One key element to the success of any business is its operating plan. If you have a business plan, you might be wondering why you need an operating plan. This plan is more about the actual nuts and bolts of how your business works. Your business plan was probably more conceptual, more about the theory of your business and potential. The operating plan is the practical application of production through distribution. Creating this plan might be time consuming, but once you and your team compile it, you’ll fully understand how your business operates and know all the factors that go into productivity and efficiency. Here are the components of a good operational plan:

  • Employee roles – By going over employee roles within your organization, you know how each member of the team contributes to your business. It also ensures that no two people are doing the same tasks, thereby increasing efficiency.
  • Locations – This section not only includes the locations of your business, but that of your supply chain. This helps to identify your selling potential and your distribution chain.
  • Manufacturers – In this section, you outline your agreement with your suppliers. By knowing where your supplies come from, a shareholder can easily see how reliable your organization is. It also helps you know your expenditures, which can help you identify places to increase your margins.
  • Goals – A clear declaration of business goals within the operational plan gives you information about how each manufacturer, employee, and location helps in achieving your goals. Each previous section of your plan should merge into this section to provide information about your business strategy.

Your operating plan is important to your stakeholders. It provides a reliable look at how you work on a day-to-day basis. Having this plan helps you get a handle on your operations, find ways to be more productive, and provide insight into how each person on your team contributes to your organization. Take the time to write it out and use it to be better.