The more detailed and comprehensive the plan, the easier it is to implement. The key to understanding a strategic plan hinges on the ability to understand strategic planning terms. Many of these terms are familiar to most business people and can be understood readily. For a deeper dive into these terms, see my related article on Becker’s Hospital Review, Do You Know Your Strategic Planning Terminology?
Businesses, and people, should have goals. The basic goal of any business is to be profitable, but the goals within a strategy development process should be more detailed. Goals, which sits atop the hierarchy of strategic planning terms, may include details like the introduction of new products, gross sales figures, or profit levels. Goals can be non-monetary. A business plan may include increasing reliance on green power or adding more minority staff. These goals can be somewhat general in nature.
An objective is a measurable target that moves the business towards its goals and is, arguably, the most important of all the strategic planning terms. For example, if the goal is to be more a more responsible energy user, then an objective might be to purchase 20 percent of electricity from renewable sources. Objectives can be ranked in importance, which can help the business prioritize the steps necessary to meet the goals. An easy test to ensure your objectives are, in fact, objectives, is to state them in a sentence that answers the questions of how much, by when? For instance, “Increase electricity purchased from renewable sources from 10% to 20% by December 31. If your objective begins with the verbs increase or decrease and answers the questions of how much, by when, then you likely have a very strong objective.
The term strategy, as used in strategic planning terms, is the action plan that is designed to meet the objectives. For instance, a company may have a goal of becoming an ethnically diverse workforce. An objective for this goal may be to increase the percent of management-level employees who are African-American. Strategies could then include advertising in publications aimed at this market segment, recruitment initiatives linked to colleges and universities that are predominantly African-American, or the development of career ladders for African-American employees. All of these are strategies that could help achieve the objective to ultimately fulfill the goal.
Strategy is long-term planning. Tactics are a much shorter look at the planning process and is the anchor for strategic planning terms. Tactics break down the strategies into a detailed action plan. For instance, if we wanted to implement the strategy to advertise in African-American publications, our tactics might include researching potential publications, developing and testing advertisements, developing a media calendar, placing the media buy with selected publications, and monitoring results. All of these tactics, like the strategy, are assigned to the individuals most capable of completing the assignment with firm due dates.
The University of North Carolina-Wilmington has available a nice strategic planning glossary cheat sheet available for download here.