Modern management systems for higher margins

Maximising margins in today's competitive international commodity markets demands superior productivity. This requires more than selecting the best equipment. It requires continually improving the efficiency of production, commercial, marketing and administrative processes under the control of solid modern management systems. This paper introduces an integrated way of working that includes proven management systems for successfully changing work practices and attitudes, developing managers and increasing accountability. It introduces a proven methodology for systematically involving people in sustained true continuous improvement of processes for maximising productivity, safety and revenue while minimising costs. The paper gets down to basics and shows how traditional systems entrench outdated and sub-optimal management and work practices. It describes how traditional performance measurement and reward systems cause managers to miss opportunities to control and improve basic production and service processes. It also describes the basic methodology for using the principles correctly and provides examples of successfully implementing modern systems in mining -to achieve higher productivity . INTRODUCTION-PROVENSUCCESS The improvement in underground development rates at a progressive client's mine within just one and a half months of starting to implement the principles described in this paper -and after successfully completing only the first step in a seven step process of performance improvement is shown in Fig. 1 Seven months after starting implementation and after completing just the fIrst three steps. the sustained improvement in productivity was over 50% -with reduced capital equipment! Around the world, operations using the principles have reported sustained productivity improvements of up to 100% and cost savings of as much as 50% -without additional capital investment. Improving productivity boils down to: identifying what to change using modem correct Measurement, Analysis and Reporting systems, applying a systematic methodology for improving operating and commercial processes, changing people's behaviours and attitudes -to build a new culture for ongoing improvement In many businesses, all three actions are flawed. Even managers' attempts to change people's work practices fail simply because their methods ignore the basics of human behaviour. This paper will cover the first and third topics after briefly examining the fundamentals for improving productivity 1 Catalyst for Corporate Performance Pty. Ltd., Brisbane COAL98 Conference Wollongong 18 -20 February 1998 33 • • •