Australia has long been regarded one of the mining innovation capitals of the world, although a recent report suggests the country is behind its competitors when it comes to long-term innovation projects and planning.

Released by global consulting firm VCI, in partnership with The University of Western Australia and METS Ignited,?the State of Play report surveyed more than 800 leaders from 321 companies in the global mining industry.

Over 70 per cent of the respondents were at an executive level and, of the 800 respondents, over a quarter of them were Australian and from some of Australia’s biggest companies, including Rio Tinto, Fortescue Metals Group and South32.


The report found 26 per cent of Australian companies had a long-term innovation plan of more than three years. Compare this with the results from the other major mining regions and it would seem Australia is being left behind. South Africa topped the list, with 63 per cent of companies recording a long-term plan of more than three years.

State of Play Founder Graeme Stanway put the lack of long- term plans down to a gridlock in Australia’s local industry when it came to the mechanics of preparing for digitisation and tech disruption.

“While there’s an intuitive understanding among mining leaders that the time to prepare for the digital revolution is now, companies aren’t always equipped to wade through the plethora of tech options, such as artificial intelligence or data analytics,” Mr Stanway said.

“These technologies are a significant departure from what the industry is used to, and more often than not, result in a project-by-project approach that stifles change at scale or pace.”

The lack of a long-term plan is definitely not the result of a lack of importance placed on innovation. The report found 98 per cent of Australian mining company leaders indicated innovation was ‘important’ or ‘critical’ to their long-term business strategy.

Some perspective

Despite Australia appearing at the bottom of the list when it came to long-term innovation plans in the VCI report, a separate report commissioned by Deloitte in 2016 turned up some fairly polarising results.

“Deloitte ran an in-depth survey last year and published a report on the subject, and we found the opposite in the mining sector,” Deloitte Partner David Cormack told National Mining Chronicle. “We found the Australian mining sector was actually ahead of the mining sector in Canada and South Africa.”

Mr Cormack put this discrepancy between the two reports down to a couple of different factors, suggesting the global mining sector was lagging behind other comparable sectors.

“To this end, what we are seeing is mining companies, certainly the bigger ones, are looking to other frameworks as a point of reference for how they innovate and how they drive the productivity agenda,” he said.

Given some of the biggest mining companies in the world are Australian could suggest a reason as to why the report found Australia to be at the bottom of the list in terms of long-term innovation. It is not so much that the Australian mining industry is lagging behind the rest of the world, it’s that the entire mining sector is lagging behind other industries, and this is where the benchmark is being placed.

The question could then be, why did South Africa record such a high percentage of long-term plans. Mr Cormack said this could be because of the socio-political challenges ongoing in the country.

“I think it depends where the burning platform is and how hyped up the broader industry is in trying to judge the merits of solutions around that burning platform. South Africa certainly has a number of challenges in the socio- political front, and that creates uncertainty for investment; so there’s a burning platform straight away,” he said.

“To have a very strong outward-facing message from the industry is not surprising, and I think a lot of that innovation comes in the commercial constructs it needs to embrace to further investment in the sector.”

The second factor influencing the discrepancy for Mr Cormack was who was surveyed as part of the VCI report.

“It’s about speaking to the right people in the organisations. With some of the larger mining companies, a lot of the work they’re doing is not in the public domain and that’s because some of the stuff still needs to be proven,” he said.

“They don’t want to come out about how viable some of these advanced technologies are until they’re quite certain they can work and be deployed commercially and viably across operations.”

This idea that some of the big mining companies are waiting until they have a commercially viable plan to declare publicly is technically backed up by the VCI report.
It states Australia is currently at the top of the pile when it comes to the success of innovation projects.

“Although we’re lacking in long-lead planning, when it comes to the success of current innovation programs, Australia is leading the charge against all other regions, with the majority (68 per cent) of Australian companies indicating they are meeting or exceeding expectations when it comes to performance of innovation programs,” Mr Stanway said.

Picture: Deloitte Partner David Cormack Credit: supplied