The Australian resources sector is inefficient and too slow to execute projects to properly capitalise on the global commodities market, according to management consulting firm Siecap, a logistics and supply chain solutions specialist for projects.
Siecap Advisory CEO David Irvine said Australia lagged behind other countries in export volumes, performance and time to execute projects. Inefficiencies in the sector’s logistics and supply chain activities also had an impact.
“Contrary to some opinions, the mining boom is far from over: states like Queensland are simply missing out because they are inefficient, too expensive and take too long to get projects off the ground,” said Irvine. “Australia is being left behind in the international marketplace and if we don’t do something about it we will face an economic climate far worse than the global financial crisis.”
He said many major projects Australia-wide were facing delays and cost blowouts because logistics planning was not given sufficient consideration in the planning of major projects.
Project directors estimate that delays cost major projects $1-3 million a day, Siecap reported, with the key challenges being infrastructure issues for remote projects and poor supply chain links becoming an obstacle to timely delivery of project resources, including equipment and personnel.
Organisations need to consider lengthy approval processes, the potential need for pilot vehicles, escort vehicles and police escort officers and appropriate fatigue management programs.
“Developing detailed execution plans capturing all the constraints and requirements will assist in managing risk, mitigating cost blowouts and schedule delays,” Irvine said.
“The first step must involve engaging and connecting with government, community and industry stakeholders early.
“The next step is to plan by identifying major requirements, constraints, volumes, routes and capacities and build that into the engineering options.
“Logistics execution plans including traffic management and road use management plans should then be developed and finally, all stakeholders must be aligned for ongoing coordination, communication and governance.”