Managing information in mining projects could save the industry billions on capital projects

“The potential savings and returns through effective management and delivery of a capital project investment can be huge,” said Jose J. Suarez, managing director for Accenture’s North American Mining industry group and the research lead. “Keeping on budget and within planned timelines across a portfolio of multi-year projects can save millions for a company – in today’s environment strong project management can be an important competitive advantage.”

A subsequent report by E&Y hit on the same note: “Capital expenditure and associated project delivery is a key topic in many of today’s financial and resource publications, yet many owners and contractors alike continue to be challenged by the strategic and /or tactical issues of project execution.”

While this might seem obvious, these kinds of quotes are music to my ears; not because of the underlying problem, but because I know we can help.

It’s all about the information…

One of the primary challenges faced by mining owners involved in large capital projects is a lack of information visibility. This lack of visibility is compounded by often contradictory demands of external and internal stakeholders stemming from:

• Increased public scrutiny, regulatory compliance and environmental pressures
• Schedule slippage and associated opportunity costs
• Financial pressures to secure the required level of capital to take their operations into production
• Risk management and litigation issues
• Health and safety issues
• As these challenges grow, it is important that the mining industry look to project tools like Coreworx to manage project execution. The reality is that mining projects are getting bigger (often in the multiple billions of dollars) and more complex.

 Achieving better capital project delivery: 5 key Areas for Improvement

1. Establish strong project governance and risk management capabilities.

The Accenture report identifies 5 key areas for improvement in project execution that will help improve ROI. I have listed each of the 5 areas below, along with commentary on how tools like Coreworx can help companies achieve these.

Risk is a reality in any large capital project, and projects are subject to both internal and external forces. Whether the risk is political, economic, social, or technological, each can destabilize and create complications in project execution. With the increased scale and complexity of today’s projects, getting the right information, at the right time, to the right people is critical.
The Coreworx solution has been built to help project teams establish strong project governance by instituting process compliance while providing the visibility necessary to help decision makers spot and deal with issues in a timely manner. Coreworx allows project teams to:

• Build systematic, enforceable processes for design review and approval to facilitate successful front end design processes
• Automate workflows for managing change and technical queries to ensure that not only the right people are engaged but also that responses and evaluation are completed in a timely matter
• Provide look-ahead reports using real time data to identify potential bottlenecks and deal with them in a timely manner before a large issue develops
• Set up dashboard reports to provide project status/progress information at a glance to supply owners and project managers the information they need to understand where closer observation may be required and give them the ability to make decisions with the real-time information
• Provide a single auditable version of the truth

2. Proactively manage stakeholders’ increasing expectations for sustainability.

Within all major capital projects, Owners must navigate the complexities of both internal and external stakeholders. Projects today face increasing regulatory demands, increasing public scrutiny, and increased financial oversight; expectations for sustainability have never been greater. These demands include dealing with contractors, HSE, surface and mineral rights, Aboriginal consultation, hiring and personnel, internal and external financial data, corporate governance, increased media attention, and land owner and public rights.

Along with collaboration and communication, effective information management is key to successfully handling so many stakeholders, often with highly varied and competing needs and perspectives. A system like Coreworx provides stakeholders an engaging, secure, online work area with access to project staff, documents, and proactive notifications. It also allows project teams to capture and classify stakeholder information as it is generated during a project. This makes it easier to ensure that:

• Promises made are promises delivered
• Selected information is transferred to records management systems for long-term retention
• Discovery efforts are traceable in the event of potential litigation

Projects are best executed when information is readily available, accurate reports are frequently distributed, and stakeholders are well informed.

3. Optimizing scarce talent through management, organizational flexibility, selective outsourcing and training

As a quick example, Canada’s mining industry is anticipating a shortage of 60,000 skilled workers between now and 2020 in disciplines such as geology, accounting, engineering, and management. There are a number of issues that factor into this shortfall including both a lack of young professionals entering the field, as well as an estimated 40% of mining employees retiring in the next 8 years.

While Coreworx can’t fix the inherent problems of an aging workforce and subsequent shortage of skilled workers, it can help to mitigate the problems associated with workforce attrition. As key employees leave, knowledge management is essential. Coreworx allows organizations to capture best practices and lessons learned, and apply this information to staff training and continuous improvement of practices. Not only does this ensure that the know-how of your experienced workforce stays in place, but it also makes processes easier to adapt for new and up-and-coming employees.

4. Integrate information systems among capital project players

Having a mechanism to exchange project information and manage uncontrolled sources of information is crucial to providing a collaborative single, auditable version of the truth for all parties.
As a basic example, the use of “Transmittals” and the use of “Workflows” controls the exchange of information and transforms uncontrolled data into a central repository of project truth.
Information systems need methods and tools to import and extract bulk data and, where machine to machine integration code isn’t practical, should use ubiquitous file formats like Excel or comma-separated values. A system like Coreworx can further refine the information into user-specific, decision-ready knowledge in the form of intelligent dashboards. This helps project teams ensure process compliance, mitigate risk, and ultimately helps to meet project timelines.

5. Accelerate operational readiness.

A well-planned and managed handover process – from a completed project to operational readiness – can help companies avoid rework and delays and support high production levels from the initial operation of the mine or plant.

Starting with the end in mind is easier said than done. Working with contractors to set up and institute best practices and determine how Vendor data is to be collected and managed can have a serious impact on operational readiness at handover. A versatile information management system that can flexibly accommodate and enforce your operation team’s data requirements, and which allows engineering and design documents to be easily searched, accessed and packaged for handover to operations is a great start. A system that provides workflows based around the desired outcome is even better, and will result in reduced risk, reduced cost and on time and easy handover to operations.

Bringing it all together…

There’s no doubt that the nature, scope and complexity of Mining projects is evolving and becoming more demanding. As the Accenture report indicates, mining companies have the potential to save large amounts of money and time executing their capital projects. The good news is tools like Coreworx have been helping organizations meet their project goals for years and will continue to evolve to meet the demands of the changing environment. I’m excited about the prospect of working with forward thinking mining organizations to help them meet these new challenges, and execute projects that achieve their goals.

For further information on effectively managing information in mining projects here a couple additional articles you might find interesting:

• Managing Information in Mining Projects – Coreworx
• Effective Capital Project Execution – Mining and metals – Claus Jensen, Ernst & Young
• Achieving Superior Delivery of Capital Projects: Insights from the Accenture Global Survey of the Mining and Metals Industries – Amy M. Callahan, John E. Lichtenstein, José J. Suárez, Accenture