Disruption and volatility the 'new normal'

DELOITTE Australia mining leader Ian Sanders has urged miners to rethink their strategies in a rapidly changing market.
Disruption and volatility the 'new normal' Disruption and volatility the 'new normal' Disruption and volatility the 'new normal' Disruption and volatility the 'new normal' Disruption and volatility the 'new normal'

Staff reporter

The 11th annual Deloitte Tracking the Trends report has highlighted the challenges and opportunities for miners in the fourth industrial revolution.

Sanders said mining companies needed to broaden their strategic outlooks.

"In addition to producing at the lowest cost ore, mining companies need to consider a range of measures to make the most of this period of growth, including focus on the role of individual assets in the portfolio, re-imagining the path to value creation, finding balance between risk and return, and understanding how their company can differentiate itself in the eyes of its stakeholders," he said.

Key trends were around disruption, including artificial intelligence and analytics, digitisation of the supply chain (coupled with supply chain transparency), changing workforces, and the differing risk profile of the digital era.

Sanders said today's market realities were very different to those of the past.

 "Disruption and volatility has become the new normal. The pace of change is challenging theindustry's ability to adapt," he said.

"Australian mining companies must not only adapt to the disruption of industry from a technical viewpoint, but the disruption being brought about by changing community standards and attitudes towards mining."

Driving sustainable shared social outcomes was identified as a key trend, with companies urged to learn from the mistakes of the past when embarking on a new wave of capital projects.

Sanders pointed to the Royal Commission into banking in Australia, which brought renewed attention to the activities of large corporations.

"In this new world order, miners will not attract talent, investment or community support if they only focus on communicating the discrete value they currently bring to communities," he said.

"Miners need to go a step further by developing differentiated business models designed to drive long-term value for their organisations and for the Australian community."

Diversity and inclusion programs were seen as another trend, with Deloitte recommending greater collaboration between the mining sector and education institutions.

Other trends for 2019 included water shortages constraining metals supply.