Most businesses or organizations have a plan in place to help them reach their goals and objectives. However, there are several types of plans, each with its own purpose.
This article will discuss the seven types of plans an organization may have: strategic, operational, financial, tactical, project, contingency, and emergency. Each of these plans has a specific function and plays a vital part in helping the organization reach its objective. To further understand the importance of each type of plan, it is important to understand what each plan achieves.
A strategic plan is created at an executive level and is used to plan and chart the company’s direction over a specific duration. This type of plan includes activities and initiatives to satisfy the core objective of an organization and outlines specific goals, target audience, and benchmarks to reach the ultimate goal. Strategic plans are used to address potential issues and recommend corrective actions.
By creating a strategic plan, it ensures the organization remains on track and functions towards a common goal or vision. These plans can be further divided into short-term goals and long-term goals.
Long-term goals tend to focus on the bigger picture of the company’s objectives, while short-term goals are focused on the necessary steps to reach those objectives.
Operational plans are based on the larger goals of the organization and the objectives that have been identified in the strategic plan. This type of plan focuses on the day to day activities that are required in order to reach those goals and objectives. Operational plans are produced for a particular department, and define the activities for the upcoming month, quarter, or year.
This type of plan does not need to align with the larger goals of the organization, but must instead focus on the task at hand. For example, an operational plan for a retail store may focus on customer service initiatives such as introducing new products, maintaining quality of customer service, and carrying out promotional campaigns to boost sales.
It will also identify tasks and budgets that are needed to achieve these goals. Operational plans help an organization to be more efficient and make the most of its resources.
Financial plans are created to help an organization manage its finances by estimating future revenues and expenses and setting appropriate budget guidelines. The plan will detail revenue streams, expenses, costs, and the resources and personnel needed to reach the organization’s financial goals.
Strategies to increase revenue and reduce expenses may also be featured. Financial plans are important to help ensure the organization is taking the steps necessary to remain financially viable. A financial plan should also consider external factors such as market conditions, fluctuations in interest rates, political unrest, and other external influences.
By anticipating potential problems, the organization can adjust their strategy in order to reduce any potential financial risks. Additionally, a financial plan should include risk management strategies to minimize potential losses and maximize profits.
Tactical plans are created to address the short-term activities of an organization. These plans are designed to achieve the strategic plan by outlining specific activities that need to be completed in order to achieve the larger goals.
This type of plan focuses on specific projects, initiatives, tasks, and people who will be responsible for achieving the goals. It is also used to ensure that teams are working together towards the same goals and objectives. Tactical plans are often adaptive and may need to be adjusted based on changing market conditions or feedback from customers.
Additionally, it may be necessary to adjust the plan based on changes in resources or personnel. For example, if the marketing team needs additional resources, the tactical plan can be amended to ensure the team has the capacity to meet the goals of the marketing campaign.
Project plans are used to define the activities and resources needed to complete a project. This type of plan outlines the tasks, timeline, schedule, and delivery date. It will also detail the resources required and any risks that need to be addressed.
Project plans are often divided into phases which allow the project’s progress to be monitored. By breaking down the project into manageable sections, it allows teams to identify challenges and develop solutions before the project is completed.
Project plans are also used to measure the success of the project and identify any areas where the project may need to be improved or adjusted. This type of plan is also useful for managing teams within the project as it outlines individual tasks and goals for each team member. It also allows for reporting on the project’s progress in order to ensure deadlines and budgets are met.
Contingency plans are created as a response to potential risks or uncertainty. This type of plan outlines what steps should be taken in the event of an emergency or crisis. The plan should be developed in such a way that it minimizes risks and damages to the organization.
Contingency plans may include steps to address a variety of issues such as natural disasters, political unrest, financial crisis, cyber-attacks, and other global events. The plan should identify potential risks as well as strategies to respond, mitigate, and recover from any of these events.
By having a contingency plan in place, the organization is better prepared to handle any unexpected circumstances.
Emergency plans are similar to contingency plans, but they focus on the immediate response to an emergency situation such as a natural disaster, or an active shooter or terrorist attack. This type of plan should be detailed and cover specific actions to be taken such as contacting emergency services, notifying staff and customers, and establishing communication channels.
Additionally, the plan should include steps to minimize any damages and minimize liabilities for the organization. Emergency plans should be tailored to the specific situation and should be updated regularly to ensure it remains effective in case of an emergency. Additionally, the plan should be tested and rehearsed to ensure that staff are familiar with their roles and responsibilities and are comfortable in responding quickly in a crisis.
In conclusion, understanding the importance of creating and maintaining various types of plans is essential for the success of any business or organization. Each type of plan has a specific role and can help an organization reach its objectives. Strategic plans create a long-term vision and outline the overall goals of the organization.
Operational plans address daily activities in order to reach the goals identified in the strategic plan. Financial plans help to manage the finances of an organization, while tactical plans are used to achieve the strategic plan.
Project plans outline the tasks and resources necessary to complete projects, while contingency and emergency plans are used to address potential risks. By understanding the purpose and importance of each type of plan, an organization can better manage its resources and objectives.