Making an Operational Plan for Your Business: Key Concepts

Many companies spend time preparing business plans to help prepare for the future. Many use a strategic planning approach, which focuses on long-term, high-level goals. Creating an operational plan in addition to a strategic plan can help your company effectively meet your strategic goals. Learn what an operational plan is, understand the benefits of creating an operational plan, review examples of operational plans, know the elements of a successful operational plan and read answers to frequently asked questions about operational plans. 

 

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What is an operational plan?

An operational plan is a specific, detailed work plan that identifies how you’ll reach a specific goal or outcome. Usually, operational plans are part of a larger strategic or business plan. The operational plan provides the steps for how the company will reach the goals outlined in the strategic or business plan. Most operational plans identify:

  • Who: Who in the company will manage each stage or step of the operational plan.
  • What: What specifically the company needs to do to reach the outlined goals. 
  • When: When each specific task needs to be completed in order to achieve a favorable outcome. 
  • How: How to reach the set goals, including how the company will use resources like time, money and labor.

Most companies use operational plans as a sort of action plan to reach set strategic goals. Think of strategic or business plans as the end goal and the operational plan as the specific steps to get there. 

Related: 5 Director of Operations Interview Questions and Answers 

 

What are the benefits of an operational plan? 

Operational plans provide a number of benefits for companies that use them in addition to broader business or strategic plans. Consider the primary advantages of creating and implementing an operational plan for your company: 

  • Identifying needs: An operational plan helps you pinpoint business needs and create a plan to resolve them. 
  • Aligning internal stakeholders: Your operational plan should help to align all the actions and endeavors of your various departments and internal stakeholders. 
  • Offering structure: The operational plan provides structure and a clear progression of steps to reach your specified goals. 
  • Maintaining accountability: With an operational plan, everyone involved has a clear description of what they need to do to contribute to the project. 

Related: How to Hire a Director of Operations

 

Examples of operational plans

Operational plans, depending on the scope of the project, can be lengthy documents. Many companies choose to create a summary table graph that outlines the basics of the operational plan for a quick overview. Consider these few examples of operational plan summaries to help you establish your own: 

 

Operational plan summary: Increase sales

This operational plan summary represents the basic steps needed to reach a strategic sales goal: 

Goal: Increase sales by 5%
Area Action Goal Owner Date
Sales Identify new leads and increase territory boundaries Sales up by 5% Sales team (Marty as lead) End of Q3
Marketing Find new areas for promotion and increase marketing on current channels At least 1% of increased sales from marketing  Tonya Q2
Leadership Improve brand reputation in comparison to competitors Positive target market surveys Roberta Q3

 

Operational plan summary: Launch new product

This operational plan summary explains the basics of a step-by-step operations plan for launching a new product: 

Goal: Launch new product
Area Action Goal Owner Date
Research and development Design a new product Bring the new product to market R&D Q4 2022
Marketing Create effective promotions at least one year prior to launch Ensure the interest and attention of the target market Martha Q3
Manufacturing Establish manufacturing and distribution channels Plan to manufacture and distribute in-house or find suitable partners Tom Q4

 

Elements of a successful operational plan

Operational plans can vary depending on the needs of the company and the specifics of the goal. However, most operational plans include the same key elements:

  • Title: Even if your operational plan is a sub-section of a larger strategic plan or business plan, you’ll likely want to indicate what the section is with a title, your company name and the point of contact for any questions about the plan. 
  • Executive summary: The executive summary briefly describes the plan in a sentence or two. This is also where you’ll include your operational summary graph if you’ve created one. 
  • Strategic content: Describe how the operational plan contributes directly to the strategic plan or business plan. 
  • Company objective: List how the operational plan contributes to the company’s long-term goals and objectives. 
  • Evidence: Describe the evidence, often in the form of key performance indicators or KPIs, you’ll use to assess the success of the plan. 
  • Financial summary: Provide information about how you’ll fund the operational plan. 
  • Staffing: Explain which departments or individuals are participating in the plan overall. Describe any new hires you may need to make in order to ensure the completion of the project. 
  • Risks: Acknowledge any risks the company might be taking as a result of embarking on this operational plan. 
  • Goals: List the specific goals the operational plan seeks to achieve. 
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Frequently asked questions about operational plans

How do you create an operational plan?

Use these steps to help you create an operational plan for your business: 

  1. Identify the goal: Begin by determining what you hope to achieve through your operational plan. 
  2. Establish a plan: Create a step-by-step plan for reaching your goal.
  3. Set a budget: Determine a realistic budget based on each step of your plan. 
  4. Assign stakeholders: Ensure each step in the plan has an owner for tracking and reporting. 
  5. Write the outline: Draft a document that outlines each step of the operational plan.
  6. Implement reporting: Establish a system for reporting on the operational plan’s progress. 
  7. Adjust as needed: Make changes to your operational plan as needed to stay on budget and reach your goals. 

What is the difference between an operational plan and a strategic plan?

Operational plans and strategic plans are often interrelated. Generally, an operational plan is part of a strategic plan or borne out of a strategic plan:

  • Strategic plan: This type of plan is very high level and outlines your organization’s top-level ambitions and goals for several years out. It lists the projects or changes needed to reach the company’s strategic goals in summary. 
  • Operational plan: This type of plan provides the actual steps and procedures the company needs to take to achieve one of the goals outlined in the strategic plan. It provides detailed instructions for achieving the objective. 

How do you write an operational plan?

When writing an operational plan, you want to ensure you include enough detail that all stakeholders, both internal and external, can easily follow the plan. Include the following in your operational plan for clarity and thoroughness: 

  • The title of the document
  • Your company’s name
  • The name of the main operational plan writer
  • Executive summary
  • Strategic connection
  • Long-term company objectives
  • Key performance indicators of project success
  • Financial overview
  • Staffing needs
  • Potential risks
  • Operational plan goals

An operational plan can help your company achieve specific objectives related to long-term company goals. Knowing how to write and implement an operational plan will maximize the likelihood of project success. 

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