Mining costs soar as productivity languishes, superfluous staff proliferate
Australian miners have been increasingly beset by burdensome expenses, cost blowouts and project delays in recent years, with many now pointing the blame at miners themselves for retaining superfluous management personnel and employing out-dated procedures.
The Australian reports that a new study from the Centre for Innovative Practice at Edith Cowan University in Western Australia has concluded that miners incur many needless expenses and delays due to inefficient management structures, which often mean key issues are unknown to senior management personnel for weeks.
Dr. Richard Fulford who led the research project says that productivity on construction projects could be "startlingly poor" due to an overabundance of subcontracted personnel and superfluous levels of management staff.
Fulford says he has seen as many as 12 levels of subcontracted staff between the main contractor and operations themselves, and claims that on some major projects information can take seven weeks to rise through the management chain.
"It's certainly costing billions and billions over time," says Dr. Fulford.
Outdated procedures also bear their share of the blame for bloated costs, with many construction techniques currently employed on projects dating from "15 to 20 years ago."
ABS data indicates that mining industry costs have surged since the start of the decade following a period of moderate fluctuations throughout the eighties and nineties, and are currently approaching the $120bn mark.