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The Importance of Dynamic, Life Cycle Costing for Your Mining OperationAMT differs from most asset managements systems. One of the key differences is that AMT is based upon a Life Cycle Costing (LCC) methodology. Life cycle costing predicts the total costs, resources, utilisation and productivity for an asset over its entire life cycle. It is an excellent tool for assessing alternatives which has made it very common in the procurement of large assets. LCC provides a rational framework to model equipment operation, taking account of all pertinent cash However, a common drawback of most life cycle models is that they are static. This means that the inputs are correct at the start of the equipment’s life, but deviate from this ideal model as the equipment begins to operate. The timing and cost of actual maintenance activities will always deviate from the model and so it quickly becomes out of date. AMT addresses this by maintaining a dynamic life cycle cost model for each item of equipment. It unlocks the benefits of having this information live and available using inputs from your existing ERP. It puts a structure around work order costs and allows you to drill down and understand the major cost drivers and their impact on the life cycle cost. Most importantly it allows you to be proactive about asset management, control maintenance costs, reduce unplanned down time and understand the drivers of equipment performance. The continuously updated life cycle cost models for all major equipment in your fleet allows you to understand the future position or Projected Cost Variance (PCV) between your budget and expected performance at some point in the future. Once the dynamic life cycle cost models have been established for your equipment, a number of key equipment management processes are easily available. These processes all rely on life cycle costing and as such, ERP and CMMS systems cannot provide this functionality. The most important processes that life cycle costing supports within AMT are detailed below. Equipment ModellingWithout a life cycle costing methodology it is not possible to produce accurate equipment models for expansion projects and new operations. AMT has a sophisticated life cycle cost modelling tool that allows the user to build up full mine feasibility budgets. Risk ManagementAMT actively identifies risks within the thousands of equipment and components under management and highlight those risks to the manager. By understanding the future impact of these risks, managers can make decisions that have a positive effect on the life cycle cost of the equipment, saving your operation money. Maintenance Strategy OptimisationThe life cycle maintenance strategy is continually reviewed to provide the lowest cost per tonne or hour for equipment. Managers can test alternate maintenance strategies and immediately see the impact of changing the strategy. Resource ForecastingThe forward requirement for components, parts, labour and resources based on the long term maintenance plan are always known. This drives inventory efficiencies and reduces dead stock. Economic life determinationThe method to determine the most economic disposal point for assets is based upon understanding the life cycle position of the equipment. AMT uses a proven method to dynamically determine the best disposal point for all assets at any point in time. Millions of dollars of asset value can be realised by understanding the best disposal point. Equipment BenchmarkingAnalyse and benchmark equipment across the entire company using methods such as Cost per Hour, Cost per Tonne, Discounted Cash Flow and Discounted Cost per Tonne. Use this knowledge to drive maintenance improvement across operations. Budgeting & ForecastingContinually see a ‘real’ zero based maintenance budgeting showing costs, availability, resources and productivity. Add overhead costs to get a full departmental budget that can be exported to your corporate budgeting system. Besides the important equipment management functions that come from having a life cycle costing approach, AMT still handles the core equipment management processes. For more information on how AMT will benefit your operation please contact iSolutions on +61 2 9966 9096 or email sales@isipl.com.
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