Classification of Planning: Strategic plan, Tactical Plan and Operational Plan

Planning is one of the most fundamental functions of management. It involves setting objectives, determining the appropriate actions to achieve those objectives, and developing a roadmap to guide the organization toward its goals. Based on the scope, timeframe, and purpose, planning can be classified into three main categories: Strategic Planning, Tactical Planning, and Operational Planning. Each type of planning serves a distinct purpose and operates at different levels within the organization.

Strategic Planning

Strategic planning is the highest level of planning in an organization. It is concerned with the long-term vision and direction of the organization. The purpose of strategic planning is to define where the organization wants to be in the future and how it will get there. Strategic plans are usually broad in scope and cover long time horizons, typically ranging from three to five years or more.

Key Characteristics of Strategic Planning:

• Long-Term Focus:

Strategic planning deals with future aspirations and sets long-term goals for the organization. It helps in positioning the organization within the industry and market in the coming years.

• Vision-Oriented:

It is driven by the organization’s vision and mission. Strategic plans are meant to define the path for achieving the organization’s purpose and values.

• Comprehensive:

Strategic planning takes into account both internal factors (such as resources, capabilities, strengths, and weaknesses) and external factors (such as competition, market trends, regulations, and technological advancements).

• Top-Level Management:

This type of planning is the responsibility of top-level management, including the CEO, board of directors, and senior executives. They determine the strategic direction and major initiatives the organization should undertake.

• Adaptability:

Given that strategic plans span several years, they must remain flexible to accommodate changes in the external environment, such as shifts in market conditions, technology, or regulation.

Examples of Strategic Planning

• A company’s plan to enter new markets or geographical regions.
• A corporation deciding to diversify its product lines or services.
• A hospital developing a strategy to become a leader in specialized medical treatments.

Steps in Strategic Planning:

1. Setting Organizational Objectives: Define long-term goals based on the organization’s vision and mission.
2. Environmental Analysis: Conduct a SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis to evaluate internal capabilities and external opportunities.
3. Strategy Formulation: Develop strategies to achieve objectives, such as market penetration, cost leadership, or differentiation.
4. Implementation: Execute the strategic plan by allocating resources and mobilizing departments.
5. Evaluation and Control: Monitor progress and adjust the plan as needed.

Tactical Planning

Tactical planning translates strategic plans into specific, actionable steps. It is a medium-term planning process that focuses on how the strategic goals will be achieved through the organization’s resources and efforts over a shorter time frame, usually within a year. Tactical plans provide detailed actions that guide middle management and departments on how to achieve the objectives laid out in the strategic plan.

Key Characteristics of Tactical Planning:

• Medium-Term Focus:

Tactical plans typically cover a shorter period than strategic plans, ranging from one to three years. They are designed to meet specific objectives that contribute to the long-term goals of the organization.

• Specific and Action-Oriented:

Tactical plans break down strategic goals into specific, measurable actions and allocate the necessary resources to achieve them. These actions are often linked to departmental or functional areas.

• Managerial Involvement:

Middle-level managers are responsible for tactical planning. They interpret strategic plans and develop the actions needed to execute them at a functional or departmental level.

• Resource Allocation:

Tactical planning involves identifying and assigning the resources—such as personnel, equipment, and budget—needed to carry out specific tasks.

• Coordination:

Tactical plans require coordination across different departments to ensure that the actions taken are aligned with overall organizational goals.

Examples of Tactical Planning:

• A marketing department creating a tactical plan to launch a new product in the next six months, including specific advertising campaigns and promotional strategies.
• A production department planning to increase output by 15% by optimizing manufacturing processes over the next year.
• A sales team developing a plan to target new customer segments through a targeted outreach program within a year.

Steps in Tactical Planning:

1. Break Down Strategic Objectives: Convert long-term strategic goals into actionable, short-term objectives.
2. Develop Departmental Plans: Create plans specific to departments or functional areas (e.g., marketing, finance, production).
3. Set Timelines and Milestones: Define timeframes for completing tasks and milestones to measure progress.
4. Allocate Resources: Assign resources like budget, personnel, and equipment to various tasks.
5. Monitor Progress: Review and adjust the tactical plan periodically based on performance.

Operational Planning

Operational planning is the most detailed and short-term type of planning. It focuses on the day-to-day operations of the organization. Operational plans are created to ensure that tactical plans are executed smoothly. These plans are very specific and deal with the execution of tasks and activities on a daily, weekly, or monthly basis. Operational planning often involves scheduling, assigning tasks, and establishing workflows that ensure the smooth functioning of business processes.

Key Characteristics of Operational Planning:

• Short-Term Focus:

Operational plans usually span short periods, such as a day, week, or month. These plans provide immediate guidance on how to execute specific activities.

• Detailed and Specific:

Operational plans provide detailed instructions and procedures for the routine operations of an organization. They focus on how individual tasks will be accomplished.

• Low-Level Management:

Operational plans are typically handled by low-level or front-line managers who oversee the implementation of day-to-day tasks.

• Task-Oriented:

These plans focus on specific tasks, workflows, and activities, ensuring that tactical and strategic goals are met through efficient execution of daily operations.

• Routine Procedures:

Operational plans include detailed procedures and guidelines that employees must follow to complete their tasks efficiently.

Examples of Operational Planning:

• A daily work schedule for employees in a retail store, assigning them specific roles such as stocking shelves, customer service, or cashier duties.
• A production manager creating a weekly schedule to allocate machinery and manpower to meet manufacturing targets.
• A hospital creating a staffing plan to ensure that there are enough doctors and nurses on duty during a busy weekend.

Steps in Operational Planning:

1. Define Tasks: Identify the specific tasks and activities required to support tactical plans.
2. Develop Standard Operating Procedures (SOPs): Establish guidelines and instructions for carrying out tasks.
3. Assign Responsibilities: Allocate tasks to individuals or teams and define roles clearly.
4. Set Deadlines: Establish timelines for the completion of tasks.
5. Monitor and Adjust: Continuously review the performance of day-to-day operations and make adjustments as necessary.

Comparing Strategic, Tactical, and Operational Planning

<

table width=”100%”>