Vale Predicts $70M in Savings From New IT System Initiative

Vale is nearing completion of a program to replace a large number of legacy software systems at its Brazilian mines,
plants and ports with an integrated Manufacturing Execution System that can handle 1.2 terabytes of information in
real time and maintain vital business intelligence information in a single, widely accessible database.
In a bold initiative that reflects the modern mine-as-a-factory concept, Brazil-based Vale is in the latter stages of deploying a new Manufacturing Execution System (MES) for its Brazilian iron and manganese ore units, replacing 17 legacy systems previously in use. Overall, 38 mines, plants and warehouses will be included in the new system, called Vale Production Management-Mining (GPV-M). The implementation has been completed at 20 units in Minas Gerais, Maranhão and Pará, with final installations scheduled for completion by the end of 2017. According to Vale, the initiative will save the company roughly $70 million in the next few years.

The company described the MES as “a highly tailor-made solution aligned with Vale’s specific needs,” guaranteeing transparency along the entire value chain and at all facilities, from the mines to the railway and port facilities. GPV-M implementation, said Vale, is in line with its policy to cut costs and optimize the margin from the productivity increase.

“GPV-M is one of the foundations of our digital strategy, which aims to establish a platform that will allow Vale to reach new heights of productivity through the combination of new technologies and processes,” said Janio Souza, Vale’s IT innovation manager. Development of GPV-M began in 2014 by Vale’s Information Technology and Ferrous business in partnership with Chemtech, a Siemens Group company. Implementation got under way in October 2016.

According to Vale, deployment of the MES is intended to provide three major financial gains. First, reduction of IT costs stemming from upkeep of the many different systems and platforms previously used by the company’s business groups is expected to yield $19 million savings up to 2020.

Second is a reduction in costs associated with operational impacts caused by system downtime. Third is the anticipated savings from higher labor and fixed-asset productivity — supported by improved system usability and greater availability of information for decision- making. These two operational gains are estimated to reach $53 million over the same period.

Reduced downtime (in which the system is “offline”) is the result of more modern and robust technology of GPV-M compared to older systems. The increase in agility and reduction of unproductive hours are obtained by the higher level of integration with automation systems that provide immediate and reliable data, besides requiring less manual work (typing, for example) and being more intuitive for operators.

Vale said it also expects to exploit the advantages offered by adopting a single system that enables standardization of concepts and indicators throughout the company’s business units. The complete operational status and experience of these units will be available in a single database, facilitating the replication of best practices and internal benchmarking, making the decision-making process more dynamic and competitive.

“Over the years, Vale has acquired several companies and each one adopted its own system. For the first time, we are standardizing all these systems,” explained Jonas Chagas, project manager. “Now we can more easily compare the performance of our units, thus identifying process improvement points to enable increased productivity,” added Marcelo Baltar, ferrous information manager.

GPV-M is capable of processing 1.2 terabytes of information in real time while serving a large population of users. Vale said that since the beginning of its deployment, the system has been accessed by a thousand different users — up to 150 simultaneously. And, as the company noted, because the MES is the intellectual property of Vale, it will be possible to constantly expand and extend the system and incorporate new functions as indicated by analysis of information generated from its use.

Overall, Vale said it is investing in information technology to become a less complex, more efficient and competitive mining enterprise. The initiatives aim to integrate the company globally, reduce costs, simplify processes, and impact the business strategically, in order to boost company-wide productivity and achieve top-level health and safety indices.

The company said it is deploying intelligent systems for supply chain planning. This includes industrial IT solutions, such as fuel and fleet management systems; advanced data analysis, in order to foresee problems, anticipate equipment failures, and influence decision-making; and mobility solutions, such as mobile applications that streamline supervisory decision-making and process development throughout the company.

As featured in Womp 2017 Vol 11 -