Mipac

Operational excellence – making the most of the daily production meeting

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As a metallurgist (Stoll, 2022), I’ve been in and had to prepare for a few morning production meetings in my time. There’s nothing worse than having to spend a couple of hours on a Monday morning recovering lost logsheets and trying to piece together fragments of data and information to figure out what happened over the weekend. If you are lucky enough to pull everything together in time, you must then spend most of the meeting reliving the past and being grilled on:

  • What went wrong
  • Why
  • What you and others will do to mitigate what went wrong and prevent it from going wrong again
  • By when – hopefully before the next production meeting…
 

The real question should be, why do we spend so much time in the daily production meeting collating, reporting and discussing what went wrong when we can manage many variability events in real-time. Doing so would not only ensure we maximised production as it happened (in this case the past) but allow us to focus the daily production meeting on what matters most – the present and future. We would also have the added benefit of returning precious time back to daily production meeting attendees so they can contribute their talents to creating value.

In this article we will explore how you can achieve operational excellence by making the most of the morning production meeting. The article will cover the following topics:

  • What is the goal of the daily production meeting?
  • What should be the focus of the daily production meeting – what should and should not be included?
  • How can the optimum daily production meeting be achieved?
  • How can your digital tools complement your daily production meeting, manage variability in real-time and create value for your organisation?

 

A study on how meetings can be improved showed that most organisations waste up to 20% of their payroll on bad meetings (https://www.lean-news.com/meetings-can-be-wasted-time/). In the author’s experience, the typical mine site consumes 6,515 people hours per annum preparing for and discussing the past in the daily production meeting.

Parameter
Unit
Min
Max
Typical

Attendance

#

10

25

15

Duration

mins

30

90

45

Proportion spent on the past

%

50

75

66

Time spent preparing data/information

mins

30

240

90

Number of daily production meetings per site per day

1

#

4

2

People hours spent preparing for and discussing the past in the daily production meeting

hours

1,095

46,903

6,515

People days spent preparing for and discussing the past in the daily production meeting

days

46

1,954

272

We encourage you to read on if:

  • You could create value in your operation by solving the problems, that are usually discussed in the daily production meeting, as they happen
  • You could save time by implementing an effective production meeting
  • You could create additional value for your operation by redirecting your people’s time from the daily production meeting to solving the problems they were trained to solve.

What is the goal?

In trying to improve the performance of part of the system, systems thinking (theory of constraints – TOC) requires that we first identify the goal of the system (organisation). For example, in mining, we would propose that the goal is to deliver suitable quality material to the client at the right time as safely and productively as possible. The production departments are the primary means by which the organisation attempts to do this, with the help of support departments like HR, supply chain, maintenance, finance and technical services.

Planners (in coordination with production personnel) will develop a monthly plan to ensure that the organisational goal can be met and then the production team needs to execute that plan. Good alignment across the organisation is vital for production to be successful. In practice, this is not easy, primarily due to departments being incentivised to maximise their own performance metrics in isolation.

Execution:

Unlike the support departments, which are not intimately involved with the day-to-day production activities, production personnel know that mining is impacted by a degree of interdependence and variability not found in other industries. This makes execution and coordination more difficult than expected, and constant adjustments must be made to stay on schedule. The more unstable the production flow, the more adjustments need to be made and the shorter the life of the mining plan.

There is one major underlying factor that complicates execution even further. In a misguided attempt to reduce cost, many mines run a balanced capacity system. This increases the instability in the production process and overloads the attention of managers and employees alike.

Let's look at an example

The goal of this exercise is to set up a cost-effective chain of six production departments to produce an average of 10 units per time interval (these could be drill & blast, load & haul, concentrating, smelting, refining, transport & logistics). We consider the running costs of each department to be proportional to its production capacity. As the department produces, it will hand over the product to the next department.

From years of working with clients in mining, we find that the picture below is considered to be the ideal configuration by most people when trying to design an efficient and cost-effective production chain. Each department is set up to produce an average of 10 units per time interval. We call this a balanced capacity chain.

In this chain, all resources will be busy and run at high efficiency (100%). Our management system rewards this design. We believe that it will produce an average of 10 units per time interval at the lowest running cost possible. However, the reality is different since these resources are interdependent and suffer from variability in output.

The average output for each resource per time interval is 10, but contrary to our intuition, the output is not a Gaussian distribution. Sometimes the output falls to zero. In this example, our effective output is the lowest output of any of the departments at a given time. If blue goes down, all units upstream are blocked, and those downstream are starved. The effective output is only 5 units, although we have resourced for 10.

What should be the focus of the daily production meeting - what should and should not be included

Traditional production meetings:

The previous image highlights the root cause underlying ineffective production meetings. The manager in charge of a chain like this has big problems. Whom do they hold responsible for the shortfall in production? Whom do they reward for good performance? And where is the bottleneck where they should focus attention? What will the inter-departmental relationships be?

Most production meetings are focused on what happened yesterday. Did each department meet their efficiency KPI’s, and if not, why not? Efforts are made to make those in charge accountable and do better. This seems reasonable, but in an interdependent system with significant variation, the ability to do better without changes to the system is limited. Effort (projects) may also be focused on driving the variability across the whole system lower. This is a good idea but will typically not deliver the most bang for your buck. 

The solution: Focus on managing the bottleneck and protect it with excess capacity and buffers

By putting in buffers, we decouple the bottleneck from the rest of the system. We can now focus our attention on running the bottleneck as well as possible. We do not need to spend a lot of time on the other parts since we size them with about 30% more capacity than the bottleneck. In that way, we can recover our buffers before Murphy strikes again

In practice, we find that the cost of increasing the capacity of non- bottleneck departments to range from 12 to 16 units per time interval is far outweighed by the value of the increased volume (capacity is higher on the upstream side since there are 3 departments versus 2 downstream). This means that the non-bottleneck departments will be idle from time to time and also that their efficiencies will be lower than that of the bottleneck. This is counterintuitive but a requirement for success.

The new focus:

Stop fixating on yesterday’s performance, utilisation and efficiency of non-bottleneck departments or business units. Instead, focus on the overall flow of production. Instead of having to anticipate events on all stages of production, focus primarily on the bottleneck. Doing so simplifies work and aligns departmental priorities. Pushing up the overall tonnes, will automatically reduce the cost per tonne to the minimum possible. Organise data visually so that everyone can immediately determine the performance of the bottleneck, the status of the buffers and the alignment of the system to overall production performance.

A good agenda for the production meeting comprises the following.

  • Communication of incidents to mitigate and prevent recurrence
  • Feedback on critical tasks that were planned
  • What were our focus areas yesterday, and how did we perform?
  • Alignment of plan and priorities for the next 48 hours
  • Summarise the overall process status (rates & buffers)
  • Deal with bottleneck specific performance (reflect on current successes, problems & threats, decisions on specific courses of action)
  • Red buffers (explore possible solutions, decisions on specific courses of action)

How can the optimum daily production meeting be achieved?

The ideal production meeting is a place where the heads of departments, middle managers and selected employees get up-to-date visual information on what is happening to the business as a whole. These include heads of support departments. If that is difficult, rotate the heads of support departments to attend and gain an understanding of how they affect production and how they can help.

We call the ideal production meeting “the Flow Room”. The Flow Room provides a forward view and highlights patterns of interaction needing more attention. It moves the company out of firefighting by highlighting problems before they occur and putting in shock absorbers (buffers) to handle variation and interdependence. The system is managed holistically by asking departments to support the overall flow through the company. Setting up a Flow Room means that teamwork will occur across layers and functions.

The Flow Room provides visual feedback on the processes workers are responsible for and shows how their actions affect the overall system and the outcomes. It highlights problem areas in these processes and allows for dialogue around these processes. As a result, management and workers simultaneously become aware of problems in the system, and restrictive policies and bottlenecks can be addressed on the spot.

For example, having the HR manager attend the daily production meeting can expedite recruitment to fill critical vacancies on a bottleneck crew. Without this knowledge HR cannot prioritise the vacancies they need to fill. Similarly, having the procurement manager attend the daily production meeting can expedite the procurement of a critical bottleneck spare. For finance, responsible for looking after the budget, they may not know when to support the reallocation of expenditure to where it will have a leveraged immediate effect.  In the absence of knowing where the bottleneck is, when we experience simultaneous breakdowns of equipment, where should the engineering manager send their personnel first? To the equipment impacting the bottleneck department in the next 48 hours of course!

These changes from the status quo come as a great relief to employees and enable them to increase their engagement. As employees start to experience success, sometimes for the first time in their careers, they become accountable and begin to volunteer their energy and talents. This reduces the load on management that can now start to work at the level it was employed for. The result is a ramp-up in the fly-wheel with broad benefits extending to enhanced organisational culture as described in the illustration on the right – see Digital Transformation Whitepaper.

How can your digital tools complement your daily production meeting and create value for your organisation?

 

Your digital tools play a critical role in simultaneously managing variability events at your bottleneck and integrating disparate data sources and systems to automate the daily production information collation and reporting you need for your Flow Room.

 

Some key questions you can ask to establish whether your current and future digital tools are effective:

Operational Excellence Pyramid
  • Are the fundamentals in place at your operation – see enabling predictive operations article
  • Do your digital tools include integrated digital logsheets where relevant events are triggered requiring operations to take appropriate action including note-taking?
  • Do your digital tools include integrated digital trigger action response plans (TARPs) to alert and engage relevant stakeholders to leverage their collective wisdom?
  • Do your digital tools apply abnormal situation management philosophy where only metrics below or above target are automatically summarised with their corresponding explanation already annotated by the responsible person?
  • Where are you on your digital maturity journey and would your operation benefit from integrated digital advisors to augment decision making?

The advantage of such a digital system described above is that it can be easily extended to support other functions such as monthly budgeting and forecasting. By collating the above information, it is possible to automate the reporting of whether over or underperformance was the result of a difference in expected price, volume or efficiency.

Making the most of the morning meeting with MPA and Stratflow

The typical daily production meeting spends too much time focussed on past, non-bottleneck departments and business units instead of the future. Significant value can be created by appropriately structuring the daily production meeting to a Flow Room and introducing appropriate digital tools. Leading practice daily production meeting structures and tools exist that can help you create value in your operation today.

Stratflow apply their expertise in TOC and complexity science to establish Flow Rooms tailored to your operation. The Flow Room has now been used in TOC interventions in mining for the last 15 years. Experience shows that interventions with a Flow Room included are highly successful. Those without still deliver value but not nearly as much, and these interventions are not sustainable. Based on more than 80+ implementations, Stratflow have seen typical production increases of +20% and cost reduction of 10–30% per tonne.

Mipac has specifically designed MPA to complement your existing technology to fill the real-time operational system void required to manage variability and automate regular reporting processes. MPA provides you with the tools to automatically detect, alert, interact with and manage variability events in real-time. In-built functionality collapses organisational layers and elevates communication from the frontline to the management table increasing transparency and visibility.

We would love to hear from you!

How many people hours are consumed in your daily production meetings discussing past performance of non-bottleneck departments or business units?

What else do you need from your digital tools or production management system that hasn’t been captured here?

Does your daily production meeting focus on resourcing the bottleneck or are priorities stretched on superfluous items?

Meet the experts

Hendrik Lourens

Owner, Statflow Australia

Hendrik completed his undergraduate studies with physics as one of his majors. Like most physicists, he tries to find the inherent simplicity or leverage points in systems. Using the Theory of Constraints' principles to direct activities here enables the average employee and team to deliver outstanding operational results. He has helped miners such as Anglo American, Petra, BHP, Roy Hill and Kinross to improve their performance. Hendrik has lectured on complexity, production flow in mining, productivity and leadership and published numerous mining publications. Hendrik has an MSc Polymer Science(Cum Laude), MBA (distinction) Heriot Watt University and Mantoc certification in Theory of Constraints.

Dominic Stoll

Solutions Manager, Mipac

Dominic is an experienced minerals process engineer with more than 14 years’ practical experience across a variety of plant, project, commissioning, consulting education, management and commercialisation roles. Dominic has significant experience integrating people, business, and technological leadership across the mining value chain, delivering end-to-end solutions that unlock client value.

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