Mining companies today are faced with pressure to meet rising demands for mining commodities
in a climate where the cost of supply disruptions is greater than ever. For a mining company to survive this kind of mining crunch, it needs to develop the capability to manage supply risks.
With that said mining companies still face numerous challenges when it comes to managing supply risk. In this two-part post we’ll look at 6 of these challenges.
Sourcing and procurement
Mines are often located in remote areas which can pose a problem because there are not many suppliers who are willing and able to service these areas. This puts these mines at somewhat of a disadvantage when it comes to negotiation and setting prices for goods and services. This limitation in the number of suppliers prepared to service remote locations poses a real threat to supply especially if there are issues with quality.
Transport and distribution
The complexities of transporting and distributing people and products can be a little overwhelming at the best of times especially with world-wide mining operations. The risks involved are often multiplied when infrastructure challenges are present because this results in transport and logistical bottlenecks. When breakdowns in communication and coordination occur this further exacerbates the situation and acts as a major hindrance to effectively manage supply risk.
xMMP (exploration, Mining & Minerals Processing) is a mining “ERP” solution that covers the Total Life of Mine (‘LOM’). Managing mineral rights (tenements) claims, exploration, drilling, EPCM for the development phase, actual mining, stockpiles, plant, shipping and dispatching all the way to mine rehabilitation.
Planning and forecasting
Information visibility in mining companies has traditionally been a great challenge, especially when it comes to providing a timely information flow across the supply chain. This is often a result of the lack of appropriate systems, standardised information and non-standard processes and technologies, all of which are essential to managing supply risk effectively.
Lookout for part two of our post where we look at three more challenges mines face when dealing with supply risk.
To effectively manage supply risk, mines need an enterprise resource planning solution that covers the total life of mine.
Resolve Immix’s xMMP solution is exactly that, an addition to handling everything from managing mineral rights to shipping and dispatching and everything in between. It provides mine operations with the tools and real-time data needed to improve asset performance, impress compliance and increase production from the mine to final product.
Resource: Deloitte – A guide to effective supply risk management in the mining industry