As a former analyst at technology firm IDC, I’ve been following the technology industry for the best part of two decades now.
But only recently have we begun to really feel the force of technology and digital disruption at large. This is also true of the mining industry, which is on the cusp of being transformed by technology; by things like clouds, robots and drones.
As with any technology, there are opportunities and pitfalls, and in this piece I would like to look at how with the right approach, mining companies can really maximise the opportunities available.
Firstly we need to look at the current state of IT in mining, and where it’s currently heading. Then we can investigate how new technologies and trends will impact mining, and finally what organisations’ can do to prepare.
IDC recently conducted technology research into the Australian mining sector, which showed our mining companies are truly world class, with a quarter actively investigating robots and 80 per cent automating operations.
Furthermore, 36 per cent of mining companies do expect to see IT budgets increase, which is at odds with other sectors where we see flat IT spending for the foreseeable future.
However, what emerged as the biggest challenge facing mining companies is the problem of bridging mining operations and corporate IT.
Connecting these forces together is essential to creating a seamless, efficient and profitable mining organisation. While this problem has been evident for some time, there’s real progress being made on tackling the issue.
The challenge of linking the business with technology is not exclusive to the mining sector, with the subject being of critical importance to the economy in general. In my experience one of the best ways to initiate the linking process is through the establishment of “tiger teams” that are dedicated to the unified application of technology. This is reflected by an IDC prediction that states by 2016, 50% of large mining companies will set up a cross-functional IT operations/LOB (Line of Business) team to focus on third platform technology. IDC describes the third platform as IT for growth and innovation; built on mobile devices, cloud services, social technologies, and big data. Put more simply, in the mining sector, this third framework translates to a dynamic elastic technology fabric that stretches across the empire of the mine with both centralised and de-centralised processing at scale. It’s really about connecting supply and demand; much like Uber, AirBnB and other new services available in the shared economy.
Indeed, one of things we're starting to see across the mining industry is similar process innovation, where a combination of IT and operations teams coming together with an armory of new technology (social, mobile, analytics and Cloud) combined with robotics and automation to look across the organisation and investigate how these technologies can be implemented, and processes significantly improved.
I have had the benefit of observing these teams for many years and noticed that the most successful teams all exhibited key characteristics. One such characteristic was the cross-pollination of ideas through the adoption of best practices from other industries. In the case of mining I would recommend looking to high tech manufacturing, the adjacent industry of Oil & Gas, and also the Australian Banking sector. Successful teams were also canny in the projects they took on, electing to demonstrate value through rapid ROI attainment, rather than more cumbersome long term projects. Importantly, successful teams were brilliant communicators, striking a balance between establishing a technology vision while maintaining realistic expectations.
The hope is that in the mining company of the future, we will look back at issues of productivity and efficiency as vestiges of a time gone by. In the mine of the future, technology will have enabled us to be all seeing and predictive. With the correct use of technology, many of the constraints that have defined the industry will be obsolete.
This transformation will not come from merely introducing some technical curiosities, but rather through the seamless interconnection of a web of input and output sensors. The workforce will utilise simulated and augmented reality technology in a wearable format like we currently see with virtual reality company, Oculus Rift. This will culminate in a world where no resource is hidden from sight and extraction can occur in a way that closely links your supply with the demand.
When the internet of things hits its stride, there will be an army of sensors providing a variety of information feeds such as text, video and machine information that produces a tsunami of data, and rather than being overwhelming, this data stream will be very positive for mining. There’s a really strong hand in glove relationship between the internet of things, and analytics. This is because of what we do with the outputs from the IOT requires that we derive insights.
Mining companies need to ready themselves for the onslaught of data. Without the right backend tools deal with the IOT organisations risk not being able to capitalise on their wealth of data to extract valuable insights that could further their businesses.
Converged infrastructure is a logical option for organisations that want to take data analytics to the next level. For example, VCE’s Vxblock systems, the world’s most advanced converged infrastructure, provides a standardized big data and analytic infrastructures to scale across multiple business units while embracing existing applications and systems.
IOT scale applications also have very different requirements compared to the usual business applications. IOT apps generate a tonne of data in a matter of minutes and traditional IT infrastructures just won’t cut it. Converged infrastructures can provide the massive scale performance needed to take on IOT apps.
To truly capitalise on all that’s ahead, mining companies must take the following steps:
- Establish a digital vision for the role of IT in your mine
- Architect a framework to support the needs of tomorrow, not just today, leaving room for the unknown
Prepare for an IT arms race
*Matt Oostveen is the CTO for VCE Asia Pacific & Japan