Mining projects are typically risky investments and are prone to poor budget and schedule performance (not unlike other industries’ results). In most project post investment reviews (PIR), the project leadership and team invariably will have been a major factor affecting the final project performance.
Over my decades of project management experience, in and outside of the mining industry, the challenges remain the same. Often, technical issues are easier to overcome than people challenges, regardless of project size.
Planning is obviously fundamental to project management, but timing is everything. Rushing or skipping planning steps at each project stage will ultimately cost the owner in some way; safety, cost, schedule, quality, or eventual operability/production.
For example, we have seen detailed engineering efforts pushed forward irrespective of the overall execution strategy and construction planning. As a result, the startup (pre-commissioning, commissioning, and ramp-up) needs were not fully considered.
Ignore the temptation to advance until the project framing and the overall execution strategy can be articulated, and the next project stage (detailed planning) done in a deliberate and proactive fashion.
Below are lessons learned, with the example details altered for client confidentiality.
First, hire or appoint the project director
The project director (PD) is required to lead the formation of a qualified, highly engaged, structured and integrated project team.
Actually, here there are two lessons in one: the PD, or project manager (PM), is the key hire and a generalist is usually preferable to a subject-matter expert (SME), particularly when the PD assembles the team.
PDs who are civil or mechanical engineers or have a project controls/business/finance background tend to focus on the management of the project, work at the right level, and avoid technical rabbit holes, thus leaving the technical details for those who are supposed to address them.
Many times, projects suffer if the leader(s) are technical SMEs without the restraint to work at the right level, because they default to what they know.
Recently, we have seen project management team meetings regularly devolving from the intended project management administration focus to wide and varied technical rabbit hole discussions, including technical trade-off studies and mine planning deep dives.
In this case, not only was time wasted with no actionable outcomes, but critical project related topics, such as schedule, safety, community, environment, and finance were ignored.
Leaders who are technical SMEs in their own right are often not restrained enough to remain focused on the intended topic. A generalist typically will look to the big picture and hold others accountable for their respective technical areas (more on responsibilities below).
The core-four are next hires
For large projects, the PM, engineering manager (EM), project controls manager (PCM), and commercial and procurement manager (CPM) are the next hires, and again, these individuals must be highly focused, engaged and experienced. This ‘core-four’ need to be full-time, with robust skills, energy and complementary experience.
A brief note on experience… mining companies tend to only hire from within the industry, and therefore, miss out on project learnings from oil and gas, technology and other industrial areas.
Also, people tend to hire from their network and this approach can result in a team that is heavily skewed in one technical area or frame of mind, creating a project echo chamber.
Project coordinator as chief-of-staff
Hire a strong project coordinator to support the PD and the project team. This key position addresses critical and high-level tasks; coordinates between the core-four and technical functions; and oversees the management routine, assists with key presentation preparation, and provides meeting support.
A mistake is often made by hiring a junior project administrator who is more like an assistant and less like a ‘chief-of-staff’.
Hire slow, fire fast
This lesson is universal. Although project team recruitment often stresses the owner’s human resources, take the time and outsource recruitment if necessary, because the team will make or break your project.
Also, if some of the team are already in place, team competency assessments are critical to ensure that legacy staffing is right for the project. Although the goal is to have a zero-vacancy position rate, do not put ‘bums in seats’ simply to fill the role.
Subsequent team turnover and a lack of owner’s team continuity is a common cause of poor project performance.
Investigate whether existing roles have proper reporting lines, and if people are working at the right level to allow them to lead and properly leverage their skills and experience. We have seen legacy reporting structures and personnel issues override the traditional approach and lead to project challenges, turbulence and delays.
Use independent contractors sparingly
Key project functions should be led by owner personnel with an appropriate delegation of authority. It’s best if all are employees, but fixed-term independent contractors will suffice if absolutely required to form the right team.
Location, location, location
Over the life of the project, there are times when the PM and EM need to be located in the engineering consultant’s office. Remote working and meetings cannot replace the necessary oversight and collaboration.
An example was a project that was delayed by months, and costs ballooned due to the lack of consistent presence and a reliance on a remote and disengaged PM and EM resident in the engineer’s offices. Another contributing factor was the lack of clarity around the PM and EM roles, with the engineering contractor receiving contradictory instructions from the PM and EM.
Provide clear project team roles and responsibilities
Most projects take the time to develop a project charter, but not necessarily a set of roles and responsibilities using a RACI matrix (a project management tool that clarifies team roles and responsibilities by establishing who is responsible, accountable, consulted and informed for each task) for the team, corporate, consultants and contractors.
Without clarity, tasks can be missed or doubled up causing confusion and usually impacting schedule and costs. The RACI matrix level of detail varies, but the approach can be used formally or informally on all or a portion of a project.
Briefly, major work areas, deliverables, or tasks are divided up as follows in a matrix:
- Responsible – The Doer – this is at least one person.
- Accountable – The Reviewer – the ONE person who agrees the task is complete.
- Consulted – The Inputters – this can be many people.
- Informed – FYI Persons – again, this can be many people.
The key is that only ONE person is accountable. This avoids having a situation where decisions or approvals are made by the wrong person without any authority. The snowball impact on a recent project was rework and extra costs.
Beyond the RACI, it’s critical to align the project’s objectives, communications, and reporting with project governance and with community, corporate, and any other parties as Nermina Harambasic outlined in this recent Intelligent Miner article.
Putting people at the core of mining projects
In summary, mining projects are technically complex, but share the same management fundamentals as other industrial projects, with people at the core. Following a disciplined approach and learning from other projects can set you on the road to success.
Mary Juetten, CPA, Esq. is an international executive, board director, published author and entrepreneur who draws from over three decades of finance, commercial, legal, project management, and mediation experience to provide a range of consulting services in the mining industry. She holds a JD with an environmental law certification and an ESG board certification. To continue the conversation, follow her on Linkedin