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OM in the News: Lean Also Works in the Mining Industry

August 5, 2014
Mines are borrowing cost saving ideas from other industries

Mines are borrowing cost saving ideas from other industries

Global mining companies have scoured deserts, mountains and jungles for resources to rev up their profits, writes The Wall Street Journal (July 28, 2014). More recently, the search has taken them to a different environment: the factory floor. “We’re certainly looking outside of our own industry, and shamelessly stealing and implementing ideas where it is possible,” said Lucas Dow, head of a coal alliance in Australia. He said he’s taking on many ideas from Toyota, the company that rewrote the book on lean manufacturing with techniques like JIT inventory, designed to wring out efficiencies. He wants to run mines using simple, repeatable processes that can flow without hitting bottlenecks, like a car assembly line.

At one large coal mine, an employee recently suggested setting up several Formula One-style pit stops around the more than 12-mile-long mine site to improve refueling of dump trucks, which haul some 300 tons of raw material at a time. That change came after Mr. Dow, praising the open communication between workers and management at Toyota, asked staff to provide feedback at the end of every shift.

Mines are also using “big data” to fine-tune maintenance schedules so that the engines in their $5 million trucks can be replaced just in time, rather than as prescribed by the manufacturers. And they increased output by as much as 13% through improving productivity—managers say a modular building style traditionally used in the oil-and-gas sector saved time and money in the construction of the company’s latest processing plant.

Food-processing technology, such as machines that sort rice, are also a big help. Equipment that uses color sensors to sort rice into white and nonwhite grains, before pressurized air is fired at unwanted grains to get rid of them is being adapted to sort rocks containing iron or copper from barren material.

Classroom discussion questions:

1. Why are mines looking to lean factories for ideas?

2. Is lean only useful in manufacturing and mining?

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