STRATEGY :

The determination of the purpose and the basic long term objectives of an enterprise, and the adoption of course of action and allocation of resource necessary to achieve these aims .

POLICIES :

General statements or understanding that guide thinking in decision making, the essence of policies is the existence of discretion , with in certain limits, in guiding decision making .

Both strategies and policies give direction to plans. They provide the framework for plans and serve as a basis for the development of tactics and other managerial activities .