Planning Ahead

The planning process often involves multiple time horizons. These horizons can vary depending on the organization, its sector, and its objectives.

An organization may be aggressively developing plans to meet quarterly revenue targets while simultaneously planning to launch a new service line next year.

It’s important for leaders to create clarity around the time horizon for which they are planning and tailor the process steps accordingly.

Time Horizons

Consider the following planning horizons:

Short-term Planning—this is typically less than 1 year and focuses on immediate goals, operational improvements, and budgeting (which is a form of planning). Short-term plans are often concerned with resource allocation and action plan execution. This horizon is important for creating stability, meeting short-range targets, and rapidly responding to immediate challenges.

Medium-term Planning—this generally spans one to three years, typically involves broader involvement than short-term planning, and focuses on translating strategies into tactical plans. Medium-term plans may involve market analysis, new product development, talent management, and expansion strategies. This horizon allows organizations to align their activities to longer-term goals while also adapting to shifts in the environment.

Long-term Planning—this encompasses a period of three to ten years (or more in some sectors). It involves setting overarching goals, defining strategic direction, and formulating high-level plans to pursue those goals. Long-term plans often consider aspects such as market trends and predictions, competitive position, major capital investments, and organizational growth strategies through means such as entering new geographic markets or mergers & acquisitions. Within this planning horizon, while harder to forecast, organizations must anticipate future trends, evaluate opportunities, assess organizational capabilities (and identify gaps), and consider risks to their long-term success and viability.

Long-term planning focuses on shaping the organization’s future direction, growth, and sustainability. It includes conducting environmental scanning to identify macro trends, technological advancements, regulatory changes, and the like.

Crisis or Contingency Planning—this is focused on preparing for unexpected events or situations that may disrupt normal operations. It involves identifying potential risks, developing response strategies, and establishing protocols to mitigate the impact of crises. This horizon addresses short-term disruptions and aims to ensure business continuity and minimize losses during emergencies.

With all planning, regular monitoring, evaluation, and adjusting of strategies and plans is vital. The environment we operate within is dynamic and requires organizations to be agile and adaptable. Continuous planning involves reviewing and updating short-term, medium-term, and long-term plans as needed to ensure their continued relevance and effectiveness in light of changing circumstances.

Activities

Typically, each of these planning horizons involve different activities.

Short-term planning is often more tactical in nature and includes activities such as setting specific, achievable, and time-bound milestones, allocating resources and budget for short-term initiatives, evaluating progress and performance against aims, and adjusting tactics as needed to meet near-term objectives.

In contrast, medium-term planning aims to bridge the gap between short-term activities and long-term objectives. It involves translating overall strategic goals into actionable plans and can include activities such as: conducting market research to identify emerging trends, customer needs, and the competitive landscape; developing and refining product and service offerings; securing funding sources for medium-term initiatives; assessing organizational capabilities and identifying gaps; and planning for talent, training, and development.

Long-term planning focuses on shaping the organization’s future direction, growth, and sustainability. The types of activities that are typical in long-term planning are: conducting environmental scanning to identify macro trends, technological advancements, regulatory changes; setting long-term vision and defining strategic goals; conducting market analysis and forecasting to identify growth opportunities; developing long-term business plans; and identifying strategic partnerships and collaborations.

Crisis or contingency planning focuses on preparing for unexpected events and minimizing their impact on the organization. Many organizations fail to engage in crisis or contingency planning and are often ill-equipped to manage when a crisis hits. I encourage organizations to identify potential risks and vulnerabilities, develop response plans for scenarios, allocate resources for crisis management and recovery efforts, conduct drills and simulations to test the effectiveness of crisis plans, and review and update crisis plans based on lessons learned.

Finally, effective monitoring and evaluation aims to ensure agility and adaptability in the face of evolving circumstances and includes activities such as:

regularly monitoring key performance metrics,
analyzing data to assess progress and identify areas for improvement,
conducting periodic reviews of initiatives against milestones,
staying informed about market trends, customer feedback, and industry developments,
adjusting short-term, medium-term, and long-term plans based on feedback and changing circumstances,
implementing a feedback loop to capture lessons learned and inform future planning activities.

It’s important to note that the activities used in each planning horizon are not mutually exclusive and are often beneficial for more than one purpose. Organizations may engage in multiple planning activities simultaneously or sequentially, depending on their needs and circumstances.

The planning horizons provide a framework for organizing and prioritizing activities to ensure effective strategic management and operational excellence.

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Kathy Letendre, President and Founder of Letendre & Associates, advises organizations and leaders to create their excellence advantage.
Contact Kathy by phone or text at 802-779-4315 or via email.