Mining/Metals/Minerals

Why You Should Consider a Basic Operations Strategy in Your Digital Transformation

The hype around the Digital Transformation can be overwhelming, causing many well-intentioned operations to jump into something before they really have evaluated what it is they want to achieve.  The result?  Wasted resources, wasted time, and wasted opportunities.

To be fair, the fault may not lie in the platform that was chosen, but rather in the thinking about what was required in the digital transformation. Thinking that may only require answers to three simple questions, “How are we going to achieve the 3E’s”:

  1. Effective: is the system doing the right thing – contributing to the higher-level goals?
  2. Efficacyis the system providing the desired result?
  3. Efficient: is the system using the minimum of resources?

So how should we think about attacking the digital transformation then?

Part of the answer lies in the fact that operations professionals need to contribute to the success of a digital transformation by using the tools they have always used to ideate, plan and direct change.

One of those key tools is the operations strategy model developed by Hayes & Wheelwright way back in 1984 in their famous book, “Restoring Our Competitive Edge: Competing Through Manufacturing” (OK, famous in the operations manager world…).

The model proposes 4 stages for operations, from operations having a negative effect on the company, to operations being a competitive weapon. In mining you might think of Stage 1 as being where operations are inefficient, the licence to operate is managed reactively, and sales has only a vague idea of what can be promised to a customer.  Whereas in Stage 4, the company has such a reputation for on-time, in full delivery and stakeholder satisfaction that they are the preferred supplier in the market.

Expanding on this model, we have considered what these 4 stages might look like for a mining and minerals operation across 5 key dimensions of performance. In the diagram below, we have also detailed the stage descriptions for the Licence to Operate and Supply Chain dimensions as an example.

Each of these stage descriptions can then also be defined in terms of people, processes, data and technology.

With this model we can ask where are we now, where do we want to go, and what are the steps to get there? There is an empirical case that skipping stages is a very difficult thing to do, and this is where we think a lot of digital transformation efforts using the latest hyped platform can fail.

A solid operations strategy that takes an approach like the Hayes & Wheelwright model is a key to successful digital transformation. It’s a cliché that “technology-only” projects will surely fail to deliver all their hyped benefits, but it seems we often fall for the same trap every time around on the never-ending cycle of hype.

If you want to start planning your digital journey and learn more about IoT-based platforms, a good place to start is here with our new brochure EcoStruxure for Mining.

 


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