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8/23/2019 Arturo Herrera
1/31
Opportunities for High-impact Innovationin Mining
PROCEMIN 2011
1
Santiago, November 2011
Arturo Herrera S.CEOaherrera@innspiral.com
www.innspiralmoves.com
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Kings of leveling downwards
2
Por qu NO sucede estoen Chile?
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Create and capture value using knowledge
Innovation is creating relevant and unique value
Innovation
3
applied to solve unmet needs
Research
Innovation = transform knowledge into moneyResearch = transform money into knowledge
Rafflers Circle
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The initial source of innovations is to find the maximum profitabilityof the installed capacity
High
UseofIns
talled
Capacity
Enterprise 1
Enterprise 3
SubstantialInnovation
Innovadora S.A.
IncrementalInnovation
4INNSPIRAL Pro uesta Tcnica
Managment CapacityLow High
Low
Both innovations may occur simultaneously and also in a complementary manner,so an integral management is required
Source: Innspiral Moves
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There are two innovation clusters in the mining industry and basedon them we can create strategic focus to look for new business
What is it? Why is it important?
Cluster based oncapacities
Cluster focused on operationaldecisions; it allows the company toidentify profit opportunities in its owncapacities, whether they are related to
their partners or not
The cluster identifies new businessopportunities designed to capitalize
on ones capacities and theirpartners
5
Cluster based onmarket trends
Cluster focused oncorporate decisions; it allows the
company to find innovation among the
market trends and its own needs
The cluster identifies new businessopportunities to solve the major
issues in the mining industry
Source: Innspiral Moves
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An installed capacity which is not in use, allows improvements
and optimisations without significant investment
Maximising theinstalled capacity
The technology considered in the design of projects is alreadyChanging of obsoletetechnologies
The first innovation cluster enables the company to developdifferent business opportunities with its own capacities
6
There are professionals who have acquired significant knowledge
ofinternationally developed technologies and methods that
often do not have the opportunity to apply them in Chile
Profiting from internalknowledge
Source: Innspiral Moves
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People Resources Business Growth
It is possible to group trends in four main focuses
Conceptual Map
Disinterest for the miningindustry
Aging workforce Cyber activism Relationship with
Communities
Inclusive Business Negotiation with trade unions Outsourcing Augmented Reality Womens World
Diversity in Talent Mining Security
Sustainability is everyonesresponsibility
Increasing water consumption Hydro-Efficiency Increasing Energy Demand Increasing Regulations Greenhouse Gases (GHG)
Decreasing Costs Investment in Mining Mining Oriented Financial
Market
Mergers, acquisitions, and
expansion
Emerging Economies Crowd Sourcing Innovation Avalanche Sulfuric Acid Market
New Technologies andAutomation
Co creation Copper Sustainability New Markets for Copper Chindia New ITs
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Disinterest for the Mining Industry
In spite of being the main driver of our economy, a great part of the population seesthe mining industry as unattractive, which generates a future shorthanded problem
Workers and professionals lack theknowledge, skills and abilitiesrequired for this industry.
Knowledge In 2007 only 2,713 wereenrolled, representing 0.37%of all students that year.
13% of professionals
in low income countries fulfill thenecessary conditions to performsuccessfully in their roles.
Only 0.93%...of the labor force in Chile wasemployed in the mining industryduring 2009.
In 2010, 4,225 wereenrolled, yet this is still
merely 1% of all students
that year.
Mining Engineering, Metalurgy andGeology Majors
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New Technologies and Automation
Innovation is the key to increase competitiveness and productivity in the industrythrough the use of new technologies
Mining companies throughout the world areincreasingly adopting new technologicalsolutions and all that information can be foundin the MINING.com Magazine.
MINING.com
Arouses InterestAccording to Microsoft, Chilean miningcompanies are more interested inapplying new technologies such as co-
working and Cloud Computing.
AndinaAutomation system in subterranean mineallows to remotely control the tasks of(un)loading and transporting materials.
ABB was awarded US$
50 millions for the
Automation and the
Electric Systemimplementation of the
Toromocho Mining
Project.
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Co-CreationGenerating new business models with the companys network brings a sustainabletwo digit growth
Community Alliance intends to include newpartners, give interesting talks, sportworkshops and support for young soccer withthe project For a better life quality in the LoaProvince
Cobreloa-Mining Co. El Abra
Providers andAllied
Channels
Value Network Diagram
IT Mining StandardSOMI, the model that also integrates FreeportMcMoRan, seeks adherence of big miningcompanies and intends to set an IT standard
for the mining industry.
Metso MineralsA Finish manufacturer of mining equipmentthat negotiates with mining companies to signagreements or strategic alliances that helpimprove the efficiency of their operations.
Complementary Allies
CompetitorsOpen
KnowledgeNetworks
Clients
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1111
Like in Horse Riding, to win a race of double digit growth, having
pure blood horses (projects) is not enough; the riders must also be
winners (entrepreneurs), and the trackmust be appropriate
(corporate environment)
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Innspiral designed, implemented and operated the InnovationSystem in the mining industry
Mainly activities realized:
Definition of the innovation clusterwith its strategic focuses
Design and implementation of the
innovation system
Creation of the InnovationCommittee and the InnovationDepartment
12
Design an imp ementation o t etechnological alert system
Results
Innovation System operatingsuccessfully and projects portfolioin execution
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The innovation system starts from the overlap with corporatestrategy until the generation of results.
The Innovation System
Innovation System
Corporate Strategy
13
Results
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The innovation system is structured from the strategic towards theoperative, reinforced by supportive processes and facilitators
Innovation System
Corporate Strategy
Results
Project ManagementIII Facilitators
InnovationPortafolio
Management
IntraentrepreneursManagement
Strategic Level
Roles, Goalsand Innovation
Focuses
I
Organization
ResourcesO erative Level
14
IV Support
KnowledgeManagement
Positioning andDiffusion
ManagementControl
Corporate Strategy defines the decision criteria and strategy for the innovation system.At the same time, the results of the system are useful inputs for re-orienting the strategy
Fuente: Metodologa Innspiral
NetworksInnovation
Alerts
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And the portfolio management is the pivot between strategic andoperative aspects, facilitators and supportive processes
Innovation System
Corporate Strategy
Results
Project Management
III Facilitators
Intraentrepreneurs
Strategic Level
Roles, Goalsand Innovation
Focuses
Organization
InnovationPortafolio
Management
I
15
IV Support
Management
KnowledgeManagement
Positioning andDiffusion
ManagementControl
II Operative Level
Corporate Strategy defines the decision criteria and strategy for the innovation system. At thesame time, the results of the system are useful inputs for re-orienting the strategy.
Fuente: Metodologa Innspiral
NetworksInnovation
Alerts
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The innovation system is structured from the strategic towards theoperative, reinforced by supportive processes and facilitators
Innovation System
Corporate Strategy
III FacilitatorsStrategic LevelI
Organization
Project ManagementRoles, Goals
and InnovationFocuses
InnovationPortafolio
Management
16
Results
IV Support
Intraentrepreneurs
Management
KnowledgeManagement
Positioning andDiffusion
ManagementControl
ResourcesOperative Level
NetworksInnovation
Alerts
II
Source: Innspiral Moves
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Focuses are specific challenges from which organizations cangenerate new business opportunities
Trends
Solutions
Needs
Problems
Innovation Cluster II
Explicit Latent
Direct Indirect
Corporate Strategy
17
InnovationFocuses
Innovation Cluster I
Companys Networks
Abilities Assets
Companys capacities Opportunities
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18
Characteristics:
1. Question2. Simple3. Brief
4. High Remembrance5. Evident Answers6. VERY aligned with strategy
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Project Management materializes the value of innovation for thecorporation
Innovation System
Corporate Strategy
III FacilitatorsStrategic Level
Roles, Goalsand Innovation
Focuses
I
OrganizationInnovationPortafolio
Management
Project Management
19
Results
IV Support
Intraentrepreneurs
Management
KnowledgeManagement
Positioning andDiffusion
ManagementControl
ResourcesOperative Level
NetworksInnovation
Alerts
II
Source: Innspiral Moves
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While the innovation process advances, the exploration ofopportunities evolves from the interior to the exterior of thecorporation
Levels and Methods of exploring new business opportunities
Knowledge and InternalCreativity Co-creation and Copy External Knowledge
Technology Alert
Exploring new technologies thatcould leverage new businesses for
Co-creation workshopsBrainstorming
Generating business ideas from theconnection between problems and
Joint exploration opportunitywith providers and companies
20
the company (Patents, Academic
R&D, Industrial and TechnologicalFairs).
Copy
Exploring products, services,and technologies that aretested or sold by similarcompanies in other markets orcountries.
Open Innovation
Inviting entrepreneurs andacademics whose businesses ordevelopments are related with theinnovation focuses of the company.
Historical Projects
Restarting old projects that werestopped for diverse reasons (lack offocus, contingency issues, etc.).
needs of clients, the trends that affect
the market, and the capacities of thecompany.
that present complementary
capacities.
Source: Innspiral Moves
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The different actors of the development and sales chain for newtechnologies will be identified
Actors in each kind of technological innovation
Applied R&D Start-upsConsolidatedCompanies
I II III
Business Incubator
R&D Centers
Technology transference and patenting
1
2
3
21
Risk Capital Funds
Innovation Promoting Entities
Industrial Associations
5
6
4
Angel Investors7
Source: Innspiral Moves
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The ideas are evaluated by the workshop participants, analyzingthose with the highest potential
Ideas that require development
for their implementation. The potential impact is high.
Ideas that require littledevelopment for therimplementation.
The potential impact can be low.
Ideas that requiredevelopment for their
Ideas Classification (conceptual)
Impact
2
3
4
22
mp emen a on. The potential impact is low.
Potential Quick Wins Reject or Freeze
Goes into design andevaluation process.
22
Source: Innspiral Moves
Ease ofImplementation
0
1
1 2 3 4
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The entrepreneurial capacity is the key for the success of projects,therefore this function is specially relevant
Innovation System
Corporate Strategy
III FacilitatorsStrategic Level
Roles, Goalsand Innovation
Focuses
I
OrganizationInnovationPortafolio
Management
Project Management
23
esu s
IV Support
KnowledgeManagement
Positioning andDiffusion
ManagementControl
Resources
Operative Level
NetworksInnovation
Alerts
n raen repreneursManagement
II
Source: Innspiral Moves
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Recruitment and SelectionProcess
Choosing the most suitable people inside or around theorganization to develop new business or innovation projects.
Evaluation ProcessEvaluating the performance of the intraentrepreneur in asystematic and formal manner during the development of his
project (design and evaluation, execution and growth).
Formation and DevelopmentProcess
Providing and incorporating learning related to innovation,intraentrepreneurship, project and personal capacitydevelopment for each intraentrepreneur.
1
2
3
The Intraentrepreneurs management must respond to 5 specificobjectives to find and enchance extraordinary talents
Specific ObjectivesComponent
24
Support Circle
both the development of the intraentrepreneur and of hisproject.
Incentives ProgramDefining incentives (pecuniary/ non pecuniary) to motivatepotential intraentrepreneurs and align them with the objectivesof the company.
4
5
When counting on extraordinary intraentrepreneurs we cando the projects withthe right people and therefore increase their chance of success.
Source: Innspiral Moves
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It is fundamental to define the structure of actors that assume differentfunctions and responsibilities in the portfolio management
Innovation System
Corporate Strategy
FacilitatorsStrategic Level
Roles, Goalsand Innovation
Focuses
I
InnovationPortafolio
Management
Project Management
III
Organization
25
Results
IV Support
KnowledgeManagement
Positioning andDiffusion
ManagementControl
Operative Level
Fuente: Metodologa Innspiral
NetworksInnovation
Alerts
Intraentrepreneurs
ManagementIIResources
Source: Innspiral Moves
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It is expected that the intraentrepeneur is continuously supportedby 4 different groups
1. Innovation Committee
4. Sponsor
2.InnovationManage-
ment Team
CentralActors
CEO and First LineManagers
Make decisions regarding allactivities in the system
Innovation supervisors atthe company
Support both the formationstage and the execution ofthe project
A first line executive for the
26
3. Intraentrepreneur
5. Other Areas
Company executives thatdedicate part of their timeto developing the project.
Lead the execution of
innovation projects
n raen repreneur
Lend political support andenhance the technical/strategicdevelopment of the project
Different areas of the company dedicatedto supportive activities
Reinforce the supportive activities (Human Resources,Communications, and Studies) as a counterpartSource: Innspiral Moves
f d l d f h f h d ff
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It is fundamental to define the structure of actors that assume differentfunctions and responsibilities in the portfolio management
Innovation System
Corporate Strategy
FacilitatorsStrategic Level
Roles, Goalsand Innovation
I
InnovationPortafolio
Project Management
III
Organization
27
Results
Support
Operative Level
Fuente: Metodologa Innspiral
Intraentrepreneurs
ManagementII Resources
IV
KnowledgeManagement
ManagementControl
Positioning andDiffusion
NetworksInnovation
Alerts
Source: Innspiral Moves
h l k l d
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The supportive processes contemplate knowledge management,innovation alerts, networks, and management and diffusioncontrol
Managing in an integral form the differentcomponents of the Innovation System to assurethe expected results (Portfolio management,project management, etc).
Components in an Innovation System.
IV Support
Feeding the process and developing projects fromknowledge and existent innovations in the market(national and international) in the framework ofinnovation focuses and projects, in both a proactive andreactive manner.
28
Capturing and making availablethe knowledge generated fromoperating the innovationsystem, the development ofprojects and the companysnetwork.
KnowledgeManagement Positioning andDiffusionInnovationAlerts Networks ManagementControl
Positioning the company as leader ininnovation.
Positioning innovation inside thecompany.
Encouraging participation andmotivation of people to contributetowards forming an innovationculture.
Encouraging, developing and
managing an open network forinnovation (internal and external)that integrates collaboration ofpeople, organizations, andcompanies.
Source: Innspiral Moves
I i i bl bli i
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2. Alignment of the company strategy with innovation goals
3. Creation of the necessary culture to facilitate the development ofinnovation projects and their entrepreneurs
4. Increased chances of success due to a rigid control and
1. Constant source of value creation for the company
Innovation is a manageable process, enabling companies toachieve at least seven benefits
Innovation as amana eable
29
7. Systematization of high impact results on EBITDA
5. Reduced uncertainty associated with a portfolio of innovationprojects
6. Systematic development of intrapreneurs to lead innovationprojects in an effectively way
process
Source: Innspiral Moves
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We will innovate.
30
en we e us ness o e o e
company in which we are, with our own business
model = Life Project
(Great Dreams)
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Opportunities for High-impact Innovationin Mining
PROCEMIN 2011
31
Santiago, November 2011
Arturo Herrera S.CEOaherrera@innspiral.com
www.innspiralmoves.com
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