Boliden's Finnish units aim at enhancing their cost control. Thanks to the user-friendly solution provided by Affecto, information is easily available in a comparable format. This helps employees in cutting unwarranted costs.
Boliden’s Finnish units, i.e. the zinc mill of Kokkola (Boliden Kokkola Oy) and the Harjavalta copper smelter (Boliden Harjavalta Oy) were involved in the project. The mills are a part of the Swedish Boliden Group, which, in addition to Finland and Sweden, has operations in Norway and Ireland.
The Kokkola and Harjavalta mills faced challenges with evaluating and following operation, maintenance, and personnel costs. The data lay in several different systems, which made their comparison and analysis arduous. Following expenses was challenging, and its accuracy was insufficient.
Efficient and accurate reporting
The project’s objective was an easy-to-use system that would improve the cost reporting of both the mills and the units within them.
“Earlier, the data was located in different systems, and refining it into information required several Excel files that always had to be updated by hand. The new system automates the data retrieval process, and this in turn improves the quality of data and speeds up its processing”, says Ville Ylä-Jokisalo, Controller at Boliden Kokkola.
The many different areas of cost reporting needed adjusting. More data was needed on the price and quantity of materials used in production. Information on tons produced and job costing was required to be itemised according to cost unit and type, material, supplier, customer and unit. Accurate information on personnel costs had to cover working hours, absences, holiday pay reserves and number of employees.
In budgeting, the goal was to make the expenditure budget of materials more precise. Since less than one hundred out of thousands of products generate 95 % of the costs, budgeting for this 5 % was taken to material and product levels.
Keys to the solution
“Affecto had a consultant, who understood our needs quickly. The project was an all-round success”, says Ylä-Jokisalo.
The cost data in Boliden’s SAP ERP were combined with data residing in payroll and maintenance systems to create a basis for cost analyses. Information on realised production and budgetary figures was added to this to improve comparability. In the future, the data can be analysed from several different perspectives.
To make the system user-friendly, it has one simple desktop to allow each user easy access to the information needed. The solution was linked to the existing access management system, which gives its user access rights to all applications.
For budgeting of materials, a Cognos Planning application was created where material quantities are entered per cost unit. Material quantities and costs allocated to accounts are transferred to a data warehouse for reporting.
“User experiences tell us that the new system is simple, well-defined and easy-to-use. It will definitely improve our cost awareness,” declares Ylä-Jokisalo.
Comparable data easily available
Affecto was in charge of the system built using Cognos products (Cognos Business Intelligence, Data Manager and Planning). The solution enables the mills to follow their costs and budgeting of materials more closely. Combining cost data from different systems works smoothly, and budgeting is now more accurate.
The tool is being used in Kokkola and Harjavalta. As far as cost control is concerned, reporting on these sites is fairly similar, making it possible to build a unified system. In budgeting, the products were so dissimilar in the mills that two different models were created, and their maintenance was assigned to local people in charge.
“In the future, we intend to expand the use of this solution to management system reporting, integrate production reporting more closely with cost reports and continue with the development of budgeting and forecasting”, envisions Ylä-Jokisalo.
The system deals with cost control and budgeting of materials. Affecto is in charge of the whole, built with Cognos products including Cognos Business Intelligence, Data Manager and Planning.
The solution provides more accurate information on Boliden’s business: costs are known exactly, combining cost data from different systems is possible, and budgeting has reached higher precision. The new system is well-defined and easy-to-use.