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They define the limits and the scope within which decisions must be made by the subordinates.Nature & Importance of Business Policy As already observed, policies are basically formulated by the two management or the general management for guiding, directing and facilitating the thinking and acting process of the various functional executives, to ensure the best contribution towards the corporate objectives and goals. Policy can either is formal or informal, which can be applied, implied or imposed. It originates from the top management for the express purpose of guiding themselves and their subordinates to make use of their operational tools as effectively as possible. It also enables to set objectives for the whole organization in general and for the various functional areas in particular.Importance of Business Policy Plans Business policies are important and affect everything from legal liabilities to employee satisfaction and a positive public image. Policies make sure everyone is on the same page when it comes to expectations of certain things. A business might have policies pertinent to different aspects of the company. There may be safety policies, human resources hiring policies and anti-discrimination policies. There may also be policies that pertain to employees’ dress code, lunch schedules, time off and holidays. Other policies are relevant to the customer experience including greeting customers, phone call management and product delivery specifics. All of these policies create a positive work environment. Employees who feel safe at work from injury or discrimination are happier and more productive. This is an important aspect