In EY’s latest report on the top 10 business risks facing mining and metals companies, released in December, three of the 10 are directly related to digitalization.
Digital effectiveness is listed as the No. 2 risk, cybersecurity No. 4, and disruption (for example, automation and its effect on jobs) No. 8.
However, while the other risks listed in the report don’t appear to be digital in nature, at least on the surface, there is no corner of mining that has been untouched by the digital revolution. It doesn’t take much a stretch to see a digital connection with risk No. 5, rising costs, or No. 7, the future of the workforce, for example. Moreover, environmental monitoring, worker and community safety, procurement – as well as productivity and efficiency – are all areas that can be vastly improved with digital solutions.
The No. 1 risk in EY’s report, which was based on a survey of 250 sector participants from around the world, is losing the licence to operate. Part of the way to address this risk is through adoption of digital technology and the transparency it creates naturally. That can include wider access to environmental data collected by companies to build public trust, and perhaps remote work solutions that would appeal to tech-savvy younger workers who currently don’t see mining as a career option.
Despite the potentially transformative value of digital technologies, a significant portion of mining sector management remains stuck in the past.
The EY report noted that a recent poll of over 600 mining and metals executives found that 37% of management surveyed had little or no knowledge of the digital landscape. Incredibly, that means that over a third of respondents are blind to the power of the new tools available to them to create a more sustainable and profitable business.
Perhaps the scariest thing for miners about digitalization is the aspect of transparency. At a recent panel discussion about digital technology, hosted by Maestro Digital Mine at the Prospectors and Developers Association of Canada conference in Toronto, the conversation turned to the tendency of miners to “massage” numbers to make themselves look better (see page 43).
“The main goal is to try to get information directly from the machine and that’s good because now we don’t have any manipulation, we get clean crisp data from the machine,” said Ethan Hull, CEO of TECHrep Global and formerly Barrick Gold’s IT manager for North America. “But you’ve got to understand in a lot of organizations that’s a difficult challenge.” The cold accuracy of numbers gleaned straight from the source will no doubt result in greater visibility as to what’s actually happening with equipment, people and supplies – providing an opportunity to fix things that aren’t working as expected.
But first, the culture of mining and its apparent aversion to transparency will need to be addressed.