BHP wouldn’t be the towering mining beast it is today if it didn’t have a few tricks up its sleeve, and one initiative is proving particularly vital amid the cost crunch.
The BHP Operating System (BOS) delivered the company approximately $US1.3 billion ($1.91 billion) of combined cost savings and revenue uplift in the 2021–22 financial year (FY22).
As BHP chief technical officer Laura Tyler puts it, BOS offers a holistic mindset to operational structure, empowering employees from the ground up.
“We’ve been working on the BHP Operating System since 2017,” she said at the BofA SmartMine 2022 conference in late June.
“Our goal was to create a way of working that makes improvements central to everyone’s role in the pursuit of operational excellence, taking inspiration from the leading car makers such as Toyota and the Toyota method.
“It (BOS) builds on foundations that we’ve built over the previous decades, including 1SAP implementation … increasing digitisation, implementation of centres of excellence, and our move to the cloud more recently.”
BHP deployed 1SAP in 2013, as the major miner aimed to standardise its practices and foster performance transparency.
At the time of 1SAP’s implementation, the company, known as BHP Billiton at the time, said “(with 1SAP), we are now using common world-class business processes, standard metrics and reports that are supported by robust data”.
1SAP has been a key driver of BOS, which continues to fortify BHP in difficult times.
“It (BOS) marks a fundamental shift in leadership, organisational capability and employee empowerment and it is our most important lever to build organisational resilience and grow value,” Tyler said.
“Together with the power of data and technology, BOS is making us safer, more reliable and more productive.”
Tyler said BOS had led to more efficient maintenance practices and higher productivity across the business, with the company’s Minerals Americas and Minerals Australia divisions key forerunners in its rollout.
About 12,000 maintenance activities are completed via the BOS app per month, with more than 2000 improvement ideas submitted each month.
Tyler said BHP’s Newman iron ore operation in Western Australia had benefited from BOS, with an excavator project extending the average equipment life by 40 per cent and delivered an availability uplift of 2 per cent.
The outcome was 3.5 years of extra life for the equipment, achieving capital productivity through the deferral of $US80 million ($117.4 million) over five years.