Do you need a strategic plan, a business plan or an operational plan?


The perspective offered here is from the experiences developing multiple levels of planning; strategic, business and operational. All levels of planning have their place, and there are a multitude of great articles written about the topic of strategic vs. business planning with all sorts of “how-to” directive exercises.

Attached is a link to a simple article that nicely discusses the differences (  One caveat to highlight is that I do not think an annual strategic plan is always necessary – the decision should be driven by business events not time.

Strategic Planning

Despite all the strategic and business planning articles, I have not seen many meaningful articles on operationalizing strategic and/or business plans. Planning in every company is different, but an integral part of any planning process should be operational planning. Operational planning is a critical translation step that enables strategic and/or business plans to be realized.

Strategic plans have their place in the overall process and are critical to an organization defining itself.  Once this has been established, and the organization’s identity and purpose are defined, then the business planning process can be used to drive the planning process.

Key point #1: Once you have defined yourself strategically, the business planning process becomes the primary vehicle unless business events dictate otherwise.

One might argue that the business plan is a step a logical step towards operationalizing the strategic plan. It is a step in the right direction, but not a large enough step to translating the strategy into actionable planning. The business plan moves the strategy in a meaningful way to many parts of the organization, but not to all parts and/or to the required depth. The business plan is focused on higher level strategic related items (both brand and managed markets), the revenue forecasts and marketing costs.

Business Planning

The business planning process needs structure to provide the foundational continuity to be meaningful. Continuity is the operative term, and a key success driver.  The required structure can vary based on the maturity and complexity of the organization. There is a direct relationship between number of products/therapeutic areas and complexity.  The relationship grows in complexity when therapeutic profitability is factored into the assessment.

A simple complexity reference matrix is provided below:

The size of an organization and number of products in the portfolio define the complexity of the business planning process. For the more complex organizations, portfolio planning becomes an integral part to the business planning process. The key deliverables from the business planning process revenue forecasts, strategies and associated budgets are the foundational elements for the operational plan.

Operational Planning

The operational plan is a translation of the business plan and product strategies to a level that all parts of the organization can use to develop their own operational plans. Operational planning is generally two steps for the more complex organizations. Step one – brand strategies prioritized and crystallized for all areas in the organization. Step two – brand operational plans are utilized to develop functional area operational plans (e.g. managed markets, field force, finance, operations, etc.).  The operational plans form the basis from which the functional areas execute from.

Key Point #2: The interim step of prioritizing and crystalizing business/brand plans builds the foundation for the operational plans.

This may sound like a lot of planning, but it is not. The efficiencies attained by the right structure and ground rules can streamline the business planning process to allow for more value-added back-end operational planning time.  Execution will be heavily dependent on the operational plan, not the business plan.  Hence, the focus should shift to that aspect of the planning process.

Key Point #3: The planning process should work for you not you for the process. Operational planning provides an execution roadmap inclusive of tactical planning and implementation/performance dashboards. Plan to Execute!

Here is an appropriate quote to summarize the discussion:

Strategy is wasted without “operational effectiveness” – Michael Porter

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