Anglo American Annual Report 2012

OPERATING AND FINANCIAL REVIEW STRATEGY IN ACTIONSTRATEGIC ELEMENT: Organising efficiently and effectivelyEMBEDDING OPERATIONALEXCELLENCE GROUPWIDEASSET OPTIMISATIONWe continue to deliver onour asset optimisation (AO)programme that has beenin place since 2009. Havingsurpassed our $1 billion targetset in terms of the sustainableAO benefits from core businessesby the end of 2011, we continueto focus on embedding themethodologies, and influencingmindsets and behavioursnecessary for delivering AObenefits across our operations.One of the key features of the AOprogramme remains the OperationReview (OR) process initiated in2010. This structured eight-stepreview process enables our businessunits to drive towards operationalexcellence through the identificationand prioritisation of businessimprovement opportunities, inaccordance with our technicalstandards and our commitment tosafety and sustainable development.The ORs are a collaborative effortthat combine our central technicalcapability with our operationalexpertise across the Group, therebycreating teams that are able to identifyvalue improvement opportunitiesand share leading practices acrossthe Group’s entire mining value chain,which includes the resource, mine,plant and product.During 2012, ORs were conductedat Collahuasi (Copper joint venture);Mantos Blancos (Copper);Bathopele/Waterval UG2Concentrator and Precious MetalRefinery (Platinum); Bokoni (Platinumjoint venture); Orapa, Letlhakane andDamtshaa mines (De Beers); and ourPhosphates business.A prominent element of the AOprogramme is to embed businessimprovement knowledge and skillswithin the business. This is beingachieved through our AO changemanagement programme, whichencompasses skills developmentand sharing of key learnings, practices,and case studies through dedicatedinternal communication channels.We continue to develop ouremployees’ business improvementskills and have trained approximately1,300 people through the Group’scentral AO Academy.As we continue to equip our peoplewith the necessary skills and tools toadvance business improvement, weare also creating unifying systems andframeworks that will result in improvedoperational performance. We arecurrently developing an OperationalExcellence Framework (OEF), thepurpose of which is to provide a clearand consistent reference for howwe operate and maximise the valueproposition for Anglo American.The OEF focuses on those priorityareas that are fundamental to drivingoperational performance, bringingtogether, and ensuring consistentapplication of all the relevantstandards and processes to supportthe operations.We continueto developour employees’businessimprovementskills andhave trainedapproximately1,300 peoplethrough ourcentral AOAcademy.Supporting operational excellenceare the Resource to Market (R2M)optimisation and Group Benchmarkingprogrammes. The objective of theR2M programme is to integrateplanning and execution across themining value chain. This ensures thatan operation is managed with anunderstanding of how decisions madeare likely to impact other parts of thevalue chain. During 2012, R2M waslaunched at Copper’s Los Broncesmine in Chile and Platinum’sMogalakwena mine in South Africaand has delivered improvedperformance and enhanced miningflexibility. As an example of specificimprovements, blasted rock stockand average tonnage per blasthave increased substantially atLos Bronces, leading to reducedcongestion at the mine.In 2012, we launched the first phaseof our Group Benchmarking Tool.The tool aims to deliver a platformthat provides a single and validatedsource for benchmarking informationin Anglo American. The first phaseof the project delivered KPIs forequipment efficiency in opencastmines. The next phase, planned forcompletion by end of 2013, willinclude additional KPIs for opencastbenchmarking as well as the launchof underground and metallurgicalbenchmarking information.20 Anglo American plc Annual Report 2012