Strategic planning and operational planning are two very different and very essential pieces to the business puzzle. They are also areas of the business planning process that seem to fall to the wayside. First, by not understanding what purpose each plan is meant to serve and secondly, not understanding the difference. But they are different. How different, you ask? Let’s find out.
Strategic planning is the foundation of any business. Without it, business owners can wander aimlessly throughout their careers never knowing how to move their business in the right direction or how to bring it to the right customer. Without stopping to think about what you want from your business, you could never possibly create a plan to achieve those goals. So it all starts with strategic planning. This includes your mission, vision, values, long-term goals, market segment development, how your business will impact the business world, the community and more. Specifically, when you conduct a strategic planning session, you want to look at four areas of business:
• Get clear on your mission statement: why does your organization exist in the first place
• What are the goals you wish to accomplish: what do you want to put out into the world?
• Environmentally: how your business will interact socially, financially, geographically, and politically in your community.
• Based on that information, identify opportunities for future development and growth for your own organization and opportunities to work with other organizations
Operational planning, however, is focused more on the “how” of business. While it’s great to know why and where you are going, you physically need to know how you are going to get there. That is achieved through organizational planning. For example, if you want to launch a mobile app for senior citizens that will help them identify the best senior living facility for their needs, you will need to determine the technology, manpower, locations, money, resources and more that you will need to make that happen. By moving your products forward, you are contributing to the strategic plan of the organization overall. There are several areas to consider when it comes to operational planning; these include:
• What activities will you engage in?
• Who will conduct those activities?
• Why will they participate in those activities?
• Where will the activities take place?
• When will those activities take place?
• How do these activities contribute to the strategic plan?
Operational plans include things like job descriptions, checklists, worksheets, payroll forms, policies and procedures, instructions on how to submit for vacation or sick leave, opening and closing procedures and many more activities depending on the nature of your business.
When it comes to determining the differences between strategic planning and operational planning, the distinction can be hard to make for some people. This is especially true if a business owner makes the mistake of taking on too many responsibilities themselves, holding too much information close to the chest, not letting employees do their jobs, and not being clear about why the company is in business in the first place. Even if you are a sole proprietor of a business, it is vital that you take time to write down where you want your efforts to take you. If you are a freelance graphic designer, you can’t just apply for graphic design jobs willy nilly; you need a plan of action that is driven by why you want to be in the graphic design business in the first place.
Simply put, strategic planning helps you determine why you do business, and operational planning helps you determine how you do business. The rest is up to you. There are various ways to write and implement a strategic and operational plan. Some research could be in order to find the approach that best fits your management and organizational style. It is also recommended that you engage a consultant to help facilitate and keep the process on track.
Simply having a clear idea of where you want to go with your business and how you are going to get there puts you light years ahead of a lot of business owners who are currently floundering in their industries. Don’t take these vital processes for granted. Be open to learning more about them for the success of your operation and strategic growth in the future.