EAME Miners’ Forum Malaga - 2007

Mining expertise, business solutions

2

Financial Management of Equipment… Evaluating Maintenance & Repair Costs

• Direct Equipment CostsExpenditures against equipment as a result of Planned Maintenance, Breakdown or Preventative Maintenance

• In-Direct Equipment CostsExpenditures undertaken to support and facilitate fleet maintenance; on-site & off-site

3

In-Direct Machine Financial Requirements

Off-Site Support Staffing

Set Up Costs

Tooling

Service Vehicles

On-Site Support Critical Success Factors

Planning

Component Inventory

Parts Inventory

Losses

Consumable Inventory

Non Cat Parts Sourcing

Continuous Improvement

Technical Support

Warranty

Financial Management

Business System

Rebuild Logistics

Inventory Management

Safety

HR & Payroll

Logistics

Management Tree

Training

Staff Recruitment

Staff vs Machines

Early SMU Management

Crane Availability

Fuel Truck Availability

Components vs Machines

Component Planning

Utilization vs. Maintenance

Component Life

Operation Severity

4

Set Up Costs

• Mining normally in Remote Location• Internet connection

– V-SAT– Maintenance of communicatiions

• On Site IT– Computers– Laptops

• Workshop Set Up– Consumable Dispensing Units– Lubricant Suction Units– Air Lines– Demarcation Lines– CC & Safety Signage

• PM Bay Set Up– Walk Around PM Stand– Kidney Loop Equipment Integration– Drip Trays– Tooling Cabinets and Tool Boxes– Workbenches

On Site Support

5

Set up Costs

• Oil Dispensing Units– Environmentally complying Cubes– Fine in-line filtration– Pump– Consumables

• Wash Bay Facility– Pressurized Water Supply allowing

localized and efficient washing• Office Facility

– Furniture– IT – Printers, Scanners etc.– Cupboards, cabinets– Planning Boards

On Site Support

6

Tooling

• Tooling provided to all employees?– Finance Costs– Specialised Tooling Requirements

• Lost / Replacement tooling • Tooling Supply• Lifting Chain Safety Requirements• Non Cat Tooling Sourcing• Tooling Supply• Depreciation• Finance Charge

On Site Support

7

Service Vehicles

• Mobile Fueling Truck– In – pit daily servicing– Daily Inspection of machines– Lubricant and Coolant supply– Selection

• Mobility• Speed• Reliability• Supply• Spare parts & Stocking

• Light Vehicles– Fleet Coverage– On Board Tooling Requirement– Maintenance– Parts Supply and Stocking

On Site Support

8

Service Vehicles

• Specialised Support Equipment– Telehandlers

• Facility Manoeuvrability• Component Replacement• Man Basket Function

– Fork Lift• Parts and Component Manoeuvrability• General Workshop use

– Hiab Truck• Component replacement• Heavy / Large item transport

• Specialised Maintenance Equipment– Welding Bay

• Mobile / Stationary Welding Sets• Work benches

– Compressor• Mobile / Stationary• Air supply in field

On Site Support

9

Planning

• Storage of WIP (Backlog) Parts– Shelving– Plastic Boxes– Clipboards– Warehouse space

• Planning Visual Aids– Component Planning Boards– PM planning Boards

• Information Storage – Business Dealer System

• Capture planning functions

– Machine History Files– Storage Room

On Site Support

10

Parts & Component Inventory

• Parts Availability– Lead Time Variables– Fast Moving vs. Slow Moving Stock– Effect on Machine Availability

• Finance Charges• Warehouse Racking and Manoeuvrability

– Logistics

• Exchange Components– Increase Availability– Component Stands– Installation Kits– Extra ‘Seeded’ Components

• Charges– Finance Cost– Depreciation

• Component Space Allocation– Rust Prevention– Forklift Access

On Site Support

11

Consumable Inventory & Losses• Lubricant

– Grease, Oil & Coolant– Finance Costs– Logistics

• Welding Consumables– Nitrogen & Oxygen Bottles– Grinding Discs– Welding Rods

• Workshop Consumables– Rags– Contamination Control

• Wipes• Mats

• Stationary– Printed Forms– Printer paper and cartridges

• Theft• Dead Stock• Wastage

– Oil & Fuel• Incorrectly ordered parts• Warranty Claims• Poor Workmanship

On Site Support

12

Safety

• Personal Protective Equipment– Vests– Boots– Glasses– Hats– Welding Screens

• Vehicle Safety Enhancements– Flashing Lights– Buggy Whips– ROPS

• Fleet Safety Enhancements– Mounting and Dismounting Standards– Lock Out Devices– Wheel Chocks

• Lifting Device Certification and Training– Chains Periodic Inspection– Crane Inspection and Certification– Lifting Training

On Site Support

13

Operation Severity

• Operation Severity Measurement– Consistency– Key Performance Indicators

• Operator Influence– Long Term Abuse

• Transmission Shifting• Retarder Control• Torque Stall

• Pit Floor / Haulroad Influence– Fleet Life– Labour Hour Calculations– Workshop Space Calculations– Tyre Maintenance

• Loading Practices influence– Strut Maintenance– Body Maintenance– Tyre Maintenance

On Site Support

14

Inventory Management & Non Cat Parts Sourcing

• Central Inventory Control– Initial inventory stocking– Min / Max Setting– Re-ordering metrics– Parts Clearing– In country logistics

• Fast Moving Parts– GET Management

• Cost / Hour• Hrs / Change

– Undercarriage Management• CTS Inspections• Wear rates• Shoe Life• Link Life• Roller Life• Frame Life

• Non CAT Sourcing– Mega Water Truck Spares– Service Truck Spares– Fork Lift Parts

Off Site Support

15

C.I., Technical Support & Warranty

• Continuous Improvement– Site Audits– Conference Calls– PIP/PSP Completions– Fleet Updates

• Technical Support– Repetitive Machine Issues– Urgent Welding and fabrication– Software and Support Documentation– Warranty Follow Up

• Warranty– Documentation Processing– Caterpillar Follow Up– Reporting– Claim follow up and resubmission

Off Site Support

16

Business System and Financial Management

• Parts and Work Order Management– Parts Requests and Additions– Work Order Opening– Invoicing Requirements– Cost Control

• Scheduled Reporting– Work in Progress– Backlog Parts– Non-moving Parts

• Fleet Costs Management– Expenditure versus Budget– Projected Costs– High Costing Machine Areas– Machine Specific Reports– Re-alignment of maintenance practices

along with expenditures

Off Site Support

17

Rebuild Logistics

Off Site Support

Component Return to M.A.R.C. Site

Planned / Unplanned Component Replacement

C.R.C. Strip, Rebuild & Test

(Following R.P.I. Administration)

Component delivery to C.R.C. Workshop

(Component Tags andRepair Instructions)

The 3 week Component Return

Cycle

Fleet Long Life Component Projections

Pre-Prepared 100% Rebuild Kits

Pre-Ordering 100% Kits for all Components

(Seafreight)

Pre-Prepared Labour Enhancements and Structure Upgrade

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Recruitment, HR & Payroll

• Interviews, medicals and appointments– Selection Criteria– Aptitude Testing– Medical Letters– Unsuccessful Medicals– Appointment Letters

• Inductions– Company inductions– Safety inductions– Initial training

• Union Negotiations• Staff quantity increase

– Payroll Stresses– Allowance calculations

• Provident Funds

Staffing

19

Management Structure

Staffing

Project Manager

Maintenance PlannerSHEMaintenance Supervisor Parts Supervisor

Welding Supervisor Electrical SupervisorService Bay Supervisor Shift Supervisor

Abraham Sackey Alfred Tawiah Samuel Ayiku

Francis Gyakye Alex Baah

Kwasi Amande Isaac Nyarko

Emmanuel EwudziDominic Cudjoe Asare Baidoo

Benjamin AhorseyBuami Xola

GeorgeNkrumah CyrusSampson Larbi

Daniel AcheampongLawrencia Ofosu Gyan

Martin Satekla Gabriel Cudjoe

Hagar NyamekyeKofi Gyimah

Thomas Appiah Lawrence Mensah

Ebenezer Oppong Christian Kumordzi Anthony Aquach

George Blay

Workshop Supervisor

Admin Manager

Terrence BlanksonDaniel Adjah

John Oko AmarteifioSamuel Okine

Fred AkuffoEmmanuel AmuCharles Mends

William Asare DonkorEmmanuel Bart-Plange

James Abban (C)James Asamoah (C)

Isaac ObengAbdul Karim

Nicholas KueviFuseini Amandu

Moses AtivoRichard Kofi Norgbey

Samuel DanquahAgbessi Bamidele Kingsley Appiah Richard Nyanney

James Bilini Samuel Arthur Bekai Darku JohnTanko

AyubaBen VondeyMaxwell Boaitey

Fuel Bay Inspectors Dan Venance

Samuel IncoomPaul Bluvi

Prince Yeboah Lord Cudjoe Lube Truck

Edward Kwame KyiAkakpo MichaelFranklin Kwofie

Peter Danso William AmpahPatrick Boakye

CIL InspectorsGeorge Solomon Richard MensahJohn Kyei Bosco

Samuel Boadi Bramsco Isaac Kyereboah

Wilson VordzorgbeJohn Opoku

Emmanuel Nsiah AdamsGaddiel Amoako

Yussif SeiduAlfred Yankson

Vehicle Info Manager

Hose Technician Rowland Bessieh

Crane operators Ebenezer Asimeng

Wakson Supervisor

Seidu DawudaIbrahim Abubakari

Francis KwofieAugustine Tsiwah

Joel AnkomallBen TakyiKwesi Ano

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Logistics• Transport

– Staff transport to/from work– Expatriate travel to/from site for

leave/training– Leave / Training Flights– Visitor travel arrangements– External trainers

• Accommodation– On site accommodation for expatriate staff

• Furniture• Kitchen Utensils• Cleaning and Laundry

– Hotels – Local accommodation for training– Visitor and Management Hotel Costs

• Food– Local Food supply

• Dayshift/Nightshift

– Expatriate Meals– Visitor / Management Meals

Staffing

21

Training

• On-Site Training – Room and Projector– Training Co-ordinator– Updated Schedules– Initial induction

• Safety• Contamination Control

• Off-Site Training– Technical– Supervision– Management– Soft Skills– Traineeship

• On-Line Training– SIS– Parts Pro– New Product Information

Staffing

22

Components vs. Machines

• How many spare components do I need on site?

– Fleet Availability Requirements– Rebuild Turnaround Time– Rebuild Failure Rate– Component Durability– Fleet SMU Proximity– Model Importance– Maintenance Strategy

• On-Site / Off-Site Repair• Reman Strategy

• Fleet Example– 1 Power Train Exchange per 10

Equipment Models• >90% Availability• <1 month turnaround• <10% failure rate• >80% Rebuild Life

Critical Success Factors

23

Staff vs Machines

• How many staff do I need on site?– Fleet Size

• Qty of PM’s per day• Average Breakdowns per day• Component Changeouts per day

– Fleet Age• Proximity to Component Changeouts• Specialised Work Required

– Welders (Body repairs)• Breakdown % per day

– Workmanship• Quality of work• Scope Capabilities• Training Needs

– Key Areas• PM Supervisor• Toolstore• Backlog Store• Maintenance Planner

Critical Success Factors

24

Component Life & Planning

• Component Life Extention– Increasing component life does not mean

decreasing cost per hour– Increasing component life and achieving budgeted

rebuild cost will decrease cost per hour– Rear Axle Life

• Kidney Looping• Condition Monitoring

– Oil Cleanliness• High efficient filters• Continuous Monitoring

• Fleet SMU Proximity Implication– Try to avoid Component Change-Out Peaks– Be aware of the possibility of component potential

failure increase.– Plan 12 months in advance– Ensure Parts and Rebuild Centres are aware

• Replacement Strategy– Reman option– Recondition option– New option– After/ Before Failure option– Condition Monitoring option

Critical Success Factors

25

Early SMU Management

• Early Hour Principles– Be aware of the ‘Honeymoon’ Period!– Utilize Training Opportunity– Keep Work Efficiency High– Ensure the Asset is looked after, not the

breakdown– Ensure Systems and Procedures are

adhered to.• Contamination Control• Safety

– Keep discipline consistent– Assign Roles and responsibilities– Ensure fully furnished workshop

• Tooling• Fabricated Stands• Fabricated Steps

– Plan some components early– Validate parts kits

• PM• Component Replacement

Critical Success Factors

26

Crane & Fuel Truck

• Crane Usage– Vital in machine build– Component Changeouts

• Dump Bodies

• Fuel Truck Availability– Vital for all tracked machines

• Fuel Truck Spec– Fuel Capacity– Oil Types– Pump capacity and flow rate

• Quantity of fuel trucks– Tracked Fleet quantity– Strategy

• Truck fueling• In pit Fuel Bay

Critical Success Factors

27

Utilization vs Availability

• Projected utilization of fleet key to facility and maintenance planning

– Components – Staff– Workshop Space – Tooling – Rebuild Centres

• Utilization is directly proportionate to machine downtime

– Availability in relation to calendar hours will vary due to machine utilization

– Example• 8760hrs Calender Hours• 50% Utilized 4380 hrs worked• 800hrs downtime 91% Availability

• 75% Utilized 6570 hrs worked• 1200hrs downtime 86% Availability

Critical Success Factors

28

In-Direct Machine Financial Requirements

Off-Site Support Staffing

Set Up Costs

Tooling

Service Vehicles

On-Site Support Critical Success Factors

Planning

Component Inventory

Parts Inventory

Losses

Consumable Inventory

Non Cat Parts Sourcing

Continuous Improvement

Technical Support

Warranty

Financial Management

Business System

Rebuild Logistics

Inventory Management

Safety

HR & Payroll

Logistics

Management Tree

Training

Staff Recruitment

Staff vs Machines

Early SMU Management

Crane Availability

Fuel Truck Availability

Components vs Machines

Component Planning

Utilization vs. Maintenance

Component Life

Operation Severity