- Lesson Materials Operations Plan Worksheet
- Completion time About 40 minutes
The operations section of your business plan is where you explain – in detail – you company's objectives, goals, procedures, and timeline. An operations plan is helpful for investors, but it's also helpful for you and employees because it pushes you to think about tactics and deadlines.
In the previous course, you outlined your company's strategic plan, which answers questions about your business mission. An operational plan outlines the steps you'll take to complete your business mission.
Your operations plan should be able to answer the following:
- Who – The personnel or departments who are in charge of completing specific tasks.
- What – A description of what each department is responsible for.
- Where – The information on where daily operations will be taking place.
- When –The deadlines for when the tasks and goals are to be completed.
- How much – The cost amount each department needs to complete their tasks.
In this session, we explain each item to include in your operations plan.
Goals and Objectives
The key to an operations plan is having a clear objective and goal everyone is focused on completing. In this section of your plan, you'll clearly state what your company's operational objective is.
Your operational objective is different than your company's overall objective. In Course One, you fleshed out what your strategic objective was. Your operational objective explains how you intend to complete your strategic objective.
In order to create an efficient operational objective, think SMART:
- Specific – Be clear on what you want employees to achieve.
- Measurable – Be able to quantify the goal in order to track progress.
- Attainable & Realistic – It's great to be ambitious but make sure you aren't setting your team up for failure. Create a goal that everyone is motivated to complete with the resources available.
- Timely – Provide a deadline so everyone has a date they are working towards.
Different departments will have different operational objectives. However, each department objective should help the company reach the main objective. In addition, operational objectives change; the objectives aren't intended to be permanents or long term. The timeline should be scheduled with your company's long-term goals in mind.
Let's look at the following example for a local pizza business objective:
- Strategic objective: To deliver pizza all over Eastern Massachusetts.
- Technology department operational objective: To create a mobile app by January 2017 to offer a better user experience.
- Marketing department operational objective: To increase website visitors by 50% by January 2017 by advertising on radio, top local food websites, and print ads.
- Sales department operational objective: To increase delivery sales by 30%, by targeting 3 of Massachusetts's largest counties.
Sales department operational objective: To increase delivery sales by 30%, by targeting 3 of Massachusetts's largest counties.
After you create your objectives, you have to think strategically on how you're going to meet them. In order to do this, each department (or team) needs to have all the necessary resources for the production process.
Resources you should think about include the following:
- Suppliers – do you have a supplier (or more) to help you produce your product?
- Equipment & Technology – does each department have the necessary equipment, technology and software to meet objectives? For instance, in keeping with the pizza business objective above, necessary tools might include:
- Technology team: app developing software
- Marketing team: software licenses for website analytical tools
- Sales team: headsets, phone systems or virtual phone system technology
- Cost – what is the budget for each department?
In addition to the production process, you'll also need to describe in detail your operating process. This will demonstrate to investors that you know exactly how you want your business to run on a day-to-day basis.
Items to address include:
- Location – where are employees working? Will you need additional facilities?
- Work hours – will employees have a set schedule or flexible work schedule?
- Personnel – who is in charge of making sure department tasks are completed?
Creating a timeline with milestones is important for your new business. It keeps everyone focused and is a good tracking method for efficiency. For instance, if milestones aren’t being met, you'll know that it's time to re-evaluate your production process or consider new hires.
Below are common milestones new businesses should plan for.
When you completed your Management Plan Worksheet in the previous course, you jotted down which key hires you needed right away and which could wait. Make sure you have a good idea on when you would like those key hires to happen; whether it’s after your company hits a certain revenue amount or once a certain project takes off.
Production milestones keep business on track. These milestones act as "checkpoints" for your overall department objectives. For instance, if you want to create a new app by the end of the year, product milestones you outline might include a beta roll out, testing, and various version releases.
Other product milestones to keep in mind:
- Design phase
- Product prototype phase
- Product launch
- Version release
Market milestones are important for tracking efficiency and understanding whether your operations plan is working. For instance, a possible market milestone could be reaching a certain amount of clients or customers after a new product or service is released.
A few other market milestones to consider:
- Gain a certain amount of users/clients by a certain time
- Signing partnerships
- Running a competitive analysis
- Performing a price change evaluation
Financial milestones are important for tracking business performance. It's likely that a board of directors or investors will work with you on creating financial milestones. In addition, in startups, it's common that financial milestones are calculated for 12 months.
Typical financial milestones include:
- Funding events
- Revenue and profit goals
- Transaction goals
In summary, your operations plan gives you the chance to show investors you know how you want your business to run. You know who you want to hire, where you want to work, and when you expect projects to be completed.
Download the attached worksheet and start putting your timelines and milestones together on paper.
- Lesson Materials Operations Plan Worksheet