World’s Largest Mining & Commodities Company

Business Challenge

The Nickel business unit of this global leader had just completed an SAP implementation and was looking to make significant procurement cost savings during a tough time for global commodity prices and volumes. Headquartered in Canada, with an annual managed production of more than 100,000 tonnes of nickel in seven countries, they had many lines of raw data passing through their ERP systems and now wanted to take the opportunity to drive better procurement decisions through standardization of their data.

Each site had an extremely diverse range of items of supply being bought daily from many suppliers through multiple purchasers in each country. They were running best of breed procurement tools however, the current tools were not the main problem – the underlying raw data was the real issue. It was extremely tough to get all users, some in remote mines with language challenges to provide repeatable descriptions for spend classes and material groups assignment across a broad range of commodities - from stationery and services all the way through to specific mining explosives and machinery.

The question was: how to automatically tag all the purchased items to internal reporting material groups and how to enforce repeatable Noun:Modifier material descriptions – reducing duplicates & off-contract spend?

After investigating the market for a specialist tool and including in-depth own-material tests & SAP integration tests, Refresh™ Desktop was selected for the entire Nickel group. Some factors key in the selection of Refresh™ included:

• Fresh Software Proposal very easy to understand
• Low technical cost and low implementation effort
• Ease of use allowing the right person to do the job quickly
• Deep Global International Standards experience & content
• Pre-Built dictionaries ready to use on day 1
• No need to touch the SAP system or use SAP resources

The Solution

Refresh Desktop was installed in Canada and made available globally within one week of purchase. The purchasing team and especially the lead data analyst from the largest mine was quick to pick up the Refresh tool and started the full cleanse during the kick-off workshop itself. The automation quickly drove standardization at the material level, even in multiple languages.

6 months after the kick-off with Nickel, a second business unit saw the progress at Nickel and decided also to purchase a Refresh license.  This BU, headquartered in E.U. and South Africa, on its own is the world’s largest producer of ferrochrome and with at least 100 000 materials to standardize on many complex mining & smelting sites. A project proof of concept meeting took place at the HQ with mine-site procurement staff agreeing that any new items would now pass through Refresh screening within local SAP systems. A year later a third BU (Coal) joined in, based in Australia. This meant that most of the main mines globally had Refresh – truly covering the SAP systems of the world’s largest mining company.

Key Business Benefits

The software now cleanses and manages materials across all departments - for all equipment and spares, from all suppliers. For the Operations team the main benefit is finding their materials easily. For Strategic Purchasing the main benefit is a detailed view of each purchase, highlighting common purchasing trends and showing any category areas which require further improvement.

• Easy to find materials & reduced inventory carrying costs
• IT lowest total cost of ownership - fully reused ERP
• Trustworthy Spend Reports
• Reduced off-contract spending
• Cross-Plant Spend Transparency allows better bundling
• Materials described as commercially neutral - open bids
• Cross-Plant PO line-item translation - visibility in English
• Easier accounts payable process & three-way match
• Reduced Duplicates & Obsoletes
• Increased knowledge sharing and technical development
• Increased Safety through better specification