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16th International Conference of the

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Johannesburg, South Africa

The Critical Conflicts of Efficiency

measurements and TOC in Mining

Katlego Mabote, TOC Optimization Manager

South Africa Lonmin
23th April 2015
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Katlego Mabote Resume

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Critical Conflicts in Application of TOC in Mining

Conversations to be Outlined
What to Change to

What are the Critical Conflicts

Variability to Remove W Effect Analysis

3 Focus Areas of the Topic

Efficiency Measurements in Application

TOC approach to Change
Mindset required for Change

Investing in TOC as a strategic approach to identify bottlenecks and sustainable leadership to ensure
profitable future and excellence, How Lonmin is investing in TOC and the results Lonmin is achieving
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Questions we Answer
Shaft Revenue Potential
4 Year Tons performance-Trend Graph
MO s Picture View History
Project Initial Bottleneck Identified Flow Model
Project Initial Bottleneck Identified Management`s View
Project Initial Bottleneck Identified Supervisor`s View
Project Saffy Outstanding Project 2015
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Revenue Potential: 4BShaft

Section 1
Panels

Value of ONE Blast:

R185k, Less 15% TVC

R250 000
Section 2
Panels

4B Shaft
83 Panels
R 21 m per day

Section 3
Panels

Section 4
Panels

Section 5
Panels

Shift the
conversations from
the hundreds and
thousands to the
Millions

Crew Salary:
R250 000 per month
Total Crew Salaries:
R24m per month
Material Costs:
<R1000 000 per Day
Winch Cost:
R110 000 each

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Total Shaft Where we where? Performance

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MO Section 41 Johan Kemp

TOP Bottlenecks

Development
Constraint on 6,7?
Blast on Mesh
No Panels

UG2

Underground Stores

MO Section 41

1.
2.
3.

Development
Blast on Mesh
No Panels

Belt
Tips
Level 6

Le vel 6

230t

230t

Fault
Level 7

Level 7

230t

History Tons Trend

Belt
Tips

230t

Half Level Bottleneck

Development

Potential Revenue

Action Plan
Task

By Who

By
When

1,6
Million/Day
Panels to be
Blasted

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Unpacking the Flow Model

Management View
ROWLAND SHAFT

Call:

8000t
Shaft
Schedule

Skip: 25t
Reef 600t/h
Waste 480t/h

15E

Main
Stores
Guaranteed
Availability

Plant
Stock
Pile

Product ion Crews:

1,0 km

Vertical & Decline Shaft System

- Men & Material

EXPLOITATION
1. Shaft Schedule
2. Additional Chairs on Chair Lift
3. Extra Deck on Mary -Anne
4. Centralised Blasting
5. Man Carriages on 16, 17, 18 Levels

Op timised Half Level:

5 Produc tion crew s (each producing
550m2 Mer, 540m2 UG2,
Reef 14000t/m-800t/d
5 Reef rais e c rews ,
3 Raises holed.
One Flat end & Travelling way crew
(producing 35m/m, 1500t/m). Flat end
5 raises ahead of raise crews,

Bu ffer Store per H/L:

16

Agreed list, Including Wi nches

Stock for 4-5 days
Replenished by Logi stics,
2x per week
Engineering Spares
Well Managed

17
18
19

Cag e:

TOC Operational Flow Model

2013-03-18

ID ENTIFIED CONSTR AINT

Shaft Store
1-2 Weeks

69 Panels in Mer & UG2

5 White areas

3,3 km

Reef: 190 000t/m, 8000 t/d

AIM for: 9500t/d
Waste: 1000t/d

20

Grout
Plant

Cyclone
Plant?

5 R a is e L in e s S t o p in g

3 R ais e s
Holed

5 R ais e s in
D e v e lo p m e n t

D ro p R a is e

Bo x

T ra ve l W ay

F la t E n d

HL
Store

22

180 people
14 min cyc le
to 26 lev el
(Increase to 230)

21
22

DR
Bl as t

23

Vent ila tion

Zones:

24
1600t

DR
D r i ll

Wa s te
Pr o du c t io n T o n s

Support
Pumping

Wa s te To n s

R a is e T o ns

Reef

25

Flow / HL

26

26 l ev el
1,2 km

29

Cross Tramming:
3x locos, 63t / span
200t in 40 min, 300t/h
Reef and Waste
ore passes 100t - 200t
3 hours flow

Drop R ai se
Constraint

28

3x 250t
Decline belt
1200t/h

Slusher
Progress
Constraint

Reef : 500-800t/d
Waste: 75-100t/d

27

SUBORDINATION Projects:
30

1,

31

km

Gondola

Chair Lift

40-50 Cars/d

600 people /h

Engineer ing
Workshop per
Level

1.
2.
3.
4.
5.
6.
7.
8.

Face Time
Compressed Air Column
Labour Unavailable
Drop Raising (Longer term)
Relationships (Strategic)
ATM & Kios k
Grout infrastructure
Material Supply Logistics

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Unpacking the Flow Model

Shift Boss s` View

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Defining the Current Structure and leadership model

Definition TOC within : Improving Capacity and Scope of making more money and
creating an enabling environment

REFRAMING
Local Efficiency & Cost World Frameworks towards a
Production Flow
Framework
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Defining the Concept of The WAR ROOM

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The TOC Change and the Results

Lets Unpack
Rowland Shaft Total Tons
250,000

Indication of the world of efficiency, World less for More and the
World of WHY Approach
NOW
200,000

Variation
to Big
150,000
Tons

Then

6M mov ave

100,000

Linear (Tons)

Six Sigma and Lean Interventions

The World of efficiency

50,000

Recession time

W Effect on the Revenue loss is estimated @ 30% of the 200 000

tons amounting 6 Million /month and cumulative Year by Year

Oct-06
Dec-06
Feb-07
Apr-07
Jun-07
Aug-07
Oct-07
Dec-07
Feb-08
Apr-08
Jun-08
Aug-08
Oct-08
Dec-08
Feb-09
Apr-09
Jun-09
Aug-09
Oct-09
Dec-09
Feb-10
Apr-10
Jun-10
Aug-10
Oct-10
Dec-10
Feb-11
Apr-11
Jun-11
Aug-11
Oct-11
Dec-11
Feb-12
Apr-12
Jun-12
Aug-12
Oct-12
Dec-12
Feb-13

During recession time the world ask business to find new answer to Production, cost
savings and re engineering and apply the concept of less for More.

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TOC the Clear Results ROI

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The Results- Comparison

The Results- Comparison

1.
2.
3.
4.

Low Variability
Upward trend
Movement from Non performance to performance
A profit Game
th

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The Conflict NO 1A (The We and US)

Local vs Global
Parent to Child Conversation
rather Parent to Parent

The World of the We

and Us

Visible
The World of I
think and you
DO

Invisible to Management

Definition TOC within : Improving Capacity and Scope of making more money and
creating an enabling environment
The world of Rule and Order
The world SOP

REFRAMING
How to rescue business leadership from the recession time and begin to
think like business Man not Victims of recession more so Like business
Victors
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The Conflict NO 1B (No Young Executive Mind-set

Fixed vs Change World )

VS

Levels of
Work

35
years

50
years

Years
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The Conflict NO 2 (The World of what to think

Not How to think) The World of Produce to Stock not by Order
10

10

10

10

10

10

16

15

14

10

13

12
F

STOP

START / DO

Manage EFFICIENCY

Manage FLOW

Control Everything

Control Leverage Points

Manage Silos

Flow of the System as a

Whole

Manage by Budget

Manage the Constraint(s)

Individual KPIs

Buffer Management

Cost world (Input control)

Throughput world (Lost

revenue)

Management by Numbers

Management by Means
(What)

People just work for a

salary and must be
controlled
(Efficiency driven)

People are intelligent

and want to perform
(Leadership, Care & Growth)

Low morale and spirit

Positive and enthusiastic

culture
17

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East 3

The Conflict NO 3 ( The Lack of the Executive View) and Business Unusual

4B

The 10 10 Chain Balanced Capacity Production Design

Hossy

Saffy

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The Conflict N0 5( The Lack of Buffer

management System)
Plant
Stock
Pile

Shaft
Schedule

5 R a is e L in e s S t op in g

3
Ra i s e s
Ho led

5 R a is e s i n
De v e l o pm e nt

Bo x

D r op R a is e

T ra ve l W a y

F la t E nd

10 10 10 10 10 10
Skip

DR
B l as t

W as t e
P r o d u c t io n T o n s

Ra is e T o n s

DR
Dr il l

W as te T on s

Re e f

Production HL's
Main
Stores

Grout
Plant

Cage

Shaft Store

Support
Pumping

TOC principles non existences

1. No Buffer management system
2. No concept of the War Room
3. Primary and Secondary Chain
not designed for TOC

Decline belt

Cross Tramming

Gondola

Chair Lift

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The Conflict NO 6 ( The Finance reporting vs Revenue

Calculation) The Language Sap system
(Innovation is squeezed out)
NON PERFORMING ZONE
Shafts Achieving 60 % of the Budgets

PERFORMING ZONE
Shafts Achieving 40% of the Budgets

How the project trial was commissioned

20

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The Conflict NO 7 (The W Effect Impact

Principle Efficiency vs Through -Put)
Buffer Management System

September W effect

Buffer Management System

1.
2.
3.

Engineering Buffer
Material Buffer
People Buffer

No Buffer
2 Weeks Buffer
Buffer

Performance against TOC (5 to 10) % above Plan

W Effect Analysis October

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The Conflict NO 8 (The leadership dilemma)

TRAINING FALLS VICTIM TO SHORT-TERM PRESSURES

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Defining What needs to be Changed

1.
2.
3.

Defining What needs to be Changed

Leadership Structure TOC enabling environment
TOC Flow principles to be entrenched
Promotion of Economic Business Competency

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The ANSWER to the Solutions-Measurements

1. Overall flow of tons
2. Rate of the identified bottleneck
3. Status of the primary buffers feeding the
bottleneck and its effects on flow stability
4. Status of the protective capacity
5. Visibility of the systems reality & Changes
6. Spirit / Vibe / Dynamics of the shaft
7. Level of understanding of the TOC concepts

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The TOC is a Sustainable approach Moving Forward

The Conclusion

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