In today’s business environment, clear and consistent communication enables your team to have a shared understanding of the status and direction of your product. To this end, an operating plan collects your strategic objectives in one place, allowing everyone to grasp what they need to do, and how the product will remain successful.
In this article you will learn what a product operating plan is, how it can help you achieve your objectives, and best practices for effectively implementing one within your project team.
A product operating plan is a document that outlines the strategic actions your team will take to achieve a specific goal. Most operating plans only cover a period of one to two years and serve a crucial role in the product development process. You can expect your operating plan to include budgets, resource allocation, timelines, and key performance indicators (KPIs).
The operating plan moves away from the big picture vantage point of vision and strategy, towards a more granular and tactical plan for the execution of product strategy.
The operating plan helps product managers assess the impact of changing business priorities and customer needs on the product roadmap. Product managers can use the operating plan as a tool to factor in and communicate changes across the organization, allowing the product development process to remain agile.
An operating plan seeks to outline your product strategy to guide decisions and deliver on your stated goals. The operating plan comprises of the following:
To better understand what goes into an effective operating plan we will breakdown each step and discuss best practices for approaching the following:
The product goals derive from the product vision and strategy. To define these you should:
In order to align with the product strategy and vision, one should:
Identifying and tracking the right metrics is key to the success of any product and therefore the product team. Below are the steps to identify and track the right product metrics:
A product operating plan provides you with an instrument to ensure your product will deliver on the stated vision, strategy, and goals. However, the success of your operating plan depends upon your ability to manage and monitor it throughout the course of the product lifecycle. Proper management of the operating plan includes:
You can measure the success of a product operating plan by developing product metrics which allow you to quantify and track the progress of the plan. Also, having a visual representation of the metrics allows you to make better interpretations and display your progress visually.
Product metrics let you determine whether a product operates to plan or not. When your team performs as planned, there’s no need for further adjustment.
However, when the team misses, or finds themselves falling short of the agreed upon target, you need to take corrective action and pivot course.
Here, corrective action could come from aligning or augmenting resources, changing the budget allocation, or moving around the tasks based on the dependencies in the plan.
Because the operating plan has many moving parts and stakeholders involved, you need to ensure that you have the buy-in from all the stakeholders involved.
The best practices for ensuring stakeholder buy-in include:
As with anything, challenges will arise while working with a product operating plan. Rather than allowing these to grow into a bigger problem, you should work to mitigate following issues before they impact the health of your product:
Similar to the product manager role, the product operations or operating plan team has to work without direct authority, or people management responsibilities. You should be aware of this while trying to push the team towards your deliverables and use the operating plan as an influencing tool.
Communication is key to maintaining the flow of delivery across the product lifecycle. Insufficient communication or communication gaps can result in teams and stakeholders missing out on necessary changes or tasks. These knowledge gaps could result in misalignment, which impacts the product delivery timelines, as well as the scope.
Since the product operations team is a level above the product management, the product operations team may have limited visibility of the roadmap, customer needs, or the technical architecture/design information.
Below is an example of an operating plan that provides an illustration of what the process might look like for you. The operating plan focuses on two main steps:
To provide a mobile based shopping experience for a retail grocery store shopper (in addition to in store shopping which is currently available)
To help you get started on your own operating plan, use this template. The template includes all the key parameters that need to be tracked and mobilized in order to make the product operating plan successful.
The product operating plan is a key component of the product development and delivery lifecycle. Having a product operating plan allows you to outline the tactical steps and ensure successful product delivery and tracking of your product.
The product operating plan also fosters alignment with the vision, stakeholder buy-in, and sets the product and the product organization up for success.
Featured image source: IconScout
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