You’ve probably heard of a strategic plan, which maps out a long-term strategy over one to five years. But saying you want to double your profits by 2025 is a bit too pie-in-the-sky. You need something else in place to help you achieve these goals — a step-by-step outline of how you’ll reach the target. Introducing: operational planning, a vital tool in the project manager’s toolkit.
Ready to learn how to do operational planning the right way? You’ve come to the right place. Read on!
What is operational planning?
First, let’s get some definitions out of the way.
Operational planning is a process that involves making plans or policies, acquiring and allocating resources, setting milestones, implementing projects, and evaluating progress. Operational planning is sometimes called operations research, O.R., or O.P. The goal is to set out exactly how your team or business will achieve its strategic goals within a set timeframe.
What’s the difference between a strategic plan and an operational plan?
A strategic plan is a long-range plan that provides a basis for decision-making. Instead of focusing on immediate results, strategic planning provides a high-level view of milestones you need to hit to achieve long-term goals. This strategy also:
- Outlines your company vision
- Defines your target projects and the framework for measuring long-term goals
An operational plan focuses on the specific actions and short-term goals your team must accomplish to carry out their strategic plans. It also lists the resources and timelines for completing each task. Operational planning:
- Focuses on the near future — typically the upcoming year
- Includes detailed, measurable objectives
- Outlines the steps you’ll need to take to meet your strategic plan’s goals
Key differences between strategic planning and operational planning
- A strategic plan is overarching, while an operational plan focuses on achieving the details of that strategy. One is a big-picture overview, and the other is more granular.
- A strategic plan outlines an organization’s vision, mission, core values, and guiding principles. Operational plans lay out how you’ll achieve your strategic goals.
- The timespan for a strategic plan is typically three to five years, while the timeframe for an operational plan may be anywhere from weeks to months. At most, an organization will plan operations for an entire year.
- Strategic plans are forward-thinking by nature. Operational plans focus on the immediate actions you can take to make progress within specific deadlines.
- Strategic plans are intended to align everyone with similar ideas about where you’re going together as a team. Operational plans are more about how you’re going to get there.
- Strategic plans are more enduring. They don’t change much over time, no matter what happens. Operational plans need to be more flexible and take daily changes into account.
- Strategic planning involves high-level reporting and typically includes your executive team, planning committee, and stakeholders. Operational plans, on the other hand, encompass hundreds of tasks and milestones, involving everyone in the business. Reporting tends to be on a team-wide scale, usually with managers checking in to monitor progress and drive things forward.
Who should create an operational plan?
Both plans need input from management, but operational planning is usually done by mid-level managers to avoid the risk of having too much information come together.
Strategic plans are more long-term and can go over several years, while operational plans are short-term, usually six months to a year. Both should have approval from upper management before being implemented.
What are the benefits of operational planning?
The most obvious benefit is time savings. If you have a plan, the team shouldn’t have to spend days figuring out what to prioritize or reworking projects because they don’t have enough money or time.
Another benefit of operational planning is transparency in tracking progress. If there are problems, it’s easier for management to find and fix them quickly.
Lastly, crucial tasks or decisions are less likely to fall through the cracks when you have well-defined objectives and milestones. This is especially true in terms of setting expectations with clients. In design meetings, for example, it’s common for stakeholders to forget things discussed in past meetings or during contract negotiations. Having these details written down saves everyone a headache when working together on future projects.
To summarize, an operational plan should:
- Clarify what your team will be doing on a daily and weekly basis
- Set expectations so teams can avoid going off track
- Provide a guide for day-to-day operations to help team members see what they need to do to accomplish long-term goals
What to include in an operational plan
Operational planning should be broken down into quarterly milestones with monthly action items lined out in between. The most important components to include are:
- Target objectives and deliverables
- Timetables for completing milestones
- Resources required to meet each objective
- Desired methods or processes for achieving goals
- Projected outcomes for each goal
- Metrics for measuring performance
Operational plans aren’t meant to be etched in stone; they should be dynamic and change when necessary. For example, if you budgeted X amount of money to advertise your new product in December, but Christmas sales are higher than expected, you can reallocate funds from other areas to increase ad spending.
So, how do I make an operational plan?
Follow these steps to get started.
1. Start with a strategic plan
What are your company’s overarching goals for the next year or two?
- Determine your current position.
- Develop your strategy.
- Build your strategic plan.
- Share your plan with the wider business.
2. Narrow your scope
Break down the strategic plan by team, project, or focus area. The marketing team, for example, may want to focus on increasing mobile ad revenue. Sales will have their own goals, as will the design team. Start thinking about individual team priorities, and narrow your focus accordingly.
3. Identify relevant stakeholders
Internal and external stakeholders play a crucial role in operational planning, so treat the process as a collaborative effort. To varying degrees, stakeholders have the final say on new initiatives and will actively influence whether projects move forward or not. By getting their input from the beginning, you minimize any miscommunication or conflict later on.
4. Map out your operational plan
Begin by looking at what happened during the last six months (or year). What worked well, and what didn’t? How can you improve on those successes? As for failure points, think about why they didn’t work out. Was it a lack of funding? Insufficient resources? Bad timing? Poor marketing decisions? Depending on the obstacles you have to overcome, you may need to adjust your timeline or budget.
Next, build a timeline of your plan. Set deadlines for each task with milestones along the way. If you’re doing research, set deadlines for different research areas (e.g., product testing, market research).
One of the most important steps of planning is creating milestones with specific deadlines and assigning people to each task. These deadlines should be realistic and motivate people to complete work before the due date.
For example, imagine setting a two-month deadline for a brainstorming session. Most people will probably forget and won’t bother coming up with anything until a few days before the deadline. However, if you set a weekly task to write down 10 ideas, people are more likely to concentrate on the short-term goal and come up with better ideas.
Questions to ask yourself during the planning stage:
- What do we need to accomplish? Draw from your strategic plan here.
- What daily tasks do we need to complete to hit our goals? Work backward from the end goal.
- Who is responsible for these tasks? Make sure to assign a task owner and a deadline to each one.
- What are our metrics for success? Make sure your goals follow a SMART framework.
Finally, develop an overall budget based on your timeline and milestones once you’ve fully defined the scope of the plan. If some phases get delayed or finish earlier than expected, reallocate funds accordingly so that the entire project doesn’t fail due to insufficient resources.
Another thing to consider when planning is how much everything will cost, based on task duration. For example, if you plan to release an app, you should know that the development period for your product (including research and design) will typically last around two years. But then it might take another year or two after that before everything starts making a profit, since it’s hard for new products to get noticed in the beginning.
5. Share your operational plan with the team
There’s no point in having a plan if no one knows about it or uses it regularly. Sharing your plan with the broader team ensures there are no surprises (and people won’t jump ship because they think you have no direction). You should also share it with stakeholders, so they understand your goals and have the opportunity to provide feedback.
When it comes to planning, always remember that things change — so monitor your plan and update it regularly.
Using project management software can be a massive help: you can set up workflows, assign tasks, share progress charts, and keep everyone updated in real-time. This means everyone is pulling in the right direction — a must when it comes to hitting long- and short-term goals 💪
Team Performance Plan
Identify the desired performance levels of the team. Identify how these performance levels will be achieved. Provide guidance and direction to the team. Measure progress towards the desired performance levels.
Without an operational plan, you're out of the league. Being able to update and refer to a plan enables comprehensive understanding of goals. An operational plan ensures you can identify areas that aren't generating as much revenue as they should, or are causing losses, and can help you establish what needs to change.How can the operations plan be explained to the relevant work teams and why is this necessary? ›
When properly created, an operating plan makes sure each manager and each employee know their specific obligations, as well as how they should execute them within a defined timeline. Mapping out the day-to-day tasks that ensure a clear path to your business and operational goals is essential to success.What are seven 7 important things to consider when boosting team performance? ›
- COMMITMENT. Commitment to the purpose and values of an organization provides a clear sense of direction. ...
- CONTRIBUTION. ...
- COMMUNICATION. ...
- COOPERATION. ...
- CONFLICT MANAGEMENT. ...
- CHANGE MANAGEMENT. ...
In particular, planning helps to critically assess the goal to see if it's realistic. It facilitates decision making and allows setting a time frame by predicting when the company can achieve its goal.What is the main purpose of operational plan? ›
An operational plan outlines the activities and targets which the organisation will carry out in order to work towards achieving the aims and objectives set out in the strategic plan. It provides the framework for an organisation's day-to-day operations.How can operation contribute to the success of the organization? ›
Operations management helps improve the reputation of an organization and thus has a positive influence on its capability to achieve growth and stability goals. Operations management ensures that products meet the quality standards and customers' expectations.What are 5 key elements of developing an operations plan? ›
Whatever operation needs a solid plan, there are five major components to focus on: Preparation, marketing, logistics, human resources (HR) and financial limits.What is an example of operational planning? ›
An example of operational planning would be a manufacturer creating a plan to increase revenue by 30%. Finance partners with sales, the marketing team, operations and other key business areas to align on the strategies needed to support revenue growth and achieve business goals together.What are the 7 things operational plan should contain? ›
- clear objectives of them.
- activities to be delivered.
- quality standards.
- desired outcomes.
- staffing and resource requirements.
- implementation timetables.
- a process for monitoring progress.
The role of operations strategy is to provide a plan for the operations function so that it can make the best use of its resources. Operations strategy specifies the policies and plans for using the organization's resources to support its long-term competitive strategy.Why is operations strategy an important key to success? ›
Operations strategy helps the management determine specific areas in the organization that need the most resources and how best to deliver those resources. Further, it also helps leaders identify departments that aren't using resources effectively—they can then come up with measures to improve those departments.What are the 5 key goals of operations management? ›
The five key business performance objectives for any organization include quality, speed, dependability, flexibility, and cost. When it comes to business performance objectives you're likely aware that efficiency and productivity are crucial. But how do you successfully achieve these?What are three 3 strategies you can use to improve your performance? ›
- Limit distractions. This is a tip many people know but rarely follow: limit your potential distractions. ...
- Set milestones. ...
- Set clear and achievable goals. ...
- Avoid multitasking. ...
- Improve your time management. ...
- Do important tasks first. ...
- Delegate tasks whenever possible. ...
- Clear your workspace.
- Psychological safety. Team members feel safe to take risks and be vulnerable with each other. ...
- Dependability. Team members get work done on time and with high quality.
- Structure & Clarity. Clear roles, plans and goals.
- Meaning. Work is personally important to team members.
Performance planning will help you set clear goals, create expectations, discuss future progress, and tackle other necessary issues. The key in helping employees improve their skills is to continually challenge them.What is the importance of planning and preparation in performing a task in a team? ›
Planning helps an individual to know what all he needs to do urgently and what all can be done a little later. To plan things better, employees should prepare a Task Plan where he can jot down tasks against the time slots assigned to each activity.What are the 7 main function of operational management? ›
We can distinguish seven main functions of operation management in the industrial enterprise: planning, scheduling, purchasing, controlling, quality control and inventory control. In each of those fields operations managers should conduct many decision affecting of-organization effectiveness.What are the three activities of operations planning? ›
Capacity management is a major operations consideration and the following three capacity-related areas are particularly important for planning: materials management, technology use, and the use of capital.How can operations management improve performance? ›
Operations Management helps in managing inventory efficiently by foreseeing problems that may occur in long-term. The flow of inventory inside a company can be made efficient through operation management activities.
Operations management is focused on converting resources into quality products and services. It involves overseeing the organization's production processes to create the highest level of efficiency. It helps your organization increase profits while reducing costs and ensures maximum productivity.How does operation management help competitive advantage? ›
As an operations manager, it is crucial to remember that your company/organization can achieve competitive advantage through three strategies, that are differentiation, low-cost leadership and response.What are the six 6 strategies in operations management? ›
- Customers. Perhaps the most important strategy will revolve around your customers. ...
- Partnering. ...
- Operational Improvements. ...
- New Product or Service Development / Innovation. ...
- Technology & Information Management. ...
- People and Talent.
Operations management includes three levels: strategic, tactical, and operational.What are the four steps in operational planning? ›
- Step 1: Examine your organization's vision. ...
- Step 2: Define the goals and strategy. ...
- Step 3: Plan out activities. ...
- Step 4: Assign roles and responsibilities. ...
- Step 5: Monitor and adjust.
- Goods and services.
- Quality management.
- Process and capacity design.
- Layout design and strategy.
- Human resources and job design.
- Supply chain management.
- Identify stakeholders.
- Secure Consents and Permits.
- Resolve any Identified Issues.
- Describe the problem.
- Plan the details of the Eradication Operation.
- Plan How to Manage the Non-Target Species Risks.
- Plan How to Manage the Environmental Effects.
- Plan the Monitoring.
It should be noted that each of the four competitive priorities (quality, cost, flexibility and delivery) contributes to improving and sustaining the competitive advantage of a firm, since such priorities are all linked to its corporate and functional strategies.What are the four benefits of operations management? ›
- Giving your company a competitive advantage. ...
- Increasing your profitability. ...
- Increased product quality. ...
- Ensures you comply with government regulations. ...
- Increased customer satisfaction. ...
- Helps in waste reduction. ...
- Increased teamwork.
Slack et al. (2009, pp. 19–22) classify them into four perspectives, namely: Top- down, Bottom-up, Market requirement-based and Resources-based.
Performance Objectives – Quality, Speed, Dependability, Flexibility, Customisation, Cost.What are the 6 operational objectives? ›
- Use of energy.
- Proportion of production materials that are recycled.
- Compliance with waste disposal regulations / proportion of waste to landfill.
- Supplies of raw materials from sustainable sources.
What are the 4Vs of Operations Management? The 4Vs – the 4 dimensions of operations are: Volume, Variety, Variation and Visibility. They can be used to assess all different types of business operations and understand how any why they operate, their key competitive strengths, weaknesses and different approaches.How do you build a performing team? ›
- Lead by example and show the way. ...
- High-performing teams have clear goals, roles and responsibilities. ...
- Embrace diversity of thought and wide-ranging skill sets. ...
- High-performing teams follow a clear vision and mission. ...
- Establish an efficient infrastructure and automate repetitive work.
The role of the performance plan
It's an opportunity to set the scene and plan by discussing and agreeing: outputs, projects and deliverables – what you are going to do • conduct and behaviour – how you are going to do it • knowledge and skills – that you need to do on the job.
- Identify any underlying issues. Before you start to put the plan together, make sure you are fully aware of any issues which may be behind poor performance. ...
- Involve the employee. ...
- Set clear objectives. ...
- Agree training and support. ...
- Review progress regularly.
- Access forecasts for your campaigns.
- Explore outcomes by adjusting campaign settings.
- Understand opportunities in seasonal periods.
- Manage budgets across accounts and campaigns.
Have group discussions to openly converse about the positives and negatives of your team. Discuss what can be done to improvise the team's performance. Convey the difficulties prevailing in running the team or running with the team. Having team-meetings to discuss good and bad is one way to strengthen the team members.What are the four 4 main elements of a team performance plan? ›
The four elements of Purpose, Outcomes, Accountability and Teamwork need to be used as the foundation of a performance culture.What is the importance of performance planning on the employee? ›
Performance Management Helps to Boost Employee Engagement and Productivity. Engaged employees stay longer, actively involve themselves in the workplace and produce better results. Improving levels of employee engagement is key to boosting productivity and maximising ROI.
Answer: The use of a performance improvement plan can help reduce the risk inherent in any termination. It supports employees whose performance has slipped, become inconsistent or otherwise needs improvement.What action can be taken to improve your performance? ›
Plan, organize, and prioritize.
Planning your daily schedule plus organizing and prioritizing tasks or goals is essential to improving your work performance. When making your to-do list, be reasonable and achievable. It's much better to establish realistic goals and overachieve than the opposite.
All five component processes (i.e., planning, monitoring, developing, rating, rewarding) work together and support each other, resulting in natural, effective performance management.What is one way that performance Planner? ›
Answer. Answer: Performance Planner helps businesses increase sales by maximizing the number of conversions for a spend scenario.What does performance Planner optimize? ›
Performance Planner works best by shifting budgets between multiple campaigns and optimizing for the campaigns that are expected to drive a higher return on investment.Whats in the high performance Planner? ›
Weekly Pages, featuring the Whole Life Assessment and High Performance Habits Assessment. Each week, you'll review your lessons learned and also score yourself in 10 major life areas: health, mission, family, learning, finances, friends, spirit, mental/emotional energy, love/heart, and experiences.