Lessons from the world’s leading industry in digital decision-making

October 16, 2019

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In 2017, global mining giant Rio Tinto announced the expansion of its fleet of autonomous haul trucks at mines in the Pilbara, Western Australia. By the end of 2019, more than 130 trucks – a 50 per cent increase in numbers – will be hauling iron ore, leading to significant improvements to productivity, as well as safety and efficiency.

And that’s not all. The company is also building a fully-autonomous long-distance rail network, and Autonomous Drill System to improve safety and efficiencies across operations.

The mining sector has truly embraced the promise of digital transformation.

Digging for digital transformation opportunity

Safety pays a major role in the mining sector’s motivation to innovate, in line with the global imperative to drive improved safety performance by reducing the need for manpower.

Which is exactly why digital transformation initiatives will play such a huge role in revitalising the success of this sector. According to McKinsey, innovations like data and analytics can provide better insights into the current or expected quality of product, while machines can take on many of the manual tasks. That gives companies opportunity to re-skill their employees for roles that require brain power over brute power, and also reduces their exposure to higher-risk mining operations.

Further, with the focus on creating a more digitally enabled operating landscape, mining companies are taking their network decisions seriously too – often supporting the deployment of private heterogeneous networks that combine both Wi-Fi and private LTE.

Ripe for transformation

At Telstra, we were interested to find out how mining, along with 11 other industries, performs when it comes to making digital transformation decisions.

As part of our Disruptive Decision-Making research, we surveyed 3,810 senior decision-makers from 12 industries in 14 markets around the world to uncover insights into their digital transformation programs, with a focus on decision-making.

Our research found that the mining industry leads the way in disruptive transformation decision-making, ranking first overall.

Twenty-nine per cent of mining companies said they were ‘extremely far’ along their digital transformation journey, compared with just 21 per cent of global companies. That maturity extended to their decisions, where more than three in ten (31%) said they made digital decisions extremely well, compared with 23 per cent of global results.

So, what lessons can we learn from the mining industry’s approach to digital decision-making?

Investing in decision-making to move beyond the incremental

The first lesson to note from the industry is to back your digital projects.

Demonstrating just how enthusiastically mining companies are moving forward with their digital journeys, eight in 10 mining respondents said they will increase their IT spend in the next three years – a high bar given that more than a third spent more than $500,000 in the previous year.

That investment may change how mining companies implement their digital transformation projects.

We found that most companies in the industry are currently rolling out their programs through individual business units (43 per cent). Only a third of businesses (32 per cent) have so far committed to integrating digital strategy at a whole-of-business level. As investment increases, that number is sure to increase.

Focusing on digital transformation vision

Where mining organisations are able to stand out from the crowd, however, is in the way organisations focus on digital transformation journeys – taking into account not only technologies, but also considering the associated impact on people and business processes.

When we explored organisational ability throughout the digital transformation process, across industries and countries most respondents said that they struggled the most at the first stage of the process – ‘having the right vision and mindset’.

Yet, mining companies bucked this trend, ranking it second in terms of ability only to their ability to evaluate project success. This ability to create a clear, strategic vision for digital transformation sets mining companies apart – and enables them to deliver more successful results.

Linking priorities to performance

Mining companies are using this focus on investment and digital decision-making to deliver on some of their key digital transformation priorities.

We found the top three digital transformation priorities for mining to be:

1.       Maximise existing application performance to increase efficiency

2.       Increase connectivity to improve employee effectiveness

3.       Take advantage of opportunities in new global markets

The industry is doing a good job delivering results for those priorities, seeing proportionately greater performance on their top priorities than the majority of other industries.

Yet, there are still opportunities to improve. Taking advantage of opportunities in new markets, mining companies’ third top priority, ranks 15th out of 17 when we are measuring performance on priorities.

Embracing other opportunities to build potential

Our Disruptive Decision Making research proves that a company-wide approach which looks at digital transformation across people, process, partnership and technology understanding is significantly more likely to deliver business success.

These organisations are much more likely to be highly digitally mature, make extremely good digital decisions, and see the impact of digital transformation across the business.

Although leaders in this digital movement, there is certainly far more opportunity ahead for the mining sector to grow, especially during unstable times for the industry.