AAOM Handbook

Quantity

• One set of model logic/mathematics.

• One specification of probability distribution characteristics for each model element.

• One set of input parameters to support process design

Quality

The characteristics that may require modelling of performance may include; • effectiveness (units output per time period), • sustainability (the material and social requirements for continuing effectiveness), • efficiency (the resources consumed per unit of output).

The model logic/mathematics must correctly represent the process design and operating (production and service) strategy.

The historical data used for calibration must, as far as possible; • represent stable performance i.e. random data,

• be conditioned to remove dependent variation between model elements. Note that when there is significant storage between elements of the Business Structure there may be little dependent variation in the data. Different calibration parameters (performance distribution characteristics) may need to be defined for different operating ranges across the performance/effort curve. Calibration of the model may require adjustment of the probability distribution parameters for elements of the model. The parameters most likely to require adjustment are; • the values of the minimum and maximum of the distribution, • the 'shape factor' (i.e. spread of the distribution).

Time

The calibration of a Business Structure Performance model shall be updated whenever a significant process change is made.

Resources

Specification of Performance Targets is the accountability of the role identified in the configured flowchart.

© McAlear Management Consultants 2006

Operational Planning: Set Performance Targets

Updated: August 2018

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