Why do organisations have policies and procedures?

Question

Why do organisations have policies and procedures?

Answer 1

The first answer is risk management. Organizations figure out what ways are safest in terms of protecting the organizations interests. These become the policies and procedures of the organization.

Standardization also helps with controls. It would be impossible to monitor the activities of a large organization (a daunting task already) if everyone was doing things differently.

Finally, policies and procedures occasionally help productivity. Organizations figure out the most efficient way of doing things and make people do it that way. Admittedly, that is not always the case.

If you ever wonder why a policy and procedure is in place ask someone in the know (an accountant or auditor, for example). A good one should be able to explain the underlying reasoning (which isn't always obvious) to you.