In November Cynthia Carroll, the executive director of Anglo-American, resigned. This marked an end if an era with this great world-wide producer. We heard some weeks earlier of the incorporation of Glencore Xstrata, just like the new up and coming leaders, Collahuasi and Antofagasta Minerals. We already had a lot of bad news about the lack of metal demands from China, investment restrictions, the suspension of the Greenfield and Browfield projects in big companies, serious energy problems and even over production of copper for 2013 (consequently impacting the prices for this product).
All of this seems to mean the end of one cycle and the start of another. And when we speak of cycle, we are not necessarily referring to a cycle of prices, rather a cycle of doing, of technology, of community relations, of human capital and of support from suppliers. In other words, a more complete period in the mining industry. But, what characterizes this new period?
- Management: We clearly feel the pressure from company shareholders to recuperate the value of our investments due to the excellent prices we have been seeing in metals. This implicates that a time is coming in which costs and optimization will be the next big theme in this expansive cycle.
- Technology: A period of extensive operating automation and business standardization is coming. This is happening in response to technology, not only to its evident necessity in operations but also the necessity for the best safety and sustainability practices. A different key theme is that the technologies that are developed for mass production (tablets, smartphones, etc.) are quickly beginning to dominate risk control, production statistics, and the fluctuation of cost trends.
- Community: We are already seeing a period in which the community is highly empowered, which requires a focus on community relations. This is not only applicable to new projects, but also in operations that are already up and running. Mass media and social networks are starting to play a big role in this. Companies should propose highly transparent and involved strategies in mining development.
- Human Capital: During expansive times, human capital has become scarce and difficult to hang onto. This situation should somewhat take care of itself, although we will probably see a lack of professionals with value, ability and competence. It is highly probable that we will see some changes in current job standings and a reduction of new job openings, strengthened by the suspension of big projects.
- Suppliers: The beginning of supplier development programs has come to stay, which will allow partner companies to strengthen their management systems and innovation models. This will systematically add more value to their services. Facing potential price drops, it is necessary to have only excellent services and products to fill in the frequent value gaps that we are seeing.