood as political, managerial, financial, and administrative mechanisms arranged to reach explicit goals. In public corporate finance, a critical accounting policy is a policy for a firm/company or an industry that is considered to have a notably high subjective element, and that has a material impact on the financial statements.^{[citation needed]}

It has been argued that policies ought to be evidence-based. An individual or organization is justified in claiming that a specific policy is evidence-based if, and only if, three conditions are met. First, the individual or organization possesses comparative evidence about the effects of the specific policy in comparison to the effects of at least one alternative policy. Second, the specific policy is supported by this evidence according to at least one of the individual's or organization's preferences in the given policy area. Third, the individual or organization can provide a sound account for this support by explaining the evidence and preferences that lay the foundation for the claim.^[3]

Policies are dynamic; they are not just static lists of goals or laws. Policy blueprints have to be implemented, often with unexpected results. Social policies are what happens 'on the ground' when they are implemented, as well as what happens at the decision making or legislative stage.^[4]

When the term policy is used, it may also refer to:^[4]

• Official government policy (legislation or guidelines that govern how laws should be put into operation)
• Broad ideas and goals in political manifestos and pamphlets
• A company or organization's policy on a particular topic. For example, the equal opportunity policy of a company shows that the company aims to treat all its staff equally.

The actions an organization actually takes may often vary significantly from its stated policy. This difference is sometimes caused by political compromise over policy, while in other situations it is caused by lack of policy implementation and enforcement. Implementing policy may have unexpected results, stemming from a policy whose reach extends further than the problem it was originally crafted to address. Additionally, unpredictable results may arise from selective or idiosyncratic enforcement of policy.^[4]