AAOM Handbook

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 elements for which business Performance Targets will be set.

Quantity

• One Value Driver Tree (VDT) for performance relationships between the Company, Business Units and Operations. • One set of Value Stream Maps (VSM) of the Processes and Productive Units within each Operation, • One Purpose statement for each of the above elements of the Business Structure. • One Theory statement for each of the Processes/Productive Units for each of the above elements of the Business Structure.

Quality

The Business Structure may comprise the following elements; Company, Business Units, Operations, Processes and Productive Units.

The Company is the highest level in the Business Structure. It is the level at which the Business Expectations are first defined in specific and measureable Performance Targets covering the characteristics of Effectiveness, Efficiency and Sustainability.

Business Unit shall be a grouping of Operations under a single manager accountable for the portfolio performance.

Operations shall be the separable elements of a Business Unit asset portfolio. That is, decisions about investment in, or divestment of, an Operation can be substantially independent of such decisions about other Operations within the Business Unit portfolio.

For example;

• Mines, • Processing Plants

• Supply Chain shared services, • Engineering shared services, • Power Generation.

A Process is an element within an Operation that performs a distinct transformation, transfer or store function on a product or service. For example: • Production Drilling

• Crushing • Grinding • Power Distribution.

© McAlear Management Consultants 2006

Operational Planning: Set Performance Targets

Updated: August 2018

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