Mining and Metals

Issue

An integrated mining and metals business with market leading positions in zinc and lead and growing positions in other base and precious metals had recently come out of bankruptcy and had already undertaken an aggressive cost cutting program. Leadership now wanted to focus on growing the business and identified three key strategies:

• To quickly free up as much cash as possible to allow the organization to invest in acquisitions.
• To improve operational performance, step change control and standardization across the group.
• To restructure the organization to be able to cope with simultaneous projects.

 Highland Approach

The Highland Group began by analyzing the smelting operations located across three continents. The team identified three primary work streams on which to focus:

• CVM: Closed loop contractor management system with controls and reporting to improve efficiency of contractor spend.
• MRO and Spares: Correct inventory levels, ordered by the right people, stored correctly, at the right levels for the right reasons.
• Procurement: Enhance group and site purchasing maturity, standardizing tools and processes for parts, materials and services including transportation.

 Actions Taken

Run as a group/corporate initiative, governed from HQ, joint teams targeted the individual sites and were able to define detailed action plans for delivering €7m to €10m in CVM, €4.5m to €7m in MRO and €5m to €10m in Procurement benefits across the group. The various sites integrated these benefits into their budgets. Highland Group consultants coached and developed client personnel in the new tools and processes.