Miners innovate to drive productivity

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 02 Aug 2016   Posted by admin


Rio Tinto’s autonomous haulage trucks at its West Angelas minesite. Image Christian Sprogoe Photography.

By Elizabeth Fabri

JUNIOR minors are more willing to embrace a culture of open innovation than their major counterparts, according to a new study by Deloitte.

The Innovation in mining Australia 2016 report, developed in association with Diggers and Dealers and the Association of Mining and Exploration Companies (AMEC), explored how innovation was being employed in Australian mining. Deloitte found that while junior minors lacked the resources readily available to majors, their ability to problem solve, take advantage of government incentives, and willingness to embrace a culture of open innovation led to confidence in the sector. The report also stated Australia ranked itself above Canada and Africa but needed to embrace a collaborative approach and pursue innovation more broadly to compete on the global stage.

“The mining sector has been through an intense period characterised by commodity price volatility, a slowdown in Chinese growth, difficulty in accessing capital, competition for capital from the renewables sector, and the need to address serious environmental concerns,” Deloitte National Mining Leader Nicki Ivory said. “However to remain globally competitive, Australian miners must decide if they are willing to go beyond the basics and incorporate a structured approach to innovation across their operations.”

But factors such as risk to cash flow, a short-term focus on improvements, sluggish decision-making and tight security on intellectual property were significant hurdles to innovation in the long term. “For many mining companies, the intense focus on maximising production volume during the boom years has resulted in inefficiencies becoming deeply embedded in their businesses,” the report stated. “There is a clear need to repair relationships and embrace strategic alliances with suppliers, universities, industry bodies, collaborative research centres (CRC’s) and the likes of the Commonwealth Scientific and Industrial Research Organisation (CSIRO).”

Deloitte put forward collaborative ecosystems as a measure of improvement, which included open industry forums, hackathons and mining innovation hubs. It identified a series of technologies that could alter the trajectory industry wide, including introduction of cloud-based networks to facilitate collaboration with suppliers; machine learning to enhance safety and productivity and reduce labour costs; genomics to bio-remediate polluted soils, improve mine drainage and alleviate threats to biological diversity; wearables such as Rio Tinto and Anglo American’s smart cap technology; and hybrid airships, a reportedly cheaper alternative to helicopter transport.

“Although Australian miners are progressing in developing their innovation competency, there are many stones waiting to be turned,” Deloitte Consulting Mining Leader David Cormack said. Mining leaders understand innovation is an imperative for driving productivity and growth; now it’s time to act. “Then we can expect to see more companies building breakthrough innovations – those game changers that enable leading innovators to be top performers that generate superior returns for their shareholders.”