Strategic Planning Part 3: Build your Operational Plans

Identify a Vision? ✅

Develop the Strategy?  ✅

Build an Operational Plan? 🚧

We find too often that organizations and companies will make the investment in time and funding to identify a vision and even build a Strategic Plan with a dedicated team and then NOT integrate the operational or annual planning effort to the outcomes from those activities. But who needs a Strategy to know what you need to do today? Acknowledgement of this potential gap, setting into motion activities and initiatives that are disconnected from your strategy, is where many organizations first recognize the need for a strategy. 

If you followed the approach to use your vision to develop your strategy, then using your strategies to build your operational plans will simply be a matter determining not just priority, but sequence in which you should develop your strategies. 

If Vision sets the WHY, and strategies set the WHAT and WHO, then operational plans help define the WHEN

While developing strategies, you should have identified gaps and the investments that would be needed to fill those gaps. Those investment opportunities are the road map for the initiatives needed to meet future business requirements. However, your strategic initiatives have to be broken down into a sequence of smaller initiatives and programs which allow a business to evolve and validate. 

Enabling your Vision

You may ask why breaking down those investments is required. Why not just fund and start all of those strategic initiatives and achieve everything desired? You might be a part of company or organization where the cash flow to fund that level of investment actually exists. So why not just take advantage of all the effort put into the vision and strategies and get it all? The answer is actually quite simple: you cannot achieve it all operationally because your operational plan is where the rationalization occurs and evaluation of portions of your vision that were transformed into strategies gets tested in the real world and assumptions you used build that vision. You purposefully allowed for only loosely validating vision components, and your strategies integrated those components to set direction. However, your operational plans is the first time you get to see what happens when you introduce those visionary and innovative strategies into the world. It is likely that the real world will introduce some reactions that were not anticipated. Don't be afraid of that happening, instead plan for it. It is exactly what you want to happen! Use your operational plan to help guide refinements to vision and strategies. It is a wonderful cycle.

Reach and Range

One method of breaking down the strategic initiatives into operational plans is to use a concept such as "Reach and Range" of those initiatives. Describe the strategy and priority for the logical progression of building out the features/changes for your business area. Consider how you would see the strategy deployed geographically or by business market or by product.  For example, if you are attempting to grow into markets where you have never been, then which markets have the lowest barriers to entry and can be entered first? Which take longer to enter and have longer timelines? Which markets are even open now or are some closed for the next few years? Evaluate the related opportunities, business value, and consider documenting reason that drive the priority of functionality or deployment by audience, geography, or whatever drivers are in play. 

Once you have your road map for the initiative, you can focus on the operational scoping required to achieve. 

Who uses the function?
Who has accountability for the business results?
Where is the function performed?
When (how often) is the function performed?

The operational plan then simply focuses on the scope for the year, funding, people, investment in infrastructure required to achieve. Evaluating results against that plan is key to validating those strategies. 

Simple? Maybe. If the effort is planning (remember, it's an action verb!) then the operational plan is obviously the output from those efforts. It will make sense to focus on the tactical efforts required to move the strategies forward. It is fine for there be to tactical efforts in your strategic plan that are not necessarily strategic. For example, work to exit a market that may have resulted from a strategic initiative several years ago, may be required to continue until the results are achieved. It is always worth scrutinizing those efforts to evaluate need, but that scrutiny is a part of the process and should not be ignored. Finally, ensure that your operational results and especially factors which impacted your success or impeded progress, are incorporated back into your visioning and strategy. 

This is the final post in this series and hopefully it provided some basic structure and process ideas for establishing you plans. Key takeaways include:

• Planning is a VERB and it is the Planning JOURNEY that drives the value of these efforts
• Vision is about the WHY, Strategies are about the WHAT and HOW, Operational Plan define WHEN
• Use DATA to derive your strategies
• Strategies are delivered operationally through a road maps which set the course of actions and decisions

Strategic Planning Part 2: Determine Your Strategy

You have your Vision, your team is engaged, but how do you determine the appropriate focus for the next few years?  More importantly, how do you start down a path that leads to building out that Vision? Most companies and organizations understand the business value of producing a Strategic Plan, and that is the core deliverable of your strategy. They do this annually, as a part of a formal function, and produce a document outlining their plans for the next 3-5 years. However, many lose sight of the fact that the emphasis on the process to create the deliverable is where you differentiate your plans. You are seeing in a theme in the recommendations for all of these efforts:

Approach with DATA

Your vision helps with establishing the direction and engaging your company's or organization's leadership. As you embark on the development of your specific strategies, you want to use as much data as possible to truly transform those visions components into plans. Data is the basis for informing the development of the plans that have the biggest impact and highest opportunity for success. Let's look at the type of data that is helpful for this type of effort.

Current Environment 

What are the current business process flows, applications, data records, and user points of interaction? Utilizing your existing operational documentation and data is key to understanding how to lay out a course for the future. It is highly likely that your existing GAPS in supporting your business today will still be there in the future if you do not explicitly understand and address them.

Business Drivers

The vision was developed using a process that ensured appropriate business input. Use that to distill down into specific drivers so that as your operationalize into a plan, you can consider the time and relative impact. External impacts that are occurring soon MUST be understood in more detail than impacts that are forecast for farther in the future. Getting your business stakeholders to distill their business vision forms the basis for this part of the data.

Build Your Strategies

You have a vision. You understand your starting point. And you have a direction the business heading. Now you lay out your plans. Keeping in mind that that the Strategic Planning effort emphasizes the process and also takes different perspectives to ensure it is as real as strategy can be. Focus on gathering information and facts, and documenting as you go.

Example of Building Strategies

Business Goals - A statement of WHAT will be achieved
Business Strategy - The HOW or choice to achieve that goal
Business Critical Success Factor - Capability or condition that must exist for strategy to be successful
Business Value of the CSF - What is the business value of the specific CSF?

After defining the CSFs and Business Requirements, leverage your analysis to begin to describe the gap between the existing  environment and the vision for the functional area. Once you describe the vision and the current environment, the gap between the two should naturally fall out.

The last step is to document any know business value associated with filling the gap between the current state and the vision as well as the investment expected to achieve the business value described. Note that is possible, in fact likely, that your strategy will include investment that is not a part of your vision. There will be critical success factors you need to operationalize before a vision state can be achieved. That is why the process and action of developing is so valuable, you uncover details that were not available to you before!

Developing the Specifics

Keep in mind that this effort is iterative and can take time. Months if you are developing a Strategic Plan for the first time. But once your strategies are developed, maintaining them, even if business direction and vision evolves, is not onerous. Do not shortcut these steps and know you are the right path when it feels like all you are doing is talking about what will be. Most companies and organizations do not spend enough time on this part of the process because the payback is not immediate. However, you can be sure that this time is some of the most valuable your organization or company will spend. That will be more clear when we talk about how to develop your Operational Plan from your Strategy.