Understanding Annual Planning

[Ehsanuls55]

The idea of ​​annual planning sounds pretty obvious – you make plans for the upcoming year – but it’s not that simple. Depending on your company, the size of the organization, and the market you’re in, the nature of annual planning can vary greatly. Let’s look at how.

What is annual planning?
Annual planning is the process of outlining goals, activities, milestones, budgets, and resources for the next twelve-month period. Some of the defining characteristics of annual planning are as follows.

Financially focused : Often driven by the organization's financial results and plans, in line with annual reporting to shareholders and regulatory compliance.
Review-oriented : Annual plans are based on a thorough review of the previous year's results.
Top-down : Annual plans are first developed at the organizational level, and then spread to sectors, departments, teams and individuals.
360 degrees : The annual plan describes what needs to be completed, how, by whom and with what resources
Discover how ClickUp Whiteboards help you plan, no matter the project

Difference between annual planning and strategic planning
In business management, the words strategy, plan, tactics and a combination of audit directors auditors email list them are often used interchangeably, leading to unnecessary confusion. So before we go into the details of annual planning, let's distinguish it from "strategic planning"

In an episode of the HBR podcast titled " A Plan Is Not a Strategy," Roger Martin, former dean of the Rotman School of Management at the University of Toronto, says:

A strategy is an integrative set of choices that positions you on a playing field of your choice so that you win... Strategy has a theory.

Roger Martin, Former Dean of the Rotman School of Management at the University of Toronto

So a big part of the strategic planning process is creating the theory, that is, making the big decisions about why you do what you do, who your customer is, what makes you better than the competition, etc. Some of these decisions are:

strategic planning templates

will give you a better idea.

On the other hand, the annual planning process deals with the execution of said strategy over the following twelve months.