Organizational planning: 5 steps to success

Companies that lack detailed organizational plans are planning to fail. You might think that “winging it” is a rarity, but this couldn’t be further from the truth – a survey from Bridges Consultancy found that only 48% of businesses achieve planning success.

So, how can you give your business the best possible chance of reaching its goals?

You need to create a solid organizational plan. 

Organizational planning enables you to enact your business strategy, clearly communicate objectives to every team member, and ensure you have a well-defined process. It also helps you account for contingencies should the worst happen.

Read on to learn how to elevate your company with an organizational plan and how skills testing can help you along the way.

What is organizational planning? 

Organizational planning is a map of your complex, long-term business objectives. It helps your organization define success, prepare for the future, and attain goals in shifting market conditions. An organizational plan in business planning also guides change management, organizational structure, and initiatives like company-wide restructuring.

However, nobody likes complicated plans. Good planning involves setting goals that are simple, measurable, and attainable – and involve contingency planning to mitigate risk.

In plain English, an organizational plan prevents your team from wandering aimlessly, unsure of roles, responsibilities, or expectations. 

Careful organizational planning avoids these problems. But what kind of planning is needed to steer the company in the right direction? 

The importance of organizational planning

To begin, a solid organizational plan improves your company’s performance and boosts your financial figures. Research backs us up by proving that businesses with strong plans are 16% more likely to succeed than their peers.

Organizational plans also clarify the roles and responsibilities of employees in your organization. 

For example, both your sales team and your support team strive to increase business revenue. With a strategic plan, everyone is clear that the sales team's role is to convert new customers, while the support team is responsible for keeping customers happy and upselling more profitable services.

Finally, a business organizational plan empowers your company to stay flexible with shifting markets and global disruption. You’re more resilient thanks to contingency plans, which enable you to follow a defined “plan B” when it comes to adopting new technology, launching innovative products and services, and filling new roles.

What are the 4 types of organizational planning?

Okay, so what does an effective organizational plan look like? 

Let’s cover the four phases of organizational planning to give you a better idea.

1. Strategic planning

Every great business idea starts with a carefully considered strategy. 

Organizational strategic planning involves creating broad, long-term goals for your company. These goals should cover the long term, say the next five to ten years. An example of a strategic goal would be to “become the leading brand in terms of sales and brand recognition in the electronic consumer goods sector within five years.”

Strategy is usually overseen by senior management and C-level executives. A strategic plan rights the ship, setting the vision that the entire company needs to follow to achieve success over the long term.

2. Tactical planning

Next, you need to transform your high-level strategy into tactical steps that empower your organization to reach its long-term goals.

Your strategy consists of multiple tactical plans, each of which typically takes up to a year to complete. Middle managers generally establish objectives and guide their teams to accomplish them. 

Senior management uses metrics and key performance indicators (KPIs) to track progress and ensure that the executive tactical plans are inching the company closer to its final goal.

3. Operational planning

Operational planning sets up a roadmap at the departmental or team-specific level. These are the daily and monthly objectives to be checked off by finance, marketing, IT, sales, and other departments. 

Using the example strategic goal from above, an operational goal for marketing could be to “boost brand awareness by 0.5% each month.”

4. Contingency planning

Even the best plans can be derailed by unexpected market forces (e.g., a competitor launching an innovative new service) or a force majeure (e.g. a global war or pandemic.

This is why you must always prepare your organization to deal with uncertainty and the unknown with contingency planning.

Including meticulous risk management as part of your organizational plan helps you rise above your competitors when times get tough. It gives your people structure and processes to follow when the unexpected strikes.

4 organizational plan examples

Now that we’ve covered the definition of organizational plans and the four key types, let’s spend a few minutes examining four examples of organizational planning in action.

1. Workforce development planning

During workforce development planning, you identify and address current and future staffing needs. You typically implement talent planning strategies to enhance your employees’ skills, knowledge, and abilities to stay relevant in your industry and niche.

It begins by assessing the capabilities of your current workforce.

This translates into creating a comprehensive talent map for all employees, including your C-level team members. The goal is to understand your talent baseline, identify skills gaps, determine what kind of training workers require to acquire new skills, and whether you require external hires to meet your workforce needs.

But what’s the best way to assess the skills of your workers? 

We highly recommend that you use a talent assessment tool, like our test library of more than 400 candidate-friendly skills and personality tests. This is a modern, efficient, and bias-free way to measure your people’s skills and pinpoint strengths and weaknesses within your workforce.

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Once you’ve established a skills baseline for your organization, it’s time to create two plans: a learning and development plan and a talent acquisition plan.

According to Emeritus, the value of a skill is cut in half about every four years, and the average skill half-life is constantly decreasing. Continuously upskilling your workforce and hiring top external talent helps you stay relevant, successful, and profitable.

Last but not least, you need to prepare skilled employees to jump into crucial vacant roles in the organization. This is a pivotal part of contingency planning because it gives you the ability to quickly fill roles that make or break your company. 

For example, if one of your executives suddenly leaves the business, you won’t need to panic and rush hiring. You can rely on your temporary (or permanent) in-house replacement thanks to your succession planning strategy.

2. Financial planning

Your organization can’t get far without a robust financial plan. Managing debt and reinvesting profits are two of the best ways to ensure your business is sustainable. 

A financial plan assesses and estimates your future revenue, profit margins, and expected expenses, including employee salaries. It also helps you research and evaluate strategic investments to strengthen your business and drive more revenue.

Financial analysts create these plans, so seek their recommendations about financial performance and how to optimize your overall decision-making processes.

3. Products and services planning

Your business wants to make its products and services more appealing to target audiences. However, to do so effectively, you need to be able to recognize gaps in the market and strategically create schemes that set your business apart from competitors. 

You should start by analyzing how your products and services are performing in your respective markets. Are they doing well, or are they struggling? 

Markets and trends also change, which means you need to be aware that you might need to adapt your products regularly to best serve your customers.

Once you determine the size of the gap, you can determine whether:

1. Your product is well-suited to your audience and doesn’t need updates for now

2. You need to modify your offering to better serve customer demands

3. You must innovate and launch another product or service

Developing an updated (or new) product or service requires extensive testing to achieve a solid product-market fit, so make sure to include this in your organization plan.

4. Expansion planning

A good business is always focused on growth. Hence, expansion plans identify growth opportunities and roadblocks your organization might face in its industry, helping you develop marketing strategies or other initiatives to take advantage of those opportunities and overcome the obstacles.

Expansions require hiring more people, using different approaches, and sometimes even developing new products and services. All of this requires a detailed business plan. 

How to create an organizational plan: The 5 steps of organizational planning

You’re ready to start, so here are 5 steps to get you on the right track with organizational strategic planning:

1. Come up with a big picture strategic plan

2. Transform the strategic plan into practical steps

3. Plan your day-to-day operations

4. Execute daily operations and monitor performance

5. Adjust organizational planning

1. Come up with a strategic plan

A strategic plan involves business executives defining the company’s direction for a set period of time, usually 5 to 10 years, and is closely related to the organization’s mission. 

With a strategic plan, the company creates a defined qualitative goal such as “Become the industry leader in the Chicago real estate market” or “Create the most diverse workforce in our niche.” 

Data plays an integral role because reliable information guides you in making strategic decisions based on previous performance and market indicators. 

Ask yourself questions like “Have you tried to achieve a similar objective before? What were the results like?” 

Then, examine existing data and trends and conduct a SWOT analysis (strengths, weaknesses, opportunities, and threats) to determine the path to success.

2. Transform the strategic plan into practical steps

With a tactical plan, you set clear milestones, checkpoints, and metrics that identify whether the company is going in the right direction. 

In the previous section, we mentioned two examples: 

• Become the industry leader

• Create the most diverse workforce in your niche

Both of these business goals are strategic and qualitative. To become an industry leader, you could make a tactical goal of creating and launching three new products in the next year. A long-term objective would be to increase your market share by 25%.

A tactical plan to create a diverse workforce would be to implement skills testing for the entire team within six months to reduce unconscious bias and increase overall diversity by 20% over the next year.

3. Plan your day-to-day operations

Now that we have concrete goals set, it’s time to plan out the roadmap for everyday operations and how to achieve them in your team’s workflows.

Let’s return to our previous example of an organizational plan that aims to create a highly diverse workforce. 

Here, we create a template for the specific tasks that can achieve the goal of increasing overall diversity by 20% in one year:

• Tactical goal 1: In the next six months, implement tools and processes that empower objective and fair hiring decisions

  • Find platforms that meet your requirements (for example, for skills testing, try out TestGorilla)

  • Switch to a structured interview process

  • Implement and assess the impact of the changes and talent assessments

For example, you could use this talent assessment test to assess human resource professionals and find staff committed to achieving diversity objectives:

For more example questions, see our full test preview.

• Tactical goal 2: Increase the number of women in the workforce by 20%

  • Use gender-neutral language when writing job descriptions

  • Make benefits relevant to women a key part of your employer branding 

  • Share salary and benefits information openly and develop a skills-based compensation system

  • Make sure your company is able to support moms at work

• Tactical goal 3: Create a diverse management team by increasing the presence of underrepresented groups by 10%

  • Create a leadership program that focuses on upskilling underrepresented groups and helping them gain the essential managerial skills

  • Rework your onboarding process to support workers with non-traditional backgrounds

  • Create a bias-free employee promotion policy

Once you have set these tasks, you need to create a roadmap with concrete timelines, task owners, and measurable KPIs.

4. Execute daily operations and monitor performance

Once your overall organizational plan is set, it’s time to implement all the planning from the previous steps to enable your organization to reach its strategic goals.

No matter how strong your strategic, tactical, and operational plans are, even the best plans fail if the execution isn’t right. 

We suggest you:

• Monitor relevant analytics metrics to track targets and performance and ensure that employees are executing the plan correctly and have the right tools and support

• Set benchmarks based on past project performance and available industry insights

• Use communication and collaboration tools to stay in touch with managers and team leaders

• Keep key stakeholders informed if performance is lagging behind expectations

• Implement contingency plans if you start falling behind

5. Adjust organizational planning

The business world rarely goes entirely to plan (hence the importance of organizational planning and contingency measures). 

What should you do if you’re struggling to stay on track to reach your organization’s goals?

A successful business plan is continuously monitored and adapted based on the real world. You need to review, change, and iterate each level of your organizational plan to ensure your actions remain aligned with your strategic objectives. 

For example, if you’re struggling to attract diverse managerial applicants, you could update your action plan to include a budget for attending local industry events for underrepresented groups and networking with top talent.

Organizational planning is the key to success

No one succeeds 100% of the time, but by creating an organizational plan, you set yourself up for success and create a blueprint for building an all-star team.

No matter what the future brings, you’ll be able to respond and guide every area of your business, from product planning to workforce development. 

Speaking of workforce development, TestGorilla is here for all your employee planning needs thanks to our library of 400+ assessments that help you implement better talent acquisition and retention strategies.

Sign up for a demo or try our free forever plan to discover what TestGorilla can do for your organizational plan today!

Organization plan FAQs

To conclude this article, we answer three of the most commonly asked questions about organizational planning.

What purpose does an organizational plan serve?

An organizational plan outlines a company’s goals and objectives and how it intends to manage change and uncertainty. Organizational planning ensures companies make decisions that align with their strategic vision. 

At the granular level, it gives managers a blueprint for determining how each team member spends their time and how their effort helps the business achieve its overarching goals. 

What are the three levels of organizational planning?

The three levels of organizational planning are strategic, tactical, and operational. Strategic planning deals with long-term goals, while tactical planning breaks these down into achievable short-term goals. Operational planning revolves around the daily and monthly objectives for each department, linking them back to the longer-term goals.

However, there’s another critical level of organizational planning: contingency planning. Scroll up to the "What are the 4 types of organizational planning?" section to find out more.

What are the elements of the organizational planning process?

• Develop an organizational strategic plan

• Translate the strategic plan into shorter, tactical steps

• Plan daily operations, activities, and measurable for departments and individual teams

• Execute the strategy and continuously monitor the plan's progress

• Make necessary adjustments