Global demand for minerals continues to increase steadily despite the recent downturn in the world economy. Factors driving demand include population growth and rising living standards and expectations, particularly in underdeveloped and quickly developing countries. But while the broad macroeconomic outlook is bright for the mining industry and its leaders, the demand outlook also presents a mixed blessing for the industry. Companies, in their drive to create value, are being forced to search for new resources in more difficult environments where they are presented with a host of sociopolitical, environmental and regulatory issues and challenges that many have not encountered before. A whitepaper, written by Korn/Ferry consultants Michael O’Callaghan and Chris Campbell, is based upon a series of interviews conducted with mining CEOs, board directors and senior operations and human resources executives, focusing on their most pressing issues – both now and into the future. These discussions offer insights into how companies can be proactive in addressing the variety of challenges facing the industry.
They conclude that the industry finds itself “at an inflection point as it enters the coming decade: it must satisfy soaring demand while meeting the expectations that it will conduct operations in an environmentally and socially responsible manner. At the same time, mining companies have to search for large deposits in remote regions where they have not operated before, requiring that they develop productive and sustainable relationships with local governments and communities.
“The task of balancing these sometimes conflicting priorities has fallen to mining company executives, requiring they have a whole new set of competencies. Along with the technical skills they bring to the job, the 21st century mining executive must also understand the psychology of the residents, their history and be able to address the environmental concerns of the indigenous population. Today’s mining executives must bring strong interpersonal skills and a high emotional intelligence to go with strong mining acumen. Most important, these executives must be master communicators, able to speak to the diverse communities where they operate and to be able to speak to internal constituents as well. At the same time, mining executives must bring a deep understanding of markets and finance and must also be able to balance the short-term profit drive verusu the long-term goals of the enterprise. They also need to navigate the certain economic downturns that will present themselves during the course of their tenure.
“Finding executives with the technical, interpersonal, financial and strategic ability to lead the industry at this critical juncture is essential, especially today, when scarcity of talent is becoming more pronounced. In order for the industry to meet the challenges of the future, several things will need to happen. First, mining executives will need to assess existing talent to gauge alignment to the business and the ability to meet mission critical goals today. Second, broad-based mining talent will need to be developed to meet the needs of the future in areas where it does not already exist. This will require targeted development plans that will enable smooth leadership transitions across the organization in, among other places, the areas of social, environmental and regulatory management. Finally, true leaders do not lead in a vacuum. They lead by leveraging a mix of who they are, their existing relationships and the prevailing market dynamics around them. Understanding what they need to know to optimise personal, team and organizational impact, both today and tomorrow, will largely determine the success or failure of a mining organisation.
“Given the complex nature of the business today and the need for specialised talent, the stakes for companies in developing and identifying the new generation of mining executives has never been greater.”
An electronic version of the paper is available to read and download at: http://www.kornferryinstitute.com/about_us/thought_leadership_library/publication/1623/Developing_Mining_Leadership.