Shaanxi Coal and Chemical Industry Group Sunjiacha Longhua Mining Co., Ltd. (referred to as Longhua Mining Company) is located in Shenmu City, Shaanxi Province，Established in 2008，Now it is basically formed with coal as the main body，Coal chemical industry and new energy are two wings，Modern Logistics、Modern Services、The "one body, two wings and three guarantees" industrial matrix supported by modern agriculture，The coal mine has an approved production capacity of 10 million tons。In recent years，This company thinks in terms of “big cost”，Explore the formation of “4143” extreme cost management system，The complete cost of a ton of coal is controlled within 143 yuan。
Why can Longhua Mining Company’s cost per ton of coal be controlled so low？With this question，The author conducted an in-depth interview with this mixed ownership company。
“The characteristic of Longhua Mining Company is the ‘private-owned mechanism’、State-owned quality’，Formed a fast and flexible decision-making mechanism、Refined and efficient management system。" Gao Jie, secretary of the party committee of the company, said， “‘Big cost’ thinking further improves the quality of development，Promoted the diversified development of enterprises。”
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“‘4143’ Extreme Cost Management System，It is the specific practice of ‘big cost’ thinking in coal mines。"Introduced by Liu Xiaoyi, Chairman of Longhua Mining Company，The first "4" is ex-ante budget control、In-process control、Full process analysis and control、Post-assessment control，Built a relatively complete closed loop of cost control；“1” means strictly implementing comprehensive budget management，Based on annual business goals，Calculate and decompose various cost indicators，Bring it all under budget control，Promote the deep integration of coal mining business and finance；The second “4” is investment in infrastructure、Design optimization、Material Procurement、Four major areas of sales，As the focus of extreme cost control；“3” is the organizational structure、Collaboration of three levels of talent team and corporate culture，Strongly advocate、Practice “increase revenue and reduce expenditure、Careful and careful” cost management concept，In-depth promotion of extreme cost control。
"For example，Since deepening the reform of the three systems，The number of company departments and offices has been reduced from 12 to 10，District teams were streamlined from 14 to 11。Establish 813 coal mine positions，155 other non-coal positions，Streamline management and technical positions by 25。" Liu Xiaoyi said，"Flat management，Highly streamlined organization，Corporate culture cohesion，Everything is implemented、Tested the ‘big cost’ thinking，Internalize cost control、Externalization in action、Cured in the system。”
The core of the “4143” extreme cost management system is comprehensive budget management。To accurately establish cost control targets，The company has established a comprehensive budget management process，Covers budgeting、Preliminary review、Review、Approval、Adjustment and execution and other aspects，And established a complete assessment system and system，Form a comprehensive budget management model M88 loginfeaturing "five modernizations"。
“The ‘Five Modernizations’ are for accurate indicator calculation、Indicator decomposition terminalization、Responsibility for indicator implementation、Strict indicator assessment、Institutionalization of indicator analysis。" Liu Xiaoyi said，“We focus on building a process control mechanism，Establish a UFIDA ERP (Enterprise Resource Planning) comprehensive budget data collection system covering all links，Set up in-transit monitoring points at key nodes，Communication and feedback between departments、Coordinated control mechanism。Management integrates and summarizes information，Decision makers re-formulate goals based on feedback、Dynamic adjustment。”
"Do everything possible to reduce costs and expenses，But we do not consider the cost when investing in safety，The money spent is worth every penny。All cost control measures，All are implemented under the premise of ensuring safety。" said Cao Guoxuan, deputy general manager of the company。
"By implementing extreme cost management，All employees’ awareness of cost control has been enhanced，The level of cost management has been significantly improved。" Liu Xiaoyi said，At cost、Efficiency and profit per ton of coal, etc.，Longhua Mining Company ranks among the top 36 pairs of production mines in Shaanxi Coal Group。
Longhua Mining Company Garden Factory
Effective and efficient practices in business management
In recent years，The company gives full play to the "private-operated mechanism、The unique advantage of “state-owned quality”，Gradually establish "cost control centered on production，The operating mechanism of operation and management centered on finance，Procurement management through "let suppliers run at most once"、Methods such as "quick copying" to reduce trial and error costs and "addition and subtraction" to create benefits， Ensure cost management is pragmatic and efficient。
——Promote procurement management that “allows suppliers to run once at most”。
April 9，At the company’s coal shearer bidding business negotiation meeting，The person in charge of the purchasing department said: "Your equipment quotation will be reduced again。"The supplier said: "We can't lower it any more。We give it to Inner Mongolia、Shaanxi customers’ quotations are all the same，The quotation for old customers is already very favorable。”
"No matter '3331' (30% advance payment、30% payment upon arrival、30% payment for 3 months of normal operation、10% of the warranty deposit is reserved)，Still ‘0631’ (0 prepaid、60% payment upon arrival、30% payment for 3 months of normal operation、10% of the warranty deposit is reserved)，You can choose from two payment settlement methods。Two payment methods: wire transfer and acceptance draft，You can also choose。”“Under the premise of ensuring quality，You only need to run once，Even the invoice can be mailed。Our business undertaking department will handle it in detail，Pay on time as agreed in the contract。”The head of the company’s purchasing department said。
After many rounds of bottom-out negotiations，Finally, the two parties reached a cooperation agreement to lower the price，The supplier also provides accessories worth 3 million yuan or one overhaul service worth 8 million yuan。
“We were stuck with the agent，Contact directly with the manufacturer，Each one will settle his own account，This is the reason why the price can be negotiated。" said Wang Biqing, general manager of the company，"The company has a rule，Customer missing leader。No need for the manufacturer to send someone over for payment settlement，Relevant departments handle payment procedures。”
The above cases are normal actions in the company’s bidding and business negotiations。Before each tender，The company has to do a lot of preliminary preparation work，Extensive collection of purchase prices and usage effects of similar types of equipment in coal mines in Yulin City，And negotiate the price on this basis，Reduce procurement costs as much as possible。
“Although the price given by Longhua Mining Company is low，But program specifications，No need to ask for help，No other hidden costs。How much money do you make，You can calculate it after signing the contract。" said an anonymous supplier，“The leader doesn’t see us，We don’t need to meet the leader either。We want to win the bid，It all depends on product quality and price。”
It is worth explaining，At the bidding meeting for large-scale material procurement，In addition to paying attention to the sales price、Product quality and other matters，The company also requires manufacturers to price accessories and materials later、After-sales service，Make a list of commitments。After winning the bid，To write the commitment list into the purchase contract，This move greatly reduces post-operation and maintenance costs。
——Adopt "fast replication" to reduce the cost of trial and error.
"For some M88 logincutting-edgeness、New technology that is not yet mature、New technology, etc.，Successful experiments in other coal mines、After the application matures，We will ‘quickly copy’ as soon as possible，Avoiding huge losses to the company due to technical mistakes。" Gao Jie said，The purpose of this is to reduce the cost of trial and error，Also reduce the “customization” of some smart devices，Buy smart devices that can be “mass-produced”，Much cheaper than buying “customized” equipment。
Li Chun, deputy general manager of the company, gave an example。For example, hydraulic support、Selection of large equipment such as fully mechanized mining units，The company will first conduct on-site research on the use of coal mines in the Yulin area，Select the best equipment of the same type，Then contact the manufacturer directly for business negotiations。
According to introduction，Compared to striving to be the “first” in the industry or the “first” in the country，The company pays more attention to technical applicability、Cost-benefit analysis，And the degree of integration with the existing safety production and management system，Ensure the introduction of every new technology or process，can promote high-quality development of enterprises。
“Why we do this，Doesn’t mean rejecting innovation，It is a more pragmatic development path and business risk prevention and control strategy。" Gao Jie said，This approach helps ensure safe production in coal mines，Steady improvement of efficiency, effectiveness and core competitiveness。
——Use the "addition and subtraction" method to create results.
The company adheres to the principle of "three people do the work of five people"，The principle of "getting the salary of four people"，Adopt the method of fixed staffing, fixed positions and fixed personnel，Set up positions strictly in accordance with safety production requirements。In recent years，The total number of employees in the company’s coal mines is always controlled within 1,000 people。2023，Per capita profit reaches 382.780,000 yuan，Exceeding the national coal industry benchmark value of 26.63%。
To reduce labor costs，The company strongly advocates "one job, multiple responsibilities"。As a diversified enterprise with tens of millions of tons of modern coal mines，The company’s department structure has been streamlined to 10，Equipped with 79 management staff。
He Zhijun, deputy general manager of the company, said: "We are in terms of staffing，Implement relaxed production positions、Strategy for tightening logistics positions。Official departments only have ministers，Safe production、The environmental protection department can have two persons in charge, one person and one person，Clear responsibilities of managers、Collaborative and efficient。”
The company also continues to promote the construction of “four modernizations”，Through technological innovation、“Four New” applications, etc.，Achieve security、Reduce people、Improve efficiency、Cost reduction。Since 2019，Invest 2 successively.900 million yuan，Used for intelligent construction，Further improve the production environment，Improve efficiency of all employees，Reduce costs。He Zhijun said: “We have many practices in intelligent construction，You can use ‘it works、Efficient’ summarized in four words，Always focus on improving quality, increasing efficiency and reducing costs。”
Strictly control all aspects and details of cost management
In recent years，Longhua Mining Company uses a comprehensive budget that “sees far ahead”、“Invisible” technical performance、“Accurate” Procurement and Supply Separation Reform、The “remarkable” “Longhua Quota”，Strictly control all aspects and details of cost management，Implement cost control、Remarkable results。
——Promote a comprehensive budget that “sees the long term”.
"Now，Just buy a screw，Also budget at the beginning of the year。Everything is done in advance，No warning or failure。"After Cao Hua, the new material library director of the company's financial assets department, arrived at the post，I feel most deeply about the comprehensive budget。
"Material usage per month，First check the annual budget，This is the bottom line。Within budget，Actively carry out equipment remanufacturing，Effectively reduce costs and increase efficiency。"Wang Biao, the material manager of the comprehensive mining team, said while looking at the material plan。
Start small，Start small。The company is based on a comprehensive budget，Seriously implement material tracking and assessment management，Achieve consumption quota、There are indicators for assessment、Reuse arranged。At the same time，Put the material fee、Maintenance fees and other indicators，Decomposed into district teams layer by layer、Team、Position，Promote monthly assessment、Quarterly Analysis、Annual redemption。
After exploration and practice，M88 appThe company has formed a unique comprehensive budget management model。"Compile and review comprehensive budget every year，I have to stay up for several days and nights with the supervisor and the financial department，Discuss one by one，Make sure budget matches reality。" Liu Xiaoyi said。
"If there is an error in the annual budget，The leaders in charge must be held accountable、Responsibility of the sponsoring department。Once the budget is determined，Strictly implemented throughout the year。Not special circumstances，No adjustments allowed。" Liu Xiaoyi said，The company adheres to the business analysis meeting system，Analyze production and operation conditions every quarter，Prepare a problem list in a timely manner、Supervision matters。
——Pay close attention to the "invisible" technical performance.
Focus on technology，The key is design、Focus on technology，Focus on reducing equipment、Duplicate input of materials，and funds、Waste of resources。”Wang Biqing settled 3 accounts for the author。
3-1 Optimization of coal pillar size along the groove of fully mechanized coal mining working face，Reduced the width of the coal pillar along the trough from 20 meters to 14.6 meters。Under the premise of ensuring safe production，Improve resource recovery rate，Increase economic benefits by about 48 million yuan。
Optimal design of retreat channel for fully mechanized mining face in 102 panel area，Design part of the mining face as a single retracement channel。Four single retracement channels and multiple recovery coal resources 22.50,000 tons，Calculated based on 300 yuan/ton，Producing economic benefits of 67.5 million yuan。
Deploying a 400-meter ultra-long fully mechanized mining working face，Compared to the previous 325-meter fully mechanized mining working face，540,000 more tons of coal can be mined，Produces economic benefits of about 1.600 million yuan。Working face formation reduces tunneling footage by 2200 meters，Save excavation cost by 5.5 million yuan。
Wang Biqing said，Invisible benefits like this，In production and operation work，Plays a decisive role in reducing costs and increasing efficiency。
——Implement the "accurate" procurement and supply separation reform.
Wang Rong is a senior director of the financial assets department who has worked for many years，Famous for his rigorous work attitude and keen intuition for numbers。Facing the idle waste caused by the structural imbalance of inventory materials，Wang Rongzeng was deeply worried。
To solve these problems，Early 2019，The company implemented a system reform that separated procurement and custody。To achieve refinement and professionalization of material management，The company will transfer the warehouse management functions and personnel of the Mechanical and Electrical Materials Management Department，Assigned to the Financial Assets Department for management。"After function transfer，Purchasing staff can concentrate on market research、Supplier Assessment、Contract negotiation、Procurement execution and other work，Ensure material quality and cost control。" said Li Chun, deputy general manager of the company。
After 4 years of practice，The company’s “supermarket-like management” efficiency of materials has been significantly improved。Domestic shearer、Imported anchor digger、Supporting materials、Grease、Electro-hydraulic control and other materials，Achieving agency storage and sales。Insist on carrying out "monthly draws，Quarterly Market”，Understand material reserves，Timely and Procurement、Production unit docking，Control inventory materials within 80 million yuan，Reduce capital occupation and backlog of materials。Use supplier inventory，Realizing shared storage and sharing of materials；Establishing interconnected procurement sharing channels，Form a diversified procurement network。
“This reform of separation of procurement and storage and ‘supermarket-like management’，Not only an innovation in management，It is also the optimization of corporate governance structure，Provides a reference case for other coal mines in the industry。" said Fan Guangsheng, deputy general manager of finance of the company。
——Promote the "Longhua Quota" that is "visible".
September 3, 2023，A provincial coal company came to Longhua Mining Company to conduct benchmarking exchanges on "comprehensive budget and cost management"。When introducing project cost control, Deputy General Manager Guo Zhengang said: "We always control project construction costs to be at a low level in the industry，Mainly due to the strict implementation of ‘Longhua Quota’。”
“Longhua quota” is different from industry quota standards，is following the province、Based on quarterly price information released by the city，A kind of "all cost unit price quota" promoted，Mainly covers engineering construction、Maintenance business and other contents。
“‘Longhua quota’ is higher than the underground quota of coal mines in Yulin area、The ground quota M88 loginis much lower。To keep the quota accurate，The person in charge of the quota conducts market research every quarter，A dynamic balance correction is made to the quota items every year。"Guo Zhengang said。
"July 2020，Staff apartment building is undergoing renovation，Need to configure living facilities。We do not purchase directly，Instead, individual physical objects are accounted separately，Calculate the complete cost，Add taxes and reasonable profits on this basis，Then tender。Relative centralized procurement，Save 500,000 yuan。"Guo Zhengang said。
Today，There is a saying spread throughout the engineering industry: "It's a good job，Money is hard to come by。”Before taking the job，The focus of Party B’s consideration is no longer the level of profit，It’s a question of whether the project funds are good or not。Longhua Mining Company pays quickly，Accumulated good reputation in Shenmu local area，Party B is more willing to cooperate with others。
Longhua Mining Company holds extreme cost management seminar
Any decision must be made with economic calculations
Longhua Mining Company on extreme cost management，There is another significant feature: on the premise of ensuring safety，Any decision must be made with economic calculations、Cost account，Put “big cost” thinking into all work。
Wang Biqing said: "Under the condition of ensuring normal mining continuity，First, we must reduce costs from mining and deployment。The mining ratio of other coal mine units in northern Shaanxi is 1:2，Our company is 1:1.5，That is, press 2 fully mechanized mining working faces、Proportion setting of 3 tunneling surfaces。By improving tunneling efficiency，Reduce 1 tunnel face，Invisible equipment、Material、Ventilation、Power supply、The number of personnel has been reduced。”
"In terms of staffing，Comprehensive mining team、The excavation team and so on are all one team managing two sides。Management level compression，It also reduces costs and increases efficiency。"Wang Biqing thinks，Only by incorporating “big cost” thinking into the central work，Only in order to reduce costs and increase efficiency in multiple ways。"On production mode，We implement the ‘775’ model，That is, two production shifts of 7 hours each，Overhaul for 5 hours。Production time reduced by 5 hours，Output、Footage did not decrease。Efficiency improved，The electricity bill in the production process has been reduced，The cost will naturally come down。”
"Excavation link，The gangue does not rise into the well，Compression waste volume；Coal mining link，Control roof leakage，More coal、Less waste。This way，Belt transportation、The cost is reduced during the washing and selection processes。"Wang Biqing said，“We pursue profits per ton of coal，See how much you can earn per ton of coal、How much benefit is generated。”
Qiao Qingliang, deputy general manager of the company, said: "In recent years，We have also established a coal product price committee，Promote ‘decision-making without overnight’，Adjust the quick pricing mechanism at zero o’clock on time。According to market changes，Quickly adjust the selling price of coal products，Ensure stable coal production，Maximize economic benefits。”
There seems to be no direct relationship between coal production and sales and cost management，But Liu Xiaoyi’s words are enlightening。"Through cost control，Can improve the enterprise's business risk prevention and control capabilities，Maintain coal product price competitiveness，Increase market share。”“Smooth sales，High coal output，Can depreciate equipment、Repair Fee、Labor salary、Amortization of intangible assets、Dilution of fixed costs such as various administrative expenses，The cost per ton of coal will naturally be reduced。”
“Rise the price when it’s time to raise it，Ensure balance between production and sales、No superpower production；Reducing prices when it’s time to do so，Ensure that production does not decline，Ensuring a virtuous cycle of safe production to the maximum extent。"Qiao Qingliang said，According to market changes，The company adopts "decision-making not overnight，Quick pricing mechanism for "on-time adjustment at zero o'clock"，A total of 25 pricing meetings were held from January to May this year。
“As an energy company，We must pay attention to the country’s macroeconomic trends，Looking at it from a micro perspective、Thinking、Promote the high-quality development of coal enterprises，Focus on exploration、Cultivation of new productive forces。Specific to work practice，We must grasp the laws of economics，Comprehensively implement the new development concept，Promote the economy to achieve effective qualitative improvement and reasonable quantitative growth。Coal mine cost management has a long way to go，We must take the initiative，Accelerate the transformation and upgrading of mixed ownership enterprises，For national energy security、Make due contribution to the prosperity of regional economy。" Gao Jie said。