Decision Making For Higher Profitability in Mining Sector

DECISION MAKING FOR HIGHER PROFITABILITY IN MINING SECTOR USA Toll FREE : +1 855 855 2485 Whats App: +44 744 802 7841 Email: support@askassignmenthelp.com Website: www.askassignmenthelp.com

PROBLEMS OF MINING SECTOR Key Issues: In mining industry decision makers and stakeholders are spread over geographically broad, diverse area, and varied time zones. The difficulty in aligning all the stakeholders and decision makers over necessary data at appropriate times makes decision making a challenging task in mining industry.

The mining industry is incurring on average 25% cost over-run over budgeted cost. This cost over-run not only impacts profits of the company, but also puts the purpose of feasibility study in question.

Mining companies and their units work under constant pressure to make cost control, improve performance , and profitability.

KEY ISSUES‌‌..

Most of the efforts taken to improve financial performance by different companies have been proved ineffective due to the operational profitability killers that centre around some key areas of the system..

These profitability killers are characteristics of traditional system and are strong enough to resist decision making.

PROFITABILITY KILLERS IN MINING SECTOR 

Geographic Separation: By nature mining is a global industry. The industry expends according to new discovery of new reserves across the globe. As a result of this, the decision makers and subject matter experts are widely dispersed both geographically and in terms of time zones. This wide dispersion makes the decision making process slow.



Functional silos: Operators, in order to more efficiently discharge their responsibilities, divide individual works into different sub-units and assign responsibilities to different sub teams. These sub teams concentrate on their own works and do not bother about how their performance can impact other functional teams. This lack of cooperation results in missed opportunity, deferred project completion, and cost over-run.



Individualistic approaches: In the production phase of a project, many operational units create their own approaches to the whole system.

These approaches remain non-aligned, and prevents best practices throughout the organization. The lack of best practices diminishes efficiency and erodes profitability.

PROFITABILITY KILLERS….. 

Gap in demand for and supply of experts with specialized knowledge: Demand for experts is high enough, but they are inadequate in supply. Many companies depend upon handful of experts for different projects across the world. This huge gap in demand and supply creates financial and logistical handicaps for the organizations which can create bottleneck in delivering project in time.



Lack of reliable data: Obtaining reliable data and presenting the same to the decision makers in time is a big problem for mot of the mining companies. Huge amount of money is being spent in collecting, collating, and presenting data, but most of the company complain that mot of the decisions are taken without adequate reliable data (Wipro 2017).

COLLABORATIVE DECISION ENVIRONMENT (DCE) MODEL When the decision makers make informed decision on the basis of reliable and timely delivered data, the decision should be cost and time effective.

This can be done by proper utilization of the technologies and initiation of decision making process. This need in the decision making aspect has driven the companies adopt the model where decision is taken in collaborative environment (Hernanandez, Lyons, Zarate and Dargam 2014).

The building equation of the model Right Information + Right Connections + Right Time = Right Decision

PROFITABILITY KILLERS Geographic Separation  Functional silos  Gap in demand for and supply of experts with specialized knowledge  Lack of reliable data 

COLLABORATION NETWORK

WEIGHTING The model should be such as to eliminate the bottleneck that arises due to geographical dispersion. This s the most significant bottleneck faced by mining industry.

The second important bottleneck is the functional silos, then comes availability and presentation of reliable data.

Then the individualistic approaches and gap in demand and supply should be taken into account

CONSTITUENTS OF CDE MODEL Technology:  High quality video conferencing  3 dimensional data displays  visualization and integration portals 

Physical and/or virtual environment conducive to:  Synchronize activities of the workers with work processes.  Connecting information and people at the correct time 

Accepting and adopting collaboration as the best practice  Encouraging team-based approach  Training to embed priority to organizational objectives  Measurement of performance and identify area of improvemnt 

CDE PROCESS 







Identify: Enable the stakeholders and the management understand the business process in objective way so that the processes or roles not functioning properly could be identified Enable: The organization establishes infrastructure to connect information and people in timely manner Collaborate: Develop cooperation so that problems identified in step 1 can be addressed Maintain: Installation of systems to measure performance in an ongoing process

BENEFITS OF CDE CDE eliminates all the profitability killers and improves profitability.

The issues of geographical separation are resolved by technology  Specialized knowledge can be made available without much physical travel  Individualistic approaches are eliminated by introducing common processes, systems, and roles in the organization  Reliable data can be generated and presented through automation 

RESULT OF CDE 5% reduction in costs  15% decrease in trouble shooting time  6% increase in production  2% reduction in production losses (Wipro 2017) 

CONCLUSION In today’s competitive business scenario, the mining industry must be flexible to changes in the decision making process in order to increase profitability and meet increased market demand.

Decision making process in the collaborative decision environment would result in better forecasting and project management, which would in turn improve profitability.

CONCLUSION ‌..

The profitability killers identified cannot be eliminated by traditional decision making processes. By eliminating the profitability killers CDE increases return on investment.

CDE implementation is new in mining projects but it is highly effective in removing function al silos at the beginning of a project.

CONNECT WITH US NOW! 

If you are looking for a good presentation on any topic, you can get PowerPoint assignment help by best creative experts



Ask Assignment is 24x7 available to provide you Accounting homework help for all topics and sub fields of it.