Application of Computers and Operations Research in the Mineral Industry –

Dessureault, Ganguli, Kecojevic & Dwyer (eds)

© 2005 Taylor & Francis Group, London, ISBN 04 1537 449 9

Managing key business indicators through their lifecycle

C. Lumley
Anglo Platinum, South Africa

ABSTRACT: The management of the Anglo Platinum (AP) mining technical systems (MTS), having previ-
ously defined the strategy for the MTS environment, thereafter embarked upon a process to identify critical
business indicators that could potentially impact favourably on the bottom line of the company. Once these
indicators were identified, the value proposition of utilising IT to manage these indicators through their life-
cycle was studied and appropriate strategic and tactical plans put in place to maximise value. This strategic
process took place within a company that had experienced a dramatic expansion programme within the last
four years. The mining technical systems department supports the functional disciplines of geology, survey,
mine planning and evaluation. The team primarily supports mine management to effectively gather, analyse and
disseminate data relating to the ore reserve by integrating a number of strategically selected IT applications
to ensure that the safety, legal and operational requirements are met. This service to business is rendered by
management of a strategic outsource partner via tightly controlled service level agreements (SLA’s). The focus
of this paper will be on grade management and the framework used was a hybrid of Information Systems Archi-
tecture for this business indicator. By using information flow and understanding the decision-making points, the
appropriate techniques and reports were constructed to ensure alignment to the greater internal strategy of the
business.

1 INTRODUCTION of information needed, etc. Qualitative performance

indicators include user perception of service qual-
Business indicators are more commonly know as Key ity, user satisfaction with reference response, types or
Performance Indicators (KPI’s), assist an organization levels of service available, etc.
to define and gauge progress toward meeting organi- In order to track the lifecycle of the grade indica-
zational objectives. Within the mining domain there tor within Anglo Platinum a simple framework was
are a number of critical internal indicators related required. After extensive research and consultation on
to quantity, quality, safety, occupational hygiene and how to simply visually represent the grade indicator,
environmental for example. Other external indicators the system model from the Zachman Enterprise Archi-
may relate to exchange rates, commodity prices, brand tecture model was chosen. The model is described as
or social investment programmes. Whatever KPI’s are follows by Zachman:
chosen, they must be aligned and support the com- The Framework as it applies to Enterprises is sim-
pany’s objectives. Their definition and how they are ply a logical structure for classifying and organizing
quantified generally does not change, so they must the descriptive representations of an Enterprise that are
be measurable, as they will ultimately determine the significant to the management of the Enterprise as well
success or failure of the organisation. as to the development of the Enterprise’s systems. It
Most organisations have hundreds of different indi- was derived from analogous structures that are found in
cators that are collected and used to manage dif- the older disciplines of Architecture/Construction and
ferent parts of the business, however according to Engineering/Manufacturing that classify and organize
Young, P. R. (2001), a performance indicator is defined the design artifacts created over the process of design-
as follows: ing and producing complex physical products (e.g.
A particular value or characteristic used to mea- buildings or airplanes.)
sure output or outcome. Measures of service qual- The system’s model is a thin slice of the greater
ity, performance efficiency and customer satisfaction. Enterprise Architecture model. The model that was
Quantitative performance indicators may include vol- constructed is now a poster that was circulated
ume of backlogs, processing time, reference response amongst operational management at the various busi-
time, ILL delivery time, FTE to user ration, availability ness units.

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 Figure 1. Schematic diagram of the functions supported by
the mining technical systems department in terms of the AP
value chain.

This paper documents the methodology employed

by Anglo Platinum to systemically define grade man-
agement both at an operational and strategic level. The
methodology entailed the following components:
• Taking a strategic view of managing key business
indicators
Figure 2. Schematic diagram of the sub-processes within
– Defining critical business processes the AP mining value chain.
– Gap identification
– Constructing an information systems model for
grade management Geological Modelling requires grade data from the
borehole analysis.
• Implementation of the vision Now the picture of grade management throughout
– Project selection its lifecycle was becoming clear and this critical busi-
– Project Implementation ness indicator could now be defined within a process.
The connection between the different tasks could now
• Influencing the business culture regarding grade be represented in schematic form.
management
– Creating business ownership
• Recommendations 3 GAP IDENTIFICATION

Once the flow of data relating to grade had been

documented and better understood it became imme-
2 DEFINING CRITICAL BUSINESS diately apparent that multiple manual interventions
PROCESSES were necessary from the users. This situation was
deemed inefficient and could potentially impact on the
The MTS department is tasked with providing all integrity of the data.Additionally, no central grade data
aspects of IT strategy, development, support & store was available to the user base. The underground
maintenance for the following functions within the mining samples were stored in a separate database
organization: from the geological samples.
The annual mining planning cycle, which forms
– Planning
part of the greater Strategic plan, was also using little
– Evaluation
grade information within the CAD design programme
– Geology
because it was cumbersome and required highly skilled
– Survey
operators to import the grade models from the geolog-
– Metallurgy
ical modeling package. This obviously impacted on
– Safety, Health & Environmental
the confidence levels regarding certain operational and
In terms of aligning the MTS strategy with both the strategic decisions within the organisation.
strategy of the business and the overall IT strategy, From an operational perspective there were multiple
the domain of responsibility had to be defined and the disconnects regarding grade data flows. Of immediate
value chain was again used as the tool for reference. concern was the information being generated by the
By drilling down into the underlying processes laboratories that was being sent back to the survey and
and sub-processes of the value chain, the team could geological personnel in various formats.
identify the various grade touch points within the sub- Once the data flow was mapped between the various
processes. For example, within New Mine Scope, the systems and different functional areas, the schematic

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Copyright © 2005 Taylor & Francis Group plc, London, UK

 Figure 3. Schematic diagram showing part of the systems architecture for managing grade.

was presented back to business and a number of work- – All databases to communicate to each other;
shop held to first agree that the gap exists and secondly – Minimise manual transfers;
to brain storm solutions. These solutions formed part – Increase strategic and operational alignment.
of an initial wish list that was ranked and prioritised at
Once the present state was documented a vision for
a central MTS steering committee.
2005 was constructed and presented back to business.
Once agreed, this schematic of the systems landscape
for grade management was laminated and forwarded
4 CONSTRUCTING AN INFORMATION
to all the mineral resource management teams across
SYSTEMS MODEL FOR GRADE
the organisation. Since 2003 most of the projects that
MANAGEMENT
were envisaged have materialised and little manual
intervention is required. This itself is a strong mes-
Now that the flow of data regarding grade was under-
sage back from business personnel that this strategic
stood and documented, the challenge was to create a
endeavour has added value to their operations.
schematic that was easy to understand and useful to
the operational teams. The schematic had to show the
following attributes:
5 IMPLEMENTATION OF THE VISION
– The chronological sequence of tasks;
– Various interrelated systems and their integration
5.1 Project selection
points;
– High level responsibilities of operational personnel The exercise initially identified 6 projects that were
regarding these systems; categorised into either operational or strategic. After
– Underlying databases. much debate and work shopping, a business prin-
cipal was agreed that the operational projects were
Part of the model is illustrated in Figure 3.
to be completed first, in order to establish an inte-
Other business drivers to conclude the model
grated framework for site based geological and survey
included:
teams. It was also identified that there was poten-
– Enhanced business and technology integration; tial to improve the stope width control process at

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Copyright © 2005 Taylor & Francis Group plc, London, UK

 Figure 4. Schematic diagram showing part of the systems architecture for managing grade.

Figure 5. Schematic diagram showing project management governance framework.

the underground operations. Any reduction in dilution longer-term plans. Part of the systems architecture for
would have bottom line benefits for the organisation. the strategic planning cycle is represented in Figure 4.
From a strategic perspective it was recognised that bet- The return on investment (ROI) per project was cal-
ter quality polygons were desirable as inputs for the culated as part of the process for motivating a budget

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Copyright © 2005 Taylor & Francis Group plc, London, UK

 Figure 6. Schematic diagram showing the Mining Technical Systems Steering Committee operating model.

for the projects. The internal rate of return was used as case. These debates were encouraged via the Min-
the discount rate for the Net Present Value (NPV) anal- ing Technical Steering committee and support was
ysis. This is in turn was plotted against the risk of the obtained and mandated via the group regarding the
project, which can be qualitatively determined relating strategy going forward. Proposed budgets were also
to its size, time period, clarity of business needs and authorised by the business units via this forum.
the proposed technology platform. At a user level, various details were contested and
discussed at a user group. The chairman of the user
5.2 Project implementation group was a member of the Mining Technical Systems
Steering committee and was tasked with making spe-
The following business principles were agreed upon cific recommendations regarding many contentious
regarding project implementation: matters.
– Use Prince II project management methodology
according to the internal Project Support Office;
– Project team comprising business, Group IT and 7 CONCLUSIONS
the outsource partners guided by the relevant user
forums; This strategic exercise resulted in a group strategy for
– Formal quarterly feedback to the Mining Technical grade management that was embraced by the mineral
Steercom; resource management teams across the organisation.
– Business ownership for benefits realisation. Amongst the numerous learning’s, the crux of the suc-
The project governance structure is represented in cess of this initiative was to establish a governance
Figure 5. framework for the Mining Technical Systems domain.
The framework is designed and operates as follows:
As can be seen from the framework, the vision and
6 INFLUENCING THE BUSINESS CULTURE strategy is generated by three parties: namely busi-
REGARDING GRADE MANAGEMENT ness representatives, group IT staff and the outsource
partner. This approach provided the right mix of skills
6.1 Creating business ownership to generate a model that the business could use in
The approach entailed convincing management that their daily operations. Simultaneously, the needs of
grade could be better managed than was the current the strategic planners were met.

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 The systems architecture diagram that was made The software distributors and developers: GMSI are
into a poster indicates which systems are used for mod- acknowledged for their assistance in integrating the
elling, planning, measuring or controlling information applications of the systems for Anglo Platinum.
related to grade or content. Furthermore, the diagram
suggests by whom which system is to be utilised to
generate information, while simultaneously indicat- REFERENCES
ing where the information resides. This has assisted
in defining various roles and responsibilities within Young, P.R. 2001. Electronic services and library perfor-
the mineral resource management teams. mance measurement: A definitional challenge: 21.
Additionally, the diagram serves as an educational Rowe, Mason, Dickel, Mann, Mockler. 1994. Strategic
Management: a methodological approach. 4th Edition.
tool to people interested in seeing the holistic pic-
Addison-Wesley. Reading Mass.
ture relating to the lifecycle of grade within Anglo Zachman, J.A. 1987. A Framework for Information Systems
Platinum. Architecture. IBM Systems Journal, vol. 26, no. 3, IBM
Publication G321-5298. 914-945-3836 or 914-945-2018.
Lumley, C. 2003. Value chain based strategy formulation
ACKNOWLEDGEMENTS for mining technical systems. Application of Computers
and Operations Research in the Minerals Industries, South
The support and permission of Anglo Platinum and African Institute of Mining and Metallurgy.
GMSI management in the preparation of this paper
and for permission to publish this paper is greatly
appreciated.

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