Data Drill Down: Teck Resources unearths stronger asset performance with ERP
Written by REM Staff
Vancouver-based Teck Resources
operates six metallurgical coal mines in British Columbia and Alberta.
The desire to coordinate workflow among them and manage inventory
efficiently had the coal division looking for enterprise resource
planning (ERP) software that would allow production to grow in a
cost-efficient manner.
To help the world’s second largest exporter of sea-borne steelmaking
coal update its finance and inventory management tools, Teck reviewed a
range of ERP packages before determining that Microsoft Dynamics AX
was the best fit for its change management goals. Today, Teck is using
Dynamics to realize a host of benefits; the company now manages its
inventory more efficiently, has improved workflow between its six coal
sites, and has increased customer satisfaction.
Teck Resources is Canada’s largest diversified mining, mineral
processing and metallurgical company, and is a leading producer of
copper, steelmaking coal, zinc, molybdenum and specialty metals, with
interests in several oil-sands development assets. The company is
committed to responsible mining and mineral development with major
business units focused on copper, steelmaking coal, zinc and energy.
This includes 13 mines in Canada, the U.S., Chile and Peru that the
company owns or has interests in.
To achieve its goal of business expansion for the coal business unit,
the company needed to first update its information technology systems
to improve collaboration across six mining locations. Teck’s strategy
was to gather the information from all its locations into a single
platform; these six locations historically have been autonomous, and
internal operations were fragmented due to the lack of information
control and low levels of communication between them.
“With more than 3,500 employees, Teck’s coal operation wanted to
improve staff productivity and business performance by establishing
common processes across all sites, having one view of our operating
picture and abandoning our legacy systems as they were hindering
growth,” said Chris Coupal, director of information systems and
business solutions with the coal business unit.
For Teck, the performance of its coal mining equipment is affected by a
number of financial, operating and maintenance-management issues. Staff
at Teck is tasked with managing maintenance forecasting and scheduling,
but the aging systems did not fully support these functions, which made
it difficult to accurately track and monitor asset and inventory data
across all sites. This non-integrated environment was proving not only
too labour-intensive to manage, but also resulted in operational
inefficiencies and couldn’t adapt to the company’s changing business
requirements.
“We had six independent sites running on six independent copies of
software and a legacy mainframe that was more than three decades old.
This inflexible environment hampered the ability to quickly access data
to make timelier, holistic business decisions, which in turn, required
individuals and manual processes to attempt to make up the difference,”
Coupal said. “As a result, we made the decision to implement a new,
single-business management solution that would standardize our
processes and help improve our asset management, procurement and
inventory processes in real-time.”
The company needed a more centralized management environment that was
reliable and could improve interactions with suppliers and customers
based on planned maintenance activities. The challenge was to fully
join its databases and strengthen its maintenance, materials management
and financial areas to increase focus on planning and forecasting, and
increase access to more current, more complete data — enabling timely
decision making, as well as reducing the operating processes time.
One factor that determined if they would pick Dynamics AX was
definitely which solution could be more seamlessly integrated into its
existing Windows IT-based environment.
In order to execute the implementation of Dynamics AX with the
maintenance, repair and operations (MRO) module, Teck chose to work
with the Vancouver office of reseller Eclipse based on the partner’s
global experience specific to the mining industry.
“Eclipse was able to mobilize quickly and brought a keen understanding
of … MRO, mining and maintenance to the table, which really helped make
this implementation a success,” Coupal said.
The complete rollout to all operations was finished in November 2010.
Using Dynamics AX, Teck has established a centralized store for
financial, asset and materials information and has standardized on
common operating procedures among sites on the Dynamics AX system.
“Using Dynamics AX allows us to manage as one organization instead of
as six independent ones, so I would say it’s a competitive advantage.
As an example, we have had vendors who knew more about the inventory we
held in stock at our sites than we did because our systems were
siloed,” Coupal said. “We’ve been able to streamline vendor
transactions because we now have an integrated system and an asset
maintenance planning perspective. This enables material forecasting,
allowing us to have a single purchase order for future requirements
from a vendor instead of six, or often many more.
“The flexibility of Dynamics AX has enabled us to custom develop a
lightweight production statistics module that keeps track of our
production details. It’s being used to drive our finance, material and
our maintenance functionality based on production volumes in the mining
pit,” Coupal added.
Benefits
Teck is using Microsoft Dynamics AX to realize a host of benefits. The
company is implementing more mature asset management processes, now
manages its inventory more efficiently and has improved workflow
between its six mining sites.
“I think when you look at mining historically, the view was to allow a
mine to just run autonomously and leave it at that,” Coupal said. “But
we have taken the approach to have the six operations operate as one
team, with common processes, one view of our information, and
opportunities to centralize support functions. As a result, Dynamics AX
is enabling our company to be more competitive.” The company has
recently created a finance shared service group and a material shared
service group that can perform planned procurement for all six sites.
“Having a single view into our information has been very powerful. Now,
there’s one view across all the sites, and if a site has a new piece of
equipment, planned approaches to maintenance, critical spares, etc.,
all locations have visibility into this information and can share or
allocate resources as needed,” Coupal said. “This allows our managers
at all levels to see the same view and to make decisions with better
information.”
Today, employees can have real-time access to data and reports with
current and historical information; this helps to reduce operational
costs and boost Teck’s decision-making process.
“We are now getting to the point where we can manage our maintenance
forecasting and our maintenance scheduling across all sites. We’re
performing collaborative processes across six sites instead of
independently at six sites which helps streamline our processes,”
Coupal said.
Teck has been proactively using technology to transform its
infrastructure. The company is taking advantage of the Dynamics AX
platform to ensure that all transactions are processed in real time for
just-in-time reporting. Getting the six sites to operate as one allows
the company to better leverage and better coordinate resources,
ensuring that Teck maintains its competitive industry edge.
“Dynamics AX has been a key part of our new change management strategy
to provide us the ability to create one view into our company. We can
now ensure that our purchasing processes are on behalf of all sites and
they’re more aligned to our needs,” Coupal said. “Overall, this helps
us be more strategic and competitive moving forward.”
Vancouver-based 
