Do all businesses need a written disciplinary procedure?

Yes. If you employ people, a fair and reasonable disciplinary procedure is necessary to protect yourself in an Employment Tribunal and for employees to know which behaviours constitute misconduct in their workplace. 

If you believe you have grounds to discipline an employee (for example, due to poor performance or misconduct) you must demonstrably act reasonably and fairly when taking action. A written disciplinary procedure helps to make sure you do. Establishing fair and reasonable rules, and steps to deal with breaking them, in written format ensures both you and all employees know how issues of misconduct will be handled. 

It’s important for everyone to understand that disciplinary procedures aren’t there to penalise employees (although in some cases sanctions will be necessary). They are primarily to encourage employees to overcome performance and misconduct problems so that they can properly perform their job and peacefully cohabit the workplace again.