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  • IBU = Industry Business Unit IACM = Industry Advisory Council for Mining MCB = Maintenance Cost Budgeting APO = Advanced Planner & Optimizer (Part of SAP SCM) SCM = Supply Chain Management TSW = Traders and Schedulers Workbench (Solution for Bulk Transportation) xMII = cross Application Manufacturing Integration & Intelligence (to connect to MES Systems) RLM = Remote Logistics Management IS-Mine = Industry Solution for Mining ESA = Enterprise Services Architecture IVN = Industry Value Network

Transcript

  • 1. SAP Best Practices for Mining V1.600 (on Baseline Australia)
  • 2. SAP for Mining - Overview SAP Best Practices for Mining V1.600 – Available Scenarios SAP Best Practices for Mining V1.600 – Architecture
  • 3. Challenges in the Mining Industry Today... In response to increased demand, existing operations are running at max capacity, expansion projects have to be managed Increase Production Tight supply situation for consumables e.g. tires, explosives and for heavy equipment Tight Supply Situation Industrialization in Asia drives up demand for commodities (e.g. copper, nickel, aluminum and iron ore) Demand Growth For Commodity prices but also in bulk shipping markets Price volatility Manage impact of mining activities on the community, the environment and people Corporate Social Responsibility Lack of expert workforce in Mining environment, high staff turnaround leads to knowledge drain Tight labor market Ongoing global industry consolidation requiring flexible changes in information systems support Mergers & Acquisitions
  • 4. SAP for Mining – SAP’s complete solution offering for industry challenges Suppliers & Contractors Customers & Service Providers Capital Project Management Mining Processing Transportation Marketing Business Planning & Compliance Governance Risk & Compliance, Corporate Social Responsibility Strategic Portfolio Management Budgeting & Forecasting Supply Chain Management Demand Planning Supply Network Balancing Transportation Management Contact-to-Cash Commodity Sales Contract Management Quality Management & Assay Handling Operations Management Mine Planning & Scheduling Production Performance Management Quality Assurance & Stockpile Management Reconciliation & Metal Statement Operators Training & Knowledge Management Operational Compliance Occupational Health, Safety & Incident/Accident Management Emissions Management Enterprise Asset Management Capital Investment Management & Decommissioning Maintenance Cost Budgeting Preventive & Corrective Maintenance Management Reliability Centered Maintenance Optimization Supply Management MRO & Service Procurement Strategic Sourcing Remote Site Logistics
  • 5. Mining Suppliers & Contractors Customers & Service Providers Capital Project Management Mining Processing Transportation Marketing Enterprise Management & Support Analytics Strategic Enterprise Management Financial Analytics Operations Analytics Workforce Analytics Financials Financial Supply Chain Management Financial Accounting Management Accounting Corporate Governance Human Capital Management Talent Management Workforce Process Management Workforce Deployment Corporate Services Travel Management Project and Portfolio Management Real Estate Management Global Trade Services Business Planning Supply Chain Management Contact-to-Cash Operations Management Operational Compliance Enterprise Asset Management Supply Management
  • 6. SAP Serves All Major Mining Commodities Coal & Energy Iron Ore PGM & Gold Copper Diversified and other Mining Companies Nickel, Zinc, Lead, Silver
  • 7. SAP for Mining – Increasing Productivity for the Mining Industry
    • Key Insights
      • Industry expertise takes patience and time
      • You cannot buy yourself into industry leadership
      • Continuous customer contact and projects are key to development of our solutions
      • Continuous enhancement of the solution is key to success
    Core ERP functionality
    • ESA enabling
    • Platform adoption
    • IVN Partner Management
    • Continuous Solution Enhance- ments
    • SAP Going vertical for Mining: “SAP for Mining”
    • IBU Mining
    • Mining IACM
    • Commodity Pricing (O&G)
    • B2B Market- place Integr. (Quadrem)
    • 1.st Mining Best Practice
    • Bulk Transport (Release 1)
    • Quality Mgmt. w. Assay Exchange
    • MCB Maintenance Cost Budgeting
    • End-to-End Mining Supply Chain Integration (APO+TSW)
    • xMII MES Mining Shop floor Integration
    • RLM Remote Logistics Management
    • IS-Mine Retrofit to core (SAP ERP 2005)
    <1997 1999 2000 2001 2002 2007 1998 2003 2004 2005 2006
  • 8. SAP for Mining – special SAP solution components in Business Function Set Mining to enable Mining processes Suppliers & Contractors Customers & Service Providers Capital Project Management Mining Processing Transportation Marketing Business Planning & Compliance Governance Risk & Compliance, Corporate Social Responsibility Strategic Portfolio Management Budgeting & Forecasting Supply Chain Management Demand Planning Supply Network Balancing Transportation Management Contact-to-Cash Commodity Sales Contract Management Quality Management & Assay Handling Operations Management Mine Planning & Scheduling Production Performance Management Quality Assurance & Stockpile Management Reconciliation & Metal Statement Operators Training & Knowledge Management Operational Compliance Occupational Health, Safety & Incident/Accident Management Emissions Management Enterprise Asset Management Capital Investment Management & Decommissioning Maintenance Cost Budgeting Preventive & Corrective Maintenance Management Reliability Centered Maintenance Optimization Supply Management MRO & Service Procurement Strategic Sourcing Remote Site Logistics Manage Spares & Supplies for your Mine Sites Remote Logistics Management Pricing and Invoicing based on Quotations and Qualities Commodity Pricing Plan, Schedule, Execute Bulk Transports Bulk Transportation
  • 9. SAP for Mining – special SAP solution components in Business Function Set Mining to enable Mining processes SAP for Mining - SAP for Mining supports industry generic as well as mining-specific processes and provides you with key information that enables you to run your mining business effectively and profitably. SAP for Mining integrates production, commercial, transportation, distribution and support processes to enable enterprise-wide planning, execution, and reporting. SAP for Mining consists of several components. SAP for Mining includes the following special solution components designed to make Mining specific processes work: Bulk Transportation (Trader's & Scheduler's Workbench) – The Trader's and Scheduler's Workbench (TSW) component provides functions for planning, scheduling and executing bulk shipments. The scheduler assigns Supply and Demand elements with Transportation units to the Distribution Schedule. The Distribution schedule is a preliminary transportation planning overview that will be converted into firm Nomination documents. The whole process is supported by the Stock Projection Worksheet, that calculates and shows the inventory forecast for a flexible time period and for combinations of materials and locations. At load & discharge, an official notice is sent by a partner, containing information about the product movement (so called ‘Ticket’). The ticket actualization automatically performs the logistics & financial postings. Commodity Pricing (Marketing, Accounting and Pricing) – The Marketing, Accounting and Pricing component of SAP for Mining covers market quotation based pricing as well as quality based penalty or bonus payment calculations as typically required in the mining industry. It allows to invoice the customer with a provisional invoice, based on provisional calculation rules, available market quotations and currency exchange rates, and initially measured qualities. Multiple adjustment invoices can be generated to reflect changes in available quotations and qualities. All adjustment invoices ( also called differential invoice) will only adjust the provisional invoice and will credit / debit the customer according to final calculation rules, quotations, and finally agreed qualities by negotiation with the customer or umpire. Remote Logistics Management – Remote Logistics Management enables you to manage complex supply strategies for the various supply materials, spare parts and items of equipment which are required at remote locations (e.g. at the mine site). Any maintenance order will automatically trigger the correct replenishment orders based on the predefined business rules assigned to the supply materials, spare parts and items of equipment for permitted supply strategies. Any required materials or items of equipment can be supplied by a central distribution center, or by a vendor via the distribution center. RLM can also control the dispatch of rented materials and equipment to remote sites. It also tracks rented items or repair items on their return journey back from the mine to the distribution center or vendor. RLM offers full visibility and tracking functionality for purchased and rented materials from the requesting maintenance or project order. SAP Solution Enablers for the Mining Industry in “Business Function Set Mining”
  • 10. SAP for Mining & Business Function Set Mining („BFS“ Mining) – component view
    • Based on the SAP Netweaver Platform, SAP delivers the Business Suite
    • SAP ERP contains many generic and industry specific processes & functionality
    • BFS Mining allows to activate additional Mining specific process content delivered within SAP ERP
    • SAP Best Practices for Mining leverages processes based on generic and industry specific components („BFS Mining“) of SAP ERP, SAP SCM, SAP PLM on the SAP Netweaver Platform
    Technical view on embedding the special SAP solution components for Mining SAP NetWeaver SAP ERP SAP PLM SAP CRM SAP SRM SAP SCM SAP Business Suite PM QM MM SD HR FI CO … BFS Mining RLM TSW MAP
  • 11. Within SAP ERP 2005, the SAP for Mining Solution makes use of the Industry BFS Mining (former IS-Mine) Support for Industry Solutions Financials Human Capital Management SAP ERP SAP ECC SAP ERP Central Component 6.00 ONE Industry Business Function Set for Mining (subset of BFS Oil&Gas) Industry Business Function Set Mining Generic Business Functions SEVERAL Generic Business Functions can be activated in combination with Industry Business Function set … .
      • BF Commodities Management &
      • Bulk Logistics
    TSW TWO Business Functions for Mining. Can be activated separately. Each including very complete solution components (like LES or SD/MM) TD MAP (F&A)
      • BF Remote Logistics Management
    RLM
  • 12. SAP for Mining - Overview SAP Best Practices for Mining V1.600 – Available Scenarios SAP Best Practices for Mining V1.600 – Architecture
  • 13. Mining Best Practice AU V1.600 at a Glance Based on SAP ERP 2005, SAP SCM 5.0, NW / BI 7.00 Based on Baseline Version Australia => Industry independent Scenarios
    • 2 End to End Value Chain Scenarios: Mine to Customer
    • Bulk (Coal)  Metal (Copper)
    For Mining specific, complex business requirements Out-of-the-box and ready-to-run solution
  • 14. Mining Best Practice AU V1.600 – What’s New? Stable mySAP ERP 2005 Base Re-use of some proven Mining industry best practice scenarios from 4.72 version Mining Best Practice AU V1.600
    • New Scenarios in the following Solution areas:
      • EH&S – Occupational Health, Industry Hygiene and Safety
      • Maintenance Cost Budgeting
      • EAM / Rotables management
      • Supply Chain Planning in mySAP SCM
    • Major improvements:
      • Apply most current ERP 2005 processes & technology
      • Improved design in Contract to Invoice scenarios
      • Streamlined End to end RLM scenario
      • Cost center, equipment and product cost planning & actuals
  • 15. Scenario Overview Mining Best Practice AU V1.600 Industrial Hygiene and Safety Occupational Health Timed Delivery to Remote Location Rentals Management Remote Locations Returns from Remote Location Supply to Remote Location Maintenance Cost Budgeting Rotable Management Preventive Maintenance Corrective Maintenance Contract to Invoice Cathode Contract to Invoice Concentrate, Bulk Transportation, QM Contract to Invoice Coal, Bulk Transportation DES incl. Freight Contract to Invoice Coal, Bulk Transportation FOB Rail Bulk Transportation Cost Actuals Cost Planning Copper Concentrate & Cathode Production Copper Mining Coal Blending Coal Mining Demand Supply Planning Scenario Name X81 X80 X78 X77 X76 X75 X73 X72 X71 X70 X64 X63 X62 X61 X60 X56 X55 X53 X52 X51 X50 X40 Scenario ID Environment, Health & Safety Remote Logistics Management Enterprise Asset Management Contract to Cash, Bulk Transportation, QM Internal Distribution Costing Production Supply Chain Planning (APO) Area
  • 16. SAP for Mining – SAP’s complete solution offering for industry challenges X40 X50 X53 X52 X51 X56 X55 X60 X61 - X64 X75 X76 X77 X78 X80 X81 X70 X71 X72 X73 Suppliers & Contractors Customers & Service Providers Capital Project Management Mining Processing Transportation Marketing Business Planning & Compliance Governance Risk & Compliance, Corporate Social Responsibility Strategic Portfolio Management Budgeting & Forecasting Supply Chain Management Demand Planning Supply Network Balancing Transportation Management Contact-to-Cash Commodity Sales Contract Management Quality Management & Assay Handling Operations Management Mine Planning & Scheduling Production Performance Management Quality Assurance & Stockpile Management Reconciliation & Metal Statement Operators Training & Knowledge Management Operational Compliance Occupational Health, Safety & Incident/Accident Management Emissions Management Enterprise Asset Management Capital Investment Management & Decommissioning Maintenance Cost Budgeting Preventive & Corrective Maintenance Management Reliability Centered Maintenance Optimization Supply Management MRO & Service Procurement Strategic Sourcing Remote Site Logistics
  • 17. Mining Best Practices Scenarios mapped to Supply Chain
    • Sales Forecasting
    Detailed Processing Schedule Rail & Shipping Schedule Rail & Shipping Execution Detailed Mine Schedule Stockpiling Quality 2 End to End Value Chain Scenarios for Coal Mining and Metal Mining X40 X50 X52 X60 X51 X55 X56 X53 X61 & X62 X63 & X64 X70 X71 X72 X73 X81 X80 X55 EH&S EH&S RLM X75 X76 X77 X78 X61 X63 X62 X64 Sales & Shipping Transport Processing Mining Production Stockpile Stockpile Stockpile Month/week Daily Daily & Shift Execution 18 months Integrated Supply Chain Planning Maintenance Production Procurement Costing Quality Maintenance Production Procurement Costing Quality Sales Complimentary Partner Products, linked via SAP Netweaver Platform and xMII Central User Interface & Reporting via SAP Netweaver Portal & BI
  • 18. X40 – Demand Supply Planning (Mine to Customer)
    • Highlights:
    • State of the art user friendly Spreadsheet like Planning books for demand and supply network planning
    • Automated planning
    • Sophisticated alert monitor
    • High level of integration to execution processes
    • Integration:
    • Contract & Sales order Integration in Demand Planning from X61 – X64
    • Sales Order, planned Mine production, Blending order, stock transfer planned in Supply Network Planning to X50, X51, X60
    Process Overview: Commodity: All / Coal The marketers will create a demand forecast for their responsible regions & customers, taking existing long & short term contracts into account. In parallel, the mine production planner will plan the monthly (short term: daily) production targets. Required transportation orders from Mine to Port and blending orders based on the required blend will be created by a Supply Network heuristic. The mine scheduler will check the capacity and level it where required. All involved parties perform the Demand & Supply match, supported by a sophisticated alert framework in case of any mismatches and agree on necessary adjustments.
  • 19. X50 - Coal Mining
    • Highlights:
    • End-to end process from mine to stockpile
    • User friendly entry sheets (PI Sheet) to enter production data, truck relevant KPI’s and quality characteristics.
    • High level of integration to plant maintenance
    • Automatic batch-to batch movement
    • Integration:
    • bi-directional integration to Mine production Orders planned in Demand / Supply Chain Planning X40 scenario (plan/actual)
    • Integration with Blending scenario (X51)
    • The crushed coal can also be transported by rail to the port as in scenario X60
    • Costing integration (X55, X56)
    • PM measurement point integration (X71)
    • Scenario designed in a way, that the order confirmation can be done in a more automated way from dispatch systems via xMII in the future
    Process Overview: Commodity:Coal The mine production planner is creating a process order for loading and hauling of coal in an open pit mine. The hauled quantity as well as some truck related KPI’s like fuel consumptions or operating hours will be confirmed on a PI Sheet by a production supervisor. The mined coal will be posted into inventory as a batch. The truck related KPI’s will be stored in a measuring document. The next process is the crushing of the mined coal. The process operator is recording the quantities as well as its quality characteristics for BTU, sulphur-, ash- and moisture-content on an easy entry PI-Sheet. The crushed coal of high grade will be moved as a separate batch to the stockpile .
  • 20. X51 - Coal Blending
    • Highlights:
    • User friendly entry sheets (PI Sheet) to enter the quantities to be blended and display of their quality characteristics
    • Automatic calculation of blended quality characteristics in Simulation & Actualization
    • Costs can be tracked
    • Automatic goods movements
    • Integration:
    • Coal blending is the next process step after mining (X50)
    • Blended medium grade coal can be used in sales processes as in X62 (Contract to Invoice Bulk DES incl. Freight Costing )
    Process Overview: Commodity: Coal Coal from various stockpiles is blended together into a medium grade coal at vessel or train loading using a process order. The activities are recorded by using a user-friendly interface, a PI Sheet, which also automates the postings of goods movements and order confirmations. The PI-Sheet displays the quality characteristics of the input batches and calculates the blended quality values according to the planned / actual stockpile quantities. This can also be used for simulation purposes. All necessary goods movements are done automatically in the background.
  • 21. X52 - Copper Mining
    • Highlights:
    • End-to end process from mine to stockpile
    • User friendly entry sheets (PI Sheet) to enter production data, truck relevant KPI’s and quality characteristics.
    • Batch specific unit of measure for metal content
    • Standard Cost Estimation for Copper (contained metal)
    • Integration:
    • Integration with Copper Concentrate Scenario (X53)
    • PM measurement point integration (X71)
    • Scenario designed in a way, that the order confirmation can be done in a more automated way from dispatch systems via xMII in the future
    Process Overview: Commodity: Copper The mine production planner is creating a process order for loading and hauling of ore in an open pit mine. The hauled quantity as well as some truck related KPI’s like fuel consumptions or operating hours will be confirmed on a PI Sheet by the operation supervisor. The mined ore will be posted into inventory as a batch. The truck related KPI’s will be stored in a measuring document. The next step includes the crushing of the mined ore to fine ore. The process operator is recording the quantities as well as its quality characteristics for copper-, arsenic-, sulphur-, gold- and moisture-content on an easy entry PI-Sheet. The crushed copper will be moved as a separate batch to the stockpile. Valuation can now be done for the copper ore.
  • 22. X53 - Copper Concentrate and Cathode Production
    • Highlights:
    • End-to end production process from copper concentrate to cathode
    • Use of handling unit for individual cathode bundle tracking.
    • Use of process orders for production
    • Integration:
    • Integration to copper mining scenario (X52)
    • Integration to copper concentrate and copper cathode sales scenarios (X63, X64)
    Process Overview: Commodity: Copper First high and low grade copper are blended to produce a medium grade of concentrate before it will be used for the production of copper cathodes. The produced batch for concentrate is updated with the information about moisture-, copper-, arsenic-, silver- and gold content as soon as the assay results are known. Copper Concentrate is the input for the following smelting & refining process. The cathodes produced are assigned to handling units to allow individual tracking through the supply chain. The cathode batch is updated with the copper content after assay results are known.
  • 23. X55 - Cost Planning
    • Highlights:
    • Typical cost center & cost element set-up for an open cut mine incl. auxiliary cost centers, cost allocation
    • 1 Truck assigned to 1 cost center, detailed planning per truck for recovering actual costs, summarisation of all planned costs in a hauling cost centre for generation of a rate to be used in planning
    • Cost Center, Equipment & Product Cost Planning
    • CO-ABC technology incl. Template allocation
    • Integration:
    • Maintenance costs from Maintenance Cost Budgeting planned on cost centers (X73)
    • Mine Production integration (X50, X52)
    • Planned utilization for equipment (e.g. trucks) derived from mine production planning (X40) (no technical integration)
    • Cost Actuals (X56)
    Process Overview: Commodity: All / Open Cut Mining of ore is a very cost intensive process. Operating costs in mining consist of the amortization of the capital costs of the equipment and mine establishment, and the operating cost itself. As an example, costs for a truck are planned in detail. This includes e.g. planning of Labor to operate, Fuel, Lubricants, supplies like tires. Overhead costs from canteen, HR cost centers etc. will be allocated based on defined cost drivers like headcount, no. of PC’s. Costs will be aggregated to planned costs for the fleet / hauling cost center. Costs are planned for the period of typically a month for the cost centers, equipment and finally the standard costs for a ROM produced at the mine.
  • 24. X56 – Cost Actuals
    • Highlights:
    • Primary cost postings to cost centers, actual assessment cycle for overheads
    • Recording of operational costs (e.g. for truck)
    • Cost Center, Equipment & Product Cost Actuals
    • KPI reporting on Plan / Actual Comparison
    • CO-ABC technology incl. Template allocation
    • Integration:
    • Cost Planning (X55)
    • Maintenance costs from settled Maintenance Orders (X70, X71)
    • Mine Production integration (X50, X52)
    Process Overview: Commodity: All / Open Cut Mining of ore is a very cost intensive process. Actual primary costs for the period are posted to FI GL and the corresponding cost centers. At the end of the period, overhead costs from cost centers like canteen, HR, are assessed in the same way as in cost planning through to the production cost centres based on their cost drivers like head count, Number of PCs. Operational costs for the period like fuel, energy, maintenance, labour, tire supply costs are settled to the corresponding cost centers. For the cost centers and equipment, a plan vs. actual comparison of costs can be done and variances will be analyzed.
  • 25. X60 - Rail Bulk Transportation
    • Highlights:
    • Schedule train transport with TSW
    • Electronic communication (simulation) between mine and rail carrier to request and confirm train capacities
    • SPW to analyze and locate the available inventory
    • Integration:
    • Stock Transport order integrated in Supply Planning in X40
    • Integration to Mine Production & Stockpiles in X50
    • Blending at Port in X51 and Sales from Port in X60, X61
    • Creation of IDOC's to communicate between transport planner and rail company
    Process Overview: Commodity: Coal The mine company ships coal from the mine to the port by train. The railway line is operated by a rail carrier. A stock transfer order is created and the transport will be scheduled using the Traders and Schedulers Workbench. The nomination schedule and quantity is communicated to the rail carrier, who adjusts and finally confirms the schedule. The ticketing process executes the transport and creates shipment and delivery documents. The Stock Projection Worksheet reflects the material movements in planning, scheduling & after execution at the mine and at the port and shows its impacts on the stock.
  • 26. X61 - Contract to Invoice Coal Incoterm FOB
    • Highlights:
    • Contract definition incl. quantity schedules and quotational pricing
    • Price adjustments (Bonus / Penalties) based on actual vs. contractually agreed product specifications
    • Bulk Transportation Scheduling & Execution
    • Provisional and differential Invoicing
    • Integration:
    • Contract & Sales order integrated in Demand Planning X40
    • Blending order in X40 (planning) & X51 (execution)
    • Replenishment planning (Mine to Port) in Supply Network Planning in X40 (Planning) and X60 (execution)
    Process Overview: Commodity: Coal A long term contract for multiple deliveries of coal has been signed with the customer. This includes details for total quantity, the (monthly) quantity break down, the requested quality of the coal, the agreed coal price and pricing details for any bonus and penalty payments for the breach of the contractually agreed coal specifications. After a monthly delivery has been called off by the customer, the distribution scheduler schedules the shipment. In an FOB scenario, the customer has to nominate the vessel. The coal is loaded from stockpiles onto the vessel and upon departure, the actual quantities are booked. A provisional invoice is created based on the actual quantity and quality of coal, followed by a differential invoice, taking any quality adjustments into account.
  • 27. X62 - Contract to Invoice Coal DES incl. Freight Costing
    • Highlights:
    • Contract definition incl. quantity schedules and quotational pricing
    • Detailed Bulk Transportation Scheduling & Execution incl. stock in-transit, gains & losses
    • Freight Costing & settlement for shipment incl. multiple service providers
    • Integration:
    • Contract & Sales order integrated in Demand Planning X40
    • Blending order in X40 (planning) & X51 (execution)
    • Replenishment planning (Mine to Port) in Supply Network Planning in X40
    Process Overview: Commodity: Coal A long term contract for multiple deliveries of coal has been signed with the customer. Pricing details in contract definition as well as in invoicing are similar to the X61 scenario for FOB coal sales. In an DES scenario, the seller has to nominate the vessel. Therefore, the distribution scheduler works closely with one or more carrier companies to identify the best available vessel. The scheduler may schedule demands from several customers onto one vessel. The coal is loaded onto the vessel and becomes stock in transit. At the discharge port, the coal is discharged and ownership changes to the customer. Freight costs are calculated and settled with different service providers, like carrier, port agent, Insurer.
  • 28. X63 - Contract to Invoice Concentrate incl. Quality Mgmt.
    • Highlights:
    • Contract definition incl. quotational pricing for various metal contents & penalty calculations
    • Quality Management for assay analysis incl. automatic inspection lot creation and lab results recording
    • Provisional & Differential Invoicing
    • Integration:
    • Contract & Sales order integrated in Demand Planning X40
    • Concentrate Production in X53
    • Replenishment & concentrate production planning (Mine to Concentrator & Smelter to Port) in Supply Network Planning in X40
    Process Overview: Commodity: Copper Concentrate A long term contract for multiple deliveries of concentrate has been signed with the customer. Pricing is done based on an average of LME copper quotations. In addition, other metal contents like Silver, Gold are priced. Penalties for Moisture or Arsenic contents that are out of the agreed range will be subtracted; same for treatment and refining charges, based on the metal contents. Assays analysis is performed by the vendor at the load port and the provisional invoice is based on the assay analysis and the various metal contents. There are also further inspection lots for the assay analysis at discharge port – to be analyzed by the surveyor, the customer, the vendor and in case of any disputed by the umpire. The final invoice is based on the agreed specifications.
  • 29. X64 – Contract to Invoice Copper Cathode
    • Highlights:
    • Spot Sales Contract definition incl. quotational pricing
    • Freight Liner offer & Demand to Freight Offer Pegging
    • Batch Determination (FIFO/Quality) & Handling Unit Management
    • Integration:
    • Spot Sales order integrated in Demand Planning X40
    • Cathode Production & Batch and Handling Unit Management in X53
    • Replenishment & cathode production planning (Smelter/Refinery to Port) in Supply Network Planning in X40
    Process Overview: Commodity: Copper Cathode A spot sales contract of copper cathodes has been signed with an overseas customer. Pricing is done based on an average of LME copper cathode grade A quotations. One of the freight liner carriers has send a freight offer with detailed route and timetable information. The Scheduler schedules the spot sales order on the best available freight offer. Shortly before vessel loading takes place, delivery papers are printed, indicating the batch to be taken whereby the oldest batch on stock is taken first (FIFO). The copper cathode bundles are selected by the warehouse staff and loaded into the container. Pick quantities are adjusted accordingly. A provisional invoice is created after loading is finished.
  • 30. X70 - Corrective Maintenance
    • Highlights:
    • Shows the corrective maintenance process from request to cost settlement
    • Includes approval activities
    • Is the most fundamental process containing most of the process steps required to execute the other maintenance scenarios
    • Integration:
    • Indicates the points where the preventive maintenance notifications and work orders enter the process
    • Links to the materials management processes
    • Integrates to actual costing scenario X56
    • Process Overview: Industry: Mining
    • The corrective maintenance scenario contains the fundamental steps followed whenever maintenance is performed. The corrective maintenance process demonstrates how and when:
      • A SAP user logs a notification to request maintenance to repair defective equipment
      • A planner creates, plans, and schedules a maintenance work order
      • The materials management process issues stocked spares and procures non-stock items
      • An artisan performs the maintenance work having received the work order, and captures the feedback
      • An authorised person approves and completes the work
      • The maintenance costs are reflected on the order and settled to the relevant cost center
  • 31. X71 – Preventive Maintenance
    • Highlights:
    • The three preventive maintenance processes, time-, usage-, and condition based, are described
    • Generating a cost report for time- and usage based preventive maintenance is shown
    • Integration:
    • Integration to the corrective maintenance process in X70 is shown
    • Time- and usage based preventive maintenance plans are key inputs to the maintenance cost budgeting process in X73
    • Process Overview: Industry: Mining
    • The preventive maintenance scenario demonstrates three preventive maintenance processes. It describes how to create and schedule a maintenance plan based on elapsed time and/or on usage and how to generate a planned cost report. It further describes how maintenance is trigged based on the condition of a unit.
      • Maintenance based on elapsed time: Since time does not provide the optimal schedule for maintaining equipment that requires maintenance due to operational wear, it is usually used to schedule inspection activities and periodic testing (e.g. pressure vessel tests)
      • Maintenance based on the usage of plant and equipment is a common and important maintenance strategy to enable the optimisation of the maintenance frequencies. Maintenance requirements are generated from equipment usage information, i.e. engine hours
      • Condition based maintenance is the third method used to drive the creation of preventive maintenance work. Requests for maintenance are generated from condition readings entered into SAP
  • 32. X72 – Rotables Management
    • Highlights:
    • The rotable management scenario has been extended to include all the processes that are typically followed to refurbish damaged equipment
    • Rotables are not viewed/defined as assets
    • Rotable inventory is fully valued
    • Integration:
    • The corrective or preventive maintenance scenario (X70, X71) initiates the rotable management scenario when a damaged rotable is replaced
    • Stock valuation in MM & FI
    • Process Overview: Industry: Mining
    • The rotable management scenario consists of five independent sub-scenarios or processes. Each time a damaged rotable or repairable piece of equipment needs to be processed one of the five processes must be selected. Each sub-scenario or process is a complete process managing the repair, replacement and/or scrapping of the damaged equipment. The five rotable management sub-scenarios or processes are the following:
      • Equipment exchange process
      • Internal refurbishment/repair process
      • External refurbishment/repair process
      • Replacement process
      • Scrapping process
  • 33. X73 – Maintenance Cost Budgeting
    • Highlights:
    • Maintenance is now truly able to compile a zero based budget
    • Budget changes are made by changing the inputs – changing the preventive maintenance plans and or the expected corrective maintenance
    • Integration:
    • Budget input obtained from preventive maintenance plans in X71
    • Budget input obtained from expected corrective maintenance (task lists) in X70
    • Budget inputs obtained from history
    • Process Overview: Industry: Mining
    • The maintenance cost budgeting scenario enables management to prepare zero based as well as history based budgets. As a best practice, the focus should be on preparing zero based budgets deriving the budget proposal from the preventive maintenance plans and the task lists of expected corrective maintenance. The aim should further be to limit the portion of the budget proposal derived from historical actual maintenance costs and only use historical costs to provide for truly unforeseen maintenance expenses. The maintenance cost budgeting process demonstrates how:
      • Inputs to the maintenance budget proposal are derived from maintenance plans (preventive maintenance).
      • Inputs to the maintenance budget proposal are derived from the task lists of expected corrective maintenance.
      • Inputs to the maintenance budget proposal are derived from historical/actual maintenance costs.
  • 34. X75 – Supply to Remote Location
    • Highlights:
    • SAP RLM provides a solution that seamlessly integrates mine-specific logistics with all other logistics processes
    • Includes steps for supply of materials with different stocking strategies
    • Comprehensive scenario including all steps required to supply materials from request initiation to final fulfillment
    • Integration:
    • All material requests are initiated from PM orders
    • Possible integration with maintenance scenarios X70-CORRECTIVE MAINTENANCE ; X71-PREVENTIVE MAINTENANCE and X72-ROTABLES MANAGEMENT with few adjustments in MRP views of the corresponding material masters
    Process Overview: Industry: Mining This scenario demonstrates how SAP Remote Logistics Management (RLM) enables your remote mine sites to remain fully operational while supplying parts and materials on a ‘right-on-time’ basis. SAP RLM is used to configure and determine the series of documents created for a specific material request from within a Plant Maintenance (PM) order, such as a transport requisition or a purchase requisition. When the remote mine sites requests materials, the SAP documents created depend on the company’s customized stocking strategy. SAP RLM also supports and enhances the standard SAP Goods Receipt process by providing the information and documents necessary to support efficient goods receipt process at a mining distribution center as well as a shipment receipt at the remote mine site. SAP RLM Material Tracking is a detailed report that tracks the status of material requests from initiation to final fulfillment.
  • 35. X76 – Return from Remote Location
    • Highlights:
    • Just one document for initiating and monitoring multiple returns
    • Use of recommended actions to control the return process and automatically create required subsequent documents
    • Integration:
    • Integration with X75-SUPPLY_TO_REMOTE scenario
    • Possible integration with maintenance scenarios X70-CORRECTIVE MAINTENANCE ; X71-PREVENTIVE MAINTENANCE and X72-ROTABLES MANAGEMENT with few adjustments in MRP views of the corresponding material masters
    Process Overview: Industry: Mining This scenario demonstrates how SAP Remote Logistics Management (RLM) deals with materials returns, from initiation of individual returns through to their completion. SAP RLM supports the return of materials from the remote mine site back to the distribution center. Materials can be returned to the distribution center for repair, scrap, waste, return to distribution, center stock, or for return to the supplier. RLM Returns Document is used to initiate and monitor this process.
  • 36. X77 – Rentals Management Remote Location
    • Highlights:
    • Rental item goes through the standard RLM procedures for purchase order creation, goods receipt and logistics
    • RLM supports the returns of rented materials to the distribution center and automatic status update (demobilized)
    • Integration:
    • Rental item request initiated via the standard external service in the PM order
    Process Overview: Industry: Mining This scenario demonstrates how SAP Remote Logistics Management (RLM) controls the dispatch of rented materials and equipment to remote mine sites, in the same way as it does for purchased materials. RLM enables better tracking of rental items and their mobilized (on hire) /demobilized (off hire) status.
  • 37. X78 - Timed delivery to Remote Location
    • Highlights:
    • RLM allows you to hold material after goods receipt at the distribution center
    • Once a mine site user releases the hold request flag, the materials will be released for shipment.
    • Integration:
    • All material requests are initiated from PM orders
    Process Overview: Industry: Mining This scenario demonstrates how SAP Remote Logistics Management (RLM) supports the temporary holding of materials at the distribution center before they are called off to a remote mine site. Materials could be purchased from a supplier and RLM provides functions at goods receipt to indicate that these materials should not be shipped immediately. Once the materials are released against the initial requesting document, all the necessary parties all be informed of the release and the deliveries are released for shipping.
  • 38. X80 - Occupational Health Management
    • Highlights:
    • Master Data building up to pre-configured protocols, specific protocols can be added.
    • Example of a Questionnaire.
    • Demonstrating protocol proposal ability for workplace exposure and age analysis. Upload of medical test result data is possible e.g. laboratory blood test results.
    • Ability to link documents to Medical services, persons and examinations
    • Integration:
    • Integration into HR personnel administration and Organizational Management
    • Integration into X81 – Industrial Hygiene and Safety
    Process Overview: Commodity: All Mining companies have to follow a “zero-harm-to-the-workforce” approach, which must be realized through regular examination and testing of employees to ascertain and maintain their health. These examinations are carried out by an occupational health professional, on all employees who will be exposed to risks in the working environment. T he reporting of statistical injury and occupational illness information is made possible by capturing the information in the injury/illness log.
  • 39. X81 - Industrial Hygiene and Safety
    • Highlights:
    • Exposure profiles, hazard identification and evaluation, and mitigation measures for work areas in order to manage risk effectively
    • Integration between Hygiene Monitoring and Risk Assessment
    • Comparing monitoring results against OEL’s (Occupational Exposure Limits)
    • Integration:
    • Medical Surveillance in X81 - Occupational Health Management
    • Creating Plant Maintenance Notification in X71- Corrective Maintenance
    Process Overview: Commodity: All In today’s competitive mining environment where production demand is high and efficiency is a necessity, the health and safety of the employees and the protection of the environment can not be compromised. The complexity of the demands of compliance that are placed on Industrial Hygiene and Safety globally, can best be met with the use of specially tailored software that is integrated into company processes. This scenario focuses on three components or building blocks of Industrial Hygiene and Safety – Risk Management, Incident/Accident Management and Measurement Management.
  • 40. SAP for Mining - Overview SAP Best Practices for Mining V1.600 – Available Scenarios SAP Best Practices for Mining V1.600 – Architecture
  • 41. Mining V1.600 Best Practice Landscape & Components Overview SAP NetWeaver 7.00 (2004S) Mining Best Practice AU V1.600 mySAP ERP 2005 (SAP ECC 6.00) Best Practice Baseline AU V1.600 SAP NetWeaver 7.00 (2004S) Mining Best Practice AU V1.600 mySAP SCM 5.0 (incl. BW) Best Practice - Cross Industry Package CIF 20 Mining specific Scenarios delivered as content on top of mySAP ERP & Baseline AU 2 Mining specific Scenarios delivered as content on top of mySAP SCM / BW & Cross Industry Packages Technical Infrastructure Application Content
  • 42. Best Practice Baseline AU V1.600
    • Business Scenarios available within Baseline AU V1.600 package:
    • Accounting
    • Materials Management & Procurement
    • Services Scenarios typically replaced by Mining specific scenarios:
    • Sales
    • Manufacturing
    • http://help.sap.com/bp_blv1600/BL_AU/index.htm
    Best Practice Baseline AU V1.600
  • 43. Best Practice Baseline AU V1.600 Best Practice Baseline AU V1.600
  • 44. Configure your solution based on SAP Best Practices for Mining
    • Let‘s assume, you need the following (Use Case 1):
    • Start with the main requirements in a ‚Lean Version‘
      • Basic Accounting and Costing for your Region
      • Basic Materials Management
      • Maintenance for your Mines
      • Production Execution for your Mines
    • In a 2nd project phase leverage into ‚Extended Version‘
      • Contract to Cash
      • Bulk Transportation
      • QM
      • EH&S
    • In a 3rd project phase leverage into ‚Full Version‘
      • RLM
      • Supply Chain Planning in APO
      • Maintenance Cost Budgeting
    Mining Best Practice AU V1.600 The building block concept enables you as our customer or partner to install and deploy only those scenarios and solution areas of SAP Best Practices for Mining that you really need! Project Preparation: Project team reviews and selects scenarios
  • 45. Mapping Scenarios to Building Blocks Mining Best Practice AU V1.600 X18 + Prereq. X16 + Prereq. X15 + Prereq. MCB: X20 + Prereq. X12, X14, X17 + Prereq. X12, X14 + Prereq. X10, X03 + Prereq. X13 + Prereq. X19 + Prereq. Building Block (BB) Environment, Health & Safety Remote Logistics Management Enterprise Asset Management Contract to Cash, Bulk Transportation, QM Internal Distribution Costing Production Supply Chain Planning (APO) Area Industrial Hygiene and Safety Occupational Health Timed Delivery to Remote Location Rentals Management Remote Locations Returns from Remote Location Supply to Remote Location Maintenance Cost Budgeting Rotable Management Preventive Maintenance Corrective Maintenance Contract to Invoice Cathode Contract to Invoice Concentrate, Bulk Transportation, QM Contract to Invoice Coal, Bulk Transportation DES incl. Freight Contract to Invoice Coal, Bulk Transportation FOB Rail Bulk Transportation Cost Actuals Cost Planning Copper Concentrate & Cathode Production Copper Mining Coal Blending Coal Mining Demand Supply Planning Scenario Name X81 X80 X78 X77 X76 X75 X73 X72 X71 X70 X64 X63 X62 X61 X60 X56 X55 X53 X52 X51 X50 X40 Scenario ID Prereq. dependencies of BB’s are detailed in next slide as well as shown on CD and Web. Installation is by scenario, and all required BB’s are installed automatically
  • 46. SAP Best Practices for Mining – Flexibility Through Building Blocks -> Indicates dependencies of building blocks Mining Best Practice AU V1.600 Use Case 1
    • Full Version:
    • Supply Chain Planning (APO),
    • Maintenance Cost Budgeting
    Building Block Building Block Building Block
    • Extended Version:
    • Sales & Distribution, Transportation, QM
    • EH&S
    • RLM
    Building Block Building Block Building Block
    • Lean Version:
    • Financials, Controlling
    • Plant Maintenance,
    • Material Mgmt., Production
    X14 TSW X16 RLM X12 SD X20 BW X15 PM X10 FI / CO X13 PP-PI X17 QM X11 MM X03 Master Data J02 Baseline Org. Structure J05 Baseline MM. J.. Baseline … X02 Org. Structure X18 EH&S X19 APO
  • 47. Easy Installation of your Solution
      • Best Practice Installation Agent (BPIA) to support the installation of BP Mining.
        • All the technical objects need to be installed are packed into BPIA.
        • Guided Procedure to install the your solution, incl. some manual steps.
        • Your selected solution or the whole solution can be installed within short time frame.
    Mining Best Practice AU V1.600 System Installation: Basis administrator implements selected scenarios
  • 48. SAP Best Practices for Mining
    • SAP Best Practices is a platform of reusable and layered Building Blocks out of which fully functioning end-to-end scenarios are composed
    • Delta configuration adds Industry Depth to Baseline Building blocks – Ex. „ Delta Enterprise Structure“
    Best Practice Baseline AU V1.600 Mining Best Practice AU V1.600 Materials Management . . . Profitability Analysis Baseline Organizational Structure Financial Accounting Sales and Distribution Cost & Profit Center Accounting
    • Preconfiguration
    • Documentation
    • Print Forms
    • End user training
    • Testing
    • Localization
    Building Block Maintenance Planner Sales Executive Mining operations Manager Transportation Scheduler … Customer view PP-PI Production Scheduling & Confirmation (Bulk) Transportation Automatic Payment Maintenance Cost Budgeting Master Data Maintenance Planning & Execution Remote Logistics Management Cost Center & Equipment Costing Mine Ore Purchasing Rotables Management Sales Contract & Order entry Quotational Pricing Differential & Final Invoicing Packaging and HUM Health & Safety . . . Quality Management Full Warehouse Management Mining S O L U T I O N C O M P O S I T I O N Mining operations Manager PP-PI Production Scheduling & Confirmation Master Data Cost Center & Equipment Costing Health & Safety Quality Management Maintenance Planner Maintenance Cost Budgeting Maintenance Planning & Execution Rotables Management Sales Executive Sales Contract & Order entry Quotational Pricing Differential & Final Invoicing Transportation Scheduler (Bulk) Transportation
  • 49. Value of Mining Best practice solution to non Australian Partners & Customers
    • Automatic BPIA driven Installation works only based on AU baseline version
    • However, there is high value also for non- Australian companies as of our guiding Design Principles:
    • Focus on typical & global industry processes rather than local Australian requirements
      • Logistics & Supply Chain processes designed globally
      • FI / CO set up with group currency & local currency
    • Sandbox only installation incl. AU Baseline to familiarize with scenarios
    • Configuration documents delivered to allow manual installation on alternative base (other baseline, existing implementation, etc.)
    • Potentially further localized versions from SAP or packaged in „All in One“ by Partners
    Mining Best Practice AU V1.600
  • 50. Q & A –> where to find information in the web For detail information, please check http:// help.sap.com / . For further News & Updates, also check SAP Note 1043300 Mining Best Practice AU V1.600 1 2 3
  • 51. Take the Word!
    • We are d elivering on the promise of MINING business integration to help our customers gain return on investment, foster growth, innovation and value ...
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