Definition of Business Policy

Business Policy defines the scope or spheres within which decisions can be taken by the
subordinates in an organization. It permits the lower level management to deal with the problems
and issues without consulting top level management every time for decisions.

Business policies are the guidelines developed by an organization to govern its actions. They
define the limits within which decisions must be made. Business policy also deals with
acquisition of resources with which organizational goals can be achieved. Business policy is the
study of the roles and responsibilities of top level management, the significant issues affecting
organizational success and the decisions affecting organization in long-run.

Features of Business Policy

An effective business policy must have following features-

1. Specific- Policy should be specific/definite. If it is uncertain, then the implementation

will become difficult.
2. Clear- Policy must be unambiguous. It should avoid use of jargons and connotations.
There should be no misunderstandings in following the policy.
3. Reliable/Uniform- Policy must be uniform enough so that it can be efficiently followed
by the subordinates.
4. Appropriate- Policy should be appropriate to the present organizational goal.
5. Simple- A policy should be simple and easily understood by all in the organization.
6. Inclusive/Comprehensive- In order to have a wide scope, a policy must be
comprehensive.
7. Flexible- Policy should be flexible in operation/application. This does not imply that a
policy should be altered always, but it should be wide in scope so as to ensure that the
line managers use them in repetitive/routine scenarios.
8. Stable- Policy should be stable else it will lead to indecisiveness and uncertainty in
minds of those who look into it for guidance.

Difference between Policy and Strategy

The term “policy” should not be considered as synonymous to the term “strategy”. The
difference between policy and strategy can be summarized as follows-

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

While strategy is concerned with those organizational decisions which have not been
dealt/faced before in same form.
2. Policy formulation is responsibility of top level management. While strategy formulation
is basically done by middle level management.
3. Policy deals with routine/daily activities essential for effective and efficient running of an
organization. While strategy deals with strategic decisions.
4. Policy is concerned with both thought and actions. While strategy is concerned mostly
with action.
 5. A policy is what is, or what is not done. While a strategy is the methodology used to
achieve a target as prescribed by a policy.

General Liability Insurance vs. Business Owner's Policy (BOP Insurance)

So you’re on the hunt for adequate small business insurance for your company. But now you see
two avenues to get the basic liability protection your business needs: you could go with a
standalone General Liability Insurance policy or you could see if you qualify for a Business
Owner’s Policy. What do you need to know to make an informed decision?

Consult this guide for a quick rundown on the benefits of each policy and how they differ. Then
you’ll be able to decide which one offers you the financial protection that fits your needs.

What Is General Liability Insurance?

General Liability Insurance offers a blanket of liability protection against a few common torts
small-business owners may face. It kicks in when a third party (i.e., anyone who doesn’t work
for your business) sues you over…

 Bodily injuries they suffered on your commercial premises.

 Property damage you caused while doing your work.
 Advertising / personal injuries (e.g., slander, libel, using someone’s image without their
permission, or copyright infringement).

In response to these claims, General Liability compensates you for attorneys’ fees, court costs,
and settlements or judgments (depending on your policy limits). Keep in mind that even the most
careful business owners could face these claims, which is why the coverage is considered the
cornerstone of any business protection plan.

What Is a Business Owner's Policy?

A Business Owner’s Policy (BOP Insurance) is essentially a high-octane General Liability

Insurance policy. It takes a couple insurance policies and bundles them into one convenient
package at a reduced annual rate. A BOP typically includes…

 General Liability Insurance (described above).

 Property Insurance, which compensates you for insured business assets that are lost or
damaged by fire, theft, or windstorms.
 Business Interruptions Insurance, which reimburses you for lost income when a covered
property event forces you to temporarily halt business operations.
Though a BOP is a comprehensive and affordable option, it’s not available to all business
owners. To qualify for this coverage, you must…

 Own a small business (which means your premises are small and you don’t have a lot of
employees).
 Work in a low-risk industry.
 Not need more than 12 months of Business Interruption coverage.

How General Liability and BOP Insurance Are Alike

As you can see, there is some common ground between General Liability and a BOP. Let’s
recap:

 Both policies offer basic liability protection. A standalone GL policy and a BOP protect your
small business from premises liability, property damage liability, and advertising liability claims.
Remember, if you do purchase a Business Owner’s Policy, you won’t need a separate General
Liability policy.
 Both policies can be customized through endorsements. Do you need Product Liability
coverage to address lawsuits when the products you create or sell physically harm someone? Do
you drive a vehicle for work purposes and need Commercial Auto Insurance? Do you own a
restaurant that sells booze and need Liquor Liability Insurance? These additional coverages can
be added to either a BOP or a General Liability policy.

How General Liability and BOP Insurance Differ

Here’s a quick outline of how a standalone General Liability policy and a BOP are unique:

 BOPs are not available to all business owners. As noted above, you have to meet certain
criteria to be eligible for the bundle. Namely, BOPs are only offered to small-business owners. By
contrast, General Liability Insurance is available to most business owners. For example, if you
work in construction, you may not be eligible for a BOP because your industry is considered
“high risk.” However, a standalone GL policy would be able to protect a construction business
from its liability exposures.
 A BOP can reduce your insurance rates. If you’re looking to save money on small business
insurance, a BOP should be the first place you look. You’ll receive multiple coverages at a rate
lower than you’d pay if you purchased each policy individually.

Is Your Business Eligible for a Business Owner's Policy?

To find out whether your small business qualifies for the convenient and affordable protection of
a BOP, fill out an online insurance application. Our expert agents will compile your quotes and
send them to your inbox, usually within 15 minutes.
What is the business policy?

Business policy is the study of the roles and responsibilities of top- level management, the
significant issues affecting organizational success and the decisions affecting organization in the long-
run. ... Business policies are the guidelines developed by an organization to govern its actions.

What is the definition of business policy?

Definition of Business Policy. ... Business policies are the guidelines developed by an
organization to govern its actions. They define the limits within which decisions must be made. Business
policy also deals with acquisition of resources with which organizational goals can be achieved

What is the primary purpose of a policy?

Workplace policies establish boundaries for acceptable behavior and guidelines for best
practices in certain work situations. They offer clear communication to your employees as to
how you expect them to act. Policies also contribute to the overall culture of the workplace,
because they instill norms and values.

What is the difference between a policy and a strategy?

A Strategy is a special plan made to achieve a market position and to reach the
organizational goals and objectives, but Policy refers to a set of rules made by the organization
for rational decision making. Many people have confusion regarding the two terms, but they are
not alike.

What are the benefits of having a policy?

If your company has well-developed policies and procedures, it can provide many benefits to
your workplace. Policies help to manage legal risk and allow you to outline the benefits and
opportunities your company provides to its workers – this helps to improve workforce morale,
worker retention and job satisfaction.

What is a policy in the workplace?

A workplace policy is a statement from company leaders outlining standards of behavior or
limitations. Companies have policies that cover a wide array of business activities.

What is the difference between a policy and procedure?

So, What's the Difference? A policy is a guiding principle used to set direction in an
organization. A procedure is a series of steps to be followed as a consistent and repetitive
approach to accomplish an end result. ... New Release of “How to Write a Policies and
Procedures Manual” is now available.

What is the difference between a plan and a strategy?

Often times, the words “plan” and “strategy” are used interchangeably. The meanings of the
words are quiet similar; a method for achieving an end. However, there are strong differences
between these words as well. ... A strategy, on the other hand, is a blueprint, layout, design, or
idea used to accomplish a specific goal.

Why do we need a policy?

Each service needs to have policies and procedures to help them guide the actions of all
individuals involved in the service. They ensure and endorse the well-being of all families,
children, staff, volunteers and everyone who is connected to the service. ... They provide
consistency amongst staff, parents and children.

What is the meaning of policy and procedure?

Policies and procedures are designed to influence and determine all major decisions and
actions, and all activities take place within the boundaries set by them. Procedures are the
specific methods employed to express policies in action in day-to-day operations of the
organization.

What is a policy in the workplace?

A workplace policy is a set of rules and principles that aims to guide managers and workers in
how to behave in the workplace, and you can have them in place for numerous different issues –
bullying, harassment, internet use, health and safety and social media are just a few.
Policy

A policy is a deliberate system of principles 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 to assist 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. In contrast
policies to assist in objective decision making are usually operational in nature and can be
objectively tested, e.g. password policy.

The term may apply to government, private 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 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 a desired outcome.

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 which is considered to have a notably high subjective element, and
that has a material impact on the financial statements.

Impact

Intended effects

The intended effects of a policy vary widely according to the organization and the context in
which they are made. Broadly, policies are typically instituted to avoid some negative effect that
has been noticed in the organization, or to seek some positive benefit.

Corporate purchasing policies provide an example of how organizations attempt to avoid

negative effects. Many large companies have policies that all purchases above a certain value
must be performed through a purchasing process. By requiring this standard purchasing process
through policy, the organization can limit waste and standardize the way purchasing is done.

The State of California provides an example of benefit-seeking policy. In recent years, the
numbers of hybrid cars in California has increased dramatically, in part because of policy
changes in Federal law that provided USD $1,500 in tax credits (since phased out) as well as the
use of high-occupancy vehicle lanes to hybrid owners (no loew hybrid vehicles). In this case, the
organization (state and/or federal government) created an effect (increased ownership and use of
hybrid vehicles) through policy (tax breaks, highway lanes).
Unintended effects

Policies frequently have side effects or unintended consequences. Because the environments that
policies seek to influence or manipulate are typically complex adaptive systems (e.g.
governments, societies, large companies), making a policy change can have counterintuitive
results. For example, a government may make a policy decision to raise taxes, in hopes of
increasing overall tax revenue. Depending on the size of the tax increase, this may have the
overall effect of reducing tax revenue by causing capital flight or by creating a rate so high that
citizens are deterred from earning the money that is taxed. (See the Laffer curve.)

The policy formulation process theoretically includes an attempt to assess as many areas of
potential policy impact as possible, to lessen the chances that a given policy will have
unexpected or unintended consequences.

Policy cycle

In political science, the policy cycle is a tool used for the analyzing of the development of a
policy item. It can also be referred to as a "stagist approach", "stages heuristic" or "stages
approach". It is thus a rule of thumb rather than the actual reality of how policy is created, but
has been influential in how political scientists looked at policy in general.[ It was developed as a
theory from Harold Lasswell's work.

One version by James E. Anderson, in his Public Policy-Making (1974) has the following stages:

1. Agenda setting (Problem identification) - The recognition of certain subject as a problem

demanding further government attention.
2. Policy Formulation - Involves exploring a variation of options or alternative courses of action
available for addressing the problem. (appraisal, dialogue, formulation, and consolidation)
3. Decision-making - Government decides on an ultimate course of action, whether to perpetuate
the policy status quo or alter it. (Decision could be 'positive', 'negative', or 'no-action')
4. Implementation - The ultimate decision made earlier will be put into practice.
5. Evaluation - Assesses the effectiveness of a public policy in terms of its perceived intentions and
results. Policy actors attempt to determine whether the course of action is a success or failure
by examining its impact and outcomes.

An eight step policy cycle is developed in detail in The Australian Policy Handbook by Peter
Bridgman and Glyn Davis: (now with Catherine Althaus in its 4th and 5th editions)

1. Issue identification
2. Policy analysis
3. Consultation (which permeates the entire process)
4. Policy instrument development
5. Building coordination and coalitions
6. Program Design: Decision making
7. Policy Implementation
8. Policy Evaluation
The Althaus, Bridgman & Davis model is heuristic and iterative. It is intentionally normative []
and not meant to be diagnostic or predictive. Policy cycles are typically characterized as
adopting a classical approach, and tend to describe processes from the perspective of policy
decision makers. Accordingly, some post positivist academics challenge cyclical models as
unresponsive and unrealistic, preferring systemic and more complex models.[3] They consider a
broader range of actors involved in the policy space that includes civil society organizations, the
media, intellectuals, think tanks or policy research institutes, corporations, lobbyists, etc.

Content

Policies are typically promulgated through official written documents. Policy documents often
come with the endorsement or signature of the executive powers within an organization to
legitimize the policy and demonstrate that it is considered in force. Such documents often have
standard formats that are particular to the organization issuing the policy. While such formats
differ in form, policy documents usually contain certain standard components including [citation
needed] :

 A purpose statement, outlining why the organization is issuing the policy, and what its desired
effect or outcome of the policy should be.
 An applicability and scope statement, describing who the policy affects and which actions are
impacted by the policy. The applicability and scope may expressly exclude certain people,
organizations, or actions from the policy requirements. Applicability and scope is used to focus
the policy on only the desired targets, and avoid unintended consequences where possible.
 An effective date which indicates when the policy comes into force. Retroactive policies are
rare, but can be found.
 A responsibilities section, indicating which parties and organizations are responsible for carrying
out individual policy statements. Many policies may require the establishment of some ongoing
function or action. For example, a purchasing policy might specify that a purchasing office be
created to process purchase requests, and that this office would be responsible for ongoing
actions. Responsibilities often include identification of any relevant oversight and/or governance
structures.
 Policy statements indicating the specific regulations, requirements, or modifications to
organizational behavior that the policy is creating. Policy statements are extremely diverse
depending on the organization and intent, and may take almost any form.

Some policies may contain additional sections, including:

 Background, indicating any reasons, history, and intent that led to the creation of the policy,
which may be listed as motivating factors. This information is often quite valuable when policies
must be evaluated or used in ambiguous situations, just as the intent of a law can be useful to a
court when deciding a case that involves that law.
 Definitions, providing clear and unambiguous definitions for terms and concepts found in the
policy document.[citation needed]
Typologies

Theodore J. Lowi, famous American political scientist proposed four types of policy namely
distributive, redistributive, regulatory and constituent in his article 'Four systems of Policy,
Politics and Choice' and in 'American Business, Public Policy, Case Studies and Political
Theory'. Policy addresses the intent of the organization, whether government, business,
professional, or voluntary. Policy is intended to affect the 'real' world, by guiding the decisions
that are made. Whether they are formally written or not, most organizations have identified
policies.[4]

Policies may be classified in many different ways. The following is a sample of several different
types of policies broken down by their effect on members of the organization.

Distributive policies

Distributive policies extend goods and services to members of an organization, as well as

distributing the costs of the goods/services amongst the members of the organization. Examples
include government policies that impact spending for welfare, public education, highways, and
public safety, or a professional organization's benefits plan.

Regulatory policies

Regulatory policies, or mandates, limit the discretion of individuals and agencies, or otherwise
compel certain types of behavior. These policies are generally thought to be best applied when
good behavior can be easily defined and bad behavior can be easily regulated and punished
through fines or sanctions. An example of a fairly successful public regulatory policy is that of a
speed limit.

Constituent policies

Constituent policies create executive power entities, or deal with laws. Constituent policies also
deal with Fiscal Policy in some circumstances.[citation needed]

Redistributive policies

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.

When the term policy is used, it may also refer to:

 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 the organization actually takes may often vary significantly from 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.[citation needed]

Types of policy analysis include:

 Causal (resp. non-causal)

 Deterministic (resp. stochastic, randomized and sometimes non-deterministic)
 Index
 Memoryless (e.g. non-stationary)
 Opportunistic (resp. non-opportunistic)
 Stationary (resp. non-stationary)

These qualifiers can be combined, so for example you could have a stationary-memoryless-index
policy.

Specific policy types

 Company Policy
 Communications and Information Policy is under Information policy
 Human resource policies
 Privacy policy
 Public policy
 Defense policy
 Domestic policy
 Economic policy
 Education policy
 Energy policy
 Environmental Policy and National Environmental Policy Act
 Foreign policy
 Forest policy
 Health policy
 Housing policy
 Information policy
 Macroeconomic policy
 Monetary policy
 Plan
 Population policy
 Public policy in law
 Science policy
 Security policy
 Social policy
 Urban policy
 Transportation policy
  Water policy

Other uses of the term

 In enterprise architecture for systems design, policy appliances are technical control and logging
mechanisms to enforce or reconcile policy (systems use) rules and to ensure accountability in
information systems.
 In insurance, policies are contracts between insurer and insured used to indemnify (protect)
against potential loss from specified perils. While these documents are referred to as policies,
they are in actuality a form of contract - see insurance contract.
 In gambling, policy is a form of an unsanctioned lottery, where players purport to purchase
insurance against a chosen number being picked by a legitimate lottery. Or can refer to an
ordinary Numbers game
 In artificial intelligence planning and reinforcement learning, a policy prescribes a non-empty
deliberation (sequence of actions) given a non-empty sequence of states.
 In debate, the term "policy" is slang for policy or cross-examination debate.

References:
 https://en.wikipedia.org/wiki/Policy
 http://www.managementstudyguide.com/business-policy.htm
 http://www.insureon.com/products/policy-comparisons/general-liability-vs-bop-insurance
 https://www.google.com.ph/search?dcr=0&source=hp&ei=VTsSWpaNIoKF0QT0qJGYAw&q=gen
eral+business+policy&oq=general+business+policy&gs_l=psy-
ab.3..0j0i22i30k1l5.8474.14686.0.15983.23.23.0.0.0.0.136.1947.19j3.22.0....0...1.1.64.psy-
ab..1.22.1941...46j0i131k1j0i46k1j0i22i10i30k1.0.uGtXbwWkeHQ