Mining operations rely heavily on procurement to deliver on projects. Not only is procurement the largest expenditure in a mining project, and therefore has the greatest potential for savings, but improving efficiency by just 1% can create hundreds of millions in value.
As the mining industry navigates the economic impacts of the last few years, there is an increased focus on efficiency. Here are five ways in which procurement leaders can improve the way their teams operate.
As is often the case with project-based procurement, there is a lack of high-level visibility of procurement across projects and the decentralised nature of data makes it difficult to gather and act on shared insights. Conversely, centralising all procurement operations can impede on project teams’ ability to act quickly and independently as they often need to.
The ideal for project-based procurement is a system which allows projects to operate quickly within a centrally defined framework. This allows projects to operate independently with swift workflows and approvals whilst all data is centralised and consolidated, creating a single source of truth and reliable information to make strategic decisions.
Having procurement data centralised makes practising and reporting on governance and ESG much more efficient. Knowing your supply chain, documenting issues and resolutions, then compiling them into a report is faster and easier when the information is consolidated and accessible.
One of the greatest benefits of digitising procurement systems and processes is the ability to automate administrative workflows. By automating repetitive tasks and processes, workflow efficiency is improved, and staff are able to spend more time on higher value work.
Automated approval workflows, contract reminders, compliance and onboarding updates are just some of the ways a purpose-built procurement system can help automate and improve efficiency.
Across all industries, one of the best ways for procurement to create savings and long-term stability is to forge stronger relationships with key suppliers.
Mining is no different; performing in-depth analysis on relationships with vendors will help identify the strongest suppliers, negotiate better terms, and identify any risks in your vendor profile. Maintaining up-to-date vendor records, tracking vendor performance and monitoring compliance become even more important as you focus on managing these key relationships.
Being able to identify and mitigate procurement-related risks helps create resilient supply chains. Procurement teams can augment their workflows by incorporating risk assessment activities early on.
Incorporating risk assessment into the mining procurement process begins with a comprehensive identification of potential risks, tapping into stakeholder insights, vendor profiles, and historical data. Implementing a robust onboarding process and stringent approval processes will help mitigate risks further into projects.
Underpinning all improvements to efficiency is the ability to attract and retain high-quality talent to the procurement function. Whilst technology can help reduce the workload of procurement professionals, new skills and capabilities will need to be learned or acquired.
Upskilling existing staff is a proven way to improve talent retention, but the industry also needs to work on attracting a larger pool of diverse, technically-skilled talent. Addressing any cultural or inclusivity issues, catering to new ways of working, and promoting clear career progression paths will help address the talent shortages facing the mining industry.
Although global supply chain uncertainty is placing intense pressure on procurement teams, there is still the opportunity to streamline processes and improve efficiency by adopting the right technology, strengthening key relationships and pre-emptively mitigating supply chain disruptions.
Want to see Felix in action? Feel free to request a demo here.
Previously, we’ve discussed the typical stages of a digital transformation. In this next post, let’s talk through some of the different implementation approaches and their pros and cons, e.g. waterfall, agile, etc.
As talent shortages sweep through the construction industry and impact productivity, procurement is starting to feel the effects. Focusing on increasing the performance of your procurement team is important to delivering long-term outcomes.
The following is taken from our webinar “Tips for successful procurement tech implementation”. In part 1, we start by examining a typical journey that organisations go through, broken into different stages.
Get the monthly dose of supply chain, procurement and technology insights with the Felix newsletter.