If you looked hard enough, you might find an industry where digitization is not part of an ongoing conversation, but it’s doubtful. As revolutions have done and will continue to do, they quickly separate the visionaries from the laggards, and the digital revolution is no exception. It is reaching deep into the far corners of industries and forcing change, including the mining industry.
Be current or you’ll be history is a compelling argument and many companies are boldly charging ahead to digitize the business, the operations, and the outcomes. But charging ahead is where most companies, despite best intentions, will falter and be left behind for one reason: The absence of a digitization vision.
Let me share why that’s the case and offer a few instances of proof.
At a recent mining industry convention in Montreal, there was a good amount of discourse on digitization, and rightfully so, too. Last year, the World Economic Forum published a paper citing digital’s specific potential to the industry, its stakeholders and interests, including:
- $425 billion of value for the industry, customers, society and the environment;
- $320 billion of industry value; w reduction in 610 million tonnes of CO2 emissions; and
- 1,000 lives saved and 44,000 injuries prevented.
At some point, those convention conversations referenced wireless communications as the early building blocks of digitization.
And while that is correct, what was missing was this simple and essential message: Wireless must be the early building blocks of a digitization vision driven by the company’s uppermost leadership.
For the many teams that know they need to digitize their operations, wireless affords quick forward leaps that are alluring for those accountable to bottom lines, efficiency, and production.
At the most rudimentary levels, wireless gives coverage in key areas allowing for data collection, the connectivity needed to facilitate VoIP communications with the above-ground team, and a certain amount of mobile freedom. The list goes on.
Resist the temptation of the quick wireless win without a sound digitization vision that has commitment and discipline at its core. This is not to advocate for standing down on moving forward until all the pieces are in place. Rather this is a call for ambition behind a strong vision.
In a February 2016 column published in the Globe & Mail, I built a case for disruption in the mining industry, particularly a shift for mines to become knowledge-based companies that make strategic use of the data collected. At Dundee Precious Metals, we coined the term “taking the lid off” the mine, and a vision that embraces that kind of tectonic shift in your business and our industry begins with the end in mind.
Dundee’s Chelopech mine in Bulgaria was the testing ground for what today is the technology and services behind Terrative Digital Solutions to help operators and leaders develop their digital strategy and take the lid off their own mine. The aforementioned article explains what wireless technologies eventually allowed us to do, but those capabilities started with our leadership team’s vision.
Before we made any kind of significant leaps forward, we invested the time to examine not only the pain points of our operations (an easy place to start – with the problems), but where we wanted to go with the business. For instance, it wasn’t enough for our team to know about delays in production that would impact our outcomes, we wanted to have a much broader and holistic view of the operations and to see the interconnections in the mine. We didn’t just want to manage production delays, we wanted to understand and predict them. We didn’t just want to fix inefficiencies, we wanted to find them.
Our vehicle fleet is a perfect example. With wireless communications, proactive data collection revealed they were wholly underutilized at only 25%. By examining the data, pulling information from other parts of the solution – there’s the broader, holistic view I mentioned – we could reassign and schedule vehicles so they would eventually double their utilization. And we took it a step further and applied predictive analytics to the fleet’s history which allowed us to determine the vehicles that would need servicing, not only minimizing downtime, but freeing up the individual whose job it was to manually track, record, and report on the fleet’s health. The result? An optimized fleet without a single new vehicle expenditure.
That was the kind of vision we had for Chelopech. Our digitization journey started with wireless technologies, and the driver was a unified leadership team possessing an aligned vision, commitment and discipline.
KPMG, in their 2016 discussion, The paradox of digital disruption, cited lack of strategic vision as the single biggest barrier to digitization, followed by legacy systems and cultural resistance.
“Real, lasting change” they offer “is unattainable without an organization-wide plan.” Inasmuch as digitization will carve off the laggards, it is also an opportunity for leadership to build a long-term and widespread revolutionary vision for the company.
Be current so you can make history instead of becoming it.
Rick Howes is CEO of Dundee Precious Metals and president of Terrative Digital Solutions.