Supply Chain Integration

Challenge
An integrated supply chain from mine to port should have been producing 290 million tonnes annually. Instead, it consistently achieved only 270 million tonnes. The 20 million tonne gap represented $2 billion in foregone revenue at prevailing prices. Every element hit its individual targets. Mining achieved planned rates. Rail moved required tonnes. Port met loading KPIs. Yet the system underperformed. Previous improvement efforts had actually made things worse, creating oscillations that reduced overall throughput.
Approach
We applied systems thinking to understand the operation as an integrated whole rather than connected parts. Advanced modelling revealed a counterintuitive truth: optimising individual elements created system instabilities. The solution required strategic constraints that appeared to slow components but improved overall flow. We implemented drum buffer rope methodology, identifying port loading as the system drumbeat everything else must match. Strategic buffers at key points dampened oscillations. Visual control centres showed operators how their decisions affected the entire network. KPIs shifted from local optimisation to system contribution.
Results
System throughput increased to 285 million tonnes within 12 months, capturing $1.7 billion in additional annual revenue. The improvement required minimal capital, challenging assumptions about needing major investments for production gains. Operators report fundamental mindset shifts, understanding their role in the larger system. Disruption response times improved by 60% through better visibility. Competitors have studied the transformation, recognising systems thinking as the new frontier in operational excellence.