To avoid the complacency trap, miners must establish a position of strength today that will enable them to tackle challenges arising tomorrow.

They can do so by understanding the powerful trends shaping their industry and crafting strategies for managing them. With these imperatives in mind, we've used our ‘Sensing the Future Megatrends' screening framework to assess drivers that will shape the mining landscape from now through 2030. And we consider how forward-thinking miners can best respond.

Drawing on socioeconomic, environmental, technological, and behavioural studies, we've identified demand- and supply-side megatrends that will powerfully influence mining's future. Megatrends are waves of change that transform an industry's competitive landscape by challenging existing resources and systems, affecting multiple businesses across multiple geographies, and creating ripple effects that play out over decades.

Examples of demand-side megatrends include population and economic growth, urbanisation, and availability and price of substitute materials affecting businesses as well as societies. These trends influence miners' decisions on matters such as which commodities they should focus on. We've closely examined demand-side megatrends in several publications, such as our Mining Journal article "A Strategic Lithium View".

Here we turn to an assessment of supply-side megatrends. 

While demand-side trends' relevance varies across commodities, supply-side trends tend to be universal. Examples include advances in digital technologies, the productivity focus, resource depletion, the notion of the ‘extended enterprise'/sustainability (the importance of social and environmental responsibility), and the need for education and training to attract, develop, and retain talent with new kinds of skills (see figure 1, above/top).

Supply-side trends inform decisions about how mining companies can best strengthen their 'right to win' in the future, by building up their resilience today. Miners that prepare to manage the impacts of these megatrends will stand the best chance of thriving commercially as well as maintaining their social licence to operate in their chosen markets and geographies.

Many industry players are well aware of the megatrends centred on digital technologies and productivity improvement. (We've explored these in our Mining Journal articles "Digital technology: Hype or ripe?" and "Play it again, Sam".) But over-focusing on these familiar trends can put companies at risk of neglecting the other megatrends—which are just as important to understand, even if they seem less apparent to some companies.

Take the extended-enterprise/sustainability trend.

Miners that collaborate closely with local communities and government agencies, and that are seen as socially and environmentally responsible, can strengthen their competitive position in important ways. For instance, stakeholders turn into shareholders—directly or indirectly participating in a mining company's success. As a result, approval processes for setting up new operations or facilities may be accelerated. Companies might gain easier access to financing. And transportation infrastructure or utilities projects important to both mining companies and local communities may get funded, with miners and their stakeholders sharing the costs.

Of course, ‘doing good' comes with challenges too. For example, local communities might keep ratcheting up expectations about how much support, and what forms of support, they should get from companies doing business in their area. And managing diverse stakeholders requires interpersonal skills that aren't necessarily engrained in miners' organisational culture.   

To capture the opportunities and surmount the challenges presented by supply-side megatrends, miners must benchmark their maturity on each trend. They can then diagnose gaps between what they're currently doing to prepare and what they should be doing, and take action to close any gaps. Let's see how one global player—which we'll call BigOre—handled this process. For illustration purposes, we'll focus on the company's efforts relative to two megatrends: extended-enterprise/sustainability, and education and training.

BigOre: a case in point

BigOre began by assessing its maturity on the extended-enterprise/sustainability megatrend. The company prepared a report detailing their economic performance (including its contribution to its host countries' GDP), social responsibility performance (such as supporting provision of healthcare services to local communities), and environmental responsibility performance (for example, carbon footprint and water usage). It also benchmarked BigOre's performance against its peers' on these various dimensions (see figure 2, below).

Drawing on these analyses, BigOre then formed a committee comprising representatives from local communities surrounding its operations. The goal was to deepen their understanding of these stakeholders' needs and concerns. The resulting conversations yielded some surprising—and valuable—insights. For instance, BigOre learned that a fresh-water supply project it had planned for a nearby village wasn't seen as all that important by the residents. The residents much preferred to get reliable electricity supply through provision of a solar panel and battery system. It turned out that this system would cost less for BigOre to provide than the original water supply project.

BigOre also took action to more effectively communicate with local communities. For example, it arranged to publish a regular column in local newspapers to update readers on their most recent achievements as well as business, social, and environmental initiatives they were planning for the future.

These efforts paid big dividends. The communities where BigOre did business gained valuable forms of support and a clearer view into the company's impact on their lives. Perceptions of BigOre shifted from negative to positive. As a result, approval timelines mandated by the regional government were accelerated. What's more, sabotage incidents at BigOre's mining sites declined markedly.

To support efforts on the extended-enterprise/sustainability front, BigOre needed to invest in education and training to foster new skills in their workforce. While the ability to wield a shovel or operate a haul truck remained important, the company also needed people who knew how to engage with diverse stakeholder groups and solve problems proactively and creatively. But such ‘knowledge workers' are in high demand among numerous other industries, so BigOre (like other miners) was competing against non-mining giants to attract and retain them. 

BigOre took action to sharpen its competitive edge in the talent war as well as develop its existing talent internally. For example, it offered rotational trainee programs to build future leaders. And it engrained training and development in its organisational DNA, by integrating mentorship into its performance management systems. It also offered part-time work schedules and telecommuting for relevant roles. Additionally, it began giving employees greater freedom to propose and implement their own ideas and to operate with less supervision and more personal accountability. Studies show that such autonomy powerfully drives employee satisfaction and thus retention. It also boosts dedication, initiative, productivity, and creativity. 

These are recent changes at BigOre, and their full effects will require time to play out. But BigOre is already seeing results. For example, after advertising a number of open positions, the company received applications from unusually high-calibre candidates. Moreover, absenteeism and turnover rates dropped substantially within just six months of the program's roll-out.

No one can deny that supply-side megatrends will transform mining's future landscape in ways that present both opportunities and challenges. But companies can—and should—take steps now to prepare for that future.

Assessing their maturity on each megatrend is a critical first step, and can help miners establish the position of strength they'll need to excel in a tomorrow that will look markedly different from today. 

*Matthias Tauber is a partner and managing director (Tauber.Matthias@bcg.com), Tycho Möncks is a principal (Moencks.Tycho@bcg.com), and Fabian Barthel is a principal (Barthel.Fabian@bcg.com) at The Boston Consulting Group.