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Operational Excellence – Managing variability to optimise production

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Operational Excellence – Managing variability to optimise production

I remember sitting in the morning production meeting when I was at Ernest Henry Mine and listening to the concentrator supervisor use the word ‘stability’ more than ten times in two minutes when explaining the previous 24 hours of production. As anyone that has operated a plant knows, process stability is a key driver to maximising production, enhancing safety and reducing waste. So, how do you achieve process stability and the flow on benefits to production, safety and efficiency? Managing variability is a good place to start on your path to achieving operational excellence.

In this article we are going to explore the following areas that will provide some background and insight into how you can achieve operational excellence by managing variability to optimise production by looking into the:

  • correlation between variability and production
  • variability drivers
  • options for managing variability

Identifying the potential with Operational Equipment Effectiveness (OEE) in mining and manufacturing

OEE Calculation image
OEE infographic image - https://www.oee.com/world-class-oee/

Every company, industry and process has its own Operational Equipment Effectiveness (OEE) targets and benchmarks. In his 1984 book, Introduction to TPM, Seiichi Nakajima introduced a “world-class” minimum OEE goal of 85%. ‘Seiichi defined these numbers, based on his practical experience, as minimums for which companies should strive.

The reality is that many industries, even today, do not come close to Seiichi’s benchmark despite the advances in knowledge, processes and technology. Key findings from Mckinsey’s 2015 ‘Mining’s next performance horizon: Capturing productivity gains from innovation article shows the mining sector trails other sectors by a long way and maybe getting worse!

EY extended McKinsey’s concept in 2020 by graphically illustrating the correlation between OEE and the management of variability in their article ‘Can mining decode the opportunities of the future?’ 

Paul Mitchell (author and EY Global Mining & Metals Leader) surmised that productivity in mining, minerals and metals could be enhanced by improved management of variability. In the article, Paul provided some key considerations for managing variability:

  • Enhancing digital maturity
  • Engaging people
  • Taking a system view

 

There’s no doubt that variability leads to missed production and that OEE in mining can be improved by managing variability. Will the mining sector ever reach the levels of our adjacent sectors? In this author’s opinion, probably not. The mining sector faces unique challenges such as:

  • Ore is inherently variable
  • People must travel a long way from the mine entrance to their work location typically through a bottleneck (mine shaft)
  • Instruments to measure inputs at large volume in real-time have not yet been invented.
Image source - EY Graphic on productivity - https://www.ey.com/en_gl/mining-metals/can-mining-decode-the-opportunities-of-the-future

Is there hope?

While the mining sector may be on the back foot, there is hope. As I wrote the word ‘hope’, I had a flash back to a previous manager from MIM who said that hope is neither a plan nor a method! So here I am, doing my best to offer a plan and a method for managing variability – starting with some of the drivers of variability.

How can the above variability be managed?

While Mipac promotes a holistic approach to managing variability, see enabling predictive operations article, this section will focus on your digital tools.

Some key questions you can ask to audit your current and future digital tools:

  • Do your digital tools empower you to automatically detect, analyse, interact with and manage variability in real time?
  • When interacting with a variability event do your digital tools provide visibility to multiple stakeholders (anywhere, anytime) and an ability to capture their collective wisdom for mitigating the variability event?
  • Do your digital tools build on each other to streamline other processes such as the automated collation of reports to save time, minimise errors and focus your daily production meeting on the future instead of the past?
  • Are your digital tools user configurable to minimise dependency on specialist capabilities and vendors?
  • Do your digital tools natively map data workflows to increase transparency and build trust?

How does Mipac’s MPA contribute to managing variability?

Mipac has specifically designed MPA to complement your existing technology to fill the real time operational system void required to manage variability and enable predictive operations. MPA’s solutions are additive, offering stakeholders the ability to interact with and manage variability events in real time to maximise productivity through teamwork, structure, insight and foresight.

What MPA is not

It is important not to mistake MPA for the following. MPA is 

  • Not a historian (e.g. not PI)
  • Not an ERP (e.g. not SAP)
  • Not a pure reporting tool (e.g. not Power BI)
  • Not designed to takeover the role of the control system

Manage variability and maximise production with Mipac and MPA

There’s no denying the correlation between OEE and the management of variability. This article has just presented a few of the variability drivers that exist in mining – there are undoubtedly more. Digital tools are one component of a holistic solution to managing variability. Effective digital tools should empower you to automatically detect, analyse, interact with and manage variability in real time. We are here to help if you recognise the potential productivity your operation can achieve by better managing variability and your digital audit comes up short?

We would love to hear from you!

How well does your organisation manage variability? Do you have the digital tools to detect, analyse, interact with and manage variability in real-time?

What types of variability drivers exist in your operation? Which variability drivers are missing from this blog?

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