Mining digitization requires organizational updates

During virtual mining congress COVIDMIN 2020, representatives of Chile’s mining industry analyzed the impact digital transformation has on organizational structures.

“Digitization wasn’t considered part of the industry’s core, but COVID-19 changed that perception. A number of mines have guaranteed operational continuity due to remote work,” Fernando Lucchini, president of mining promotion entity Corporación Alta Ley, said during the event.

According to Lucchini, digitization represents an opportunity to build resilient companies and processes. It would increase productivity, safety and sustainability while reducing costs. But local companies are facing communication and coordination issues, which is why they need to update organizational structures.

“As an industry, we must know where we are, and which are our analytical and technical capacities. To develop analytical capacities, we need organizational abilities that go hand in hand with decision-making processes and data governance,” he said. 

“Data governance protocols are important for decision-making and that’s why organizational structures must be modified to adopt digitization.”

A key subject is to valorize data through interoperable systems whereby integrated operation centers could use IoT to get traceability data on the mineral and receive certifications and develop new opportunities. 

“There is no follow up process without digitization. The use of sensors, data capture and the capacity to understand and use the data are fundamentals for the traceability of a product,” Lucchini said. 

CODELCO’S TRANSFORMATION

According to Nancy Pérez, head of strategic portfolio management at Chilean state miner Codelco, the company’s digital transformation focuses on operations and projects, supported by new technologies and promoting operational and organizational change.

Codelco wants to reduce costs and add US$1bn in revenues by 2021, while reducing project costs in the 2019-2028 investment portfolio by 20%, or US$8bn.

From 2017-19 Codelco focused on improved project execution, but last year switched to better project design.

“The COVID-19 crisis makes us think about the need to accelerate the transformational process. We would have a better industry if all companies get on with the transformational process,” Pérez said at the event. 

Codelco is pursuing a strategy of dividing up big teams into cells that could solve problems by testing solutions. The miner aims to focus on wider problem-solving optimization instead of daily adjustments.