BHP Billiton has announced a new operating model that the company anticipates will create a more agile company ready to respond to the challenges and opportunities presented by a rapidly changing global marketplace.
BHP Billiton intends to become a much simpler organisation focused on geographic operating regions and supported by globalised functional services drawing upon world-class expertise and scale.
Andrew Mackenzie, BHP Billiton CEO, commented: "These changes are a continuation of our simplification journey. They are made possible by the recent demerger of South32 and well-timed asset divestments, and reflect our continued commitment to improve productivity.”
Mackenzie indicated that the new model will be centred on assets that are “dedicated to safety, volume and cost enabled by functions integrated globally and largely co-located with the assets.” He anticipates that it will create value and growth going forward.
"Both assets and functions will have fewer layers and hence fewer people required to lead and run the organisation. This closer connection between management and operations will promote greater efficiency, rapid sharing of best practice and adoption of new technology to improve safety, productivity and learning - as well as management of risk,” Mackenzie continued.
BHP Billiton's minerals production operations will be organised into two regional units: Minerals Australia and Minerals Americas. The Company's oil and gas exploration and production operations will continue to be housed within a global Petroleum unit, reflecting the operating environment in that sector.
Roles and responsibilities changes:
- Mike Henry, currently President Coal, will become President Operations, Minerals Australia and will have responsibility for BHP Billiton's Australian iron ore and coal operations, the Olympic Dam copper mine, Nickel West and the Indomet Coal project. He will also be responsible for the development of world-class maintenance practices across the company.
- Daniel Malchuk, currently President Copper, will become President Operations, Minerals Americas and will have responsibility for BHP Billiton's copper assets in Chile, the New Mexico Coal mine in the US, the company's non-operated interests in the Antamina copper joint venture in Peru, the Cerrejon coal joint venture in Colombia and the Resolution copper project in the US. Malchuk will be responsible for the development of a new projects centre of excellence to promote continued advances in capital efficiency across the organisation. He will also oversee the company's ongoing copper exploration programme.
- Steve Pastor will become President Operations, Petroleum, and will have responsibility for BHP Billiton's petroleum interests in the Gulf of Mexico, onshore US, Australia and Trinidad and Tobago. He will also oversee the company's ongoing petroleum exploration programme.
The changes will be in effect as of 1 March 2016.
The changes to the the organisational structure mean that one less President role will be required in Australia, and as a result Jimmy Wilson, currently President Iron Ore, will leave the company. As the role of President Petroleum will change to become more closely focused on operations and will no longer include direct oversight of functional and business administration, Tim Cutt, currently President Petroleum, will also leave the company.
Mackenzie thanked Cutt and Wlson on behalf of the company for their service and leadership at BHP and wished them success in the future.
Mackenzie also outlined changes to BHP Billiton's functional model that are intended to improve the efficiency and capability of service delivery to the company. These changes include the transition of key functional services to global reporting lines. This will eliminate duplication of effort and create deep pools of expertise in the provision of services to the Company's operated Assets. The key changes are:
Reflecting the company's commitment to Sustainability and risk management, the Corporate Health, Safety and Environment (HSE) and Risk, Audit and Assurance functions will report to Geoff Healy, currently Chief Legal Counsel, who has been appointed to the expanded role of Chief Risk and Legal Officer.
Chief Financial Officer, Peter Beaven, will assume global responsibility for strategy and business development, allowing the company to more effectively identify opportunities for value and growth across all commodities.
BHP Billiton's Marketing and Supply functions will consolidate under the leadership of Arnoud Balhuizen who has been appointed to the role of President, Marketing and Supply.
A new technology function is being established to provide operational and information technology services to the company, as well as lead technology innovation across the organisation. Diane Jurgens has been appointed to the role of Chief Technology Officer.
Edited from press release by Harleigh Hobbs
Read the article online at: https://www.worldcoal.com/coal/23022016/bhp-billiton-new-organisational-structure-289/