Strategic vs Tactical vs Operational vs Contingency Plans

Strategic vs Tactical vs Operational vs Contingency Plans

Reynaldo O. Joson, MD

December 4, 2014

Organizational management and control involves strategy, tactics, and operational plans and oversight to monitor and improve organizational processes.  It also involves having contingency plans.

What are strategic, tactical, operational and contingency plans?

contingency plan is a plan drawn up for possible unforeseen events or circumstances.  It is a course of action to be followed if a preferred plan fails or an existing situation changes.

Strategic, tactical and operational plans are directed courses of action intended to achieve a certain set of goals and objectives.  They are formulated based on usual assumptions and expected outcomes.  These are the similarities of the three kinds of plans.

For the differences among the three plans –

In terms of level of planning, strategic plans are highest, operational plans lowest, tactical plans in between.

In terms of scope, strategic plans are broadest, operational plans least broad, tactical plans in between.  Strategic plans are based on longest-term planning horizon, operational plans shortest planning horizon (even on a day-to-day basis), and tactical plans, in between.

In terms of relationships, operational plans lead to the achievement of tactical plans, which in turn lead to the attainment of strategic plans.  In terms of cascading flow, strategic plans are cascaded to tactical plans, tactical plans to operational plans.

In the context of an organization, the strategic plan includes the statements on vision, mission, core values and strategic goals / objectives.  The tactical plan includes the action plans to achieve the strategic goals / objectives.  The operational plan includes the action plans to achieve the tactical goals / objectives.

An action plan is a sequence of steps that must be taken, or activities that must be performed well, for a strategy to succeed, or for a goal or objective to be achieved.  An action plan has three major elements (1) Specific tasks: what will be done and by whom. (2) Time horizon: when will it be done. (3) Resource allocation: what specific funds are available for the specific activities.

Read more: http://www.businessdictionary.com/definition/action-plan.html#ixzz3KucuJh5g

Simplifying things, the tactical and operational plans can be lumped together as action or operational plans.  These are plans to operationalize or to achieve the strategic plan. If there will be a difference between the two, tactical plans are more general or broader  than the operational plans.

The strategic plan is a general guide for the management of the organization according to the priorities and goals of stakeholders. The strategic plan DOES NOT stipulate the year-to-year, month-to-month, and day-to-day tasks and activities involved in running the organization.

On the other hand the Operational Plan DOES present highly detailed information specifically to direct people to perform the year-to-year, month-to-month, and day-to-day tasks required in the running the organization. Organization management and staff should frequently refer to the operational plan in carrying out their everyday work. The Operational Plan provides the what, who, when and how much:

  • what – the strategies and tasks that must be undertaken
  • who – the persons who have responsibility of each of the strategies/tasks
  • when – the timelines in which strategies/tasks must be completed
  • how much – the amount of financial resources provided to complete each strategy/task

The following table shows the difference between and operational and strategic plans:

Strategic Plan Operational Plan
A general guide for the management of the organization A specific plan for the use of the organization’s resources in pursuit of the strategic plan.
Suggests strategies to be employed in pursuit of the organization’s goals Details specific activities and events to be undertaken to implement strategies
Is a plan for the pursuit of the organization’s mission in the longer term (3 – 5 years) Is a plan for the day-to-day management of the organization (one year time frame)
A strategic plan enables management to formulate an operational plan. An operational plan should not be formulated without reference to a strategic plan
The strategic plan, once formulated, tends not to be significantly changed every year Operational plans may differ from year to year significantly
The development of the strategic plan is a responsibility shared and involves different categories of stakeholders. The operational plan is produced by the chief executive and staff of the organization.

The purpose of the Operational Plan is to provide organization personnel with a clear picture of their tasks and responsibilities in line with the goals and objectives contained within the Strategic Plan.

Basically, the Operational Plan is a plan for the implementation of strategies contained within the Strategic Plan.

It is a management tool that facilitates the co-ordination of the organization’s resources (human, financial and physical) so that goals and objectives in the strategic plan can be achieved.

http://www.leoisaac.com/operations/top025.htm

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