When we talk about strategic plan, tactical plan, and operational plan, we are talking of the plans that work together to move or propel an organization forward and the difference between them lies in the level of specificity and the level of management which deals with them. In order to clearly state the differences between strategic plan, operation plan and tactical plan, it will be wise to define these terms.
What is a Strategic Plan?
As the name implies, strategic planning is an organization’s process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy. It is here that priorities are set. It may also extend to control mechanisms for guiding the implementation of the strategy.
Strategic planning became prominent in corporations during the 1960s and remains an important aspect of strategic management. It is executed by strategic planners or strategists, who involve many parties and research sources in their analysis of the organization and its relationship to the environment in which it competes.
In the business world and in other spheres of life, strategy has many definitions, but generally involves setting strategic goals, determining actions to achieve the goals, and mobilizing resources to execute the actions. A strategy describes how the ends (goals) will be achieved by the means (resources).
The senior leadership of an organization is generally tasked with determining strategy. Strategy can be planned (intended) or can be observed as a pattern of activity (emergent) as the organization adapts to its environment or competes.
Strategy includes processes of formulation and implementation; strategic planning helps coordinate both. However, strategic planning is analytical in nature (i.e., it involves “finding the dots”); strategy formation itself involves synthesis (i.e., “connecting the dots”) via strategic thinking. As such, strategic planning occurs around the strategy formation activity.
In a nutshell, strategic planning is a process and thus has inputs, activities, outputs and outcomes. This process, like all processes, has constraints. It may be formal or informal and is typically iterative, with feedback loops throughout the process. Some elements of the process may be continuous and others may be executed as discrete projects with a definitive start and end during a period.
What is an Operational Plan?
Operational planning (OP) can be defined as the process of planning strategic goals and objectives to technical goals and objectives. Operational plan to a large extent describes milestones, conditions for success and explains how, or what portion of a strategic plan will be put into operation during a given operational period, in the case of commercial application, a fiscal year or another given budgetary term.
An operational plan is the basis for and justification of an annual operating budget request. Therefore, a five-year strategic plan would typically require five operational plans funded by five operating budgets. Operational plans should establish the activities and budgets for each part of the organization for the next 1 to 3 years. They link the strategic plan with the activities the organization will deliver and the resources required to deliver them.
Please note that a good operational plan draws directly from agency and program strategic plans to describe agency and program missions and goals, program objectives, and program activities. Like a strategic plan, an operational plan addresses four questions:
- Where are we now?
- Where do we want to be?
- How do we get there?
- How do we measure our progress?
Interestingly, the operations plan is both the first and the last step in preparing an operating budget request. As the first step, the operations plan provides a plan for resource allocation; as the last step, the OP may be modified to reflect policy decisions or financial changes made during the budget development process.
Operational plans should be prepared by the people who will be involved in implementation. There is often a need for significant cross-departmental dialogue as plans created by one part of the organization inevitably have implications for other parts.
Operational plans should contain the following;
- Clear objectives
- Activities to be delivered
- Quality standards
- Desired outcomes
- Staffing and resource requirements
- Implementation timetables
- A process for monitoring progress
What is a Tactical Plan?
Tactical plan is all about the tactics needed to execute all the plans that are generated during a strategic session. Or better put, a tactical plan answers “how do we achieve or implement our strategic plan?” It outlines actions to achieve short-term goals, generally within a year or less. They are much narrower in focus and can be broken down into the departmental or unit level.
For example, if you run a fashion business and you decided that one of the best ways to reach your target consumer is through social media ads, then the tactical plan needs to carefully spell out the specifics of the social media ads campaign and perhaps you can major on Instagram. Having said that, here are some of the Differences between Strategic Plan, Operational Plan and Tactical Plan:
What is the Difference Between Strategic Plan Vs Operational Plan Vs Tactical Plan?
- While strategic planning affects the whole company and is the responsibility of top management, it is not so for operational plan and tactical plan – Strategic plans are broad and general and deal with the mission of the company, as well as its future goals.
- Tactical planning relates to mid-level management and offers specific actions as ways of working towards the strategic plan. These plans are less general than strategic plans, but still do not include vast amounts
- Tactical planning is short range planning emphasizing the current operations of various parts of the organization. It is not so for operational planning because operational planning is the process of linking strategic goals and objectives to tactical goals and objectives of the organization.
- Tactical plans are usually developed in the areas of production, marketing, personnel, finance and plant facilities while strategic planning is broader and it covers the whole of the organization and different industry.
- Tactical planning can be restricted to just a department while strategic planning and operational planning can extend to other departments. This why it is the norm for managers to make use of tactical planning to outline what the various parts of the organization must do for the organization to be successful at some point that covers an extended period of one year or less into the future. Generally, strategic planning deals with the whole business, rather than just an isolated unit.
- The fact that senior Management generally have a better understanding of the organization than lower level managers do, upper Management generally develops strategic plans. Because lower level managers generally have better understanding of the day-to- day organizational operations, they develop tactical and operational plans.