Effective strategic business planning requires a dynamic, methodical process that keeps the organization focused on the right issues and actions. This means management must diligently define and redefine the four essential components of a successful strategy and tactical actions:
- Strategic goals, which are brief statements of what top management wants to achieve in terms of growth, products, markets, profits and the like.
- Improvement objectives, which are specific and measurable performance improvements set within certain timeframes and tied to specific strategic goals.
- Action plans, which translate objectives into a specific set of steps, responsibilities, schedules and cross-functional teams for implementing the plans to achieve the objectives.
- Performance measures, which provide quantitative means of reviewing, evaluating and updating actions, improvement objectives, strategic goals, and process performance.
The very essence of planning operational objectives effectively is a continual process of ensuring that operations is constantly and consistently doing the “right things right.” This process involves continuously reassessing current strategies including objectives, action plans, and measurements. It also involves developing new or modified objectives, action plans and measurements, whenever needed. Effective strategic operations planning must continually and systematically perform the following two tasks:
- Reassess the current strategies, objectives, action plans and performance measurements, and examine how well they are reflected in the company’s overall strategic plan.
- Develop new or modified objectives, action plans and performance measurements that are well-connected to the overall strategic plan.
Like any continuous process, effective operational strategy planning must always be asking:
- “Where do we want and need to go?” and,
- “How are we going to get there?”
These questions are defined in concrete terms as you connect business strategy with operations strategy to form an overarching competitive strategy for increasing sales, profits, ROA, ROE, stockholder value, and market share