Kinross Gold Corporation Streamlines Global Operations and Moves to Proactive Maintenance of Mining Equipment with Standardized Business Processes
 
 

Kinross Gold Corporation Streamlines Global Operations and Moves to Proactive Maintenance of Mining Equipment with Standardized Business Processes

Printer View Printer View

Kinross Gold Corporation is a Canadian-based gold mining company with mines and projects in Brazil, Canada, Chile, Ecuador, Ghana, Mauritania, Russia, and the United States. A tier-one gold mining company, Kinross produces approximately 2 million ounces of gold per year. It has been identified as a high-growth company, with plans to double in size in the next three-to-four years.

To help it achieve this aggressive goal, Kinross required a robust, integrated, and scalable enterprise application infrastructure that would support the introduction and management of best practices across the organization. A robust asset maintenance module that would enable the company to increase equipment utilization and extend its lifespan was an important requirement.

Kinross deployed JD Edwards EnterpriseOne 9.0, upgrading from a previous JD Edwards implementation. With JD Edwards EnterpriseOne 9.0, the company has streamlined its financial reporting and reduced administrative work in the human resources (HR) department. More importantly, however, Kinross has moved to a more proactive maintenance process, which is expected to extend the life of its mining equipment by 5% to 10% and optimize its availability, supporting the company’s plans for exponential growth.

 
 

 
 

Challenges

A word from Kinross Gold Corporation

  • “Oracle’s JD Edwards EnterpriseOne 9.0 provides a stable foundation for our growth and has already delivered efficiencies for our financial and human resources departments. However, in the mining industry, maintenance is really the key. By helping us move to a proactive maintenance process that will help extend the life of our equipment and optimize its use, JD Edwards helps us reduce downtime and increase our gold production volume.” David Cefai, Vice President, Information Technology, Kinross Gold Corporation

  • Deploy a robust enterprise resource planning (ERP) environment that can support a global mining company expected to double its gold production in just three to four years
  • Provide accurate, timely operational data to drive improved efficiency across the diverse organization with more than 190 legal entities
  • Standardize business processes and drive a companywide transformation to improve efficiency while maintaining flexibility to meet regional requirements that include diverse regulatory and tax mandates
  • Secure business user buy-in and input for the implementation to maximize adoption and impact
  • Improve workflow for mining equipment maintenance, ultimately optimizing equipment life, which is vital to profitability in the mining sector

Solutions

Oracle Product and Services

  • Deployed a single instance of Oracle’s JD Edwards EnterpriseOne 9.0 based on newly defined business process standards for finance, supply chain, maintenance, and warehouse
  • Went live at three sites with four more in progress
  • Established a global standard chart of accounts within JD Edwards EnterpriseOne Financials 9.0 for the 190 legal entities that exist within Kinross, which will simplify the monthly and annual account consolidation process and provide enhanced visibility into financial performance across the company
  • Established a core business process and application template that the company can configure at each site to meet local regulatory and tax requirements
  • Leveraged JD Edwards EnterpriseOne Equipment Cost Analysis 9.0 and JD Edwards EnterpriseOne Resource Assignments 9.0 to help move to a more proactive maintenance program for the truck fleet, primary crusher, and other equipment used at the mine sites, which is helping to increase equipment life and utilization and supporting company goals to increase production and profitability 
  • Made progress toward the goal of increasing asset utilization by 10% by reducing equipment downtime
  • Reduced inventory―and the working capital needed to support inventory requirements―and is expected to see a decrease in ongoing material handling costs
  • Gained greater visibility into spare parts in the warehouse with JD Edwards EnterpriseOne Warehouse Management, enabling the maintenance teams to spend less time expediting parts and avoiding associated rush fees
  • Projected an internal rate of return on the project of 30% to 60%
  • Automated transactional processes within HR, which has helped increase staff productivity
  • Improved user satisfaction and adoption by involving line-of-business managers throughout the planning and deployment phases
Advice from Kinross Gold Corporation

Focus on business process design first, before looking at IT systems.
Secure buy-in from senior management and key representatives from all lines of business and functional areas before undertaking an enterprise system transformation.
Avoid starting with a blank page. Establish a core template that each site can configure to meet its specific regulatory requirements.

Why Oracle

Oracle’s JD Edwards EnterpriseOne has a strong track record in the manufacturing and industrial sectors, with key functionality tailored to the unique processes found in these industries. Kinross was particularly impressed with the complete and robust maintenance module in Version 9.0, which supports improved asset utilization that is critical to productivity in the mining industry.

Across the company, Oracle’s integrated JD Edwards EnterpriseOne applications also deliver a smooth, user-friendly experience for Kinross employees.

Implementation Process

Line-of-business support and active participation were critical to Kinross’ implementation of JD Edwards EnterpriseOne 9.0. Implementation teams included representation from and the ongoing involvement of line-of-business managers. In fact, at least one manager from each major operational area addressed by the applications―including accounting, HR, supply chain, and warehouse management―was assigned full-time to the JD Edwards project team. 

Kinross began its JD Edwards project late in 2009, and, for the first year, it focused solely on business process design. By carefully defining standard business processes, first and by securing involvement from all relevant stakeholders, Kinross laid a solid foundation for success.

The company began the phased rollout in key regions in mid-2010. The first go-live was in Chile in January 2011, with several sites following quickly in February 2011. Additional go-lives are planned for late 2011 and throughout 2012.

Partner

Deloitte Consulting Services provided Kinross with project management resources and functional consultants for each of its regional implementation sites. The partner was involved throughout the project, from the initial gap analysis to blue-print design, and finally user training.