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Collaboration Opportunities

and Supplier Expectations

Björn SteneckerCPO

Göran LindholmHead of Supply BA Smelters

Andreas BivallHead of Procurement Development

How can we together turn waste

rock into metals?

BOLIDEN SUPPLIER SUMMIT 2017

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Boliden Procurement

Smelters CategoriesGroup Managed Categories

Logistics, IS/IT, IM&S

Mines Categories

Total Spend 1,5B EUR

BulkFixed

EquipmentMobile

EquipmentTools &

Consumabl.Logistics Services

Indirect Material & Services

IT and Telco Electrical

BOLIDEN SUPPLIER SUMMIT 2017

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Supplier selection & requirements

BOLIDEN SUPPLIER SUMMIT 2017

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Our Priorities Supplier requirements

Qualifiers

Selection

differentiators

Safety

Productivity

Cost

Innovation

• Safety

• Productivity

• Performance

• Sustainability

• Cost leadership

• Operational Excellence

• Quality

• Innovation

• Support multiple sites

We will always strive to enable healthy and fair competition

Digitizing the invoice process

The “Cure”: Invoice automation- Improves efficiency and reduces error with

automatic matching of invoices against PO

Instructions for invoicing:

• Invoice should refer to a valid purchase

order number

• Invoice should match the agreement

• Due date will always be calculated from

date of received correct invoice

• Boliden not responsible for lost paper

invoices

Use Electronic invoices- Easy to send and receive

- Improves quality and handling times in invoice process

- Improves on-time payment rate

PDF invoice is NOT an electronic invoiceSend e-invoices!

The “Pain”High yearly transactional volumes

- 200,000 Invoices

- 460,000 Invoice lines

BOLIDEN SUPPLIER SUMMIT 2017

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Suppliers at the summit

Benny Larsson Schakt AB

LångdahlsÅkeri AB

KGH:s Borr AB

who sends e-invoices

BOLIDEN SUPPLIER SUMMIT 2017

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Digitizing the order process

High yearly transactional volumes

- 100.000 Purchase orders

- 300.000 Purchase order lines

Today:

- Lot of manual work

- Slow processes

- Risk for mistakes

For both parties!

Tomorrow’s “Cure”

Boliden projects Expectations on

Suppliers

2018: Purchase orders

automatically created and

sent

When informed, be observant

and report deviating patterns

2018/19: E-catalogue Support a Boliden 3rd party,

single catalogue solution

2018/19: EDI Adapt to a Boliden 3rd party

EDI hub

2019: Bar codes on Delivery

notes

Print bar codes compliant

with delivery

BOLIDEN SUPPLIER SUMMIT 2017

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Today’s “Pain”

Will you be ready for tomorrow’s order process?

Benny Larsson Schakt AB

LångdahlsÅkeri AB

KGH:s Borr AB

BOLIDEN SUPPLIER SUMMIT 2017

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Expectations

1. Be Competitive

2. Be Safe & Sustainable

3. Be Innovative

BOLIDEN SUPPLIER SUMMIT 2017

NEXT LEVEL METALS AND MINING –COLLABORATE AND INNOVATE

Expectations

1. Be Competitive

2. Be Safe & Sustainable

3. Be Innovative

BOLIDEN SUPPLIER SUMMIT 2017

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Stability in a cyclical world

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Source: Wood MacKenzie; Boliden Annual report 2007-2016

Building for the next downturn

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Bo

lid

en

Are

a

Garp

en

berg

Tara

Bo

lid

en

Are

a

Ait

ik Kyly

lah

ti

Cash cost position - Only the most competitive will make it

Expectations

1. Be Competitive

2. Be Safe & Sustainable

3. Be Innovative

BOLIDEN SUPPLIER SUMMIT 2017

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Business partner code of conduct

BOLIDEN SUPPLIER SUMMIT 2017

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Human Rights Labour RightsAnti Corruption Environment

Supply chain control

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Suppliers with structured CR processes has a competitive advantage

Increasing

difficulty in CR

follow up

Supplier Safety Performance

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Monthly review of supplier safety performance

BOLIDEN SUPPLIER SUMMIT 2017

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Supplier Safety Performance

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Supplier No of LTI LTIF Comment

Supplier 1 7Improvement program initiated, further improvements needed

Supplier 2 4 Improvement program implemented (no LTI since 2016)

Supplier 3 4 Phased out

Supplier 4 4 Improvement program initiated

Supplier 5 4 Phased out

Supplier 6 4 Improvement program initiated

Supplier 7 4 Improvement program implemented (no LTI since 2016)

Supplier 8 3 Phased out

Supplier 9 3 Phased out

Supplier 10 3 Ongoing meetings to improve performance

Supplier 11 3 Action plan defined no LTI since March 2016

Supplier 12 3 Improved performance. No LTI since Jan 2016

Supplier 13 3 Improvement program to be initiated

Supplier 14 2 Improved performance. No LTI since July 2015

Supplier 15 2 Improvement program to be initiated

Supplier 16 2 Improvement program to be initiated

Supplier 17 2 Improvement program to be initiated

Long term tracking of Supplier safety performance (Illustrative and anonymized)

When on the list:

1. Improvement program

mandatory for Boliden

assignment

2. Create Monthly LTIF

reporting for Boliden

assignment

Be Safe

Everyone leaves our sites unharmed, with maintained health

Every day!

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Expectations

1. Be Competitive

2. Be Safe & Sustainable

3. Be Innovative

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A century of transformative innovations

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Aviation

Telecom

IT

Metals and Mining

Industry challenges

Finding new reserves

Declining ore grades

Remote and difficult locations

Increasing need for capital

Energy efficiency

Securing productivity and cost control

Securing sustainable operations

Safety

Step-change of

innovation pace

needed in our

industry

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Change drivers

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Continued demand for metals

-Supporting a developing

world

• Urbanization

• Population growth

• Growing middle class

• Aging infrastructure

Increasingly hard to set-up,

operate and decommission

mines and smelters

• Safety

• Sustainability

• Productivity

Maturing technological

enablers

• Automation

• Optimization

• Analytics

• IoT

• Robotics

• Autonomous machinery

• Teleremote equipment

• Big data

• Mobile positioning

• Traffic control

• RFID

• High powered lasers

• Automated/optimized

scheduling

• Big data

• AI/Machine Learning

• Predictive

maintenance

• Robotics

• CO2 free process

• Combined hydro- and

Pyro metallurgy

• 3d Printing

• Mobile Positioning

• Autonomous vehicles

• CO2 free transports

• RFID

• Predictive

maintenance

• Drones

• Integrated and

portable devices

• XRF/Tomography

• 3D-4D Modelling

• 3-D seismics

Technological enablers

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Finding it Mining it Smelting it Selling it

• ? • ? • ? • ?

Mentimeter Poll

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What emerging technologies within your

space will have the largest impact on the

metals and mining industry in the coming

10 years?

Innovation and collaboration – What we offer

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• Openness

• Suitable environment

• Competence and creativity

• Proven track record

• Reference value

• Low IP ownership demands

• Proximity to the best cluster

Ideal test bed

Innovation and collaboration – What we ask for

BOLIDEN SUPPLIER SUMMIT 2017

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• Allocate R&D resources towards mining and smelting

• Invest and innovate for future cost leadership

• Be proactive and innovate within our cluster

• A plan to commercialize the innovation in near future

Summarizing

Stable in a cyclical world

Get on-board with digitization

Be Competitive

Be Safe

Be Sustainable

Be Innovative

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