Deloitte says miners must rethink their strategies in an everchanging market , as it releases its annual Tracking the Trends report.
The mining industry is poised for greater growth than has been seen in the last decade, but companies must navigate a market characterised by constant disruption and changing community expectations, the report reveals.
“Mining companies really need to broaden their strategic outlooks,”
Deloitte National Mining Leader for Australia Ian Sanders said.
“In addition to producing at the lowest cost, mining companies need to consider a range of measures to make the most of this period of growth, including focus on the role of individual assets in the portfolio, re-imagining the path to value creation, finding balance between risk and return, and understanding how their company can differentiate itself in the eyes of its stakeholders.”
Mr Sanders said disruption and volatility had become the new normal, with the pace of change is challenging the industry’s ability to adapt.
“Australian mining companies must not only adapt to the disruption of industry from a technical viewpoint, but the disruption being brought about by changing community standards and attitudes towards mining”
The Tracking the Trends report identifies the following trends:
The frontier of analytics and artificial intelligence: Mining companies are investing in analytics and AI in a bid to leverage the data they generate to sharpen planning and decision-making across the mining value chain. This could improve safety, increase productivity, reduce costs and enhance employee experience.
Managing risk in the digital era: In today’s broadened risk landscape, traditional assurances around risk are no longer effective. Boards, investors, and communities expect mining companies to have a forward-looking view on risk, moving from risk assurance to the anticipation of emerging risks.
Digitising the supply chain: The organisations that determine how to interlink their supply chains, from pit-to-port, can do more than break down operational silos. They can also gain the end-to-end visibility needed to enhance their asset utilisation, operational efficiency, and productivity – realising hard dollar savings as a result.
Driving sustainable shared social outcomes: Organisations across industries are now being assessed on metrics far beyond financial performance. They are judged on their relationships with their workers, customers, communities, and regulators – as well as their impact on society at large. They must go beyond seeing corporate social responsibility as a cost of compliance and listen more closely to their constituents to determine what stakeholders truly want and shift their operational processes in response.
Exploring the water-energy nexus: Water is quickly rising to the top of mining companies’ agendas as one of the greatest constraints to supply. By approaching energy and water managements in tandem, mining companies can make business choices that optimise the use of both. These change are increasingly necessary if mining companies hope to maintain productivity, allay community concerns, and manage their environmental risks in an energy and water constrained world.
Decoding capital projects: Before launching into the next wave of investment miners must learn from the mistakes of the past and rebuild trust with stakeholders. Organisations that focus now on putting the right capital project capabilities into place can strengthen capacity to adjust supply in response to shifting demand patterns.
Reimagining work, workers and the workplace: As digitisation and automation alters the very nature of work, miners need to broaden their talent strategies. They must consider not only the shifting nature of work but how to attract a variety of workers and tailor their workplaces accordingly.
Operationalising diversity and inclusion programs: To improve diversity and inclusion in the industry, and to attract talent to meet the industries’ digitisation, automation, and innovation goals, miners need to shift historical perceptions about the industry. This requires collaboration as they recruit from education institutions and other online platforms, a focus on exposing unconscious biases that influence the hiring decisions and contribute to workplace inequality, and the implementation of more flexible workplace practices.
Demanding provenance: As customer demand for battery minerals rises, so too does demand for transparent provenance. This is exposing miners to increased scrutiny as socially-conscious consumers question the origin of raw materials in products ranging from cell phones to electric vehicles. As a result, downstream customers – such as automotive manufacturers and tech giants are demanding ethically-sourced materials. This is driving the adoption of technologies such as blockchain to enhance the traceability of commodities.
“The future of mining presents great technological advances, which will contribute to growth in the industry but it also has its challenges,” Mr Sanders said. “Tracking the Trends provides a strategic focus for miners in a constantly challenging environment.”