Only Enterprise Resource Planning (ERP) Software rightly optimised for the increasingly project-driven and asset-intensive nature of the African mining industry will be adequate to address contemporary demands.
The application of software has revolutionised mining operations in Africa in mindboggling ways, bringing forth significant cost containment and enhancing productivity tenfold. Nonetheless, for the end-users, in this context mining companies, that are constantly inundated by various vendors from all corners of the world, settling for the right products has now become complex to manage, especially for Enterprise Resource Planning (ERP) demands.
Of course the last thing a mining company would be prepared to face, as they focus on managing effects of the commodity price downturn, is utilising ERP software which won’t just deliver in times of urgent need. But, sadly, that’s everyday reality, as Director for Asset Intensive Industry at IFS North America, Patrick Zirnhelt, highlights in his paper titled Selecting ERP Software for the mining industry. IFS North America is a prominent organisation in the supply of software for various industries.
Falling woefully short
Zirnhelt is not surprised that getting the right enterprise resource planning software has become an inconvenience for many a mining company for two main reasons. Firstly, he notes: “Most ERP products came out of the world of repetitive manufacturing, which means they are built around processes that are not appropriate for the mining industry.” In addition, the majority of the current ERP packages do not cater for mines’ powerful asset management and project management requirements.
The result is that the software falls woefully short of requirements, Zirnhelt laments. “The software will not give the executive visibility or real time control to successfully executive their P&L responsibilities.”
Suppliers have to up the ante
Noticeably, judging from the current situation, suppliers have to up their ante in their research and development endeavours by providing products that are not just relevant but meet complex industry requirements. This is because, as Zirnhelt foresees, the scope of applications of ERP software is likely to increase as mining companies revise their business strategies to cope with mounting challenges to their operations. He says: “ERP is becoming a higher priority as mining executives find themselves dealing with numerous wildcards including fluctuating commodity prices, a shortage of skilled labour and engineering professionals, increasingly global footprints and associated regulatory diversity. Merger and acquisition activity also will force mining companies to rapidly absorb newly acquired divisions into their standard business processes. Regulatory pressure to start specific divisions in a specific country or region also means mining companies must be able to manage multiple companies within a single, centralised enterprise software environment.”
On the obligation on software developers, Zirnhelt believes that only software optimised for the project-driven and asset-intensive nature of the mining industry will be adequate. This echoes what SYSPro, a South African enterprise resource planning company, underlined in the January/February 2016 edition of African Mining Brief.