www.tocpractice.

com

13th InternationalConferenceofthe
TOCPractitionersAlliance TOCPA
www.tocpractice.com

May2122,2014Johannesburg,SouthAfrica

4 Pillars of TOC and effective application

and results in Mining

Katlego Mabote :TOC Optimization Manager South

Africa :Lonmin

13th InternationalConferenceoftheTOCPractitionersAlliance TOCPA

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Katlego Mabote Resume

13th InternationalConferenceoftheTOCPractitionersAlliance 2016/08/15

TOCPA

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4 Pillars of TOC and effective application and

results in Mining

What is TOC for US

REFRAMING

Leadership
Concept of Revenue Flow
Concept of Variation and Buffer Management System
Concept of Behaviour (Non Verbal and Verbal)
What measurement are Critical

13th InternationalConferenceoftheTOCPractitionersAlliance 2016/08/15

TOCPA

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4 Pillars of TOC and effective application and

results in Mining

What is the Core Problem

How
Muchwe
Spend

The
Difference
IsProfit

Moneytobe
Made

EspeciallyiftheMarketsareopenforMoreVolume

13th InternationalConferenceoftheTOCPractitionersAlliance 2016/08/15

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4 Pillars of TOC and effective application and

results in Mining

But what is the Reality our Business Plan

TheLoss

or
Less

The
SPENT
become
Fixed

The
Difference

THENWhatisNEXT.

13th InternationalConferenceoftheTOCPractitionersAlliance 2016/08/15

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4 Pillars of TOC and effective application and

results in Mining
THENTheUnconsciousNewbusiness
Model

or
Less

These
become
Fixed

The
Difference

TheLoss

THEN:COMESTHEWORSED

13th InternationalConferenceoftheTOCPractitionersAlliance 2016/08/15

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4 Pillars of TOC and effective application and

results in Mining
THENTheUnconsciousNewbusiness
Model

or
Less

These
become
Fixed

ThenTHE
SpendCant
be
Increased

TheLoss

THEN:HOWDOWEANALYSEANDSPEND
OURTIMEINTHENAMEOFREVENUE

13th InternationalConferenceoftheTOCPractitionersAlliance 2016/08/15

TOCPA

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4 Pillars of TOC and effective application and

results in Mining
THEN:weanalysetheLOSS

or
Less

These
become
Fixed

Then
SpendCant
be
Increased

ThenWesuggest
theobvious:WHAT
ISTHAT ?

TheLoss

Analysethe
TOP5loss
contributing
factors

13th InternationalConferenceoftheTOCPractitionersAlliance 2016/08/15

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4 Pillars of TOC and effective application and

results in Mining
THEN:WebenefittheLAWOFFOCUS

or
Less

These
become
Fixed

Then
SpendCant
be
Increased

TheLoss

Or

Series

Parallel
13th InternationalConferenceoftheTOCPractitionersAlliance 2016/08/15
TOCPA

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4 Pillars of TOC and effective application and

results in Mining
THEN:theconversationbetween
COREPRODUCTIONandNONCORE

or
Less

These
become
Fixed

Then
SpendCant
be
Increased

TheLoss

PRODUCTIONVOICE

NONCOREVOICE
MoreSpendisWaste
d
BLACKBOXMentality

PolicingthePolicy

OneVOICE
Weneed
More

13th InternationalConferenceoftheTOCPractitionersAlliance 2016/08/15

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4 Pillars of TOC and effective application and

results in Mining

THEN

OURVICTIMSOFWHATTOTHINK
Or

VICTORSOFHOWTOTHINK

13th InternationalConferenceoftheTOCPractitionersAlliance 2016/08/15

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THE TOC ANALYSIS

THEN:THENTOCANALYSETHELOSS

or
Less

These
become
Fixed

Then
increase
theSpend

TheLoss

TheWorld
ofVariability
andStability

13th InternationalConferenceoftheTOCPractitionersAlliance 2016/08/15

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THE TOC ANALYSIS VISIBLE VARIATION

THEN:THENTOCANALYSETHELOSS

or
Less

These
become
Fixed

TheTOC
TechnicalLoss

Then
increase
theSpend

The1st lossisNOGuarantee
Availability
The2nd lossisNO
ProtectionofRevenueFlow
13th InternationalConferenceoftheTOCPractitionersAlliance 2016/08/15
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THE TOC ANALYSIS INVISIBLE VARIATION

THEN:THENTOCANALYSETHELOSS
TheTOC
TechnicalLoss

or
Less

These
become
Fixed

The3nd lossis
Leadershipand
BehaviourThe
FIGHTAGAINST
POLICY

Then
increase
theSpend
The1st lossis
GuaranteeAvailability
The2nd lossis
ProtectionofRevenueFlow

13th InternationalConferenceoftheTOCPractitionersAlliance 2016/08/15

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The4PillarsofTOCSuccess(Inputs)

Leadership

OptimisedFlowoftheWhole

Understand&AdoptTOCFrameofReference
ArticulateStrategy&SharedVision
Plan&CommunicateCaseforChange
IdentifyCriticalSuccessFactors&KPIs
ExhibitInclusive&CoachingManagementStyle

DevelopBigPictureFlowModels
DetermineSystemConstraints&Buffers
EstablishMOPictureforFlow
ConductHLAnalysis&ManagePriorities
EnsureVisibilityofSystemHealth

OptimisedFlow(TOC)
EstablishingaSystemfor
ExcellentResults
BufferManagement

Ops&Reflection

EstablishBuffer&ReplenishmentApproach&
System
EnsureMaterialBuffers&Replenishment
EnsureSkillsBuffers&Replenishment
EnsureEquipmentBuffers&Replenishment
ManageOperational&StrategicBuffers

ConductDailyOpsRoom&EstablishFocus
FacilitateRevenuebasedDecisionmaking
ConductReflectionmeetings/conversations
FacilitateDialogueprinciples
InstituteTeamworkdevelopment&
15
improvement

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TOCinLonmin

15
13
12

IN

750 000 oz

16

16

11

16

15

12

14

16

Leadership

12

13

12

10

13

13

12

OUT

15

14

Stable
Predictable
LowCost/oz

Optimised
Flow
4Pillars
Buffer
Management

Unstable
Unpredictable
HighCost/oz

Bottle3
+20%

Ops&
Reflection

Rowland

Bottle2
+10%

Saffy

4B

K3

Leadership
Flow of the
Whole
Buffer
Management
Ops & Reflection
18

Bottle1
90 Days
16

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InternationalConferenceoftheTOCPractitionersAlliance TOCPA

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13th InternationalConferenceoftheTOCPractitionersAlliance TOCPA

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FinancialvsOperationalLeverage
Savings
Expenses
Costs

Leverage

Inoneroombutin
twodifferentworlds

Margin
Turnover
Revenue

TrulyVariableCost

Leverage

$ $

Expenses
Costs

ReducingExpensesisaguaranteed
waytoimproveBottomLineResults
TheMoreweSave,themoreMoney
weMake
Costsareexactnumbers,derivedfrom
history
ErroneousAssumption:Revenuewill
remainConstant

Margin
Turnover
Revenue

TrulyVariableCost

TheMorewePutin,TheMorewecan
getOut
ErroneousAssumptions:
Production/Revenuewillincreaseas
wepredict
Theincreasedfundingisavailable

18

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20

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The Results- Comparison

The Results- Comparison

1.
2.
3.
4.

Low Variability
Upward trend
Movement from Non performance to performance
A profit Game
th

23

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SaffyWetTonsHoisted2013/2014
8,000

7,000

6,000

5,000

Shifts
Workedin

ShaftRecord
Production

Requestfor
additional
supervisory
opsstaff

InitialTOC
training Ops
meeting
started

4,000

3,000

2,000

Fatality
1,000

7DayMoveAvg

Requested
22winches
forbuffer
R4,1m
Halflevel
storestobe
expanded
totwo
WeeksR7m
(Notdone)

Linear(7DayMoveAvg)

Sect54

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Pushed Hard to
Implement
TOC, partial
Success

New
Leadership
Introduced

25

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4BTONSRESULTS

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E3NOW

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EdDemingonMeasurements
DrEdwardsDemingusedsay:97%ofwhatreally
mattersinanorganizationcan'tbemeasured.Only
maybe3%canbemeasured.Butwhenyougointo
mostorganizationsandlookatwhatpeopleare
doing,they'respendingalltheirtimefocusingon
whattheycanmeasureandnoneoftheirtimeon
whatreallymatters whattheycan'tmeasure.
Whywouldwedothis?We'respendingallofourtime
measuringwhatdoesn'tmatter.
EdDeming
FewpeoplerealisethatToyotadoesnotuseany
standardcostaccountingforitsdailyoperations

FounderofTotalQualityManagement(TQM)

13th InternationalConferenceoftheTOCPractitionersAlliance TOCPA