As the Robert Burns saying goes, “The best-laid plans of mice and men often go awry.” While the adage aptly cautions against an expectation of smooth success, it fails to acknowledge why we need plans in the first place: to serve as a North Star, guiding action to reach a desired outcome. Read on to learn how you can create an effective action plan for your company.
What is an action plan?
An action plan is a detailed step-by-step outline for achieving a specific goal. In business, action plans encompass workflow, process, budget, resources, and timelines.
Action plans keep both teams and individuals organized and on track. They’re a go-to for project managers and an essential tool for managers and founders. They are often used for strategic planning but can also help improve individual performance, structure professional development, and drive business key performance indicators (KPIs).
Action plan vs. project plan
While action plans and project plans share commonalities—e.g., tasks, resources, and timelines—there are several key differences.
An action plan guides how your company plans to complete a specific goal. It serves as a framework to execute a project plan and is typically linear, with sequential tasks that lead to a final outcome. The action plan outlines how teams will work to achieve objectives and helps you organize resources, responsibilities, and deadlines.
A project plan is more granular than an action plan and details all the components of a project from start to finish. These components include in-depth details on scope, risk management, stakeholder communication, and quality assurance. A project plan may involve multiple stages or phases and helps comprehensively guide large, complicated, and long-term projects.
Action plans and project plans work in tandem to ensure a job gets done. An action plan functions at a higher level than a project plan and can encompass multiple project plans that ladder up to a major business goal or objective.
For example, say your ecommerce business needs to increase its profit margin on a particular product to make it economical. An action plan might outline two key initiatives to support this goal: increasing efficiency in production and reducing customer acquisition cost (CAC). Each initiative will entail various projects, so you can use project plans that outline the details, such as individual task assignments, stakeholder approval schedules, and marketing channels.
How to create an action plan
- Define your goals and objectives
- Determine and allocate resources
- Outline your steps
- Assign ownership
- Establish a timeline and set deadlines
- Create documentation for your action plan
- Monitor your progress
- Revise your plan as needed
Developing a business action plan involves the following steps:
1. Define your goals and objectives
Every action plan needs clear and actionable goals.
Before writing your action plan, determine your specific goals and objectives. Determine if your goal is short term or long term and if it’s a financial, growth, or operational goal. Tie your goals to KPIs, and ensure they support your overall business strategy. Keep them tangible by making them SMART goals: specific, measurable, attainable, relevant, and timely.
2. Determine and allocate resources
The strongest plan can fall apart if you fail to consider resourcing. To get an action plan off the ground, determine the money, staff, and other assets you need.
Set an appropriate budget to meet your goals by calculating your costs, including employee time, vendors, materials, and any other hard costs. Lay out which resources you already have, what you need to acquire, and how you plan to manage them.
3. Outline your steps
After you set your project goals and resources, outline a list of steps your team will need to complete. Break your main goal into smaller objectives, making each step specific, actionable, and attainable. Consider any dependencies between the steps and ensure they all clearly ladder up to your larger goal.
4. Assign ownership
An action plan is only as good as the team that supports it. Delegate specific tasks to team members who are best qualified to complete them. Ensure they have the information and resources they need to deliver on schedule. Use tools like RACI charts to clearly visualize who is the person responsible, accountable, consulted, and informed for each step of the plan.
5. Establish a timeline and set deadlines
Determine the action plan timeline by setting deadlines and end dates for phases of work. Work backward from your final deadline and identify key milestones along the way. Be mindful and realistic when setting deadlines by properly considering how much time each task may take.
6. Create documentation for your action plan
Once you have all the pieces of your action plan, put it together in a cohesive report. You might build it in a productivity app or use a well-known format like a Kanban board or Gantt chart. You can also use a free action plan template to help structure and format your report.
7. Monitor progress
Ensuring an action plan’s efficacy is vital—or you risk becoming the “mice and men” whose plans go awry.
Track progress on the plan’s timeline regularly and flag if anything is running behind—before it has a ripple effect across the entire plan. Keep tabs on the budget as well. Consider holding daily or weekly check-in meetings with the team(s) executing the plan, and circulate regular updates in writing.
8. Revise your plan as needed
Good action plans are malleable. Unrealistic, aspirational plans can do more harm than good. If a piece of the plan isn’t working, revisit each of the above steps to understand if you lack resources, clarity, documentation, or something unexpected. Revise the problem areas and make necessary adjustments in collaboration with your team members to ensure success.
Action plan FAQ
What is an action plan example?
Imagine you run an online home goods store struggling to keep up with customer service needs. Your business starts receiving bad reviews due to slow response times and order issues. You, or a project manager, draw up an action plan to improve customer service and response times.
Your plan includes tasks like expanding the team through strategic hires, revising policies, and revamping the customer service training. You determine the budget required to grow the team, the outside resources needed—perhaps in the form of new software—and a timeline to show improvement. By the end of the process, you have strengthened customer service, are responding to issues promptly, and are generating new positive reviews.
How do I write an action plan?
Writing an action plan involves various steps: setting goals, collecting resources, assigning roles, establishing timelines, and documenting in a project management app or other format.
What is the difference between action plans and to-do lists?
To-do lists typically include a series of individual tasks that don’t necessarily funnel into one common, shared goal. By contrast, action plans are tailored and structured around one main goal. In addition to tasks and actionable steps, action plans include the resources and timelines you need to reach the established goal.
