1. Policy of an organization is prepared to deal with the internal affairs generally. Whereas strategy generally deals with the affairs and events that are external to the firm.
2. Strategy produces the policies but policies do not produce strategy.
3. Policy is concerned with both thought and actions. While strategy is concerned mostly with action.
4. Policy deals with routine/daily activities essential for effective and efficient running of an organization. While strategy deals with strategic decisions.
5. The strategy of a company can be known if we analyze the policy followed by a company.
6. Policies must be within the power of the boss and can be executed by exercising the power of the boss. But strategies can’t be executed by exercising the power of the executives because many external events affect the attainment of objectives.
7. A policy is framed for recurring activities but a strategy is not formulated for recurring activities. It is formulated to meet the events that may arise in near future and also in the long ran.
8. A strategic process goes through analysis and diagnosis, choice, implementation and evaluation to complete. But in framing the policies the executive does not need to scan the environment.
9. The policy is in fact a sub-function of strategy. When recurring problems arise frequently then a best standard solution is found out and is termed as policy. So, policy implements strategy but strategy does not implement policy.
10. 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.
11. Policy formulation is responsibility of top level management. While strategy formulation is basically done by middle level management.
12. The distinction between policy and strategy is made in the context of delegation or implementation. The implementation of policy can be delegated downward in the organization, while the strategy cannot, since it requires a last-minute executive decision.
13. Examples of policies are product policy, sales policy, purchase policy, personnel policy.
Whereas, examples of strategy are stability strategy, growth strategy retrenchment strategy and combination strategy.
