SAP Key To Yancoal’s AI-driven Business Transformation

The challenge for Australia’s largest pure-play coal miner was alarmingly simple – innovate, or risk losing it all beneath mounting costs underpinned by process inefficiencies.

Yancoal had been an SAP customer since 2011, amassing a disparate array of system configurations at each of 11 coal mine sites across New South Wales, Queensland and Western Australia.

“Therefore, over the last 10 years, Yancoal was really modifying SAP on the fly. It was like modifying the engines on a plane mid-flight,” says Graham Slattery, the General Manager of ICT for Yancoal Australia.

In 2021, when the cost-per-tonne of coal hit an all-time low, it was imperative for the company to cut costs. The ICT team was challenged to determine if SAP was the right product for Yancoal.

That began a journey of business transformation, led by a shift to RISE with SAP, promising 20% savings over five years, and underpinning a major overhaul of the company’s systems, data acquisition and storage, reporting, and analytics.

“We evaluated seven softwares, and SAP came out to be the most cost-efficient and the one that can actually provide us with a platform moving forward with our digital initiatives,” says Maria Rodriguez, Yancoal’s Business Solutions and Portfolio Manager.

“We committed to the business that they will be leveraging on the capabilities of SAP S/4, and we now have a roadmap to really maximise the investment in SAP.”

In just five months, Yancoal was able to transition away from multiple legacy on-premise and third-party analytics platforms, consolidating various business reporting methods into a unified analytics strategy. This was powered by SAP Analytics Cloud (SAC), SAP Analysis for Office and SAP Datasphere for improved efficiency.

“On Day 1, we immediately achieved time savings,” Rodriguez says. “Our business used to take probably a day or two to run reports. But it came out to be like, minutes or hours to do it, fully reconciled.”

A key feature of the expedited transformation process was a collaboration between Yancoal and SAP. SAP’s Customer Success Partners (CSP) supported Yancoal to augment its IT workforce and address critical business needs.

With a strong focus on implementing process automation to drive cost savings across the business and its 4400 employees at 11 mine sites in three states, a key focus has been to lean into SAP’s expertise in harnessing emerging AI technologies.

“Given the time constraints across Yancoal, our aim is to streamline operations through automation and unleash valuable time,” Rodriguez says. “For example, AI can aggregate vast datasets, analyse them comprehensively, and yield valuable insights, opportunities, and risk assessments.”

Productivity improvement remains a key focus, says Slattery. “Data and technology, including automation and artificial intelligence, are further unlocking growth opportunities and enhancing our operational performance,” he says.

“We are actually improving data quality and data standards, and once you do that you can actually head towards more predictive analysis. You can make better decisions.”

Looking forward, the formerly old-tech miner is making plans for SAP’s consumption-based AI model to play a pivotal role in Yancoal’s business vision. Goals include identifying critical risks and opportunities, especially in job planning and machinery performance. An emphasis on data analytics will provide real-time information to operators and management, while maintenance tasks can be automated to reduce manual data entry.

Other innovations such as installing sensors to optimise large conveyor belts, plus implementing new environmental monitoring and data capture technologies, are creating demand for centralised data collection and reporting systems.

“The business gave us the direction to go down the path of Intelligent Mining,” says Slattery. “This will head towards process automation, as well as mobility.

“Getting people to use mobility products allows them to make decisions quicker, heads towards data analytics, and to be able to make intelligent decisions to drive the business further.”