Policies – A necessary evil?

In most of the start-ups I believe there would be this question, whether or not to introduce policies and procedures around different processes. Is it necessary? The answer is subjective; every person would have a different approach to it.

The people against the policy idea would argue that policies stifle innovation. In start-ups where the culture is more lax and open, if a policy is introduced employees might feel they are being pushed to adhere to preset norms. They would feel their out of the box thinking is being questioned! And worse still they might feel they are being watched.

The pro policy people would have a different mindset. I fall in this category and so am biased towards this approach.
Webster defines policy as “a definite course or method of action selected from among alternatives and in light of given conditions to guide and determine present and future decisions”.

To me a policy is a guide; it is a broad tool that helps make the right decisions especially when companies are in the initial phase of setting the culture. One of the policies that I would like to talk about here is the Travel and Entertainment policy. One might say we don’t need a policy for that, we have a culture where people know that they should not waste anything and order things only when they absolutely need it. “Spend the company money like it is your own” This definitely sounds great, but can it be really implemented. When there are 10 people maybe, when there are 20 it gets challenging and when there are 50 it is difficult to keep the mantra going. Different people think differently, they have different approach towards money and it is these differences that the T&E policy addresses.  A general T&E policy can lay down the general guidance on how to spend money rather than the amount of money, so instead of saying the company will pay no more than $1500 for travel trip to Asia (from the US), the policy can ask employees to do due diligence (search on kayak) and chose an economical choice (not cheapest but economical). This way the employee is left to make the choice but is given a guiding principle. There is a line between guiding people and forcing them. A generic policy can be a boon if it is communicated well and does not include strict rules to follow.

Send me your views on this topic. If you are work in a startup do you develop policies or not. If there are policies how did you develop this? What has or has not worked for the teams?