Creating an effective operational plan is essential for turning your organization’s strategy into actionable results.
Operational planning is a key component of the annual strategic planning process that provides a link between the department’s strategy and the day-to-day efforts of its people.
Definition of Operational Planning
- Outlines the actions necessary to accomplish the goals and objectives in the Strategic Plan
- Creates a set of annual plans for governance, adjudication, and administration entities
- Establishes performance measures to track progress against actions
- Aligns actions to budget
Purpose of Operational Planning
- Helps managers identify organizational priorities and capabilities
- Establishes tasks, performance expectations, schedules, milestones, and resource needs
- Focuses departments to organize resources against performance targets
Annual Strategic Planning Process
The 5 Step Process for Effective Operational Planning
Step 1: Review Strategic Plan
Creating the operational plans begins with reviewing the strategic plan and its mission, vision, goals and objectives.
Objectives
- To create an understanding of the Strategic Plan in preparation for identifying current department initiatives that align to its goals and objectives
Activities
- Planners carefully review the Strategic Plan and educate their unit on the mission, vision, goals, and objectives
Outputs
- A more comprehensive understanding of Strategic Plan
Step 2: Identify Each Department’s Initiatives
Next, each Working Group member will engage staff to articulate the unit’s initiatives.
Objectives
- To create a streamlined list of each department’s current activities
Activities
- Each planner will engage his or her employees in listing the department’s current initiatives
- The planner will then meet with the facilitator to review and refine the list
Outputs
- List of department’s current initiatives
Step 3: Align Initiatives to Strategic Plan Objectives
Working Group members will align the initiatives to strategic plan objectives and draft the operational plan.
Objectives
- To create a link between the department’s current daily activities (and initiatives) and the Strategic Plan objectives
Activities
- The planner will work with department staff to determine which Strategic Plan objective is related to each initiative
- The Implementation Team will then compile the information from each unit to create draft Operational Plans
Outputs
- Initiatives aligned to company’s objectives and goals
- Draft Operational Plans
Step 4: Develop Performance Measures and Targets
Each member will develop performance measures and targets for all of the unit’s initiatives.
Activities
- The planner will review draft operational plans and work with the implementation team to develop performance measures and targets for each of his unit’s initiatives
Outputs
- Performance measures and targets (added to draft operational plans)
Step 5: Align Operational Plans to Budgets
Finally, the operational plans will be aligned to the Department’s budget.
Objectives
- To create a link between company’s budget and the department’s initiatives that support Strategic Plan objectives
Activities
- Estimate and identify available resources for implementing operational plan initiatives
- Communicate budget adjustments to Finance and update budget accordingly
Outputs
- Budget estimates for each initiative (added to draft operational plans)
- Financial performance targets
How to create an operational plan?
The [Department] oversee administrative functions related to [list primary functions]. It consists of [a number of] sections which collectively are responsible for providing [type of services/products] to the company. These sections and their primary responsibilities are outlined below:
- Section 1: Primary Responsibilities
- Section 2: Primary Responsibilities
- Section 3: Primary Responsibilities
- Section 4: Primary Responsibilities
Business plans have been created for each of the Departments listed above. Each business plan is organized as follows:
- Department Mission and Contribution to the Company Mission, Vision, and Strategic Goals.
- Structure, Roles and Key Processes
- Operating Expectation: Metrics, Targets and Results
- Budget and Actual Expenditures
- Analysis of Risks and Opportunities
- Initiatives to Change and Improve the Department’s Performance
Department Mission and Contribution to the Company Mission, Vision, and Strategic Goals.
Department Mission
1 – 3 sentences explaining:
- Why the department exists
- Who are its primary customers?
- The key services / processes for which it is responsible
Contribution to the Company Mission, Vision, and Strategic Goals
1 – 3 sentences explaining how the department contributes to the company’s:
- Mission
- Vision
- Strategic Goals
Structure, Roles and Key Processes
The [Department] is led by [Title of Manager/Director], who reports to [Title of Direct Report]. The [Department] structure is:
Insert Department Organization Chart
The [Department] consist of [a number of] sections. Each of the Department’s sections have key processes for which Standard Operating Procedures (SOPs) exist or will be developed. These are listed below:
- [Name of Section]
- List the Section’s key processes for which SOPs exist or will be developed.
Operating Expectation: Metrics, Targets and Results
For each section list the following:
- Section
- Metric
- Target
- Rating
Budget and Actual Expenditures
Business Activities: Included core business activities for each section.
Sample Budget and Actual Expenditures Table
Analysis of Risks and Opportunities
The [Name of Department] has identified the following risks and opportunities based on an analysis of the above operating metrics targets, budget results, and findings expressed in the Department’s Quarterly Performance Report.
Analysis of Risks and Opportunities Table
These initiatives are described in further detail in section 6 below. The Rough Order Magnitude (ROM) budget for these initiatives is already captured in the planned 20XX budget table in section 4 above.
Initiatives to Change and Improve the Department’s Performance
This section presents a summary of all the initiatives undertaken by the [Name of Department] in order to improve performance and/or implement requirements established by the Strategic Plan. It is presented in four sections:
- Total Number of Initiatives
- 20XX: Open Initiatives
- 20XX: Closed Initiatives
- Proposed 20XX Initiatives and Details
1. Number of [Name of Department] Initiatives by Start Date
Number of Initiatives Table
2. 20XX [Name of Department] Open Initiatives
- Role
- Initiative
- Strategic Plan Objective Alignment
- Start Date
- End Date
- Performance Measures
- Operating Metrics
3. 20XX [Name of Department] Closed Initiatives
Closed Initiatives Table
4. Proposed 20XX [Name of Department] Initiatives and Details
Description
- Insert 1-3 sentences describing this initiative
Benefits
- Insert bullets of all benefits of implementing this initiative
- Support Objectives
Cost Drivers
- Staff Salaries
- Hardware/Software
- Office Equipment
- Facilities
- Training
- Vendor Support
- Miscellaneous
Contributing Organizational Sections
- Indicate which Department section will contribute to implementation of this initiative, description of the contribution
Performance Measures & Targets
- Initiative Outputs
Initiative & Details Table
