AAOM Handbook

The direct accountability of each role in an organisation is to monitor and respond correctly to the KPIs for that role, and to call to account those who are directly accountable for contributing measures. If a KPI indicates that a process is changing, or is likely to change, or a control action has been initiated to create a change in the KPI, then contributing measures from levels below in the Business Structure will be leading indicators of the change. When a role chooses to look at a contributing measure (lower level accountability) during the process of driving performance change, the measure is referred to in the Operating Model as a Control Measure. Once the required change is complete the monitoring of the measure by the higher level role should stop, and they should focus only on their direct KPIs and managing the direct reports accountable for their input measures. A generic guideline to role accountabilities is: 1. Frontline Team Members (operators, tradesmen, etc.) are accountable for delivering the relevant Theory of the process. The Quantity, Quality and Time of tasks assigned to them. 2. Frontline Team Leaders are accountable for delivering the Schedule of work assigned to the team on time and to quality. 3. Programing Roles (Frontline Manager, Planner, Scheduler and Resource Coordinator) are accountable for setting up the approved Production and Service tactics for successful execution by the Frontline Team. 4. Department and Functional Heads are accountable for defining the Strategy Options and Tactics for implementing approved Strategies. 5. General Managers are accountable for optimising the Operation Value Stream performance, and approving Strategy choices that integrate across the value stream, in order to deliver the Business Expectations. Having set Performance Targets and measures to a Productive Unit level, we can develop a Production Strategy and a Service Strategy for the Equipment/Workplaces within that Productive Unit. Most processes will over their lives undergo many changes, additions and/or contractions. The Business Structure and related measures must be updated whenever such changes are made.

Purpose

To specify the Key Performance Indicators for a process.

Quantity

• One purpose statement for each element of the Business Structure. • One set of Purpose and Theory measures for each element of the Business Structure. • For each measure: o One individual identified to be accountable (KPI Owner), o One set of specification limits, and o One specification for the expected shape of the distribution of performance.

© McAlear Management Consultants 2006

Operational Planning: Set Performance Targets

Updated: August 2018

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