The Difference Between a Process, a Policy, and a Procedure

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We’ve all had that one time we are confused as to why our employees have failed to understand the instructions, we gave them.

Yes, I have given them clear steps.

Yes, I have demonstrated how to do it.

Why are they finding it hard to comply?

Your team may be unable to keep up because they are finding it hard to tell the difference between the rules to follow and the actions, they need to take to perform a task well.

Although these are both important for your agency to successfully deliver the desired outcome, it is still necessary to differentiate three elements essential to your business: policy, process, and procedure.

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Organizations often mistake these three terms as being one and the same, but in reality, they are different tools with different definitions, applications, and documentation. In this article, we will discuss the distinctions, which are important to understand when researching and developing documentation for your organization. After reading, you will understand the key differences between a policy, process, and procedure. Let’s dive into it.

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Business process definition

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What are business processes? A business process is not only a single task; it is a high-level view of interrelated tasks done to produce a product or a service. It gives a big picture of the duties and assignments with the departments doing them. It serves as a connector to assignments done within an agency arm or even across several divisions across an agency.

Here are some process qualities: processes define “what to do” to complete a service or create a product in an organization. Usually, processes cross departments. Diagrams are sometimes created through process maps, which describe the points when and where a person in authority performs or approves the task. Process diagrams are work flowcharts that are graphical representations of the entire process flow. Processes also have a process map that bridges point A to point B and the people who control the action.

If the agency implements a process of delivering a product out of a business concept, it shows you that point A is the business concept while point B is the end product or service. It follows a detailed procedure that maps out what are the sub-processes you must do and the people or groups of people who will be functioning at a certain point for you to get from one point to another. Sometimes, the total process crosses department lines; however, they will always contain specific instructions on following the company’s strategic direction to get to the desired destination.

The total process converts input to output, covering each process step underneath it so that an employee knows what to expect from start to finish after a function has been activated. That way, they know the task has started or been completed already!

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Understanding what a policy is

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Most companies have a particular set of work instructions. They are defined as policies. These policies are business rules that align with the agency’s objectives, goals, and management philosophies.

Setting an agency policy demonstrates an organization’s best practice; without policies, the other two elements – the processes and procedures – will be affected. This set of regulations helps establish the company culture that all employees from each division or department will follow, no matter their rank. They also help create control points with which you can monitor the extent to which policies and procedures are being adhered to.

Business policies can be regarded as laws inside the agency because they build the framework from which an organization helps its team quickly learn about the company. Tasks, especially repetitive ones, be implemented in a more standardized manner. Unnecessary errors can be avoided because there is already a policy put down, and people act following it to ensure that the agency operates smoothly.

A distinct quality of a policy is that it will always let an agency understand its destination clearly. However, it will not specify the direction to take or how to get there.

Policies address related subject matter

An excellent example of a policy would be a data privacy policy. This policy is often included in an agency’s rulebook. It assures its clients that their records and transactions are kept private. It is also a policy to protect your team members, ensuring that the employees’ information security is maintained and safely kept.

The data privacy policy can be seen as a reflection of how the company’s culture prioritizes the preservation of confidentiality within its organizational structure and externally among its clients. It aligns with a company’s goal of safeguarding its reputation and building trust. Still, it does not specify who is responsible for its implementation or how it is executed.

Other policies that can be established are vacation policy, social media policy, and recruitment policy.

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Policy versus procedure

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On the other hand, procedures refer to detailed instructions on how to do tasks or perform a sub-process action. Procedures should be aligned with all business rules contained in the company’s policy.

Special procedure manuals give specific instructions on how to go from point A to point B, how employees will go to the next phase, or how they will know if the process is complete.

Procedure qualities: procedures define the steps

Procedures identify which step-by-step instructions are needed to support team members in carrying out specific work. It is also a way to empower them to take control over work instruction. Business procedures help you manage tasks more efficiently by delegating assignments to make the most of your time as your agency learns to follow and document industry specifics.

A more detailed procedure can even be established by creating a desk top procedure for easy accessibility to the different department lines. This documentation presents procedure components, the detailed procedure, and business rules.

Developing documentation requires understanding the process tasks, how to properly structure the document, and any other related subject matter. The content contained in the procedures document should identify policy and graphically display system instructions.

How does a policy differ from a procedure?

The key difference between policies and procedures is that procedures are steps to achieve a particular outcome, which can be as little as a single task or as big as a full-blown company process. In contrast, policies address the reason behind constructing each procedure.

The policy is the “why”– the foundation and rationality – while the procedure is the “how”, the agency’s compliance to the why, and the manner or method by which you systematically achieve the goal.

There is no specific procedure for each policy, but each of your procedures should align with the organization’s business policy to keep it in check and operational.

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What about a business process vs. procedure?

Business processes are useful information for customers and employees to learn the workflow outline and identify the responsible decision-making body. The procedure then elaborates on the series of steps required by the details of activity within the process.

The employee promotion process, for example, is composed of several points to rising from a certain rank to another. It involves several people who perform a specific service (role or responsibility) – the employee, the immediate supervisor, and the senior management. It can include a few sub-processes like evaluation, training, submission of requirements, and employee and colleague interviews, to name a few.

The procedure under each step discusses each detail from filling out the application form, giving X number of hours to perform promotion-related tasks, attending which seminars, and waiting X number of days for the approving body to decide.

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What are the benefits of knowing the definition of each element?

We have now defined each key element together with its qualities and purpose. By knowing the differences and similarities of each, an agency can create its own structure of policies, processes, and procedures to improve its productivity and efficiency.

It is also useful information that can guide point persons in handling resources and can be vital to enhancing employee and client systems. It plays an important role in training new employees and tenured employees to observe compliance.

Organizations can also build on their internal and external connections by polishing up their policies, processes, and procedures. Marketing strategies can be easily executed by properly explaining guidelines to boost customer relationships. Departments implement these elements with reporting and proper documentation for future data baseline and evaluation.

Giving and receiving input on completed guidelines can serve as feedback for employees’ performance and foster communication in finding areas for improvement in your agency.

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Key Takeaway

An agency’s process, procedure, and policy are essential because they go hand in hand to make a task more manageable and transparent. When properly structured, they help ensure consistency and set industry standards, ultimately creating work stability in the organization. While a process describes the outline to meet the end goal specified by the policy, the procedure details the minute actions taken to complete it. Assessing and revisiting these elements improves the organization’s work and eliminates, if not reduces, inaccuracy in performing work.

If you still have difficulty differentiating these three essential elements in your agency, keep in mind that policy-process-procedure are like peas in a pod:

• Policies are business rules and regulations set by the company to achieve its goals
• Processes give directions to point persons or the various department lines based on the policies
• Procedures detail step-by-step guides on how to perform the processes

While policies and procedures help establish control points and ensure consistency, procedures explain the exact steps to follow policy and procedure requirements.

Following your organization’s policy, process, and procedure makes it easy to connect points and identify functional areas as everything is properly structured. Understanding the distinction keeps you and your team well-informed and aligned with your organization’s objectives from Day 1 until project completion.

With ScaleTime you can take a step back and let your agency grow. We give you guidelines on maintaining your team members’ accountability so they can work independently in their functional areas. We provide process improvement with our guidelines and templates, help you identify major functions, and properly structure your organization to attract new customers. Your policies, processes, and procedures will be taken care of to level up how you run your agency.

Take our FREE agency growth assessment quiz to see where things are falling short. We’ll send you a bundle of resources tailored to scaling your agency.

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