As the provider of raw materials for many other industries, the mining and metals industry is in a unique position; one that presents both challenges and opportunities. While these companies are no strangers to disruption, over the past years the frequency and types of changes that they have faced have grown substantially.

As part of the 2021 report, The cloud imperative: Asia Pacific’s unmissable opportunity, Deloitte Australia Access Economics surveyed 600 companies across 18 industries in the Asia Pacific region to develop a disruption map (figure 1). This revealed that businesses operating in mining (a significant contributor to the Asia Pacific economy) are among those expected to face the most significant level of disruption in the future, with changes coming from both external forces (e.g., environmental pressures, commodity price fluctuations and supply chain disruptions) and internal threats (e.g., skills shortages, use of technology or competition).

Dan Newman, partner, Cloud Transformation Leader, Deloitte Australia, and author of the report, says: “Our research identified that mining and metals companies, while being exposed to this double level of disruption, are also some of the least prepared to respond and adapt to changes.”

In Tracking the trends 2021, Deloitte Global highlighted the need for organizations to boost their resilience in a way that would stand them in good stead through a range of scenarios. This is even more important today as the rate of economic, social and environmental change is expected to continue to increase over the coming decades. In building resilience, mining and metals companies will not only enhance their own longevity; they will also help secure supply chains that underpin global food production (potash, phosphate salt), energy provisions (critical and battery metals) and infrastructure (steel and iron), to name just a few.

Turning challenges into opportunities

For miners and metal providers to thrive through change (whether predictable or unpredictable) requires that their structures, processes and operations become more dynamic. Ultimately, this will allow them to respond faster to both challenges and opportunities through new partnerships, attracting new talent and accelerating innovation efforts.

Cloud computing serves as an enabler during times of disruption and has supported value creation in multiple industries over the past decade.

Cloud involves using a network of remote servers accessible over the internet to store, manage, and process data (as opposed to local servers or personal computers). It’s commonly used to deliver tools and services such as databases, networking, software, analytics and intelligence on demand. The ability to rapidly deploy and scale resources up or down is a major advantage to businesses. Cloud allows even the smallest companies to access the same tools and services as the largest enterprises.

Around 80% of the organizations surveyed for Deloitte Australia’s Cloud imperative report stated that by implementing cloud they were better prepared to help address future challenges and organizational needs. A similar proportion said that cloud enables them to innovate more quickly and frequently, and seven out of 10 respondents indicated that cloud allows them to instantly scale projects up or down.

Accelerating cloud adoption and maturity

Today, the level of cloud adoption and maturity varies within the mining and metals industry. Early movers include tier one companies, such as Rio Tinto. Rio began moving its SAP applications to the Microsoft Azure cloud platform in 2016 as part of its digital transformation.

More recently, BHP selected AWS and Microsoft as its long-term cloud providers in June 2021.7 AWS will provide data analytics and ML tools to rapidly deploy digital solutions and improve BHP’s operational performance. Meanwhile, Microsoft Azure will host BHP’s global applications portfolio. This will enable BHP to leverage its existing Microsoft licenses and SAP applications portfolio and reduce its reliance on regional data centres.

Rakesh Surana, Partner, Mining & Metals Leader, Deloitte India explains: “Most companies will already be using some cloud-enabled functions. However, there would be increased business benefits and value gained if they were more prepared and ready to progress toward a greater level of cloud adoption.”

As these examples demonstrate, cloud maturity, even within large mining and metals companies, is still at a relatively early stage. Many companies are only recently moving from building appropriate infrastructure and data centers to application migration and data modernization. However, once organizations have a digital core in place, then they can start tapping into cloud-based resources for a range of exciting use cases.

The tip of the “cloud” iceberg

In mining and metals, some of the most promising applications for cloud include data integration to enable analysis of mine site data, predictive maintenance of equipment to better manage and extend asset life, and the integration of supply chains

Migrating legacy data from enterprise warehouses, or even specialist cloud databases, into a cloud-native data lake offers two advantages. First, it democratizes access to data by decoupling it from existing systems. Second, it allows companies to correlate events and trends across different domains. This supports the use of advanced simulation programs such as digital twins, which can be invaluable in process and operational optimization.

Newman adds: “We’re also seeing a push toward edge computing as part of miners’ cloud strategies. In Australia, a number of large companies are collaborating with hyperscalers, such as AWS, and Google, and localized data centers to leverage cloud providers’ edge solutions and enable low-latency workloads in the field. These are essential to autonomy and other Internet of Things–based technologies.”

Data integration through cloud also allows insights to be shared across supply chains, which will be vital in improving traceability and in lowering Scope 3 carbon emissions.

Cloud users can also benefit from the expertise within their cloud provider’s teams. The level of knowledge, for instance in data science, held within a company such as IBM will be infinitely broader, deeper, and more recent than that held within even the largest mining or metals company. Through cloud subscriptions, mining and metals organizations can leverage this capability and combine it with their own subject-matter knowledge to accelerate their innovation efforts. This will be particularly valuable to junior and mid-tier companies that may not be able to afford to build and maintain a large data science team in-house.

“Moving to the cloud means that organizations can focus on their core business and source of differentiation, rather than maintaining computing infrastructure and data centers,” says Newman. “Organizations should overcome any reservations on moving to cloud, embrace the opportunity, and act on it, as cloud is here to stay.”

Source: Deloitte, Tracking the Trends 2023

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