System: Strategic Planning

This is an excerpt from my longer article “Systems: How Product Best Practices Drive Success at Amazon.

Strategic Planning

One of the most famous outputs of Amazon's systems is the expectation that one must write a "Working Backwards" document for any new product idea. What really gives the system structure, however, is the Operational Planning process. 

The Calendar

This process starts in the spring, with a chance to pitch your moonshot idea, 3-Year Plan (3YP). Then, at the start of summer, you begin the planning process for the next year. Your ultimate output is an Operational Plan. To get the plan right, engineering and product teams need to brainstorm, ideate, and hold themselves accountable to profit and loss (P&L). Knowing you must have this plan to get or maintain your budget is the forcing function that defines the system. It helps Amazon drive outcomes. It pushes teams to have a clear vision for the year. 

Operational Plan 1 (OP1) Document Basics

In order to create your Operational Plan, you need to start with your vision, tenets, and goals. You must also address what you learned over the last year. Next, you will dive into how you are going to meet your goals through product innovation over the following year. You will want to explain how you are enacting your plan by addressing the human and technical resources you have at your disposal. Don’t forget to highlight what fell just “below the line” when you made your prioritization decisions. This will give an idea of what you plan to do with more resources. 

To learn more about the actual documents that make up the Operational Planning system, check out my other article, Communication Habit: 12 Amazon Product Communication Tools.

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