Most businesses devote significant time and money to developing strategic plans, doing their best to lay out a roadmap that establishes a strong long-term vision. Although developing a strategic plan is important, a significant number of companies fail to provide a key strategy component: an operations plan.
The operations section of your business plan is where you outline the priorities, goals, processes, and timetable for your organisation. An operations plan is beneficial to have not only to investors, but also to you and your staff because it allows you to consider strategies and deadlines. It can also provide information about inventory specifications, vendors, and an overview of the manufacturing process, depending on the type of company you operate.
It sets out the day-to-day responsibilities of running a company. When properly developed, an operations plan ensures that each manager and employee are aware of their particular responsibilities as well as how they should be carried out within a set timeframe. It’s important to plan out the day-to-day activities that will insure a consistent path to your company and organisational objectives.
Your operations plan should address the following questions on a regular basis:
Your strategic plan is a manual that ensures that your organisation and all of its staff carry out day-to-day activities in a consistent and efficient manner.
Since operational plans are created with the goal of allocating money, resources, and personnel for each 1-3 year span, all of the measures that an operational plan would include should essentially serve that goal.
Since an operating plan is a necessary tool for achieving the objectives set out in a strategy, you must first insure that the strategic plan is in place. It’s best to start with the vision, as with every project plan. Tasks to meet specific, clearly established targets, as well as management of the staff to insure they’re performing at their best, are the key features of an operations plan. Once you’ve identified your vision for certain stages, you can move on to the research process.
As we mentioned above, the key to a successful operations plan is to have a clear vision and target that everyone is working towards. You’ll explicitly state your company’s organisational goal in this section of your strategy.
All good operating plan examples follow one rule: emphasis on the most critical targets. It’s difficult to execute a complicated strategy with several targets that aren’t clear and simple. In order to create an efficient operational objective, think SMART:
Specific – Be clear on what you want employees to achieve.
Measurable – Be able to quantify the goal in order to track progress.
Attainable & Realistic – It’s great to be ambitious but make sure you aren’t setting your team up for failure. Create a goal that everyone is motivated to complete with the resources available.
Timely – Provide a deadline so everyone has a date they are working towards.
Operational priorities can vary depending on the department. However, each department’s goal should contribute to the company’s overall goal. Furthermore, organisational priorities shift; they aren’t meant to be permanent or long-term. The timetable should be planned around your company’s long-term objectives.
Have a look at the following example for a local pizza delivery business goals:
Once you’ve created your goals, you’ll need to analyse how you’ll accomplish them strategically. To do so, each department (or team) must have all of the resources available for the production process.
The following are some useful resources to consider:
You’ll need to explain the operating process in detail in addition to the development process. This will show investors that you know exactly how you want your company to operate on a daily basis.
Among the items to include in your operations plan are:
For your new company, developing a timeline with milestones is crucial. It helps to keep everyone centred and is a good way to monitor production. If milestones aren’t being reached, for example, you’ll know it’s time to reconsider the development process or accept new hires.
Create a framework and report on all of it as the plan progresses until you’ve set out the operating plan—which should include specific targets with deliverables, priorities, timetables, and staff required to accomplish the plan. Stakeholders, other department heads, and leadership will want to check in on the progress of the organisational plan at each milestone, whether it’s monthly, quarterly, or project-based.
Your KPIs will have a major impact on the success of your operations plan, so choosing the right ones is crucial. Leading indicators are the most powerful metrics because they forecast what to expect in the future and allow you to change your strategies accordingly. Lagging metrics, on the other hand, just show you how far you’ve come after it’s too late.
Sales meetings or calls per week, for example, may be a good leading indicator if the target is to hit a certain sales level. You may be able to predict how many calls it takes to close a transaction based on your previous experience. This will encourage you to use phone calls to see if you’re on track to meet your sales targets. However, if you only measured revenue, you wouldn’t know where you were in relation to your targets and forecasts unless you were already there.
You must always be ready to change, as with any well-planned project. Have you ever reached a benchmark that yielded less-than-desirable results? The tasks in an operating plan are so detailed that you can now tell and understand precisely which parts of the plan aren’t working at their best. Adjust as needed, include team members as needed, gain stakeholder buy-in, and move on to the next benchmark with your newly-adjusted operations plan.
If you had the foresight to use business planning software like Planium Pro to create your plan, such changes are simple to make. If you have to make changes to a static Excel sheet or Word document, it can take hours to update anything.
Business planning software, on the other hand, is a versatile tool that helps you to quickly establish processes, delegate tasks, monitor progress, and make adjustments. To learn more about how business planning software can assist you with your operations plan, get your 14-day free trial with Planium Pro.
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