The Client
The client in this case study “Building a Virtual Business“, is a mining company with a large petrochemical complex that produces fuel from coal. Most of the coal – the primary raw material used by the company – is sourced from five mines located close to the company’s fuel plants. At one of these mines coal reserves of export quality were discovered.
An extensive feasibility study was conducted, following which the company decided to export three million tons per year. Exporting coal was a major new business for the company. It required a number of major coal processing activities that the company had not been involved in previously. The company set about building, from scratch, a complete coal handling system and beneficiation plant without disturbing coal supply to the fuel factories.
To deal with the myriad facets of designing and constructing the new plant and systems the company established a project team, comprising its own people as well as several external consultants. All together about ten groups.
The team brought together people with different roles and areas of expertise, and different approaches to areas of design, management and problem solving. This required comprehensive project management – not the least being how and where information would be stored, managed and presented.
Using the knowledge based system, a virtual business was created encapsulating the design and operating philosophies of the entire project team.
That business was manipulated, modified, enhanced and accelerated to show results over long periods of time, and slowed to show results in real time. It was run both independently, and connected to other computer systems.
Over a three month period around 300 design permutations of the entire plant were built and tested.
There are many examples of situations that can have a significant and detrimental impact on the operations of the plant. Train service is typical.
It was decided to investigate the ramifications of the train service failing to operate for a week. We chose a peak production week. The result was, literally, a mountain of problems. The stockpile build up at the rail load- out station backlashed through the entire operation, causing damage that could easily have set the plant back six months.
As a result of this experiment, an emergency stockyard was built. Several months after the plant opened trains to the plant were halted due to a derailment. The emergency stockyard took the overload and operations continued virtually unhampered. No environmental restrictions were violated.
Training was much faster and smoother as operators were able to use real systems and procedures. This provided them with quick, non-destructive training and enhanced their performance and capabilities, especially in problematic or dangerous situations. Additionally it provided them with an intimate appreciation of the characteristics and operation of the plant, and the impact of their activities down the line.
The company’s management had the task of negotiating with a broad spectrum of suppliers and customers. In many cases they were negotiating with people they had not dealt with before and in areas where they had little experience.
The ability to understand and quantify the impact of every design change meant management were able to negotiate from strength. They knew precisely what the sensitivities were, which issues they could compromise on and where they needed to stand their ground.
The knowledge base was integrated with the plant’s business information system to provide management with short and long term planning and forecasting information.
This included an automatic hands-off system for easy, quick and accurate determination of plant settings, evaluation of scenarios, information transfer, and determination of the plant’s initial state for forecasting. And budgeting information for sales distribution, quality management, plant management and costing.
KBS is a major leap forward from traditional business modelling systems.
Traditionally mathematical formulae are used to describe the components of a business – with limited scope. Change the business scenario and the formulae may no longer be valid.
KBS learns and understands the business in much the same way that people do. It can replicate the entire business, including human and operational subtleties within that business. It preserves the knowledge within the business’s own computer systems, providing a maturing knowledge base on which to continually build.
That knowledge can be used to simulate any imagined business scenario, and to improve the planning and control of business processes.
Within a few weeks KBS can begin to provide management with previously unheard of decision making power. It can deliver immediate answers that may otherwise take a team of engineers many years to obtain.
This project, like many of our engagements, looks straightforward on paper. The reality is far from it. Our skill is not just in identifying problems and designing solutions, but in making those solutions work – often in a tough business and cultural environment.
GPR Dehler has an excellent record of implementing change programs in Australia, New Zealand, Asia, Europe, North America and Southern Africa. Every- thing we do is geared towards achieving results – not writing reports. We have the management and planning skills as well as hands-on consultants with experience to overcome obstacles and transform good ideas into effective and successful programs. Significantly, we do this with minimum disruption to our clients’ business operations.