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What Are Policies and Procedures of a Company? Examples, Overview

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  • 0:02 Policies and…
  • 0:28 The Importance of…
  • 0:57 Key Concepts
  • 2:21 Examples of Policies…
  • 3:13 Lesson Summary
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Lesson Transcript
Instructor: Shawn Grimsley
Every company has policies and procedures. In this lesson, you'll learn some general concepts about company policies and procedures and be provided some examples.

Policies and Procedures Defined

A policy is a set of principles and related guidelines that a company establishes to define its long-term goals, direct and limit the scope of its actions in pursuit of long-term goals, and to protect its interests.

A procedure is a fixed manner of completing a task that consists of a sequence of steps that must be followed in order for the task to be completed properly.

The Importance of Policies and Procedures

You may wonder why policies and procedures are important. Company policies and procedures work together in service of the company. Company policies are important because they define organizational goals and the scope of organizational action, as well as help protect an organization's interest. Company procedures are important because they provide the means by which organizational members satisfy and fulfill company policies.

Key Concepts

Company policies can be divided into two general categories. Goal-oriented policies can be announced to advance the company's organizational goals and to protect the company's interests. Other policies are created due to a legal requirement. Compliance policies are policies created to satisfy legal or regulatory requirements.

As we mentioned earlier, procedures are the means by which organizational members advance company policies. Just like policies, procedures can be implemented to advance the company's goals or to protect the company's interests. Compliance procedures are procedures that are implemented to satisfy legal and regulatory requirements.

It is important to note that goal-oriented policies and procedures and compliance-oriented policies and procedures are not necessarily mutually exclusive. For example, the company may announce a policy preventing discrimination in employment because that is a corporate value and goal, even though it also serves to ensure the company's compliance with the law. Moreover, some parts of a policy may speak towards goal achievement, while other parts towards compliance. For example, research and development policies are generally goal-orientated policies but will often have compliance components, such as company research protocols designed to comply with the Food and Drug Administration regulations regarding pharmaceutical research.

Examples Of Policies And Procedures

Some examples of various company policies and procedures are:

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