Points to remember:

Instream procedure should be defined before EXEC statement.

Example:

//INSTPROC  PROC
//    statements
//    ----
//    ----
//          PEND
//STEP01 EXEC PGM=pgm1
//FILE1  DD DSN=file-name
//STEP02 DD INSTPROC
//STEP03 DD INSTPROC

Cataloged Procedure:

Cataloged procedures will be stored in separate PDS. This PDS name should be specified in JCLLIB ORDER. If the procedure is not found in the specified library, then SYS1.PROCLIB will be checked.

We can add/modify the parmeters in steps of Cataloged procedure without even changing it. 

Ex. I have a cataloged proc name MYPROC and wanted to add Region parameter to STEP02 in that
proc, i can code like below in corresponding JCL

//MYSTEP EXEC MYPROC, REGION.STEP10=56K

To apply region parameter for all the steps in MYPROC

//MYSTEP EXEC MYPROC, REGION=56K

To nullify a parameter of a particular step in MYPROC, override the same through JCL and just don't give any value like below

//MYSTEP EXEC MYPROC, TIME.STEP10=

- The DSN and UNIT parameters must be coded for new generation data sets.