Strategic Planning vs Operational Planning: What's the Difference?

So, strategy works in your business, while operations work IN your business. Strategic planning and operational planning are two distinct types of planning processes that are carried out by the organization's managers and executives. The goal of strategic planning is to outline the company's long-term vision and how all departments must work together to achieve it. It is used to identify the internal and external factors that have a direct impact on the organization. Although closely related, it is important to understand how these two processes differ and how your organization can use both types of plans to advance its objectives.

Strategic plans are usually set in stone for longer periods of time, while operational plans are often modified. However, many companies struggle to align their daily operations with their high-level strategic objectives and the information obtained from the front line does not serve as a basis for the strategic process. It is essential to evaluate your strategic plan every year to ensure that it still makes sense in light of any dramatic changes inside or outside the organization, or if unexpected performance results occur. These tools help management design a strategy that takes into account several elements that will guide the organization towards its vision. Once created, the strategic plan will be driven by multidisciplinary teams that will work together to ensure its success.

When reporting on your strategic plan (usually on an annual and quarterly basis), your strategic planning committee or executive team will want to analyze your company's performance in relation to the measures you have chosen. Although delegating the outline of their own operating plans and budgets to them is a good idea, you should incorporate each of those individual plans into the overall business plan. The purpose of creating a strategic plan is to predict, detect, initiate, and lead changes in the market. Although strategic planning is usually carried out by the management team or a strategic planning consultant, it is important that employees (or department directors of larger organizations) be consulted to ensure acceptance of the final plan. This operating plan will ensure that they meet certain milestones and that the company will continue to move in the right direction in the long term.