Challenge
Our client, one of Australia’s largest Iron Ore miners, was looking to identify and remove bottlenecks across their Pit to Port supply chain. This was part of a broader program targeting a $250m EBITDA uplift.
In working to identify major bottlenecks, PCG found that there were two key factors contributing to inefficiencies across the supply chain:
- Managers were unable to see the upstream and downstream impacts of their operational decisions, and
- CAPEX investments were not being prioritised according to value created.
Our Solution
- PCG Solutions modelled the clients operations in its Pit to Port Value Driver Model (VDM). This Solution incorporated a detailed materials balance model that reflected monthly movement of all ore through the system.
- All key capacities and constraints of the supply chain were considered (eg. OPF and train loading of separate mine sites, rail network availability, shipping capacity, and available product at the front of every process).
- Where stock could not be moved due to supply chain constraints in downstream processes, the model determined the quantity of constrained stock attributable to each bottleneck.
Benefits
- The model was implemented on a site by site basis, and PCG conducted user training for key site management. Working in close partnership with the client, PCG then used the model to identify initiatives to contribute to the $250m EBITDA uplift.