Tracking the trends 2019

Rethinking mining strategy

Embedding the discipline to deliver measurable value across the cycle

In today's complex mining environment, companies can no longer anchor their strategic planning cycles around merely producing the greatest amount of ore at the lowest cost. Miners have not yet sufficiently broadened their strategic outlook to take a range of critical industry shifts into account—the role of individual assets in the portfolio, balancing risk and return, the path of value creation etc. Some mining companies are taking steps to reposition for the future by revisiting their underlying business models and making new strategic investments. While it remains to be seen whether those moves will be sufficiently far-reaching or radical, one thing is clear: management teams serious about long-term value creation must put strategy at the heart of their board-level conversations.

The frontier of analytics and artificial intelligence

Moving up the maturity curve

Despite making impressive strides in the realm of digitization, mining companies are grappling with moving the analytics maturity curve. They have begun expending on analytics and artificial intelligence (AI), not only to manage volumes of data but also to turn it into an advantage. Identifying the root causes and answering all the "what", "why", and "how" questions can help companies move the needle from predictive analytics to prescriptive analytics. This trend presents some interesting mining-specific use cases to help realize the value for the business outcomes of analytics and AI.

Managing risk in the digital era

Exploring a new approach to controls and risk management

In a landscape characterized by mounting tariffs, potential trade wars, cyber threats, and operations in less stable regions, mining companies can't view risk management from a mere compliance perspective. Moving beyond the siloed approach, they must take a more holistic outlook of risk management and deploy the next generation of internal audit─Internal Audit 3.0. How does Internal Audit 3.0 embrace cognitive technologies like AI and analytics to help companies manage risk?

Supply chain digitization

Why innovation requires integration

Disruptive technologies like AI, industry 4.0, cognitive technologies, robotics, cloud computing, and the Internet of Things (IoT) are combining to create digital enterprises that are both interconnected and capable of more informed decision-making. To harness the business growth and create a more interconnected and responsive supply chain, mining companies must switch gears from the traditional supply chain to a digital supply network (DSN). The DSN employs real-time data to accelerate decision-making, enhance transparency, foster multidirectional communication, and enable collaboration across the entire supply network.

Driving sustainable shared social outcomes

Finding value beyond compliance

Until recently, mining company social spend has been seen as a cost of compliance, rather than a way to deliver measurable and sustainable benefits to host countries and communities. If mining companies hope to drive different social outcomes, that dynamic has to change. A social enterprise is an organization whose mission combines revenue growth and profit-making with the need to respect and support its environment and stakeholder network. Finding value beyond compliance is no easy task. It requires miners to listen more closely to their constituents to determine what stakeholders truly want, and then to shift their operational processes in response.

Exploring the water-energy nexus

Making the case for a systematic approach

As one of the world’s most energy and water intensive industries, the mining sector has long struggled to secure uninterrupted access to these critical inputs. The true value from energy management can only be derived by addressing the triple bottom line of social, environmental, and financial performance. Companies that succeed in this effort can reduce their energy consumption by 15-20 percent in existing mines, and up to 50 percent for new mines. What approach can companies take to better manage water and energy use?

Decoding capital projects

Learning from past mistakes

With the commodity price meltdown, many mining companies were compelled to operate leaner—wedging their capital expenditure. The sector's capital investments in 2017 dropped by almost two-thirds compared to the US$80.8 billion peak of 2012. With the cycle turning, mining capex is expected to exceed US$40 billion in 2020. Companies need to avoid the mistakes of the past and engage in a wave of new capital projects to offset production declines and meet the demand of commodities.

Reimagining work, workers, and the workplace

A blueprint for the future

The mining industry faces a changing talent landscape, with digitization necessitating new skillsets, a massive generational shift when considering C-suite succession planning and a younger generation of workers who measure loyalty to an employer in months instead of years. To prepare for this imminent future, organizations need to clarify not only their business goals and aspirations, but also the role that their talent strategy should play to deliver on them.

Diversity and inclusion programs in the workplace

From theory to practice

The way mining companies are approaching diversity and inclusion is shifting. They are announcing ambitious corporate diversity targets, but are far from achieving the goals, given the scarcity of qualified diverse talent. The challenge is more numerical than cultural. To move the dial on inclusion strategies, they need to cultivate new behaviors, attitudes, and policies—this is imperative to transform the vision of diversity and inclusion into a permanent reality.

Demanding provenance

EVs and battery minerals provoke the desire for provenance

The rising demand for electric vehicles (EVs) is increasing demand for EV battery materials such as cobalt, lithium, graphite, and copper. However, socially-conscious consumers are now questioning the provenance of raw materials. As a result, downstream customers, such as automotive manufacturers and technology giants, are demanding ethically-sourced minerals. This is putting unprecedented pressure on mining companies to create a more transparent interface with their customers and driving the adoption of technologies such as blockchain to enhance the traceability of commodities.

Blogs

What’s in store for miners in 2019? Explore our blogs for a brief insights into the top issues miners face in the coming year.

Video

Phil Hopwood, Deloitte's Global Mining Leader, talks about the top 10 trends on the horizon for miners. Watch the video!