TOC Mining

1. Theory Of Constraints (Eli Goldratt) The Productivity Choice • GOLDRATT • Group SA Presenter: Henning du Preez Managing Director Goldratt Group Southern Africa TOC Mining A Theory of Constraints Application

2. Run of Mine Tons per day (Opencast) Proven Process Capacity 40% GOLDRATT Group SA 60% TOC Mining A Theory of Constraints Application

3. Reef Tons Hoisted per day (Underground) Proven Pocess Capacity 40% GOLDRATT Group SA 60% TOC Mining A Theory of Constraints Application

4. THE BARRIER to Productivity Proven Process Capacity 40% Barrier Productivity of the process < 70% (Across mining types, across continents, across companies) Are we all facing the same type of productivity barrier ? GOLDRATT Group SA 60% TOC Mining A Theory of Constraints Application

5. Theory of Constraints One bottleneck per process (A chain is only as strong as its weakest link) Root Cause behind the 60% BARRIER = The bottlenecks are managing us versus we are managing the bottleneck • GOLDRATT • Group SA Dr Eli Goldratt was an Israeli physicist who became a business management guru. He was the originator of Theory of Constraints. TOC Mining A Theory of Constraints Application

6. Theory of Constraints How do you know if the bottlenecks are managing us? Symptoms of the root cause -> Bottlenecks developing (daily & weekly) there where we can least afford to have them. -> Constant changing priorities and fire fighting (management don’t have time) -> De-motivated people (people are blamed for all the problems) ->Ave daily production <70% of proven Capacity ->Falling short of required targets GOLDRATT Group SA Dr Eli Goldratt was an Israeli physicist who became a business management guru. He was the originator of Theory of Constraints. TOC Mining A Theory of Constraints Application

7. Manage your BOTTLENECK increases the process PRODUCTIVITY dramatically We manage the Bottlenecks Bottleneck managing us GOLDRATT Group SA Implemented the Theory of Constraint Way of managing a Bottleneck TOC Mining A Theory of Constraints Application

8. Underground Mine (on one level) 80% 67% GOLDRATT Group SA Implemented the Theory of Constraint Way of managing a Bottleneck TOC Mining A Theory of Constraints Application

9. The Future of Mine Planning and Design Decide where the bottleneck should be Underground => The Cleaning Cycle must be stronger than the Blasting Cycle [Today it is frequently the opposite] Opencast => The mining side must be stronger than the plant side Planning, Budgeting and Measuring => Plan to meet 80% of your bottleneck performance consistently => Budget for the required buffers for reliability and consistency of performance => Continuously measure your constraint rate and the status of your buffers (single measure single priority) GOLDRATT Group SA TOC Mining A Theory of Constraints Application

10. The Productivity Choice Let’s move from a marginal mine (65%) to a mine with a margin (80%) – From bottlenecks managing us to us managing our bottlenecks. The Choice is yours! GOLDRATT Group SA TOC Mining A Theory of Constraints Application