In the coming years, mining companies will face some extremely daunting challenges in addition to the usual difficulties of running a mining business. Three of the biggest are product commoditization, increased regulatory oversight and pressure to keep prices low. Mining companies have two choices: give in to despair (ok of course not!) or find a way to use technology to address the challenges. If you choose to go the technology route, consider these ideas.
Commoditization: EAM can be a differentiator
It’s pretty hard to differentiate mined products based on the product characteristics. The assay results speak for themselves. The best way to compete in a commodity market is to provide superior service. Research shows that customers are willing to pay more for products from suppliers who provide services they value. The service they often value the most is consistent, reliable delivery promises, but that can be hard to live up to if your equipment isn’t running reliably.
An EAM system helps increase productivity by reducing downtime due to unplanned maintenance. These systems generate preventive maintenance orders based on elapsed time, or they can even integrate directly with your equipment and schedule maintenance based on production quantities or when performance nears thresholds that signal imminent failure.
EAM systems lower costs, increase productivity and throughput and enable more predictable deliveries. Lower costs mean higher margins for you and predictable deliveries result in happier customers. It’s a win/win for everybody.
With mined products, delivery times can be even more crucial than in other industries because of the high cost of downtime in customer’s processing plants. The fastest way to lose a customer is a consistent pattern of late deliveries.
Using Internet of Things to Comply with Regulations
It seems like every day there are new rules or guidelines proposed or finalized. In December 2014 alone, new EPA rules affecting the mining industry included a proposal for groundwater remediation during in situ mining of uranium and thorium and regulations for the disposal of coal ash. It isn’t easy to keep up, and it costs money to put these proposals in place. The only things more expensive than compliance are the consequences for non-compliance including potential damage to their social right to operate, corporate image or fines – so mining companies have no choice.
The Internet of Things, or IoT, works by connecting your equipment to sophisticated analytics software that predicts problems in advance. When equipment is no longer running at peak efficiency, an alert lets the maintenance team know it’s time to spring into action. The sensors monitor the equipment’s status every few minutes, so the volume of data goes well beyond what a traditional BI tool can manage, and the information is time sensitive so a data warehouse would be too slow anyway. For this application, you need an in-‘memory analytics tool that can handle very large volumes of information. Timely maintenance can help keep your company from running afoul of the regulations and avoid potentially costly fines.
Keeping Equipment Running Protects Margins
Customers will always ask for lower prices; it’s the nature of the game. But taking steps to ensure operational efficiency, reducing downtime to ensure consistent throughput and keeping equipment operating at peak levels will help ensure that your margin stays strong even when you’re forced to lower prices.
Customers consistently show a preference for certain suppliers over others, even in price sensitive commodities. While the statistic that it costs four to ten times more to land a new customer than to keep an existing customer is often quoted, people rarely speak about the cost of switching suppliers, which can be equally as high. The truth is that it costs money to change suppliers, so customers are sometimes even willing to pay slightly higher prices to continue in a relationship with a supplier who provides better service or one that they know and trust. The right technology can help you be that trusted supplier.