Thesis (MBA)--Stellenbosch University, 2004. / ENGLISH ABSTRACT: The aim of the investigation was to supply decision-makers within the explosives industry
with a study, outlining all aspects important for the successful completion of a capital project.
It also aimed to supply a model to support them in decision-making regarding new capital
expansions and to sensitise them to what is necessary for the successful completion of a
capital project. This model was developed with the aid of the following equation:
Target return = Cost + Desired percentage return x Capital invested
In the process of developing the model, it became clear that financial criteria could not be
looked at in isolation. The conclusion was reached that, in an attempt to successfully
complete a capital project, it becomes important to investigate the whole process, from
budgeting to project completion.
The capital project at issue takes place against the background of the explosives business in
South Africa. It follows that the investigation started off with a study as to where explosives
originated from, as this played an important role in the later development of mining
techniques and the resulting change in how mine management approached the delivery of
service through explosives companies. From the investigation it became clear that large
mines, in an increasing way, opt for "one-contract suppliers". It is expected from these
suppliers to manage all aspects pertaining to drilling, blasting and the hauling of ore. The
study also indicated that there is an oversupply of ammonia, an important ingredient in the
manufacturing of explosives, in South Africa. The combined conclusion was that margins in
the explosives industry in South Africa were put under pressure. This conclusion underlines
the importance of proper capital project management.
It was also found that the level of customer service largely contributes towards the
determination of the layout, size and quantity of remote sites. It follows that this is also a
large cost driver. This cost as well as the costs of erection, purchase of explosives trucks and
the "operability enablement" of such a remote site are important in the sense that they form a
part of the determination of the initial capital outlay as well as the future cash flow for the
calculation of the net present value and the internal rate of return on the project.
A large portion of the operations cost is represented by the transportation of raw materials
from the manufacturing plants to the different remote sites. This action, in the Sasol
Explosives environment, is the only link in the logistics system that has been outsourced. The
investigation into the outsourcing showed that there was no clear reason why this function
was outsourced and, likewise, no apparent reason why it cannot be "insourced" again. A
recommendation has been made that a full-scale investigation into the possible insourcing of
the transport function be launched.
In the process of establishing the future cash flow, an investigation was launched into the
income generated by the project. It was found that the investigation into income could be
divided into two parts: the first, the required return, is coupled to risk; and the second is the
actual sale of products. Sales volume (tonnage) and the accompanying price per ton
"combine" to form sales income. Finally, price per ton, in turn, is used to "balance" the
equation that has been investigated. This price is used as the figure quoted to potential
customers. This equation, as well as the sum total of the investigation, was used as the basis
for the development of a model or Excel spreadsheet. / AFRIKAANSE OPSOMMING: Die doel van die ondersoek was om 'n studie aan besluitnemers binne die springstofbedryf
daar te stel wat alle aspekte belangrik vir die suksesvolle voltooiing van 'n kapitaal projek
bespreek. Die doel was verder om 'n model ter ondersteuning van nuwe kapitaal-uitbreidings
besluitneming daar te stel en besluitnemers ook te sensiteer ten opsigte van wat nodig is om 'n
kapitaalprojek suksesvol af te handel. Hierdie model is ontwikkel aan die hand van die
volgende vergelyking:
Doelopbrengs = Koste + Verlangde persentasie opbrengs x Kapitaal belegging.
In die proses om die model te ontwikkel het dit duidelik geword dat daar nie in isolasie na
finansiele kriteria gekyk kon word nie. Daar is tot die slotsom gekom dat, in 'n poging om 'n
kapitaalprojek suksesvol af te handel, dit nodig was om die hele proses, vanaf begroting tot
projek-afhandeling, te ondersoek.
Die genoemde kapitaalprojek vind plaas teen die agtergrond van die springstofbedryf in Suid-Afrika.
Die ondersoek het derhalwe 'n aanvang geneem met 'n volledige ondersoek na waar
springstof vandaan gekom het, aangesien dit 'n belangrike rol gespeel het in die latere
ontwikkeling van mynboutegnieke en die gevolglike verandering in hoe mynbestuur
dienslewering deur springstofmaatskappye benader. Uit die ondersoek het dit gevolg dat
groot mynmaatskappye hulle al meer wend tot "een-kontrak-verskaffers". Daar word van
hierdie verskaffers verwag om alle aksies rakende boorwerk, skietwerk en die vervoer van
grondstowwe te bestuur. Die ondersoek het ook daarop gewys dat daar 'n oor-aanbod van
ammoniak, 'n belangrike onderdeel in die vervaardiging van springstowwe, in Suid-Afrika
bestaan. Die gesamentlike gevolg was dat marges in die springstofbedryf in Suid-Afrika
onder druk is. Hierdie gevolg het die feit onderstreep dat baie noukeurig na kapitaal projekte
gekyk moet word.
Daar is bevind dat die vlak van klientediens grootliks die uitleg, grootte en aantal verafgelee
aanlegte bepaal. Gevolglik is dit ook 'n baie groot kostedrywer. Hierdie genoemde koste,
asook die kostes van die oprigting, aankoop van springstoftrokke en die "bedryfbaar-maak"
van so 'n verafgelee aanleg, is belangrik in die sin dat dit deel uitmaak van die nodige
vasstelling van die toekomstige aanvanklike kapitaaluitleg, asook die kontantvloei vir die
berekening van die huidige nettowaarde en interne opbrengskoers van die beplande projek.
'n Groot deel van die bedryfskoste word verteenwoordig deur die vervoer van grondstowwe
vanaf die vervaardigingsaanlegte tot by die verskeie verafgeleë aanlegte. Hierdie aksie is
egter, in die Sasol Springstowwe-omgewing, die enigste skakel in die logistieke stelsel wat uit
gekontrakteer is. Die ondersoek na hierdie "'uitsondering" het daarop gewys dat daar
klaarblyklik geen rede gevind kon word waarom hierdie aksie uitgekontrakteer is nie en dat
daar ook geen klaarblyklike rede bestaan waarom dit nie weer ingekontrakteer kan word nie.
'n Aanbeveling is gemaak dat 'n volledige ondersoek gelas word na 'n moontlike
inkontraktering van die vervoer-aksie.
In die proses om die toekomstige vloei van kontant te bepaal, is ondersoek ingestel na die
inkomste wat gegenereer word deur die projek. Daar is gevind dat die ondersoek na inkomste
in twee dele verdeel kan word, i.e. die eerste, die verlangde opbrengs, wat gekoppel is aan
risiko, en die tweede die werklike verkoop van produkte. Verkopevolume (ton) en die
meegaande prys per ton "kombineer" om verkope-inkomste uit te maak. Ten slotte word
prys, per ton, gebruik om die vergelyking wat ondersoek is te balanseer. Hierdie prys word
gebruik as die syfer wat gekwoteer word aan potensiele kliente. Hierdie vergelyking, asook
die som totaal van die ondersoek, is gebruik as basis vir die daarstelling van 'n model of
Excel-sigblad.
| Identifer | oai:union.ndltd.org:netd.ac.za/oai:union.ndltd.org:sun/oai:scholar.sun.ac.za:10019.1/49826 |
| Date | 03 1900 |
| Creators | Düring, Johannes Petrus Joubert |
| Contributors | Gevers, W., Stellenbosch University. Faculty of Economic and Management Sciences. Graduate School of Business. |
| Publisher | Stellenbosch : Stellenbosch University |
| Source Sets | South African National ETD Portal |
| Language | en_ZA |
| Detected Language | Unknown |
| Type | Thesis |
| Format | 154 p. : ill. |
| Rights | Stellenbosch University |
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