Effective performance management has three primary components: planning, management, and gratifaction assessment. Working plan’s a procedure to recognize desirable performance, and gain employee’s resolve for implement that which was expected from him.

Company performance is usually evaluated or referred to based on achieving results: short and long-term of profit, returns, assets gathering, and initial capital gathering. Similarly, working plan concentrate on results that accomplished through the worker: what exactly are they created and, possibly essential, how would be the results could be accomplished.

This includes optimization of process control equipment, long-term sustainable solutions, not just minimization of error but also wastes and rework, time efficiency, and elimination of activities that do not add value. The cycle of process improvement initiatives broadly divided into three main activities, discovery and design, deploy and execute, and monitor and control.

Discovery starts with identifying the needs of the process. Starting from the drivers, values, strategy, until the results of the business organization. This identification will support the “raison d’être” of the process.

Further identification was followed by an inventory of the process that has been running both the primary process and supporting processes. This inventory is more groove photographing how it works, how much it cost, cycle time and so forth. Also needs to be mapped, if a process adds value or not.

Production system

In a service oriented system, most of these inputs are labor, but also depends on its system, machinery, physical facilities, and information and technology could be in form of important inputs (like health care). In the supplying food system, raw materials are also become the important input. The conversion process itself does not only involve technological application but also rely on controlled variables management.

This is where the production / operational management has role in designing and completing that system and also in planning and controlling the operations. The point of effective production management is to maintain the relationship between all variables as well as look out the whole process as an integrated system.

If all the system running properly, then it will produce output in form of products and services that able to meet the standards of quantity, quality and cost, which are obtained when it’s needed by the production management system.

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The technique is widely used, especially in work planning, resources organization and control process. The application of knowledge and practices that have developed from other disciplines such as economic, finance, and mathematic, for example determining the production level based on the approach of demand and supply from the economic theory, analyzes operating performance using financial ratios, the use of quantitative or mathematical methods in decision making.

The most influential technological discovery in production system and also to encourage the technological development or production processes, which cause changes whether in layout, types of equipment and production processes.

Applications, operational management can be applied in various types of organization, such as manufacturing industry, plantations, hospitals, hotels or banks. Operational management is required to manage building’s layout, spaces, machinery or equipments; to determine work plan and standard time for a task; product design development; product distribution; and other operational activities.

The basic structures and elements of the operational management is similar for all types of company, but the interest elements level can be vary depending on the company’s type. For example, the layout plan which is required by restaurants, schools but it was very important for manufacturing companies, especially for setting the production’s machinery and equipments.