ANDERSON & SCHWAB - PROFIT IMPROVEMENT STUDIES
1. Complex Metallurgical Plant Assessment - Major U.S. Diversified Mining
Company
Profit improvement study of a rehabilitated operating facility processing three
metals with similar properties through a complex hydrometallurgical process.
Our work focused on determining, given the market conditions and the supply
contracts, whether the facility was operating at optimum throughput and costs.
Our approach entailed comprehensive discussions with a broad cross-section of
management; a review of the world markets of nickel, copper and cobalt; the
productivity of the facility; the adequacy of the instrumentation process involving
controls and automation; the adequacy of materials handling and process flow
-- all in the framework of continuing cost improvement programs to be managed
by the client.
Our principal findings were that the plant was run well and that the most that
could be expected was continued fine-tuning of management's basic operating
and control process. (110-117)
2. Mine Cost Reduction Assignment - Colombian Government Agency
Conducted a study of the operations, maintenance and support function of a major
Colombian coal mine, an approximately 15-million-ton-per-year open pit coal
mine, railroad and port facility located 400 miles north and west of Barranquilla.
This project was designed, developed and initially managed by Exxon Corp. It
is currently being managed by Intercor, which is owned jointly by the Republic
of Colombia and the Exxon Corporation. Of Intercor's total work force of about
3,000 people, only seven are expatriates.
The project entailed an examination of every aspect of the business to include
its line and support functions with a view toward determining potential improvements
in management, productivity and costs. (721-1)
3. Study to Improve Operating Mine's Cash Flow - Colombian Government Agency
Identification of opportunities to improve cash flow from one of the world's
largest coal mines. Our client is Carbocol, the Colombian Government entity
responsible for the Cerrejòn Mine.
Carbocol requested A&S and another firm (in a joint venture) to conduct
a study of the operations, maintenance and support functions of the Cerrejòn
Mine, a $3-billion-plus-investment, 15-million-ton-per-year, open pit coal mine
in the Guajira Peninsula in northern Colombia. This work was done in 1993 and
1994. Cerrejòn is a joint venture between Exxon and the Colombian Government
and is operated by Intercor, an Exxon subsidiary.
We assembled a team of approximately 14 consultants, who reviewed every facet
of Cerrejòn's operations, infrastructure and administration. The consultants
identified opportunities to increase cash flow significantly and recommended
changes in management structure, changes in operating and commercial philosophies,
and specific cost reduction programs to attain these objectives. A&S and
the joint venture continued to provide consulting services of an advisory nature
to Carbocol. This arrangement continued through 2001, at which time the Colombian
Government implemented its plans to sell its 50% ownership of Intercor and hence
would no longer have responsibility for the Cerrejòn Mine. (721-2)
4. Profitability Enhancement Study for Integrated Copper Company - Major
Copper Producer and Fabricator
Profit improvement in a major copper producer and fabricator. Operation and
profit improvement studies in every phase of an integrated copper company including
mines, transportation, refining, secondary recovery, mill, and consumer products.
(158-43)
5. Operational Audit - Latin American Fluorite Producer
Fluorita de Mexico has an underground fluorite mine and milling operation in
the northern portion of the state of Coahuila, Mexico. A&S was hired by
the company to perform an operational audit with the objective of increasing
monthly production of acid-grade fluorite.
A&S spent four days reviewing all aspects of the operations. Unique features
of this operation included the mine's being over 100 miles from the mill and
located in an extremely arid, undeveloped part of Mexico; relatively small mine
using both company and contract miners and limited capital.
A&S recommended additional geologic work to define more ore reserves and
better control the ore grade, replacement of obsolete mining equipment, provision
of better maintenance facilities and hiring a geologist and a health and safety
professional. (773-1)
6. Process Improvement Study - Major Australian Mining Company
Reengineering the maintenance, supply and finance function for all major business
units and corporate of a multi-mineral mining company (nickel, gold, copper
and two other metals). In November 1995, the client, a major Australian mining
company engaged KPMG and A&S, as a strategic partnership, to facilitate
their efforts to (1) select and implement an integrated management information
system (MIS), and (2) reengineer the company's maintenance, supply and finance
functions.
The objective of the project is to develop systems that will enable management
to make better decisions and to create world-best practices and performance.
The project will require about two years to complete. The kickoff phase was
completed at year-end 1995 culminating in a successful presentation to the client's
Managing Director. The presentation defined (1) the project's requirements;
(2) the project/CEO team structure, responsibilities and general scope of work;
and (3) the anticipated impact of the project in terms of cost, time, resources
and benefits.
The challenge of the project is to develop a plan that balances the need to
maintain the responsibility and accountability of recently decentralized business
units, as well as, leverages the benefits of a consistent implementation effort
across the entire company. The project needs and conceptual organization and
planning was formulated through (1) lengthy interviews with the senior management
of the company's major business units and corporate functions; and (2) extensive
workshops held with the project team and the core KPMG and A&S team members.
The next phase of the project entailed detailed project planning software testing
and selection (SAP or MINCOM), and preliminary reengineering efforts.
The program is anticipated to provide the client with new information capabilities
and more efficient support functions that will give the company a competitive
edge in making better decisions and reducing costs. (706-9)
7. Administrative Cost Reduction - Major Coal Mining & Service Company
Our client, a medium-sized coal company, had the task of reducing administrative
costs by 20 percent in a one-month program. We worked with key managers to help
develop a program that would obtain the desired reduction in costs while still
carrying out necessary services. (145-45)
8. Operational Audit - Major Oil Refinery and Petrochemical Company
Operations analysis of a major oil refinery and petrochemical complex. This
project entailed an examination of all aspects of the client's operations, with
a view toward identifying cost savings that could be obtained without impairing
operation effectiveness, and developing programs to achieve these savings. (148-4)
9. Review of Operating Effectiveness of a Beneficiation Plant - Major Latin
American Fertilizer Producer
We and our associated engineering firm reviewed recovery and determined whether,
through modifications, recovery could be improved. We advised the client, a
major Latin American fertilizer company, recently privatized, that increased
recovery from 44 percent to 50 percent could be attained by improving the efficiency
of the screening/grinding section of the plant to enhance liberation of course
phosphate to the finer sizes. We also determined that plant capacity could be
increased, assuming changes in the existing screening, flotation feed, addition
of two more conditioning tanks, and changes in the operation of the existing
pumps. (724-4)
