How competitive do you see consultancy rates vs costs for permanent employees? What are the key factors determining why consultants are used and how do you expect these factors to change in the future? How will these changes impact the way consultants do business and the nature of consulting?
Do managers know the true costs of their employee’s time i.e. what are the total costs for an employee and their effective work hours?
In most organisations I would say NO. Consultants however do know this cost.
Work force effectively is the key. Although consultant rates can appear high the rate per effective work hour is typically lower than that for permanent employees with the same experience to do the same work. What is the effective work percentage your workers. I believe this is alot lower than most people/managers believe. For example general observation at various times of a high rise building site excavation in Brisbane where you can see everyone working in the hole, I estimate that about 50% of the workers are actually doing constructive work at any point in time. Ask this question on employee efficiency on yourself, and to your workforce and mining consultant. Then compare the costs. Costs are not the only driver but they are a focus issue, work quality and results/conclusions are others. Why do some people/organisations not use consultants, or complain about the cost while others use consultants very effectively and gain a business advantage.
AL: An emerging issue is the impact of increased professional indemnity insurance premiums on consultant’s ‘license to operate’. Some smaller companies have chosen to operate with no cover. What is your company position on this issue and how has it affected your company?
Norwest continues to operate with a USD 2 Million professional indemnities insurance. What goes with this is the accepted responsibility, internal peer review and quality control of work, to produce legal documentation for consulting projects. Large mining companies may be generally unwilling to seek to seek compensation from an individual, but for larger projects and international consultants the risk remains. Individual consultants need to be very careful in this area and consider “What are they prepared to lose”
The small job for an associate or small company could be very expensive. Consultant consolidation assists in covering individuals and reducing average costs.
AL: What has been your experience with regards to international vs Australian work? How do you see this trend going into the future?
An example of expanding international work and the scope of consultants for Norwest is the Sarshatalli open cut coal project in India. Under a long term contract Norwest provides two senior people, essentially the mining superintendent and the technical manager to complete work in two key areas and also assist and train the mine owners and contractors employees. This is an unusual and challenging role, and very different for what is typically expected of mining consultants.
AL: The last few years have seen the use of more and more advanced technologies in mining. To name only a few: 3D seismic has had a huge impact in resolving structures ahead of mining; computer technology continues to have a major impact, from bringing real-time monitoring of mining closer to improving communications systems underground. From your point of view, which tools (existing or conceptual) hold the most promise, in terms of safety or productivity? And why?
The growing emergence of coal seam methane as an energy source and business will assist longwall mining Gas extraction will be from the surface, typically use horizontal holes and the gas will be utilized for power generation. Safety, Technical, environmental and longwall efficiency issues relating to underground gas drainage will drive this. Last year Norwest merged with Questa Engineering, a petroleum, coal seam methane and reservoir evaluation company to complement and expand our services in this area. Currently we are working with a forward thinking and major mine to develop an integrated long term multi seam gas extraction and longwall mining plan in an environmentally conscious area.
Overall the aim is to provide some revenue from the gas, meet current/future communities, wastage/environmental expectations and produce more coal more predictably.
AL: On the subject of roof control, the industry still battles regular roof fall incidents. What progress has been made in improving the way we manage roofs? Better bolts? Improved mine planning? Clever geotechnical models?
Roof control will improve with incremental advancements in all areas, seismics, geotech models, strata deformation measurement and monitoring workforce communication, planning and plain old inventiveness. An example is the “Bux plug” for cablebolting, developed by a mining engineer, Sean Buxton, based in Brisbane for the metals industry. Commonly being called by U/G miners the BUTT plug (what else would you expect) it simply speeds up the grouting cables, reduces wastage and makes the process more efficient and effective. (By the way this is a plug for a friend of mine who invented it, www.innicon.com)