Transformation – Power of Continuous Improvement in Mining Operations
In the competitive landscape of mining, achieving profitability and maintaining market position requires the adoption of modern management methods. Continuous Improvement (CI) management is one such approach that can significantly impact a mining company’s financial performance.
Case Study
One noteworthy example of CI implementation is OKD, a mining company based in the Czech Republic. In 2008, OKD introduced CI structures under new management, leading to a surge in innovative proposals that could be systematically assessed and rewarded. The momentum of CI management gained further traction in 2009 with the appointment of CI Managers at each of the company’s four collieries. These managers reported directly to the colliery directors, combining practical expertise with organizational authority. Additionally, a dedicated CI committee was established, convening monthly to oversee CI initiatives.
Steps taken for the implementation of CI structures in OKD:
- Establishment of a new management structure to oversee the implementation of CI structures.
- Natural authorities with extensive practical experience were appointed to lead the CI initiative.
- Special CI committee was formed and convenes every month to evaluate CI progress.
- CI Manager position was created at each colliery to oversee the implementation of CI structures.
- Dissemination of knowledge and positive staff experience.
- Specific CI tools were used, such as idea cards, teams of optimization, analyses provided by the CI department, and education.
- Assessment of value of each idea for implementation.
- Top management driving assessment and implementation of value driven ideas.
- Optimization teams were contracted by the mining company or colliery management. This team team is responsible for the realization of the innovation proposal.
- Profits per implemeted ideas are monitored to assess success of CI activities.
Results:
Over three years, the application of CI methods had a remarkable financial impact, boosting the company’s income by nearly US$38.1 million. This success story underscores the value of continued CI application. This achievement is accompanied by several other advantages:
- Better Quality Innovation Proposals: CI management encourages employees to submit higher-quality innovation proposals. This leads to quicker realization and improved financial outcomes.
- Enhanced Efficiency and Effectiveness: CI management enhances operational efficiency and effectiveness, resulting in cost savings and increased productivity.
- Increased Employee Engagement: CI management offers employees opportunities to contribute to the company’s success, leading to higher engagement and job satisfaction.
- Informed Decision-Making: Specific CI tools and analyses help evaluate innovation proposals, resulting in better decision-making and more informed choices.
- Sustainable Competitive Advantage: CI management helps companies maintain a sustainable competitive advantage by continuously improving their operations and processes.
Takeaways:
- CI management is a valuable tool for driving financial benefits within a mining company.
- Monitoring profits per realized innovation is an effective means of assessing the impact of CI activities.
- Initial CI structure implementation can trigger a surge in profitability, as employees contribute proposals that address critical issues.
- A reduction in admission frequency for CI activities does not necessarily signify failure, as it can be offset by improved quality and execution.
- Expectations of continuous innovation surges should be realistic in subsequent years, as the initial boom may not be sustained.
Source: researchgate.net/publication/282466385
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