The Key Differences Between Short- and Long-Term Planning

Businesses and employees set short- and long-term goals to help them measure their performance in the workplace. They both utilize key performance indicators to analyze if they're on target with their goals that tie back into the organization's strategy. However, planning short- or long-term goals makes a difference in the execution of your projects.

In this article, we define short and long-term planning, the differences between these concepts and show how to use SMART goals for short-term planning.

Related: Setting Goals to Improve Your Career

What is short-term planning?

Short-term planning is defined by the characteristics of an organization, such as skills. In the workplace, managers devise strategies on how to improve these characteristics in the short-term to meet long-term goals. For example, issues with company equipment like computers, or the quality of content provided by employees, need to be addressed to meet short-term deadlines set by management.

Short-term planning can factor in these concepts to reach success:

• Cash flow

• Budget

• Savings of capital

• Investments of stock

• Organization

• Communication

• Ability to network

• Attention to detail

• Daily routines

What is long-term planning?

Long-term planning displays how your business can be successful over a continued period. The goals set in long-term planning are less likely to be changeable due to the consensus a management team needs when creating them initially.

Long-term goals can factor in these concepts to reach success:

• Sales

• Brand awareness of your product

• Public reputation

• Number of staff members

• Social and digital media presence

• SEO traction

• Attendance at industry events

What are the differences between short- and long-term planning?

Short-term planning evaluates your progress in the present and creates an action plan to improve performance daily. However, long-term planning is a comprehensive framework that comprises of goals to be met within a four- to five-year period.

Here are two key differences between short-term and long-term planning:

1. Scope

Ideally, a short-term goal should tie into a long-term goal. However, daily adjustments are required to ensure that you're working efficiently to meet your goals and that operations are smooth. Thus, the scope of short-term planning may change daily compared to long-term planning, where their goals are finite after they're discussed with key employees.

2. Execution

The execution of short-term planning depends on current operations that can determine if an organization is completing projects. The execution of long-term planning is based on if short-term goals can be met. For example, if your long-term goal is to hire 50 more staff members within the next four to five years, you can set short-term goals for which positions need to get filled quickly.

How to use SMART goals for short-term planning

Short-term planning can be perceived as measurable action taken to execute the strategy agreed to by management and the rest of the organization. In fact, short-term planning can fall under the SMART formula (Specific, Measurable, Actionable, Relevant and Time-based.) Thus, a series of objectives must be assigned and completed to plan for short-term success.

Follow these steps to learn about the SMART formula and how it can help with short-term planning:

1. Understand the SMART framework

Short-term planning is an operational piece that is crucial to the success of an organization. Usually, lower-level employees can execute short-term projects assigned by their manager. Changes to workflow processes and technology can help streamline a team looking to achieve a company's long-term goals. Breaking down and understanding the SMART framework gives you more clarity for your short-term planning.

Here's how each part of the SMART formula works:

Specific

This step measures what you want to achieve in the short-term. The short-term can be defined by several hours, days, months or a one-to-three-year period, depending on the size of the company. In fact, the formulation of your organization's long-term goals and strategy should put you in a position to determine how you want to run your operations. You may need to check with low and mid-level managers to ensure this is an effective management style for them to execute.

Measurable

Know how long-term goals are being measured, so you align measurement practices to your short- term planning strategy. Set up milestones help you break down a timeline in reaching the desired steps of your short-term plan. If you're looking at applicants for expansion, you can use this step as a benchmark to see the number of candidates applied to a position and the number of interviews you've secured. You can change how your metrics tie into your long-term goal in case you run into any disruptions and establish a rewards system for when you reach that milestone.

Achievable

Identify your motivations in planning for the short-term and what you're trying to get out of it. Knowing the output you want to receive from your team helps you stay focused on what the organization is trying to achieve. Also, it can outline the effort and resources needed to assist your team.

Relevant

Make sure that your plan aligns with the company's core values, and if you can establish a process that can promote the efficiency of your employees.

Time-based

Define how long you need to plan and how long the team needs to adapt to changes spearheaded by management.

2. Prioritize what your organization needs to accomplish

Once you understand how the SMART framework can help your organization carry out your day-to-day operations, look and see what parts of your organization need immediate assistance. Some areas can include project management, company facilities and team morale.

3. Consult with management to see if short-term planning demands align with everyone

Before you can create short-term business goals, consult with your team to see if they share the same demands and mindset about what type of short-term planning is needed. Feedback is essential to planning the best solution for your organization.

How to create short-term business goals

Here's how you can create short-term business goals for your organization:

1. Remind your team of long-term business goals.

2. Determine what your team needs to reach long-term targets.

3. Develop your team's skills to meet long-term goals.

4. Find out how to keep track of your team's development over time.

1. Remind your team of long-term business goals

Teams need a consistent reminder of what the company's long-term business goals are. By reminding your team about the goals they need to reach and why, you give them more clarity on which tasks to prioritize in the short-term.

2. Determine what your team needs to reach long-term targets

Once you review your organization's long-term goals and understand your team's demands, determine what your team needs to be successful. It could be access to new technology, more training on current technology in place or a larger staff to hit short-term targets. It's essential to include them in the goal-creation process so they can understand the results they are striving for.

3. Develop your team's skills to meet long-term goals

With the help of your human resources department, create programs to train your staff on how to reach their goals. Team-building activities are essential in sustaining your team's morale and encouraging a culture of growth. You and your human resources department should take an active approach in communicating and enacting your plans to generate success.

Related: 6 Tips for Effective Teamwork

4. Find out how to keep track of your team's development over time

Discuss with your team and human resources department how to track the success of your short-term business goals. There should be full transparency in communicating how you're completing major projects tasked by management.