The old stereotype of a mining company as a gritty and outmoded operation that simply moves dirt from A to B is long gone. Today’s mining operations use groundbreaking (pardon the pun) technologies to streamline and automate manual tasks. They invest in new equipment, new business management software, and new technologies that allow them to grow out and up — diversifying operations to capitalize on new revenue opportunities.
Recent research from Deloitte indicates that one of the foundational steps required before a mining company can embrace new avenues of opportunity is to integrate internal operations. By doing so they create a cohesive business technology platform that streamlines workflows, delivers deep business insights, and helps miners diversify and expand operations. In this two-part series, we’ll first look at how mining companies can create integrated business operations. Then, in part two, we’ll explore what opportunities integrated mining companies are pursuing — and how it’s paying dividends.
Integration unlocks technology’s advantages
Everywhere, technology is advancing at a record pace, and technological advances within the mining industry are accelerating as well. Call it digital transformation, the process of using digital technologies to create new — or modify existing — business processes to meet changing business or market requirements. Mining companies are experiencing a wide range of results from their digital transformation efforts. While some are significantly lowering costs and increasing productivity, others are seeing only incremental improvements.
Deloitte’s research within the mining industry offers some insight into why mining companies see mixed results with their technology initiatives. They’ve found that mining companies in general have been slower than other industries to integrate their operations, leaving silos of data that hamper strategic decision making and stall process improvements. Integrated operations, Deloitte asserts, facilitate cost advantages and drives more predictable outcomes, creating long-term trust with stakeholders.
What kind of integration are we talking about?
The integration we’re referring to is primarily within the mining company’s business management software. Mining is a multi-faceted business, and many of our mining clients rely on several applications to run their business — from accounting and finance, asset and equipment maintenance, to shareholder relations and human capital management. When those applications stand alone, with data siloed, it’s difficult to gain a cohesive and comprehensive view of the mining operation.
Why is integration so elusive?
Why is integration absent for many mining companies? In our experience, we see that many start their exploration phase by using an entry-level accounting application like QuickBooks. An entry-level solutions can seem like a fine starting point, but as the mining company grows into the next phase, adds a location, or prepares for a merger or acquisition, it will need more sophisticated business management tools.
We’ve worked with mining companies that had to rely heavily on spreadsheets to achieve necessary financial and operational reporting. Others added disparate, specialized applications like inventory tracking or HRMS to fill in the gaps the entry-level solutions leave. Starting small and tacking on applications as you grow is understandable but is inefficient and stifling. We encourage young mining operations to “start smart” rather than start small, investing early in a technology infrastructure that will scale with them as they grow.
How do we solve the integration puzzle?
To gain the visibility needed to support real-time, strategic decision making, the applications need some form of integration — they need to share data. Integration often comes through APIs that support data exchange between applications. Integration can also come in the form of imports and exports of data into and out of disparate applications — as long as the import/export process is swift and efficient. Finally, integration can come from a holistic mining industry ERP solution that offers broad functionality within a single application, reducing the need for ancillary applications.
Creating an integrated technology platform is an essential part of building the foundation mining companies need to pivot and adapt to changing markets — and capitalize on new opportunities by diversifying and expanding operations. Stay tuned for part two of The Connected Miner series, where we’ll look at how successful mining companies are using their foundation to create new and sustainable revenue opportunities.