Mining Supply Chain: Setting Up: Human Resources

Tuesday 18 February 2014

Almaty Office, Kazakhstan

-3°C Sunny and hazy (or maybe simply smog)


As discussed in a previous blog, there are 4 main strategic supply chain stages during mine life:

1.      During mine development and construction

2.      At start-up

3.      During change management

4.      When performance fails to meet expectations.


We discussed the first stage in brief on 6 Feb and we will address this stage again later in more depth.


The second stage was initially discussed on the last blog (11 Feb) and in that blog we covered management controls during the setting up stage of supply chain for a new mine.  There are many facets to setting up a new mining supply chain operation and we will address more stages in subsequent blogs as it is too much to bite off at once.  This blog addresses the all-important topic of manpower


People are the most important asset in supply chain and choosing the right personnel at all levels is crucial to success.  The adverse effects of poor manpower selection are lower performance and higher costs: get it right and mine supply will operate efficiently and quietly in the background; get it wrong and supply will become a headache that is time-consuming and costly to correct, and meanwhile production is jeopardised, costs mount and dissention sets in.  Recruiting and thoroughly training the right people are therefore crucial.


Employing the right people for the right jobs at remunerations within the company grading and salary matrix is important, as are the essentials of good induction and thorough theoretical and on-the-job training before ‘go-live’.


It is most important to establish the correct manpower structure for your supply chain department and to agree this with the (recommended) Supply Chain Steering Committee (see previous blog).  Each mine is different: a manpower structure in, say, Australia, will be completely different from manpower needs in, say, most African countries.  The structure will be designed by supply management and coordinated not only with Finance and Human resources management but with the support of general management and end users, through the Steering Committee.  Everyone should be on board with the aims and objectives of the supply department well before ‘go-live’.


Once the organisation structure is finalised, a decision is made concerning sourcing potential recruits.  Many countries have localisation policies and once the department is up and running, expensive overseas involvement may be cut to a minimum if recruiting is effective.  If your mine is foreign owned/operated your interests may be best served by employing at least one permanent foreign home-based overseer depending on the size and complexity of your operation, but while setting up and settling in, a greater level of experienced, knowledgeable expertise will be required and this may have to be from higher-cost outsourced experts such as CBC or in-company specialists if they can be made available. 


Job descriptions for each position are prepared and agreed, and at this stage coordination into the company’s grading and remuneration matrix will be finalised prior to the recruitment process.


Once the recruitment process has been defined and implemented for each level of the structure, selection of the best candidates for each position is crucial and will be managed by Supply Chain management, supported by HR.  This process in many places will take months to complete and sufficient time should be allowed to complete the process.


Once candidates are employed, depending on their knowledge and experience, they will be familiarised with processes to be employed and a theoretical induction and on-the-job training program designed for each job category.  All employees will be expected to know the requirements of their position thoroughly from two fundamental perspectives (where applicable), covering both their routine tasks and the actions that are taken to support the electronic processes.  For example, a person responsible for receiving materials will be competent to handle the goods physically and ensure that the correct data reaches the company’s electronic system promptly to enable accurate inventory data and to facilitate payments.


These procedures will be supported by detailed manuals in relevant languages.


We will look at aspects of this in greater depth in later blogs. 



CBC is able to undertake and support this crucial element of setting up for an efficient mining supply operation: from structure, descriptions and recruitment, through training and ensuring the workforce is operating efficiently to the preparation of process manuals.

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