Where the mining industry is failing to manage complexity, and how it can change its approach

Dec. 15, 2010 - PRLog -- In its new white paper – Managing complexity: where is the mining industry going wrong? – it explores the views of CEOs, industry experts and academics on how mining companies can change their approach to facilitate growth in an increasingly complex market.

The paper highlights four common mistakes that the industry must stop making:

Investing in machines, not people. Investing in people is the key to sustainable growth, and solving the skills shortage. Contributor Dr Johannes Sittard of the Eurasian National Resources Corporation says: “What use is the best machine if I have no people? Machines have to be replaced – people don’t change, so if you are clever you will invest in people because that’s a long term investment.”

Failing to learn from other industries. Applying ideas from other industries will enable mining companies to think in new ways and improve operational effectiveness. Contributor Lia DiBello, President of Workplace Technologies Research, Inc., says: “Companies must look to different business models, rather than sticking to the one they’ve always applied.”

Not working closely enough with governments and local populations. To ensure resources are developed fairly and profitably for all, governments and local people must be ‘on board’ with exploiting them. Contributor Richard Allan, Morgan Stanley’s Managing Director of Metals and Mining, says: “Industry and government must work together to improve the operational framework and minimise uncertainty.”

Under-assessing risk. A lack of foresight and a ‘one view of the world’ approach means risks are not being appropriately assessed and managed. Contributor Greg Yeatman, Executive Director, C&M Strategic Resources Fund, says: “If you only gear yourself towards growth you are vulnerable to being ‘hit’ by an event. While you can’t predict the future, you can position the company to survive different outcomes.”

Eddy Solbrandt, CEO of GPR Dehler, said: “We believe the mining industry faces more complexity most. As well as the challenges all CEOs have to manage, CEOs of mining companies must handle another layer of complex issues unique to our industry – the need to operate wherever reserves exist, sourcing funding for exploration and getting the right expertise in situ, for example. By effectively managing this complexity, they can create competitive advantage – but first the industry must stop looking at the same problems through the same lens.”

Notes to editor
For further information, contact Hannah Robertson at Onefish Twofish on hannah@onefishtwofish.co.uk or at +44 1183 217457.

To request a copy of the white paper Managing complexity: where is the mining industry going wrong? please email Rolf Gerritsen at rgerritsen@gprdehler.com or call him on +44 207 7589600.

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GPR Dehler is an independent, international management consultancy which specialises in the design, development and implementation of change strategies which yield tangible financial benefits for major corporations worldwide.