Key Difference:  Strategy is a comprehensive plan of action formulated or designed in order to achieve a particular goal. On the other hand, policy is a set of guidelines which help people to take appropriate decisions or act in a specific situation.

In business practices, policy and strategy play a vital role. Generally, they are thought to be similar in many ways. However, there are very different from each other even in their core definitions. Strategy and policy of an organization are both defined as key characteristics of a company, and therefore are used together many times in defining the nature of any organization as 'Strategy and Policy'. Strategy is like a roadmap which is generally made by the middle management.

This roadmap is prepared in order to ensure that an organization meets the set goals and objectives. It is important to mention that due to the involvement of middle management of the company in the formulation of a policy, it reflects their thinking and approach. Top management plays a guiding and controlling role. A strategy helps the organization to reach to the desired platform from the current platform.

On the other hand, policy is like a blueprint formulated for the routine types of activities.  It provides guidance in dealing with regular types of activities. Policies are also very important for any organization. It helps in answering the questions like what to do in a particular situation. Policies are implemented firmly as they work as a protocol.

Policy and strategy are different in many ways. Policies are generally framed by top management, whereas strategies are usually framed by middle management. Policy helps the lower management to deal with a routine type of problem without requiring any interference from the top management.

Policy deals with actions and thoughts, whereas strategy deals with actions more. Policies are rules for activities which are faced repetitively in an organization. On the other hand, strategy is formulated usually for dealing with a fresh objective or problem which has not been encountered or considered earlier. The process of strategy and policy formulation is similar. However, in formulation of the strategy it is more difficult to identify and analyze the factors associated with a problem.

Comparison between Policy and Strategy:

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