Planning is a supply chain activity that aims to allocate efficiently resources to supply certain products based on forecasts of actual demand. Those resources should be allocated in the short, medium, and long term. A supply chain plan can trigger several activities, from raw material purchase to production capacity reservation, to investments to increase production capacity. There are three main levels of planning and they are based on the time horizon considered.

Anyone working in the supply chain should know that there are three levels of planning: strategic, tactical, and operational.

The document summarizes in a matrix the planning level and the main characteristic that distinguish one level from another.

The supply chain planning level matrix is a table, very easy to read. Each row represents a level (strategic, tactical, and operational), and on the columns, there is relevant information like:

• Time horizon.
• Time buckets.
• Planning frequency.
• Planning process examples.
• Preferred unit of measure.

This matrix can be useful for those starting to work for the first time in the supply chain, operations, controlling, and even sales. Especial in companies where the main focus (or only focus) is on the operational level, it is a good idea to review this table in case the supply chain needs to be redesigned or the ERP needs to be reimplemented.

It is important to know that the operational planning level is not the only existing planning type in a supply chain. Long-term planning allows being proactive rather than reactive. Long-term investments can be justified easily.