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Papers

Establishing Stable Operations through Continuous Improvement Program Lesson Learnt from a Nickel Mining & Processing Company in Indonesia

A prominent nickel mining company in Indonesia, part of a global mining company has been running continuous improvement program using TPM principles. Commencing in 2010, the program called Operation and Maintenance Improvement Program, has delivered enormous savings and benefits both tangible and intangible. Up to 2014, it has directly been involving more than 150 employees, completed 24 significant improvement projects whilst other 15 improvement projects are still on-going. Many other improvement initiatives will be commenced soon as awareness of the importance of continuous improvement and improvement skills have spread out company wide

The company is one of the world’s premier producers of nickel which is an important mineral for industry and modern living. The company produces nickel in matte, an intermediate product at its integrated mining and processing facilities. The ore with as much as 1.5 – 2% of nickel content are mined, screened, and stockpiled in mining area. It is then delivered to processing plant to be processed through Dryer, Reduction Kiln, and Smelter to be nickel rich product as much as 78% nickel content. 

At the time,
processing plant was the bottleneck of the overall nickel production flow. During its operation, Processing Plant often experienced delays thus interrupting production activity that affecting the achievement of production target. Further, this will affect the company’s revenue and profit margin. This condition was even worse when, mineral mining industry faced unfavorable
market situation. Nickel price considerably plunged thus reducing profit margin. Exposed to this situation, the company required to increase its production capability whilst reducing operational cost. 

 

Continuous Improvement is one best option to enable the achievement of that purpose. Continuous improvement is company-wide activities that involve everyone, either as individual or as a group, from many different levels in the company, to systematically solve problems and continuously improve performance. In order to carry out continuous improvement program, top management established a new department in charged with the responsibility to develop, implement, and coordinate sustainable improvement program across the company. The initial objective of the improvement program set by management is to grow production by establishing stable operations.

Establishing stable operations means eliminating interruptions/ delays to productions which eventually will increase production rate without over-limiting the equipment. This purpose is then wrapped in a theme “Stop the Stops”. Fix the simple things that cause equipment to stop – a major cause of lost production and process variation (process efficiencies). 

 

Unplanned equipment stoppage has to become focus since every stop increases the risk of accident (safety), every stop at the bottleneck is production lost, every stop causes loss of process control (energy efficiency), every stop causes refractory and equipment damage, and some stops cause spillage osustainability of the continuous improvement program, the company approached Relogica and asked for assistance in implementing the program.f material (environment, health, cost, production). In this search for a suitable improvement methodology and to ensure

 

Selecting Suitable Methodology

 

The company agreed to use the approach offered by Relogica for establishing the continuous improvement program. The approach is based on the principles of TPM where employee engagement and employee empowerment is the key part for successful continuous improvement program and sustainable performance improvement. Employees are engaged and empowered through formal continuous improvement activities using cross-functional teams and area based teams. Applying this approach would not only achieve the initial objective in establishing stable operations, but will also enforce positive culture among employees to actively identify and solve problems, thus continuously improve the performance.

A simple improvement method, easy to apply even by the lowest level employees, is introduced to all employees who involved in improvement project. Each improvement project becomes a part time activity for the team members. Each of these teams consists of 4-8 members from different departments and expertise as required. Team members would need to allocate their time for 1-2 hours improvement meeting per week and another 2 hours for doing their improvement work out of meeting hours. Improvement team members will still be in their normal position and responsibility during improvement activity. In this method, role and relationship for improvement facilitator, improvement coordinator, sponsor, team leader, and team member are clearly defined.

The method is based on PDCA principle which systematically forces the team to take a step-by-step move and prevents team from jumping to solution without proper analyses.

 

It limits the improvement activity in an agreed period of time to maintain teams in their best momentum and avoid frustration caused by a never ending project. Teams should manage their improvement scope properly so they could realistically achieve their goals in the designated time.

Performing Improvement Program

 

Several improvement projects aiming on establishing stable operations were performed under the operational and maintenance improvement program. They initially focus at Nickel Processing Plant area (Dryer, Kiln, Electric Furnace) where at the time it was the bottleneck for the overall nickel production flow.

 

Numbers of employees from various levels and areas like Operations, Maintenance, Engineering, Utilities, and SCM were performing the improvement projects, working together in team, exercising their knowledge and experience. They were trained to conduct systematic problem solving, being supported and facilitated by Relogica consultants along the journey to ensure that they follow the systematic steps of PDCA and achieving success. 
 

With the completion of those initial improvement projects, the management was able to see that the plant performance is improved. This led to a bigger wave of improvement projects across wider areas of nickel processing plant. More employees were involved in the improvement program as they can learn much from the improvement activities and able to see the benefits from their involvement. This led to more acceptance and commitment from management and employees for the continuous improvement program.

The successful improvement program in nickel processing plant area causing the bottleneck of nickel production flow to move from process plant to mining area. The management decided to roll out the program to mining operations and maintenance areas while keep expanding it in the process plant area.  
 

Up till now, the program has directly been involving more than 150 employees, completed 24 significant improvement projects whilst other 15 improvement projects are still on-going. It has delivered enormous savings/benefits both tangible and intangible. Many other improvement initiatives will be commenced soon as awareness of the importance of continuous improvement and improvement skills have spread out company wide.

 

Sustaining Continuous Improvement

 

Sustaining the successful continuous improvement program is now become the main focus for the program. There is no instant way to achieve sustainability. The management has to consistently show their commitment and support to continuous improvement culture development to all stakeholders. The improvement activities have to be keep expanded across the organization vertically and horizontally. It has to be supported with a good supporting infrastructure like basic management processes, training program, reward and recognition, etc. Employees need to be given with knowledge, skills, opportunity and trust so that they would become empowered to continuously identify & solve problems and improve their performance. 

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