The goal of mining is to remove waste rock and extract valuable ore and metals—the goal of lean is to remove process waste and extract value. Practically speaking, implementing lean principles can help companies reduce the amount of physical waste and increase the quantity of value extracted from ore, but lean can provide tangible benefits throughout all aspects and processes of mining operations.
What is Lean Six Sigma?
The lean methodology was developed with the ultimate goal of reducing costs and increasing efficiency by identifying and eliminating activities in a given process (service or manufacturing) that fail to add value and yet consume resources. In the lean terminology, value is defined as ‘what the customer is willing to pay’. As a result, lean is heavily oriented not only to efficiency and cost reduction but also to creating value to ensure customer satisfaction.
On the other hand, Six Sigma is a system developed with the goal of controlling variation and making processes more consistent and reliable to ensure the quality of deliverables. The combination of Lean with Six Sigma results in a faster creation of value at the lowest possible cost.
Lean within the Mining Industry
Due to the continual uncertainty and volatility in the mining industry caused by fluctuating demand, cyclical pricing, and a decreasing trend in mining profitability, it is vital that mining companies identify and implement strategies to continuously reduce costs while enhancing operational efficiency. The dependency of the industry on fluctuating commodity prices results in increased costs when commodity prices are high as companies produce more, but cost-cutting methods such as layoff and operation shutdowns occur when prices are low. Lean six sigma can provide the tools to reduce the impact of variation in commodity prices and help avoid layoffs and shutdowns in order to remain profitable at any point in the cycle.
Also, mining companies need to achieve and maintain high overall equipment effectiveness (OEE) and minimize waste. Any operation that fails will struggle to compete. As a result, it’s necessary for mining operations to be streamlined and efficient to not only remain competitive but also to be responsive to a complex and dynamic market. It is possible for mining firms to build toward sustainable, long-term success through the implementation of lean manufacturing principles.
Various lean process improvement opportunities include minimized shutdowns, increased production, reduced chances of failures to reach targets, improved possibilities for technology adaptation, and improved safety, as well as potential benefits to environmental footprints.
Implementing lean in mines is more challenging than in most manufacturing plants due to the inability to control certain elements in contrast to controlled plants where the steps to execute methods such as 5S and visual workplace to improve cleanliness and organization are more straightforward. Nevertheless, operational excellence is possible, though it requires strategies for effective implementation and sustainability of lean initiatives. Through lean six sigma, businesses can ensure they are utilizing their time and resources in the most efficient way possible to generate the most profit.
But making fundamental changes to how companies operate is not easy. Successful implementation of lean requires culture change from within and buy-in from all levels of employees. Continuous training and repeated kaizen events that enable employee empowerment are necessary for lean to become engrained within the company. The fact that 70% of improvement potential is contained within human talent makes it important to both empower employees to continuously improve agreed-upon standards for their work and educate employees about effective problem solving.
Mines are able to achieve significant operational improvements in areas of biggest losses; for example, waiting and material waste can be minimized by standardizing material areas that can be refilled regularly, which could lead to gains in the number of ore face cycles per day and cost reductions per meter excavated in the range of 5%. Value stream mapping can be used to identify significant variables that can contribute to optimized cycle times and reduced lead times, leading to increased mine throughput. Environmental benefits are gained when improvements to process flow cause reductions in operational footprints and wasted energy.
Further potential exists with new technologies applicable to mining, such as autonomous operations including maintenance or drilling, as well as the use of drones or virtual reality tools that will enable the presence of employees within mines to decrease. However, adapting to these new technologies through a lean perspective can maximize the benefits able to be achieved, rather than introduce new sources of waste and wasted potential.
Lean Six Sigma Training & Implementation
At AMSaxum we provide onsite corporate training on lean six sigma/continuous improvement methodologies and help our clients with the implementation of process improvement projects. There are government grants available in Canada and the USA to cover the cost of corporate training.
Government Funding & Assistance Options
In addition to the tangible benefits possible through lean, the research and development efforts (labor, materials and subcontracts) required in the mining sector could be eligible to be recovered through government funding, such as through the Scientific Research & Experimental Development (SR&ED) program in Canada.
For companies in North America, specifically, there could be applicable grants to aid in upfront costs such as capital investment and employee training. AMSaxum experts in government funding help with the application of these grants and with the preparation of SR&ED claims.
There are additional tools that can aid in improving overall efficiency, such as an RCCA labor tracking solution we offer, which is an application for collecting data or for tracking labor or KPI efficiency.
For more information on continuous improvement and Government funding within the mining sector call AMSaxum at 905-315-6847 or contact us here.