The Secret to Accelerating Operational Maturity through Capital Project Excellence
It is commonly believed that the project stakeholders have delivered their project commitments once the asset had been successfully commissioned.
Given the fact that recent studies show that 65-80% of large capital projects in the mining and metals industry frequently experience performance issues and fail to meet their budgets and/or schedules, it’s no wonder why executives and owner teams are distracted from envisaging the outcomes beyond the commissioning phase. The stark reality is that a project can only be regarded as a success once the asset sustainably reaches name plate production within the projected timeframe.
Senior leadership needs to focus more on the strategic business case and outcomes of the project and enable the acceleration of operational and organizational maturity growth beyond ramp-up. By focusing on “culture and systems of work by design” earlier in the project development cycle, prior to or during the detailed engineering phase, companies can experience a positive impact on Net Present Value (NPV) while positioning the future operational organization to enhance organizational capabilities and drive maturity growth.
Establishing the needed operational foundation that enables data-driven decision making, operational excellence and continuous improvement during capital project execution and post operational ramp-up, creates a culture that fosters long-term growth, resilience and scalability across the asset. Furthermore, the early investment in designing the “systems of working” with the supporting management operating systems, while integrating with today’s advancements in AI, automation, Digital Twins, EAM, ERP, IoT, robotics and other technologies positions the asset to emerge from the capital project at a much higher maturity stage and set of organizational capabilities. By leveraging the insights and efficiencies these systems and tools provide, mining and metals companies can not only optimize their immediate operations but also position themselves for sustained success in a rapidly evolving industry.
Yes, integrating management operating systems with AI, IoT and other enterprise platforms during capital project execution can have a positive impact on NPV and cash flow. “Systems of Working” help streamline project execution, reduce delays, and improve project scheduling, allowing the company to start generating revenue earlier than expected. Additionally, avoiding project delays reduces the discounting effect on future cash flows. These same systems can help identify and mitigate risks such as supply chain disruptions, equipment failures, and market fluctuations. By reducing these risks, companies can avoid unforeseen costs and improve project reliability.
Systems of working provide the project and operating teams the ability to improve operational efficiency by optimizing resource allocation, reducing downtime, and minimizing waste. Additionally, predictive maintenance supported by enabling technologies, process automation, and enhanced supply chain management can lower equipment failure rates, energy consumption, and labor costs, while helping owners to significantly reduce both capital and operational expenditures. Creating a “Culture by Design” with the supporting “Systems of Work” early in your capital project will directly impact the key drivers of NPV by improving operational efficiency, reducing costs, accelerating revenue generation, and lowering risks.
USC partners with your organization to accelerate Operational Maturity by helping your team create a Culture by Design supported by the needed Systems of Working
Since 1968, USC Consulting Group has been working with clients to address the challenges and avoid the pitfalls when creating cultural change and developing systems of working. While the integration of AI, IoT, MOS, EAM and ERP offers tremendous potential in capital project execution in the mining and metals industry, companies must carefully navigate the challenges. Addressing high costs, technical complexity, workforce readiness, and data management are key to overcoming hurdles. Strategic planning, phased implementation, and ongoing system monitoring are critical to successful integration and maximizing financial and operational benefits.
Mining and metals projects often vary in size, complexity, and location, which means the systems of working need to be scalable and adaptable to different environments. Inflexible systems may struggle to scale up or adapt to specific project needs, leading to inefficiencies and higher costs. Our seasoned consultants help the owner team to ensure compatibility with the project environment and to overcome scalability challenges.
The integration of AI, IoT, MOS, EAM and ERP introduces additional layers of complexity in project management, as these systems require continuous monitoring, optimization, and alignment with project objectives. Mismanagement of complex systems may lead to delays, cost overruns, and reduced system effectiveness. USC Consulting Group understands how your project and operating teams can best utilize the needed information while addressing the unique challenges of the mining and metals sector to ensure smoother execution and in-shift adjustments.
Employees and management may resist the changes required to implement these new systems of working, especially if they fear job displacement or lack understanding of the new ways of working. Cultural resistance can slow down or even derail the integration process, leading to project delays and inefficiencies. Our people bring effective change management strategies, including clear communication, training, and involving employees in the transition, that ease resistance.
Misalignment between project stakeholders can cause challenges. Lack of collaboration between the various teams can result in inefficiencies, process failures, or unmet project and/or operational goals. Ensuring early and continuous collaboration between project stakeholders and operational teams helps bridge the gap while ensuring a successful project completion and production ramp-up.
While the long-term benefits of integrating and implementing systems of working are substantial, measuring these benefits and calculating NPV and ROI can be complex, especially when the results are not immediately visible. Stakeholders may become skeptical if they don’t see immediate financial returns, leading to reduced support for continued investments. USC works with the owner’s team to establish clear KPIs and benchmarks for performance improvements, measure progress and demonstrate long-term value.
USC Helps You Tackle Key Challenges
- Align project and operational stakeholders on the strategic business case and operational outcomes
- Develop a high reliability culture focused on breaking down silos and executing work in a safe manner
- Ensure the right resources are at the right place to minimize lost time – enabling safe and disciplined execution
- Control quality of work at the point of execution by identifying off specification and enabling in-shift correction
- Identify potential roadblocks proactively during mine planning and solve complexity during the planning process
Do you want to understand how creating a Culture by Design can accelerate the future asset to achieve the strategic business case and nameplate performance targets safely?
Want to find out more about how USC can help you uncover the hidden value loitering in your capital projects? Contact us today.
