Pivoting from crisis to transformation
Most mining and metals executives agree that the current pandemic has exposed the shortcomings of traditional business operation models and, at the same time, validated the value and imperative for digital transformation in key business functions. Although some companies have already progressed with digital transformation, its broad adoption in the sector could be still considered embryonic and misunderstood.
For many years, the adoption of artiﬁcial intelligence and data-driven decision-making to increase productivity has helped some companies fare better in this landscape. Now, the opportunity lies in the combination of data and analytics, AI, automation, robotics and virtual ecosystems to reinvent the organization across the value chain. Given that each company faces a unique set of circumstances and varying appetite, the common fundamental self-assessment question is: how can a digital transformation strategy drive actions today that are tied to a bigger purpose in the future?
During my interactions with members of the industry across the country through the CIM Distinguished Lecturer Series, there was a general consensus that successful transition into digital transformation requires a timeline prioritization of intent, actions and impacts between now, next and beyond.
Right Now, companies need to focus on redeﬁning their organization’s agenda by addressing issues and challenges unearthed or exposed during COVID-19. For example, trusted re-entry should include reviewing current workplace and workforce models to test and secure collaboration platforms so that a physical return to work strategy is more than just transitioning back to the old ways.
Next, establish a digital transformation strategy and prioritize delivery of immediate and meaningful results that will drive and sustain enterprise-wide engagement on the transformation journey. To achieve such levels of commitment and reap the rewards of the invested efforts, the sector should look at creating an ecosystem of partners within and outside of the industry. Typically, a comprehensive vision statement, along with initial key pillars, execution team and governance model should underpin such strategy for it to be useful and drive results.
Beyond COVID-19, companies will need to reﬁne or redeﬁne the purpose of their long-term value generation so that it aligns with the digital evolution of the rest of the world. For example, rethinking the approach to talent and culture that will be required to operate in a digital world by creating an environment of continuous innovation and adoption of technology breakthroughs.
Throughout the digital journey, companies can pull the following ﬁve levers to stay relevant, while achieving their goals faster at a lower cost of failure.
1. Digital strategy and continuous ideation: continue to think through the fundamentals that that led to the strategy, with a constant focus on proﬁtability, productivity and long-term value.
2. Innovation ecosystem: forgetting about innovation in a digital transformation strategy is a mistake we see all too often. Mining and metals companies should look beyond the sector for innovation to ﬁnd partnerships with external ecosystems such as start-ups, accelerators, venture capital or academics. For example, recurring meetings with key suppliers could enlighten the sector on what investments and avenues are being contemplated, and which could profoundly change the mining business.
3. Organization and process: discover how to set up the business differently to drive and revitalize the innovation agenda, while measuring ongoing success. Consider the people you assign to these teams. Far too often employees that are already swamped with work are placed on digital transformation teams, pushing the strategy back in long list of priorities.
4. Enterprise scale: build the capabilities needed to scale innovation more quickly to create enterprise-wide impact – while looking at what can be built vs. bought. One simple example is digital signatures. This was a tool that could be implemented in a human resources function and then scaled to all facets of the business. It allows the company to then categorize and archive documents, while streamlining processes across the organization.
5. Culture and talent: engage and empower the workforce. Selectively release old practices to create space for renewal. Advance digital as a core capability through hiring, developing, training and incentivizing employees to develop new skills and digital capabilities.
With COVID-19 and its impacts, fast-tracking digital transformation is an imperative for the mining and metals sector. Accelerating the use of collaborative technologies, cloud-based ecosystems and intelligent platforms can speed recovery and create a competitive advantage in a post-pandemic world.
Theo Yameogo is the EY Canada Mining & Metals Co-Leader focused on helping companies execute digital transformation. He is based in Toronto. For more insights, visit www.ey.com/en_ca/mining-metals.