In some circles (rhetoric and analytics philosophy come to mind), much is made of the difference between metaphor and simile.
(Rhetoricians pay attention to it because they like taxonomies of communicative devices and analytic philosophers spend time on it because of their commitment to a truth-theoretical account of meaning and naive assumptions about compositionality).
It is true that their surface and communicative differences have an impact in certain contexts but if we’re interested in the conceptual underpinnings of metaphor, we’re more likely to ignore the distinction altogether.
But what’s even more interesting, is to think about metaphor and simile as just part of the process of interpersonal meaning construction. Consider this quote from a blog on macroeconomics:
[1a] Think of [1b] the company as a ship.  The captain has steered the ship too close to the rocks, and seeing the impending disaster has flown off in the ship’s helicopter and with all the cash he could find. After the boat hit the rocks no lives were lost, but many of the passengers had a terrifying ordeal in the water and many lost possessions, and the crew lost their jobs.  Now if this had happened to a real ship you would expect the captain to be in jail stripped of any ill gotten gains.  But because this ship is a corporation its captains are free and keep all their salary and bonuses.  The Board and auditors which should have done something to correct the ship’s disastrous course also suffer no loss.
Now, this is really a single conceptual creation but it happens in about 5 moves which I highlighted above. (Note: I picked these 5 as an illustrative heuristic but this is not to assume some fixed sequence).
 The first move establishes an idea of similarity through a simile. But it is not in the traditional form of ‘X is like Y’. Rather, it starts with the performative ‘Think of’ [1a] and then uses the simile ‘as’. [1b]. ‘Think of X as Y’ is a common construction but it is rarely seen as an example in discussions of similes.
 This section lays out an understanding of the source domain for the metaphorical projection. It also sets the limit on the projection in that it is talking about ‘company as a ship traveling through water’ in this scenario, not a ship as a metonym for its internal structure (for instance, the similarities in the organisational structure of ships and companies.) This is another very common aspect of metaphor discourse that is mostly ignored. It is commonly deployed as an instrument in the process of what I like to call ‘frame negotiation’. On the surface, this part seems like a narrative with mostly propositional content that could easily stand alone. But…
 By saying, ‘if this happened to a real ship’ the author immediately puts the preceding segment into question as an innocent proposition and reveals that it was serving a metaphorical purpose all along. Not that any of the readers were really lulled into a false sense of security, nor that the author was intending some dramatic reveal. But it is an interesting illustration of how the process of constructing analogies contains many parts.
 This part looks like a straightforward metaphor: ‘the ship is a corporation’ but it is flipped around (one would expect ‘the corporation is a ship’. This move links  and  and reminds us that .
 This last bit seems to refer to both domains at once. ‘The board and the auditors’ to the business case and ‘ships course’ to the narrative in the simile. But we could even more profitably think of it as referring to this new blended domain in which we have a hypothetical model in which both the shipping and business characteristics were integrated.
But the story does not end there, even though people who are interested in metaphors often feel that they’ve done enough at this stage (if they ever reach it). My recommended heuristic for metaphor analysts is to always look at what comes next. This is the start of the following paragraph:
To say this reflects everything that is wrong with neoliberalism is I think too imprecise.  I also think focusing on the fact that Carillion was a company built around public sector contracts misses the point. (I discussed this aspect in an earlier post.)
If you study metaphor in context, this will not surprise you. The blend is projected into another domain that is in a complex relationship to what precedes and what follows. This is far too conceptually intricate to take apart here but it is of course completely communicatively transparent to the reader and would have required little constructive effort on the part of the author (who is most likely to have spent time on constructing the simile/metaphor and its mappings but little on their embedding into the syntactic and textual weave that give it its intricacy).
In the context of the whole text, this is a local metaphor that plays as much an affective as it does a cognitive role. It opens up some conceptual spaces but does not structure the whole argument.
The metaphor comes up again later and in this case it also plays the role of an anaphor by linking 2 sections of the text:
Few people would think that never being able to captain a ship again was a sufficient disincentive for the imaginary captain who steered his boat too close to the rocks.
Also of note is the use of the word ‘imaginary’ which puts that statement somewhere between a metaphor (similarity expressed as identity) and simile (similarity expressed as comparison).
There are two lessons here:
The distinction between metaphor and simile could be useful in certain contexts but in practice, their use blends together and is not always easy to establish boundaries between them. But even if we could, the underlying cognition is the same (even if truth-conditionally they may differ on the surface). We could even complicate things further and introduce terms such as analogy, allegory, or even parable in this context but it is hard to see how much they would help us elucidate what is going on.
Both metaphor and simile are not static components of a larger whole (like bricks in a wall or words in a dictionary). They are surface aspects of a rich and dynamic process of meaning making. And the meaning is ‘literally’ (but not really literally) being made here right in front of our eyes or rather by our eyes. What metaphor and simile (or the sort of hybrid metasimile present here) do is help structure the conceptual spaces (frames) being created but they are not doing it alone. There are also narratives, schemas, propositions, definitions, etc. All of these help fill out the pool of meaning into which we may slowly immerse ourselves or hurtle into headlong. This is not easy to see if we only look at metaphor and simile outside their natural habitat of real discourse. Let that be a lesson to us.