Risk Analysis, Operational Planning, and Strategic Plan Relationship

This report provides a comprehensive analysis of risk analysis techniques within the context of operational planning. It begins by evaluating two specific risk analysis techniques: risk probability and impact assessment, and expert judgment, highlighting their applications and importance in project management, particularly within an educational setting. The report then details the key components of an operational plan, including clear objectives, activities, quality standards, key targets, risk management plans, staffing and resource requirements, implementation timetables, and a process for monitoring progress. It emphasizes the significance of each component in ensuring the efficient and effective execution of plans. Finally, the report analyzes the relationship between strategic and operational plans, underscoring how operational plans, developed by department heads, feed into and support the broader strategic goals set by the leadership team, ensuring organizational alignment and success. The report concludes by stressing the importance of continuous monitoring and adaptation to ensure the effectiveness of operational plans.

1.1 Evaluate the use of risk analysis techniques in operational planning
Risk analysis is a technique that helps you identify and overcome new problems. To conduct a risk
analysis it is important to first identify risk. Risk analysis should be used for instance when you are
planning a new project. There can be two different types of risk analysis techniques. Qualitative and
quantitative methods are both used. For the day to day running of an organisation, qualitative
methods are more efficient as they are designed to monitor day to day risk that businesses can
face. The purpose of risk analysis is therefore to evaluate whether or not the risk involved in a
project is acceptable and whether the outcomes are worth the risk.
Two risk analysis techniques will be evaluated specifically linked to the context of a school. The first
risk analysis technique is risk probability and impact assessment. Firstly impact in probability are
both essential considerations in risk analysis. This technique considers the impact versus the
probability of certain risks on a projects and aims to assess whether the impact is considerable or
not. Indeed, most activities that businesses initiate involve a certain degree of risk. This is due to the
fact that there are some unknowns and therefore outcomes of projects are not always easily
predicted. Hence risk management should be an important consideration when an organisation
plans a new activity to ensure the success of the project. ‘A commonly used method for risk
assessment is preparing descriptive scales to rank risk in terms of probability and impact’
(Thorhallsdottir). This method usually involves an impact and probability matrix which helps to
prioritise risk.
The second risk analysis technique is expert judgement. This technique is based on expertise of
groups or people within a specific industry. This technique can be used by groups or individuals from
within an organisation or they can be brought in through external consultations. “Expert judgement
is used for situations which require recourse to expert judgement by completing, validating,
interpreting and integrating existing data, assessing the impact of a change, predicting the
occurrence of future events and the consequences of indecision, determining the present state of
knowledge in one field, providing the elements needed for decision making in the presence of
several options.” (Sotille, 2016). Therefore expert judgement is used when trying to assess the
repercussions of specific activities on the functioning of the organisation. Planning appropriately
and identifying risks are an essential part of project management.
To conclude, It is essential to assess the level of risk involved in a project during operational
planning in order to determine what could impact on the success of the project. Various techniques
are used in different situations. They are an essential part of planning a project and responsibility
for risks should be assigned to specific individuals so that they can keep track of any new
developments and preempt any issues that may arise.
1.2 Explain the components of an operational plan
An operational plan is part of an organisation’s strategic plan, and it sets out the work to be carried
out and the workflow from initial input to end results, including all the resources that will be
needed.
It also sets out how risks will be dealt with and how the achievements of the plan will be sustained.
According to ‘Ultimate Workbook Develop and Implement an Operational Plan
(M&L 27)’, key components of an operational plan include:
 Clear objectives
In order for an organisation to run efficiently, it needs to have clear objectives. The first step for that
is the creation of a strategic plan. Once this has been done, operational plans are designed to set

out the steps required to implement the company’s goals and objectives. The team needs to be
aware of the objectives and they need to be “major, measureable objectives” (Klinkert, 2014). This
is important for employees to see the bigger picture and understand the direction of their work and
to motivate them. It helps focus employees and avoids wasting time. For objectives to be effective,
they should be SMART: specific (narrow enough so that they are easily met), measurable (success of
outcomes can be observed through analysis of data), attainable (they are likely to be met), relevant
(they align with the broader picture), and time based (tied to a schedule to help prioritise work). An
operational plan should address the following questions: where are we now?, where do we want to
be?, what do we need to do to get there?, how do we measure outcomes? In the context of
education, clear objectives can relate to areas of teaching and learning, and are essential for each
department to be aware of in order for them to work collectively towards these objectives.
 Activities to be delivered
Usually the responsibility for the creation of operational plans lies with department heads or project
leaders, who have to determine the activities needed to achieve the goals of the organisation. Once
the objectives of the operational plan have been laid out, it is important to identify which activities
will be delivered and by whom. This means setting out the roles and responsibilities of each member
of the team. Although the success of operational plans are important for individual departments, it is
also going to have an impact on the success of the strategic plan. Therefore, middle leaders in charge
of operational plans need to carefully consider what activities need to happen to ensure the success
of the project. Furthermore, as middle leaders know their team well, they should consider who is
best placed within their department to oversee individual activities.
 Quality standards
An essential part of an operational plan is ensuring the quality standards are met. A quality plan is
needed to specify standards, specifications, allocation of responsibilities, and ways of testing and
inspecting the quality of the work. “A quality control plan may specify product tolerances, testing
parameters, and acceptance criteria” (American Society for Quality). A quality plan includes three
elements: quality control, quality assurance, and quality management. “Effective quality
assurance is proactive. It aims to prevent defects before they occur through process design. QC is
reactive and exists to identify defects after they have happened.” (Stanton, 2021). The entire team
should be involved in quality assurance, but only single individuals are required for quality control.
Quality control plans usually contain information on: Team members involved, industry standards
that need to be met, testing parameters, acceptance criteria, a feedback mechanism, corrective
action and preventive action, etc. (ASQ). In the context of education, Operational plans should be
aligned to quality standards of teaching and learning, and professional standards. The bodies who
set these standards can be the local authority or the Department for Education.
 Key targets and key performance indicators
Collins defines performance indicator as “a quantitative or qualitative measurement, or any
other criterion, by which the performance, efficiency, achievement, etc of a person or organization
can be assessed, often by comparison with an agreed standard or target“ (Collins). Therefore, key
performance indicators are measures used to assess the effectiveness of the project. A useful way of
doing this is by using leading indicators, which indicate what can be expected in the future. Hyun
states that “leading indicators allow the team to make adjustments before it's too late (2021).
Leading indicators are used by businesses to assess “how future economic conditions may affect
markets and revenue” (Investopedia, 2021). They are often used in contrast to lagging indicators,
that usually produce evidence when it is too late for any changes to occur. In an educational setting,
KPIs can be tracking data on pupils that reflects their progress, attitudes to learning, End of key
stage data, and/or exam results.

 Risk management plans
Risk Management plans are important to identify any potential risks involved in any project.” We
encounter and plan for risks in every part of our lives, from buying disaster insurance to practicing an
evacuation plan” (Workfront). The purpose of a risk management plan is to ensure the success have
a project by being prepared for any potential risk. Collins states that “if something that you do is
a risk, it might have unpleasant or undesirable results” (Collins). Therefore it is not something that
has already happened but something that could potentially happen in the future. When creating a
risk management plan, the first step is to identify the types of risks involved and their consequences
on the project outcome. It is also important to assess the level of urgency of this risk and the
probability of it occurring in order to rank risks and produce action plans to mitigate their
consequences. According to Workfront, there are three types of risks: a known risk, which has
already been identified by the team, an unknown risk which arises from the project at a later date,
and unknowable risks, which no one can anticipate. When designing a risk management plan, it is
important to evaluate potential risks and to give ownership of these risks to individuals who will be
in charge of reviewing the response. It is also important to continue checking on the progress of the
project and continually reviewing the organisation’s response to risk as new risks may arise.
 Staffing and resource (including budget) requirements
When planning a project, it is important to spend time considering who will be in charge of which
tasks and who else might need to be involved. This helps the team be clear on roles and
responsibilities of each member and gives accountability. Furthermore, Isaac states that “thought
has to be given to all possible costs that might be incurred if a strategy is implemented”. This should
be detailed and try to include all costs involved, ranging from photocopying/printing, phone calls,
postage, equipment, promotional materials, advertising, etc. it is essential to consider staffing and
resources when designing an operational plan, as spending may need to come out of department’s
budgets, and new jobs may need to be created.
 Implementation timetables
In the initial stages of an operational plan, consideration should be given to timeframes in order to
ensure the success of the project. It is important to set a clear timetable “to give order to the great
many tasks that need to be done” (Isaac). In an operational plan, the timeframes can be on a
“weekly, monthly, quarterly, or yearly basis” (Hyun, 2021). This is different to strategic plans, that
set out timeframes over longer periods of time, for instance the next five years. In the context of
education, setting timetables is essential, as pupils are given specific timeframes for examinations
and therefore any objectives of an operational plan are time bound.
 A process for monitoring progress
Once the operational plan has been clearly mapped out, it is essential to create a mechanism to
monitor the progress of the plan. The outcomes then need to be reported back to management, and
the whole process reviewed in order to be adjusted to be more fit for purpose if needed. This
process is important to hold the department to account. In schools, monitoring systems already
exist. For instance, tracking is an important part of schools’ systems, and indicates pupil progress,
which is an effective mechanism to assess pupil outcomes and to predict future results.
1.3 Analyse the relationship between strategic and operational plans
Strategic plans are the responsibility of the leadership team, and usually set out the direction of the
whole organisation. In contrast, operational plans are usually developed by department heads or
middle leaders, and detail the work of individual teams. Operational plans should feed into strategic
plans, and should aim to have similar objectives.

A strategic plan is “a document that establishes the direction of an organization” (McCarthy, 2020).
According to McCarthy, a strategic plan should have seven elements: a vision statement, a mission
statement, core values, SWOT analysis, long term goals, yearly objectives, and action plans. When
setting the vision and mission statement, managers should think about what the business should
look like in an ideal situation. The vision “is important to strategic planning because it tells you and
your employees the direction your business is headed in” (Vo, 2021). Therefore, the vision should
be the overarching goal towards which the organisation aims to work. A mission statement is more
specific and contains more detail. “It explains to people outside of your company why your business
exists” (Vo, 2021). The long term goals and the yearly objectives should be in keeping with the
mission and vision statements. The purpose of action plans is to identify steps the business will take
to achieve its goals.
There are some similarities between strategic and operational plans. Indeed, the goals of the
strategic and the operational plans should be aligned. Strategic plans should detail the companywide
vision, and operational plans detail the steps that each department will take in order to fulfil the
requirements of the strategic plan. Furthermore the way each plan is designed is somewhat
comparable, as they both need clear objectives, action plans, and some form of monitoring process.
On the other hand, there are some key differences between the two plans. The first difference is the
scope of each plan. As Sedmak (2019) states, “a strong strategic plan serves as a roadmap to follow
from where you are now, to where you want to be. An operational plan, however, focuses in on the
micro, or the day-to-day and weekly actions that can help your people achieve organizational goals”.
Furthermore, the time frame required for the execution of each plan differs. Generally, operational
plans will focus on the shorter term, and strategic plans lay out the direction of the organisation for
a longer period of time. “Typically, middle-management manages the operational plan, while the
strategic plan is executed from the top, down” (Weber, 2019). Therefore the timeframes are very
different with these two plans.
In an educational setting, the strategic plan is generally called school action plan, and operational
plans are the department action plans (DAP). Alongside these, schools usually have school
improvement plans (SIP), department improvement plans (DIP), and department evaluation reviews
(DER). The purpose of a DER is to review the outcomes from the past year, whereas a DIP or DAP
focuses on how to improve results based on the review of the past year. All these operational plans
need to be aligned with strategic plans of the school.
In conclusion, both strategic plans and operational plans are essential in the running of an
organisation, as they both have important roles in determining the course of work for staff
members. It is important to have a strong strategic plan in order for operational plans to be
designed. This helps team members understand the organisation’s strategic direction, thus making
it easier for them to complete their daily tasks and and see how this supports the organisation’s
goals.
1.4 Evaluate the use of planning tools and techniques in the operational planning process
In order to effectively plan and ensure outcomes are met, it is important to use effective tools and
techniques. There is a wide range of techniques used in different situations. Here we will look at two
of those techniques and evaluate their effectiveness.
The first tool is GANTT charts. This tool is useful for planning out activities to be conducted and
setting a timeframe for completion. “a Gantt chart shows you what has to be done (the activities)
and when (the schedule)” (Gantt). The concept originates from Karol Adamiecki, a Polish engineer

and it sets out each task needed for a project along a timeline. According to Ramos (2021), the
benefits of Gantt chart are that “ it provides a high level overview, it improves efficiency and helps
manage resources, it allows for better tracking, and boosts productivity”. Indeed, gantt charts show
a timeline of activities which helps managers to visualise what needs to be done to achieve goals in
the short- and long-term. However there are certain limitations to this tool, the first one being that
setting up these charts can be “ time consuming”, and “ they can become complex and confusing”
(Ramos, 2021). The use of software can help to make this tool more useful and less time consuming
to create. Furthermore, gantt charts layout a list of tasks to be completed but does not prioritise
which are more important. In addition, gantt charts do not show task dependencies, meaning that
they do not highlight which tasks depend on and other tasks being completed first.
The second tool is project evaluation and review technique (PERT). This techniques puts all activities
into a chart or diagram, following a sequence. This tool is more appropriate for bigger projects,
“with one-of-a-kind projects, especially those involving unpredictable activities or a large component
of research and development, and it was designed to help generate highly accurate time estimates”
(Eby, 2016). PERT uses three different time scales: shortest possible time, the most likely time, and
the longest possible time. The results of this tool is much more accurate than with other models.
This model originates from the Cold War, when the aim was to deliver results quickly. On the one
hand this project is efficient as it can be used to “estimate a completion date, gauge risk when there
is a drop dead date, find where you have flexibility, and improve scheduling of tasks” (Eby, 2016).
Indeed this model is useful, as many people tend to underestimate the amount of time needed for
completion of a given project. This model therefore helps give a more realistic timeframe for
completion of work. In addition, this tool will hep “in improving the planning and the decision-
making capabilities of the project team” (The Engineering Community). Therefore, this technique
helps departments collaborate effectively. However on the other hand, there are some
disadvantages to using this model. For instance, it can be unreliable due to subjectivity of the person
using the tool. Furthermore, it is quite time consuming to maintain (Eby, 2016). Another
disadvantage, is that it can be difficult to predict outcomes, which could lead to failure of the project
if decisions have been taken based on inaccurate data (The Engineering Community).
1.5 Explain how to carry out a cost-benefit analysis
A cost benefit analysis can be defined as “the process of comparing the projected or estimated costs
and benefits (or opportunities) associated with a project decision to determine whether it makes
sense from a business perspective” (Stobierski, 2019). Therefore a cost benefit analysis weighs up
the costs involved in a project against the potential benefits, and determines whether the project is
worth going ahead with or not. If the projected benefits are considerable, then the project is worth
running. On the contrary, if the costs outweigh the benefits, then the company needs to reconsider
its decision to run the project.

According to Stobierski, there are four steps in carrying out a cost benefit analysis: firstly,
businesses need to establish a framework for their analysis. This means “Identify the goals and
objectives you’re trying to address with the proposal” (2019). The second step is to identify the
costs and the benefits. To do this, direct costs should be considered first. These are expenses such as
labour, materials, production. There may also be some indirect costs attached to the project, and
some intangible costs that are hard to measure. Benefits can also be direct or indirect, for instance a
direct benefit of a project might be increased sales of a product, and an indirect benefits might be
raising awareness of the brand. There can also be intangible benefits to a project, for instance closer
collaboration between departments, staff wellbeing, etc. The third step in the process of carrying
out the cost benefit analysis is to “Assign a Dollar Amount or Value to Each Cost and Benefit”
(Stobierski, 2019). This will allow easy comparison between costs and benefits. Some costs and
benefits may not be easily quantifiable, especially indirect and intangible ones. The final step in the
process is to compare the value of the benefits versus the costs.
Once the cost analysis benefits has been carried out, the business will want to look at whether the
costs are worth the benefits, in which case the team can go ahead with the project. If however, the
costs outweigh the benefits, it is worth looking at alternative methods and trying to identify areas
where costs can be cut in order to achieve the aims and objectives of the project.

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