Main difference between strategic and operational goals

Well-run small and midsize businesses typically begin their planning process with a broad mission or vision statement. While this starting point in results-based management is both necessary and challenging, it often cannot be used by management until the mission is translated into a strategic plan that is then used to guide operations.

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Business leaders benefit from understanding the difference between a strategic and an operational goal because this distinction plays a huge role in turning an overall vision into concrete, specific tasks. In this sense, the operational goal will allow many of the ideas that cross the strategic goal to be grounded, paving the way to achieve it.

The proposal for this article is to establish the main differences between strategic and operational goals to identify some key aspects to trace each one.

What are strategic goals?

Strategic goals are long-term organizational goals that help turn a mission statement from a broad vision into more specific plans and projects. They determine major benchmarks for success and are designed to be measurable, specific, and realistic translations of the mission statement that executive management can implement to guide decision-making.

Strategic goals are typically developed as part of a two- to four-year plan that identifies key strengths and weaknesses by setting out the concrete expectations that will enable the company or organization to achieve its broader-based vision or mission statement.

What are operational goals?

Operational goals are daily, weekly, or monthly project benchmarks that incorporate broader strategic goals. These operational goals, also called tactical objectives, are defined with strategic objectives in mind and provide a means for management and staff to break down a larger strategic goal into achievable tasks.

They establish short-term goals that are related to the general strategy of the company. These goals must be measurable and specific, and their purpose is to promote efforts toward the fulfillment of the strategic goals. In addition, they allow all areas to be aligned in the same direction. By drawing up a roadmap including all operational objectives, you will not only be able to carry out an organized daily work scheme but you will also contribute to the achievement of strategic goals.

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Differences between strategic and operational goals.

The most significant difference between strategic and operational goals is their time frame. Operational goals are short-term goals, while strategic objectives are long-term. Strategic and operational goals also work differently in practice, as they are often too broad to make sense as a specific set of daily tasks or weekly projects.

On the other hand, operational goals are specific and short-term enough to be considered usable in the daily allocation of time and assets. Although the strategic and operational goals are substantially different, it is important to recognize that they are closely linked.

An organization is unlikely to achieve a strategic goal if it does not effectively translate it into viable operational goals. At the same time, operational goals will lack cohesion with each other and with the company's overall mission if they are not designed to impact and promote the achievement of strategic goals.

In simpler words, strategic goals only become functional when they are translated into operational goals, and operational goals are only effective when they are designed to drive a strategic goal.

Examples of strategic and operational goals.

An example of a strategic objective is a 20 percent increase in profitability within one year, either in sales revenue or cost reduction. In turn, achieving this result requires completion of the operational objective (by area) to develop and execute an effective business strategy in conjunction with other operational goals.

As with the strategic goals, the operational goals must also be measurable and specific, although their focus is more limited since they are short-term goals whose results are expected to be more immediate. A sales goal is operational because it involves the commercial area on a day-to-day basis, even though part of its income contributes to the increase in profitability set as a strategic objective.

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In summary, the main difference between strategic and operational goals is that the first one covers the entire organization and its perspective is long-term, while the second one is outlined in each area and is short-term. The operational goal is oriented to the results that are to be achieved in a certain area, while the strategic goal sets an organizational goal, with which the operational goals must be aligned with it, contributing to its achievement.