1. Newsletter – December 2013
The Blind Leading the Blind?
If the blind lead the blind, both shall fall into the ditch……Matthew 15.
Well mining leaders may not be blind, but according to our readers, they are certainly given credit for the
massive drop in this industry’s productivity in the past decade. A lack of leadership capability presents
significant challenges to the future of the mining industry.
It’s not news to tell you that during the boom, companies advanced technical specialists who lacked the
strategic and leadership qualities necessary to lead project development and operations both locally and
abroad. Nor is it a revelation to remind you that there is a shrinking pool of key leadership talent
throughout the industry. The social, environmental and regulatory dimensions of operating large‐scale
mining operations have changed and as a result the skills needed in today’s mining leaders have never been
more diverse.
As mining operations move to more remote locations in search of new high‐grade resources, companies
and their leaders are encountering ever more challenging issues. Large‐scale deposits are becoming a rarity
in the Americas and increasingly in Australia. Instead, mining companies are developing and operating
mines in such countries as China, Mongolia, Madagascar, Russia, and various parts of Africa. A decade ago a
General Manager of a mine was focused on getting the commodity out of the ground. Now a General
Manager can also be expected to have a firm grasp on a range of social, cultural and environmental issues
plus a deep understanding of what is happening in international economies – often with no more training
than their own personal experience and an engineering degree. How life has changed! And we wonder why
we don’t have better leaders?!
There is intense pressure on leaders throughout the industry to deliver short term targets. Perhaps this is
no different to leaders in other industries. But, given the time it takes for a mine to become operational,
there is perhaps no other industry where success is so dependent on a long‐term focus. And, due to the
cyclic nature of the industry, there is little doubt that there will be at least one economic downturn
between pre‐feasibility and production phases!
The task of balancing these sometimes conflicting priorities necessitates a whole new set of leadership
competencies. Mining executives must bring a combination of vision, and strategic agility to enable them to
navigate through the minefield of bureaucracy, politics, environment, fluctuating economies and risk, never
taking their eye off the short term imperative of delivering profits. Along with honed technical skills, the
new age mining executive must also understand the psychology of the residents, their history and be able
to address the environmental concerns of indigenous populations. These executives must be master
communicators, able to speak to the large array of internal and external stakeholders who demand their
attention. At the same time, they must bring a deep understanding of markets and finance and must also be
able to balance short‐term profit drive vs. long‐term goals.
Finding, developing and retaining people with the technical, interpersonal, financial and strategic ability to
lead is fundamental to the future success of the industry. To expect them to possess all of the above skills
and experiences is ludicrous.
Offices:
Email:
Level 2, 11 Lang Parade
MILTON QLD 4064
info@confiance.com.au
Tel:
Fax:
Website:
+ 61 (0) 7 3864 0500
+ 61 (0) 7 3864 0599
www.confiance.com.au

2. Newsletter – December 2013
The aging of the baby boomer generation exacerbates the pre‐existing problem of leadership skills paucity.
The pool of emerging superstars is indeed shallow. As the complexity of the mining executive’s role
increases, the available skills decrease in parallel – the problem will worsen if action is not taken.
Now most of us acknowledge that women have an incredible contribution to make in the workforce. But it
was only 60 years ago when men marched off to war and women discarded their teapots and gardening
gloves to take their husbands’ place in factories, offices and farms. We cringe at our ancestors’ naiveté and
the time it took to realise the value of this underutilised resource group. In another 60 years it will seem just
as ridiculous that society in 2013 sat back and allowed droves of talented and vibrant people exit
workforces which were in desperate need of the wisdom and experience that really only comes with age.
With the recent mining industry downturn, thousands of workers with tens of thousands of years of
experience have been thrown onto the scrapheap or out onto the golf course. As baby boomers continue to
retire, employers will finally work out that a glut of experience has walked out the door, leaving insufficient
talent to fill the void.
Some organisations are already taking some steps to address this. Toyota, for example, modified its
workstations to cater for the ergonomic needs of older workers. BMW have set up a specific factory which
employs only over 50s. About 25% of Ernst & Young’s recruits have worked for them before, become
experienced elsewhere and return as more rounded, more value adding employees. Other professional
services firms, like Deloitte have an official retirement age of 60 written into their employment contracts.
Eric Ford, Executive Vice President of Peabody Energy retires in January 2014, however he will continue to
assist Peabody in a consulting role throughout 2014.
Our proposed solution to the dearth of leadership talent in today’s industry is not just to manage the exit of
baby boomers or indeed to bring them back to help develop and mentor mining executives on the rise. But
it’s a start.
The leadership problem our readers so poignantly articulated in our recent survey is multidimensional and
can’t be solved in the space of a 1000 word article. The problem as we have discussed is not that there
exists a lesser cadre of business executives in this early part of the 21st century. The leader’s role has
morphed and the industry hasn’t identified the changing role description early enough. We still promote
excellent technicians and miners into positions of seniority and influence. We rarely accept that
experienced leaders from other industries could possibly add value in the hallowed halls of mining. We
continue to promote banal leadership 101 courses that preach Maslow or Hersey and Blanchard theories,
expecting budding leaders to miraculously and instantaneously demonstrate their newfound skills in
complex and ever‐changing roles. We must acknowledge and define the complex role of a leader in 21st
century mining and define the skills and attributes essential to succeed. Growing those skills is the hard part
and there is no one solution. Harnessing the intellect and the experiences of the outgoing baby boomers,
importing talent from other industries, global talent management programs are a few suggestions. The
blind leading the blind will most certainly lead us all into ditches. Let’s build mining leaders whose foresight
and insight lead to spectacular success.
Joanne Westh
December 2013.
Offices:
Email:
Level 2, 11 Lang Parade
MILTON QLD 4064
info@confiance.com.au
Tel:
Fax:
Website:
+ 61 (0) 7 3864 0500
+ 61 (0) 7 3864 0599
www.confiance.com.au