AAOM Handbook

Productive Units are elements within a Process that can make a separate contribution to the performance of the Process e.g. different loading/truck fleets within a mine, multiple crushing or grinding circuits within a mineral processing plant. They are the lowest level at which we set separate Performance Targets. To arrive at the Value Driver Tree (VDT) of Company, Business Units and Operations, and construct a tree that identifies all of the elements at each of these levels. As a guide to constructing a VDT; • Start at the Outcome Node – the result. • Each Branch is independent • All Nodes in a branch must relate to the end Node of the branch • A Driver that can be isolated to affecting a specific Node is placed under that Node. • A driver that relates to several Nodes is placed at the same level as the highest related Node. • A driver is not placed below the level at which it is controlled. To arrive at the Value Stream Map (VSM) of Processes and Productive Units for an Operation, construct a flowsheet that identifies the transform, transfer and storage steps involved in the handling of products, services and waste streams within the Operation (e.g. ore, concentrate, reagents, steam, oxygen, tailings, fumes or effluent, etc.). As a guide to constructing a VSM: • Identify each significant storage point for product, services or waste, • Insert the significant transform or transfer step between each storage point, • Identify all branches from or to the significant transform, transfer or storage steps, • Insert the transform or transfer steps within the branches, and • Consider thoughtfully any area of the VSM where there are directly connected transform and/or transfer steps, i.e. no storage between these steps. If the connected transform/transfer steps; o do not exhibit significant independent variability in performance they should be combined into a single element. E.g. a loader feeding a conveyor belt – the conveyor does not exhibit independent variation in its throughput rate. o do exhibit significant independent variability in performance they should be kept as separate elements. E.g. a loader feeding a truck fleet – the loader and the truck fleet each exhibit independent variation in throughput rate. Where an ERP system is used to collect transactional data for activities and costs related to elements of the Business Structure, each element from the Business Structure shall be entered into the data hierarchies that need to reflect these relationships, e.g. Profit and Cost Centre structures, location and equipment structures.

© McAlear Management Consultants 2006

Operational Planning: Set Performance Targets

Updated: August 2018

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