AAOM Handbook

Management Routines

2.3 COMMUNICATION OF BUSINESS EXPECTATIONS

2.3.1 Context

Business Expectations are ultimately defined by the expectations of the many stakeholders of that business. These may include shareholders, employees, communities, regulators and others affected by the presence of that business. It is the role of the executive levels of the business to understand, balance and integrate these many expectations. In the Business Process Framework these expectations are summarised in three areas of measurable performance; sustainability, effectiveness and efficiency. Targets for each of these areas need to have a; specification, confidence expectation and time horizon for achievement of the target confidence because of the inevitable presence of variation in the performance of any Business Unit or Operation. Business conditions and therefore Business Expectations are not constant but are affected by many economic, social and political variables. In setting Business Expectations executives must understand the external conditions that shape product demand, costs, price etc over the most likely economic cycles of the communities in which the organisation operates. Cycle movements would typically lead to a different level or balance of Business Expectations if value creation is to be optimised. Therefore, the work of the executive is to define the: • suite of operating scenarios that would best characterise the economic cycle, • scenario that each Operation should be implementing under the current and near forecast economic conditions, and • time when an operation should be transitioning between operating scenarios. It is the role of operations management to understand the capabilities of the various elements of the operation and to; • develop Production, Service and resourcing strategies that optimise value creation for each of the operating scenarios. • develop strategies and plans for optimum transition between operating scenarios, and, • implement and transition between operating scenarios to deliver the Business Expectations. Communication of relevant message to many stakeholders is a situation where these of a meeting is appropriate.

2.3.2 Purpose

To provide a set of Business Expectation scenarios for the next 5+ years.

2.3.3 Quantity

One meeting held quarterly and/or whenever there are changing business expectations. The meeting should communicate; • The current economic cycle forecast. • Any changes to the operating scenarios that the Operations management are accountable for incorporating in their Operational Planning work.

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