The terms policies, decisions, and goals have similar meanings. But it is important to note that in business terms these are not the same. We may sometimes use these terms interchangeably, but each has its own distinct meaning and purpose. Let us learn a little about these important concepts.
The process of policy formation starts with identifying the problem and coming up with a solution. So efforts to curb pollution, increase employment, promote education, abolish child labor, boost our national defense, the creation of any new state, etc. are all results of policy formation.
Take for example the Swach Bharat Abhiyan initiated by the Prime Minister. This is a policy of the government to spread awareness about sanitation and improve the living conditions of its citizens.
Policies in our country have a vast area of operation. They cover everything from socio-economic welfare to the protection of our constitutional rights to protecting the moral values of our country. There can be various types of policies, such as:
- Regulatory Policy: These are concerned with the regulation of our economy, i.e. regulation of trade, business, etc. It also covers policies of safety guidelines and safety measures etc. Such policies are generally formulated by advisory boards and committees working for the government.
- Distributive Policy: These policies are for the benefit of certain sections of society. Like education for the girl child, health services for the poor, justice for women, etc.
As we saw, policies are a collection of ideas. Decisions, on the other hand, initiates the actions to be taken to implement the policy. So a policy will emanate from a decision.
So say for example there is a policy in the company to promote juniors for management positions. The decision of the team leader to promote one particular person will implement this policy.
However, not all decisions are a result of a policy. Decision-making is a complex and dynamic process of choosing the best alternative from the available options. So a decision has to be taken when there is more than one available course of action.
So when the team leader chose one particular employee for promotion, it was after the process of evaluating many available candidates and coming to a decision.
Goals are another important economic term. The decisions we take are based on the need to fulfill certain goals. So our course of action must help us achieve our goals, must be in line with the goals not opposing them.
So if the goal of the company is to reduce the costs of a project, then the decision to hire a manager would be a step against the goal. But to reduce the working hours of current employees would be a step in the right direction.
India is the largest democracy in the world. It is a union of its states, who have their own state legislative. The goals of all these state legislative must be outlined, and they must be in the same line as the national goals of the country decided by the Central Government.
And then these national goals are discussed in the parliament and it is decided to make laws to implement such actions and achieve the goals.
Solved Question on Policy, Decisions and Goals
Q: Policies regarding Foreign Trade are
- Regulatory Policies
- Directive Policies
- Public Policies
- None of the above
Ans: The correct answer is option A. Regulatory policies help regulate various sections of the economy like trade, business, foreign trade, foreign exchange, etc.