OPERATIONAL PLAN OVERVIEW Office of Planning and Budget Division of Administration State of Louisiana October 2006

2 OPERATIONAL PLAN An operational plan is an annual work plan. An operational plan describes short-term business strategies. An operational plan explains what progress toward accomplishment of strategic goals and objectives will be achieved during a given operational period (fiscal year). An operational plan is the basis for and justification of an annual operating budget request.

3 OPERATIONAL PLAN Act 1465 of 1997 requires that an operational plan be prepared and submitted by each department/agency (or budget unit) as part of its “total budget request document.”

4 OPERATIONAL PLAN An operational plan (OP) draws directly from department/agency and program strategic plans, and performance progress reports, to:  State strategic missions, goals, and objectives  Report actual progress  Project future progress

5 Like a strategic plan, an OP addresses: Who are we? Where are we now? Where do we want to be? How do we get there? How do we measure our progress? OPERATIONAL PLAN

6 To answer these questions, the operational plan must include meaningful data for: prior fiscal years current fiscal year ensuing fiscal year (the fiscal year for which funding is requested)

7 OPERATIONAL PLAN The operational plan is both the first step and the last step in preparing an operating budget request. As a first step, the OP provides a plan for resource allocation. As the last step, the OP may be modified to reflect policy decisions or financial changes made during the budget development process.

8 OPERATIONAL PLAN Because Louisiana appropriates funds to budget units by program, the operational plan is focused primarily on program level information. However, that program information must be placed in the overall context of the department/agency (budget unit) within which the program operates.

9 OPERATIONAL PLAN Outline of Operational Plan Components Department/Agency Name Department/Agency Number Examples: Agency No = Department of Justice, Office of the Attorney General Agency No = Department of Social Services, Office of Family Support Agency No = Department of Civil Service, Division of Administrative Law

10 OPERATIONAL PLAN Outline of Operational Plan Components Department/Agency Description Department and/or agency mission statement (Mission is a broad, comprehensive statement of purpose; it describes what an organization does and whom it serves.) Department/and or agency goals (Goals are the intended broad, long-term results. Goals are clear statements of the general end purposes toward which efforts are directed.) Both are taken from strategic plan.

11 OPERATIONAL PLAN Outline of Operational Plan Components Agency - List strategies for development and implementation of human resource policies that benefit women and families. Required under Act 1078 of 2003 Include list under Agency Description See objective links also

12 OPERATIONAL PLAN If your department equals a budget schedule, then submit departmentwide mission and goal statements in addition to agencywide mission and goals for each budget unit in the budget schedule. EXAMPLE: Budget Schedule 09 – Department of Health and Hospitals (DHH) is made up of several budget units or agencies. So DHH would provide departmentwide, agencywide, and program mission and goal statements. In the Executive Budget Supporting Document, the departmentwide mission and goals appear on the summary page for the 09 budget schedule. An agencywide mission and goals appears on the summary page for that agency/budget unit. Program mission and goals appear in the program description for that program.

13 OPERATIONAL PLAN Outline of Operational Plan Components Program Name Program Authorization (Constitutional or statutory provisions, executive orders, federal court order, etc.) Program Description Program mission statement Program goals (must be consistent with department/ agency goals) Description of program activities Programwide performance information (optional)

14 Outline of Operational Plan Components Program Objectives Links Explanatory Notes Performance Indicators OPERATIONAL PLAN

15 OPERATIONAL PLAN Objectives are specific, measurable targets for accomplishment. Objectives are SMART. Specific Measurable Aggressive but attainable Results-oriented Timebound

16 To set program operational objectives, review the program’s five-year strategic plan. Then think about: How does this operational cycle relate to the strategic plan? Which strategic objectives will be addressed in this operational plan? REMEMBER: You cite strategic objectives in your operational plan. However, it is possible that some strategic objectives may not be addressed in an operational cycle. OPERATIONAL PLAN

17 State each strategic objective separately. Present objectives in a logical sequence. Be sure that the time frame is clear. Cite your strategic timeframe. If your initial strategic timeframe has been modified, reflect that modification in your operational plan. Label the objective level (key or supporting). Critical success factor? Big ticket item? Hot button item? History and who values? OPERATIONAL PLAN

18 Program Objective Links Louisiana: Vision 2020 Action Plan 2003 Human Resource Policies That Benefit Women and Families Children’s Budget Other links (TANF, Tobacco Settlement, Workforce…) Response is required. “Not applicable” may be an appropriate response. OPERATIONAL PLAN

19 Outline of Operational Plan Components Program Objective Explanatory Notes Optional but often useful Provide background and explain technical terms Program Objective Performance Indicators Basic or Standard Performance Tables General Performance Information Tables Explanatory Notes OPERATIONAL PLAN

20 Types of Performance Indicators Input Output Outcome Efficiency Quality OPERATIONAL PLAN

21 Levels of Performance Indicators Key Supporting General Performance Information OPERATIONAL PLAN

22 A key performance indicator is a performance indicator that is included in the Executive Budget Supporting Document and the General or Ancillary Appropriation Act. Factors in determining key level include: Critical success factor? Big ticket item? Hot button item? History and who values? OPERATIONAL PLAN

23 OPERATIONAL PLAN A supporting performance indicator is a performance indicator that is included in the Executive Budget Supporting Document, but not the General or Ancillary Appropriation Act.

24 General performance information (GPI) is included in the Executive Budget Supporting Document and may be included in the General or Ancillary Appropriation Act. However, values for general performance indicators are reported for prior year actual only. GPI may include: Multi-year histories or trends External comparisons (national or regional) Disaggregated data OPERATIONAL PLAN

25 OPERATIONAL PLAN REALITY CHECK The performance indicator levels designated in your operational plan may change as the Executive Budget documents are developed. Title 39 assigns the responsibility of determining what performance information goes into the Executive Budget documents to the Division of Administration (OPB). The OPB values agency designations but also must incorporate the opinions and recommendations of other key entities in the budget decision making process. Sometimes, other key parties may not agree with you.

26 Performance Standards A performance standard is the expected level of performance associated with a performance indicator for a particular period and funding level. Performance standards are service commitments; they identify the level of performance associated with the level of funding budgeted/appropriated. In other words, they describe what we can expect to receive for our money. OPERATIONAL PLAN

27 Performance Standards n During budget development, performance indicator values associated with the funding level recommended in the executive budget and appropriation bills are proposed performance standards. n During the appropriation process, performance indicator values become performance standards linked to the funding amounts actually appropriated in the appropriation acts. n Performance standards may be modified only through approved BA-7s or August 15 th Performance Adjustments. n Performance standards are monitored and tracked through the Louisiana Performance Accountability System (LaPAS). OPERATIONAL PLAN

28 POINTERS: Report a balanced set of indicators. Use appropriate indicator tables. Basic or standard performance indicator tables General Performance Information tables Report indicators consistently. Don’t change performance indicators willy-nilly. Don’t let the OP be the first indication of desired change. OPERATIONAL PLAN

29 POINTERS: Present performance information at appropriate levels in order to surface key data while maintaining the availability of support and explanatory material. Label indicator levels (key or supporting) on basic or standard tables.  Try to get consensus on indicator levels before indicators are reported. OPERATIONAL PLAN

30 OPERATIONAL PLAN POINTERS: Check indicator names and values against official sources. LaPAS OPB documents Appropriation acts and approved BA-7s and Aug. 15 th adjustments Use explanatory notes.

31 OPERATIONAL PLAN It’s my operational plan! Why can’t I change my performance indicators whenever I want to? In your strategic plan, you identified the indicators to be used to measure progress over the lifetime of the plan. You committed to those indicators. We need to track indicators over time to see progress. So there must be a compelling reason to change indicators during the lifetime of your strategic plan. AND that reason must be communicated and justified, early in the budget development process, to all key parties. Given our post-hurricane operating environment, some changes for FY may be justified. However, other key parties—particularly OPB— must agree with you.

32 Outline of Operational Plan Components Repeat Program Components for each program OPERATIONAL PLAN

33 Outline of Operational Plan Components Charts Department/agency organization chart Department/agency program structure (with activities) chart Contact Person(s) Name, title, contact numbers, & address OPERATIONAL PLAN

34 Operational Plan Forms and Guidelines and Instructions are available on the OPB website. Look under PBB Forms and Guidelines OPERATIONAL PLAN OPB Website Address:

35 LaPAS performance data are available on the OPB Website. Look under LaPAS. Use the View function. You can print from View. OPERATIONAL PLAN OPB Website Address:

36 OPERATIONAL PLAN Remember that performance information must be provided also on: Continuation Budget Forms Technical and/or Other Adjustment Package New or Expanded Service Forms  Use performance indicators to describe and quantify existing services and justify workload adjustments and/or enhancements.

37 CAPITAL OUTLAY REQUEST TRACKING SYSTEM CAPITAL OUTLAY BUDGET DECISIONS OPERATIONAL PLAN OTHER BUDGET REQUEST FORMS & ADDENDA PERFORMANCE PROGRESS REPORTS AUDITS OPERATING BUDGET DECISIONS Louisiana: Vision 2020 SECURE AGENCY STRATEGIC PLAN PERFORMANCE ACCOUNTABILITY OPERATIONAL BUDGET DECISION-MAKING