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September 30, 2019

Metals & Mining industry is poised to grow exponential in the next few decades, owing to the significant growth in the emerging technology landscape. At one hand, there has been a continuous push from the industry itself to improve upon its safety measures and at other, there is a constant nudge from the environmentalists for reducing green-house gases and avoiding accidents. But one thing that is overlooked quite often is the understanding that if cost reduction is needed, first investments are needed to be done.

While M&M experts, consultants and analysts have always pointed out the use of emerging technologies, the recent price volatility has resulted in lower profit margins for the companies working in this sector. This is further coupled by many accidental cases across the value chain, some of which result in destruction of an entire area, region or community. Hence, in the context of Business 4.0TM, the M&M companies should evaluate their needs across the value chain and understand them in conjunction with other value chain partners. However, the problem lies not in identifying the needs, but in matching the needs with the demand.

One thing that has become evident in the context of Business 4.0, is that no single technology can be the winner in this type of competitive & dynamic landscape, rather a cluster of technologies needs to be considered. A few examples of clusters could be Legacy Solutions (ERP, networking solutions, geo-physical Methods etc.), Remote-controlled solutions (drones, autonomous vehicles, remote operations etc.), simulation solutions (AR, VR, wearables, simulation S/W dashboards tracking etc.), Analytics (big data analytics, big data solutions, predictive analytics etc.), Security & Safety (Blockchain, cybersecurity solutions etc.), External Sensing (Sensors, Wearables, IoT, 3D Printing etc.), Mobility Solutions (Cloud, Mobile App etc.) etc. While legacy solutions and mobility cluster seem to have gained prominence as of now, they are closely followed by Analytics and Security & Safety. Remote-controlled solutions cluster has been slowly coming to prominence, while Simulations cluster is yet to make a significant difference to the M&M operations.

The Balancing Act

The clusters or the groups as mentioned above, have specific uses across the different value chain divisions. Therefore, M&M organizations should not adopt all the solutions as a part of their investments towards emergent technologies. Instead, they should gather a clear understanding of different work processes and the ways by which the above solution groups could aid in increasing their ROI. Then only the organizations should go forward with their investments for effective asset utilization along with efficient capital investments. But here comes the main issues, if one of the Metals & Mining Company is using Legacy Solutions Cluster and wants to adopt Remote Controlled Solutions cluster, the company would be required to necessarily invest in Simulations atleast to some basic level and Mobility solutions to medium level in order to churn out benefits from the digital initiatives. Again, if M&M companies want to beef up their Security & Safety cluster, they need to invest mandatorily in Mobility Solutions cluster and Analytics cluster both to atleast medium levels. This is because of the fact that, technologies in recent times are now growing together and the siloed approach of adopting any single solution has stopped being the panacea.  No wonder then that the M&M companies in most cases, fail to identify their exact requirements and either underinvest or over-invest in one cluster thereby failing to meet their ROI requirements. This shows, that the problem of balancing investments across clusters remains a big challenge for the industry.

What is the Way Ahead?

In a situation, where volatility is eating up on cash reserves, with competition being waged on prices, it is high time the M&M companies engage with consulting partners or analysts from third parties, so that they have a neutral outlook about their immediate, medium-term and long-term requirements and are better equipped to effectively gauge the required cluster of technologies. Their next step should be pilot runs in distinct parts of the value chain before investing huge. Pilot runs could help identify the compatibility and help prevent potential loss. Looping in human intervention and exhaustive feedback from the stakeholders would further help them to gauge the actual benefits, before the solutions could be commercialized across operations of the value chain.

Swayambhu Dutta is a Research Analyst looking after North America, ANZ, & MEA geographies in the Energy & Resources (E&R) business unit at TCS. He has around seven years of experience spanning across E&R and Telecom verticals. Currently, he is working as a business analyst enabling strategic decisions and deals support for the company. Swayambhu is a Gold medalist during his MBA stint in XIM, Bhubaneswar. He is a telecom engineer with deep interest towards Oil & Gas industry value chain technologies.


Soumya Banerjee is presently the Research Lead of Marketing Transformation – Research team in TCS. Soumya is leading research for Energy & Resources (E&R) and Healthcare verticals and advising research activities for Retail, Consumer Packaged Goods (CPG) and Travel, Transport and Hospitality (TTH) verticals. He is also leading research for geographies including APAC & ANZ, Japan, LATAM, and MEA. Soumya has over 12 years of cross-industry experience and has completed his MBA from Durham University, UK. He also holds an MS degree in Computer Science from Dresden University of Technology, Germany and a B.Tech in Computer Science & Engineering. 


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