Just as individuals make New Year’s resolutions, so too can mining companies. They might resolve to be more profitable in 2004. Corporate leaders know that to lose money is to risk disappearing from the scene. Like many resolutions, this one is easier said than done.
Mining executives might want to look at the benchmark study "Mining Company Performance, Improvement Programs and Results" from NORBRIDGE INC. of Concord, Massachusetts. The Norbridge consultants have been in business for 10 years and count mining among their core businesses. Their services cover operating improvement, process management, business modeling, marketing strategy, e-commerce strategy, and more.
Norbridge looked at 25 publicly-held mining companies in North America. Almost half of them lost money in 2001 and 2002, when weak performance was found in all industry segments. About half had lower net incomes in 2002 than in 2001. Such pronouncements are powerful reasons to work even harder to keep Canadian miners among the best.
The Norbridge study benchmarked 17 mining companies including FALCONBRIDGE, NORANDA, PLACER DOME, INCO, POTASH CORP. OF SASKATCHEWAN, and other metals, non-metallic minerals and coal producers. The report focuses on performance improvement strategies and results achieved by specific strategies. Three primary objectives were followed: 1) identify problems that prevent companies from improving financial and operating results; 2) discuss the paths companies are taking to improve performance; and 3) highlight results that are being achieved by each type of path.
The two paths that might be followed are facility- or issue-specific and larger corporate-level improvement programs. The first involve projects at specific sites, sharing best practices, and safety, preventive maintenance or similar issues. The second covers such fields as Six Sigma, business process improvement programs, change acceleration, etc. Norbridge notes that either path can improve performance, but there were more profitable companies following the facility- or issue-specific path.
An important feature of the study is that it identifies barriers to better performance. Executives might recognize many of thesean aging workforce, shortage of capital, dwindling reserves, lack of proactive planning, poor communicationwithin their own organizations. Norbridge goes on to explain the improvement paths in detail and the results achieved by each of them.
My objective is not to summarize all the findings of the Norbridge study, but to tell our readers that this information is available for free at www.norbridgeinc.com. Click the button that links to the company’s white papers. Besides the mining benchmark study, you may find others of interest.