In this blog article, I outline the seven key differences between strategic and operational thinking and working to help you better understand these concepts and apply them effectively on a day-to-day basis. I also take into account an interesting observation by Chet Holmes, author of the book “The Ultimate Sales Machine”, who points out how rarely strategic thinking / working occurs in practice.
1. Time horizon: short term vs. long term
One of the biggest differences between strategic and operational work is the time horizon. Operational work is generally short-term in nature and focuses on the immediate tasks and responsibilities that need to be fulfilled in order to keep everyday life running smoothly. This includes things such as processing customer inquiries, meeting deadlines, maintaining systems and much more. While these activities are necessary to keep the business running, they rarely look beyond the next month or even the next week.
Strategic work, on the other hand, has a much longer horizon. It is about shaping the future and setting long-term goals that extend up to years into the future. Strategic decisions could include opening up new markets, reorganizing company structures or investing in innovative technologies. While operational tasks represent the “now” mode, strategic thinking is focused on the “later” – and this is crucial to ensure sustainable growth or even to leave a legacy.
Example
A sales employee who takes calls every day and achieves sales targets is working operationally. The managing director, who decides to invest in a new CRM system to increase efficiency in the long term, works strategically. Both roles are important, but they complement each other. However, according to Chet Holmes, a sales strategy expert, only about 9% of all managers and executives are purely in strategic mode, while only 9% can think both strategically and operationally. Shockingly, he estimates that around 80% of managers are constantly stuck in operational mode, which shows how rarely strategic thinking occurs and is applied in practice.
2. Focus: detail orientation vs. big picture
Another key difference lies in the focus. Operational work requires a much greater focus on detail. Employees who think operationally are concerned with the specific processes, rules and standards required to complete a task. They ensure that everything runs smoothly, that deadlines are met and that no errors occur. This focus on details is essential to ensure day-to-day productivity.
Strategic thinking, on the other hand, focuses on the big picture. Instead of getting lost in the details, it is about identifying trends, analyzing competitors and determining the direction of the company. Strategists ask themselves: “Where will we be in five years’ time?” or “What opportunities will new technologies offer us?” or “How can we gain new competitive advantages?” They think less about the day-to-day challenges and more about how they can position and strengthen the company in order to be successful in the long term.
Example
Let’s assume a company is faced with the decision of whether to introduce a new product line. The operational manager would focus on how production is organized, how the supply chain works and how employees need to be trained. The strategic leader, on the other hand, would examine whether the new product line is in line with the brand identity, whether it has the market potential and how it could affect the long-term competitive position. This clear division explains why only a minority of managers – Holmes estimates only 9% – are able to think purely strategically, while the majority (around 80%) remain caught up in the operational detail.
3. Decision making: reactive vs. proactive action
The way in which decisions are made also differs considerably. Operational work is practically only reactive. Problems or challenges arise and the operational level reacts to solve them. If a server crashes, a technician is called immediately. If a customer complains, the complaint is dealt with quickly. This type of problem solving is necessary to keep the business running, but it is rarely innovative or forward-thinking. It can even lead to short-term chaos.
Strategic thinking, on the other hand, is proactive. Instead of just reacting to problems, it tries to anticipate and prevent them. Strategic decisions are made on the basis of data, market analysis and vision in order to exploit future opportunities or minimize risks. For example, a strategic leader might decide to invest in cybersecurity before a data leak occurs or identify a new target group before the market is saturated.
This difference can significantly influence the success of a company. Reactive action keeps the ship afloat, but proactive action steers it towards new shores. The fact that, according to Holmes, only 9% of managers think purely strategically underlines how difficult it is for many leaders/managers to get out of reactive mode and focus on proactive, forward-looking and empowering strategies.
4. Areas of responsibility: Day-to-day business vs. corporate vision
Another important difference lies in the areas of responsibility. Operational work focuses on the day-to-day business – the recurring tasks and processes that ensure that a company functions. This can include personnel planning, accounting, production or customer service. These tasks are often standardized and repeatable, and their completion is crucial for short-term success.
Strategic work, on the other hand, is responsible for the company’s vision. It is about setting the direction, setting new goals and ensuring that the company stays on course to achieve these goals. Strategic managers develop business models, analyze market trends and decide on the long-term future of the company.
Example
In a retail company, the storekeeper who makes sure the shelves are stocked might work operationally. The CEO, who decides whether the company should expand online, works strategically. Both roles are essential, but their perspectives and priorities are very different. Holmes’ observation that 80% of managers remain in operational mode shows how rarely leaders take the time or have the skills to focus on the long-term vision.
5. Resource management: efficiency vs. effectiveness
Another difference concerns the way in which resources are managed. Operational work places great emphasis on efficiency. It is about making the best possible use of available resources – time, money, personnel – to achieve daily tasks and goals. An efficient process minimizes waste and maximizes productivity within the given framework.
Strategic working, on the other hand, focuses on effectiveness. It is not just about using resources efficiently, but ensuring that they are aligned with the right goals. Strategists ask themselves: “Are our current investments getting us where we want to be in the long term?” They are willing to sacrifice short-term efficiency for long-term effectiveness if it serves the overall vision.
Imagine a technology company that is considering whether to invest in research and development. The operational manager might argue that this investment is too expensive and jeopardizes current projects. The strategic leader, on the other hand, might see that this investment is necessary in order to remain competitive and open up new markets. This shows the difference between efficiency (short-term) and effectiveness (long-term). This distinction is particularly relevant when you consider that, according to Holmes, only around 9% of managers are able to consistently focus on effective, strategic decisions.
6. Risk tolerance: minimization vs. acceptance
Another important aspect is the attitude towards risk. Operational work tends to strive to minimize risks. As it focuses on the stability and continuity of daily operations, change or uncertainty is often seen as a threat. Operational teams prefer known processes and proven methods to avoid disruption.
Strategic thinking, on the other hand, is often associated with a greater willingness to take risks. New strategies, such as entering a new market or launching an innovative product, involve a certain amount of risk. Strategic leaders accept these risks because they know that no significant progress is possible without them. They weigh up the potential rewards against the risks and make calculated decisions.
Example
An operational leader might be reluctant to change an existing system because they believe the changeover could lead to complications. A strategic leader, however, might decide that implementing new software is necessary to remain competitive, even if there are short-term challenges. This willingness to take risks is a characteristic of the 9% of leaders who, according to Holmes, think purely strategically, as opposed to the 80% who focus on the security of the operational.
7. Measurability: results vs. effects
Finally, strategic and operational work differ in the way in which success is measured. Operational work focuses on measurable, short-term results. These could be sales figures, productivity metrics or adherence to schedules. These metrics are important to assess the current status and ensure that everything is going as planned.
Strategic working, on the other hand, measures success in terms of long-term impact. Instead of focusing on immediate results, it evaluates whether the strategy is bringing the company closer to its overall goals. This can be more difficult to measure, but requires a deeper analysis of market trends, customer feedback and competitive analysis.
For example, an operational sales leader might be proud that their team exceeded sales targets this month. A strategic leader, however, wonders if these sales are sustainable in the long term and if they put the company in a stronger market position. This disparity in measurability reflects why few leaders – about the 9% Holmes describes as purely strategic – are able to look beyond short-term successes.
Conclusion: Finding a balance
Strategic and operational thinking and working are not opposites, but two sides of the same coin. Without operational thinking, the company would fail on a day-to-day basis; without strategic thinking, it would have no future. The challenge for managers and teams is to find a balance between these two approaches. Holmes’ observation that only 9% of managers think purely strategically, 9% are both strategic and operational and 80% are stuck in operational mode highlights the urgent need to train leaders to think more strategically.
If you as a manager or employee understand how these differences work, you can better prioritize, make decisions and define your role in the company. Ask yourself regularly: Am I currently working on solving a problem or on shaping the future? Am I being efficient or effective? Only when both approaches are in harmony can a company not only survive, but also thrive.
In a world where change is happening faster and faster, it is more important than ever to think strategically while acting operationally. By internalizing and applying these differences, you put yourself and your company in a position not only to meet today’s challenges, but also to seize tomorrow’s opportunities.
Strategic goals:
Long-term: Strategic goals are geared towards the long-term success of the company. They aim to bring the company to the forefront of the competition in the future and establish the brand as a leading force in the industry. An example of a strategic goal could be “to achieve market leadership in the niche of our industry”.
Vision and mission: These are aligned with the company’s mission and vision and set the direction in which the company wants to go in the long term.
Major changes: Strategic goals often involve critical changes and are outside the company’s comfort zone. They often require new approaches and innovations.
Sustainable benefits: They aim to create sustainable competitive advantages and long-term profitability.
Operational goals:
Short to medium term: Operational goals are geared towards the short to medium term and serve to implement the strategic plans. They focus on daily activities and the improvement of important issues in day-to-day business. An example of an operational goal could be “to increase customer satisfaction by 15% within the next three months”.
Execution and optimization: They are focused on optimizing daily processes and increasing efficiency.
Best practices: Operational goals are often based on best practices and processes to ensure short-term profitability.
Practical execution plan: They allow the achievement of strategic goals through a practical and manageable execution plan.
Connection and difference:
Connection: Strategic and operational goals are closely linked. Strategic goals set the direction, while operational goals define the path to achieve them. Without operational goals, the implementation of strategic goals would not be possible.
Difference: The main difference lies in their time horizon and their focus. Strategic goals are long-term and visionary, while operational goals are short to medium-term and practice-oriented.
Examples:
Strategic goal: “Achieve market leadership in the niche of our industry”.
Operational goal: “Increase customer satisfaction by 15% within the next three months”.
By clearly separating and focusing on both types of goals, a company can effectively shape both its long-term vision and its day-to-day operations.
