Transforming the Mining Industry into an Elec

Mottola, L.; Lipsett, M.; Scoble, M. Transforming the Mining Industry through Electronic Commerce

Transforming the Mining Industry through Electronic Commerce

Laura Mottola, HATCH, Advanced Systems Group, [email protected], www.hatch.ca Mike Lipsett, Syncrude Canada Ltd., Edmonton Research Centre, [email protected] , www.syncrude.com Malcolm Scoble, University of British Columbia, Department of Mining and Mineral Process Engineering, [email protected] , www.mining.ubc.ca Key words: Information Technology, Electronic Commerce, Supply Chain Integration, Knowledge Management, Distance Education, Decision Support Systems, Computers, Monitoring.

Abstract This paper characterizes the important features of Electronic Commerce and demonstrates how it is transforming industrial sectors. It reviews how Electronic Commerce is a business strategy and examines supply chain integration, knowledge management, and human/machine communications. It aims to consider what would be required for a mining company to operate as an electronic business. It attempts to provide a vision of some future electronic mining scenarios.

Introduction Information technology traditionally has been viewed as only a support or operational tool in business. The advent of the World Wide Web on the Internet, however, has facilitated the creation of electronic commerce, a more cost effective and diverse way of doing business. Information technology (IT) is currently the main mechanism for the streamlining of business activities that is now widespread amongst manufacturing companies seeking to improve competitiveness. Technological change and organizational restructuring have been observed to bring gains in productivity and market share. The mining industry also faces similar acute competitive pressures. How can mining adapt information technology and realign itself as an electronic business? In order to provide a clearer vision of how electronic commerce would support an operating mine, consider the following scenario set at some future point in time: A remote Canadian base metal operation is faced with the imminent breakdown of a major piece of equipment. The failure has been predicted by an on-board condition monitoring system, which automatically generated a machinery diagnostic report and maintenance recommendation, whilst alerting the machine operator of the critical condition. The shift supervisor, the maintenance engineer, and the production planner automatically receive the maintenance recommendation and the engineer approves the work request generated by the computer-based maintenance management system. A query of the maintenance history database reveals that this failure would most likely result in two days of lost production and that the potential damage to the equipment is such that it could add to the normal repair time. The machine condition indicates that the failure will occur in three days. The repair procedure lists the required parts, none of which are warehoused at the site. The regional dealer has been electronically notified and confirms that all of the parts can be shipped within 24 hours via special carrier except one. However, a replacement is located in the inventory of a neighbouring mine. Under a parts pooling agreement, the required part is loaned to the mine and a replacement part is later shipped to the neighbouring mine. Short-range plans are modified accordingly and other equipment is redeployed to primary production for the duration of the repair, which is duly planned and tracked through the maintenance management system. No production is lost, feed grade to the mill is assured, and maintenance time and resources are kept to a minimum.

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Mottola, L.; Lipsett, M.; Scoble, M. Transforming the Mining Industry through Electronic Commerce Meanwhile, the original equipment manufacturer is notified of the failure, which is an unusual recurring problem in this type of equipment. The manufacturer gathers this information from its entire customer-base to improve the product design and promptly distributes the failure information to all customer sites to update their respective maintenance history databases. Thus the operating mine, original equipment manufacturer, dealer, shipping company, and parts pooling members were all seamlessly linked to the Internet in one integrated electronic business community, illustrated in Figure 1. Information, products, services and payments were delivered by electronic commerce via telephone lines, computer networks or other means. In this remote mining scenario the operating costs were reduced, whilst the quality of products, services and maintenance achieved were increased.

short range plan monitoring + telemetry

archival database

analysis tool

report & work request

planner’s work package

Mine

work orders

resourcing

work performed

inventory

procurement

Dealer

dealer

shipping & receiving

Parts Pool parts pool shipping

Shipper service bulletin

OEM

Figure 1: Mining Electronic Commerce Scenario It is widely recognized that the Internet is a worldwide network of computer networks using a family of agreed upon technologies and protocols, an intricate and extensive web of communication that links millions of people across the entire world. However, to capitalize on its connecting power, the Internet should be viewed as the domain where 21st century electronic commerce will take place, and the mining and metals industry is no exception. This paper firstly introduces Electronic Commerce (EC). It then explores some areas in the mining business that are poised to become more electronic in nature: • Supply Chain Integration, • Knowledge Management and Education, • Human Communications, • Machine Communications. These areas are treated in terms of technology capability as well as applicability in and outside the mining industry. The paper attempts to characterize the important features of EC and clarify its associated terminology, in order to facilitate an understanding of the potential for its implementation in the mining industry. It aims to demonstrate how EC is transforming parallel industrial sectors and how this might be considered for the mining industry.

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Electronic Commerce Business Strategy EC is more than a technology; it is a business strategy, a method for achieving corporate goals and objectives. It is critical for the support of industry and streamlining of the process of trading with partners. It includes the use of technology to facilitate Business to Business, as well as Business to Consumer transactions resulting in improved revenue and/or profits. It requires fundamental changes in organizations, corporate behaviour, and business thinking throughout the enterprise. What causes companies to implement an EC strategy? External pressures, such as competitors, customer demands, collapsing and tightening value chains, and the pressure to compete globally create certain initiatives whose execution is enabled by EC. These initiatives require tighter, faster, more reliable electronic links to business partners. This set of business partners, spanning across the entire supply and distribution chain and connected electronically to the enterprise, form a trading community known as an Electronic Business (EB) community [EDS 1999].

Business Value The business impact associated with EC has been found to vary, according to the maturity level of the enterprise’s EC implementation. The business value impact on a company may arise through four stages: • • • •

task automation, addresses intra-departmental efficiency by providing process automation and accurate information; it does not require re-engineering and delivers reduced costs; information sharing: addresses inter-departmental efficiency by providing functional automation, enhanced information access; it requires re-engineering of processes in a functional area and delivers reduced costs and productivity improvements; extended enterprise: addresses integrated efficiency by providing improved processes across enterprises and shared information networks; it requires organizational re-engineering and delivers reduced costs, productivity improvements, and increased revenue; virtual enterprise: addresses inter-enterprise integration by providing process improvement and information networks across enterprises; it requires inter-organization re-engineering and delivers increased revenue, increased opportunity, and increased market share [EDS 1999].

Technology Many different technologies are used to implement an EC strategy: • • • • • • • •

The Internet, with public access, provides an electronic market with limited security; Intranets, with restricted access, reside behind company firewalls, supporting and enabling intracompany processes; Extranets, secure hybrids of internet and intranet technologies with restricted access to the community membership, support and enable inter-company processes and extend the enterprise beyond its traditional boundaries; Value-Added Networks (VANs) or virtual private networks are private communications networks; Electronic Data Interchange (EDI) is a standard for compiling and transmitting business information between systems, often over value-added networks; Electronic Fund Transfer (EFT) is a standard for transferring monetary payments electronically between enterprises through financial institutions; Electronic Catalogues are collections of product specifications in digital form; Electronic Policies and Procedures.

Supply Chain Integration In the fast moving consumer products business, the market is shifting the value of companies from hard assets (factories, warehouses, inventory, and fleets) to soft assets (customer information, relationships, and market insight). The mining and metals industry is very capital intensive and hard asset oriented. Plants, CIM Bulletin – May 1999

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equipment, material stockpiles and inventory are the tangible wealth that defines the value of the mining and metals business. Could it be that, even in our industry, a shift in thinking is required to compete in today’s transient, low commodity price market? Is a shift in emphasis from hard assets to soft assets even feasible or appropriate in the resource sector? EC has the power to dramatically impact the economics of the supply chain of the mining and metals industry by exchanging physical assets for business information to reduce the overall cost of ownership and improve revenue. As described in the opening scenario, the maintenance of mining equipment can be enabled for just-in-time delivery of parts by electronically linking the suppliers into the maintenance management system and automating the part ordering process. This minimizes the need for keeping part inventories and frees up capital as well as real estate.

Extended Enterprise A supply chain is a business system consisting of a collection of enterprises that contribute to the delivery of a product or service. In an integrated supply chain, information is shared among the member organizations with the goal of optimizing the performance of the total system [Scovell and Dunbar 1999]. The pivotal point is the buying organization, the enterprise delivering the product or service to the customer. Integrated supply means focusing on the overall impact of supplier and customer relations on that enterprise’s operational effectiveness [Shepherd 1994]. The extended enterprise therefore encompasses its core value chain as well as both sides of the supply chain, i.e. supplier and customer relationships. For example, a mining and metals company should consider its key suppliers (e.g. chemicals suppliers, energy suppliers, equipment manufacturers, information technology service providers, contracted labour suppliers, etc.) and major customers (e.g. steel companies) as strategic partners. As such, they are treated as an integral part of the business by sharing critical information and best practices that enhance the overall supply chain. Hence, there exist two sides of the supply chain: • supplier relationships (procurement management) • customer relationships (order management). Supply chain integration aims to connect these extremities via inventory management into a seamless information flow enabling the efficient delivery of goods and services.

Procurement Management In the manufacturing industry, supplies purchased by the company are assembled into a final product. A distinction is made between non-production supplies used for maintenance, repair, and operation (commonly referred to as MRO or indirect purchases) and direct purchases (or non-MRO) for assembly into a final product (e.g. vehicle components). In the mining and metals industry, supplies are used in the process of extraction and production of the final product. The nature of the mining and metals business involving the transformation of natural resources forces the majority of purchases to be indirect or MRO (with the exception of capital expenditures). Supply Chain Management analyses the spend dollars per category of purchases versus the number of suppliers used, looking for ways to reduce the overall purchasing bill. With most items falling in the MRO category, the buyer has more leveraging power to rationalize the supply base and negotiate competitive contracts with a few key partner suppliers. In the electronic commerce world, procurement management can be performed in a buyer-controlled electronic market place where several buyers can leverage their combined purchasing power to obtain the most value. Intermediary agents (or aggregators) form a buying consortium of companies that are looking to purchase fairly generic consumables in bulk quantities (e.g. explosives, flotation chemicals, drill bits, etc.) [Berryman 1998]. Requests for bids may be posted on-line and submissions accepted electronically, thereby significantly reducing the cost of issuing and evaluating bids. Large companies have been using Electronic Data Interchange (EDI) over private networks to reduce labour, printing, and mailing costs in the CIM Bulletin – May 1999

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procurement process. Automating routine tasks has allowed the procurement staff to focus on negotiating contracts and building supplier relationships.

Order Management Managing the customer relationship and the order process directly impacts the revenue stream. The automotive industry is working toward a scenario where dealerships will be in a position to order a vehicle as per the customer’s specifications via a web-enabled application. Manufacturing of the vehicle will commence upon instantaneous receipt of the order and the dealer, or even the customer, will be able to track the progress of assembly and shipping of the product via the Internet. Automotive companies will no longer have to build an inventory of finished products to satisfy the demand and customers will be able to affect the configuration of the vehicle as permitted by the manufacturing process. Cars will be bought and sold on the Internet through electronic commerce. Is an electronic market for our mineral and metal products developing quickly? According to McKinsey [Berryman 1998], the speed with which an electronic market develops for any product depends on the inefficiency of current transactions and the sophistication of buyers. In our industry, transaction inefficiency is rather low, whereas buyer sophistication is high. The opportunity for developing an electronic market place for commodities is likely to be attractive in the near future. Through electronic commerce, it is feasible to market and sell clearly specified mineral and metal products via the Internet directly to the client. It is conceivable that the London Metal Exchange (LME) start trading copper, primary aluminum and aluminum alloy, lead, zinc, nickel, and tin on the Internet with registered member firms and producers while respecting regulatory and security issues. The LME already has an excellent web site and is set up to provide a direct real time price feed to customers through third party vendors [LME 1999].

Knowledge Management and Education Knowledge Management Knowledge Management (KM) has recently attracted much attention in the business world. Many corporations are now claiming to offer knowledge products in the form of value-added goods and services while others are repositioning themselves as knowledge organizations. But what is knowledge management and how does it relate to the mining and metals industry as an electronic business? Let us take a brief look at the concepts of knowledge management and their application to electronic commerce.

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KM Definition The familiar pyramid model shown in Figure 2 provides an adequate depiction of the hierarchy within the knowledge management concept.

Foresight

Wisdom

Insight

Knowledge

Fact

Information Data

Distillation Crystallization Interpretation Analysis Synthesis

Figure 2: KM Concept Data is the underlying foundation upon which knowledge is built. Large quantities of data are processed through analysis and synthesis to arrive at the essential information which is sought. Information is commonly shared within organizations and is factual in nature in that it does not provide instructions about how to use it. People interpret information uniquely to develop knowledge and then naturally apply that knowledge to improve processes. Knowledge is insightful in that it provides a means to use effectively the information upon which it is based in order to progress to the next level. Although knowledge is the only source of wealth that is indefinitely sustainable, it is rarely captured and shared within organizations. When clusters of knowledge (the personal possession of people) are pulled together and connections are drawn between seemingly disparate elements, the essence is crystallized and distilled into wisdom. Wisdom is the upper-most echelon of the pyramid in that it provides foresight based on the collective experience and insight of people. Knowledge Management can be viewed as an extension of data management, but, clearly, it is much more. It is a means to sustain competitive advantage and to grow the business beyond the limitations of physical assets. KM in Mining and Metals The mining and metals industry is highly dependent upon the acquisition and interpretation of data. Until the mineral resource is extracted from the host rock, every tonne of ore is virtual, that is entirely based on data. Physical asset valuation is based on information, therefore it is critical that we manage the knowledge that is acquired within our organizations.

Applications of knowledge management in our industry include the following examples: •

Developing exploration databases containing geological, geophysical, and geochemical information about geographical regions, complete with remote sensing data, satellite images, results of analyses undertaken, and discoveries made. For example, as a starting point, the Mining Lands section of the CIM Bulletin – May 1999 6


•

•

•

government of Ontario has created a web-site for accessing mining claims, reports, maps, policies, etc. (www.gov.on.ca/MNDM/MINES/LANDS). Packaging feasibility studies and environmental impact assessments as “knowledge documents” that directly address the concerns of the target audience, i.e. bankers and government officials in charge of approving financing and mining permits. The pharmaceutical company Hoffman-LaRoche dramatically decreased the time it takes to obtain a new drug approval from the US government by repackaging the drug application into a knowledge product which consistently and clearly presented key information to the decision-makers [Ernst &Young 1998]. Producing a comprehensive map of the knowledge sources in the company for quick reference and access to qualified people. Engineering consulting firms can build a central repository of professional resources available to the company, complete with curriculum vitae and cross-referenced with a project database archive containing documentation, drawings, maps, simulations, calculations, etc. Developing intranet- and extranet-based discussion databases for sharing best practices and benchmarking within organizations and the industry, for example, the large tire user group formed by Canadian surface mining companies.

It is important to remember that knowledge encapsulates insight and goes beyond the mere sharing of information. For knowledge to be successfully nurtured and transferred it is essential that people document the added value of their experience and insight. People that feel their position threatened by sharing their knowledge are unlikely to realize their full potential and contribute to the growth of the organization. Finally, KM need not be technology-intensive and should not be technology-driven. Although technology such as the Internet can be a powerful enabler of business processes and organizational transformation, it is merely a means to implement KM practices on a large scale across and beyond the enterprise.

Distance Education The ability to re-engineer the mining business process will be very dependent upon the skills and motivation of both management and the workforce. Our mines are dispersed and the challenges to support continuing education can be eased by the use of the Internet for Distance Education. The architecture of Web-based courses may range from simply the access to course notes, to the ability for online discussion and interaction with multimedia presentations, to direct interaction through video conferencing. In Canada much of the development of Distance Education technologies is being undertaken by the TeleLearning Network of Centers of Excellence (www.telelearn.ca), a $13 million initiative based at Simon Fraser University. This links more than 130 researchers at 29 Canadian universities. Part of the role of the network is to observe the application of a software package, Virtual U, and the best ways to teach on the Internet at all educational levels. Improving the design of Web sites for education is part of the aim of the Network for the Evaluation of Educational Technology, based at McMaster University (http://socserv2.mcmaster.ca/srnet/evnet.htm). For example, intense and dreary question-and-answer exercises are to be avoided. Also, students take responsibility for guiding themselves through a Web site, therefore good courses recognize this "learner driven" dimension, [Lougheed 1998]. Web-based education offers the ability for personnel at all levels to access the best courses, regardless of their origin. The mining industry should consider the ability to integrate continuing education into the workplace so that employees can develop their skills and knowledge under their own control as part of the working environment. Mine site students from as far apart as the Arctic or the Andes will be able to take courses under their own control from the most appropriate sources, wherever they originate around the world. The Mining Schools in Canada are beginning to develop their Web-based continuing education strategies, but the opportunity should be taken soon to form alliances to provide integrated programs of courses for the industry. The development of quality courses is challenging and dependent upon the availability and motivation of good teachers with true specialist expertise. This is an opportunity for industry and universities to collaborate more intensively.


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Human Communication Email Electronic mail (email) is the most common form of business communication using computers, both inside an organization and externally. It has grown from a text-based electronic memorandum (with a low level of security), to an electronic courier system, where large attachments of formatted documents, drawings, and other digital media can be sent between networked computers. Encryption allows improved security between correspondents.

Groupware Groupware lets people work together through their computers. “Groupware is software that supports the creation, flow, and tracking of non-structured information in direct support of collaborative group activity” [Orfali 1996]. Email is part of groupware. This article was written using a word processor that allows changes by each author to be tracked. The file was circulated by e-mail, with all changes to the draft highlighted within the document. This style of collaborative work allows data in a document to be captured and bundled at point of entry. A document can include text, images, sounds, mail, bulletin boards, faxes, video clips. If it can be stored in a computer, it can be included in a document. Groupware also includes multimedia documents (including web pages), workflow, conferencing, and scheduling. Workflow is the electronic equivalent of a paper trail through a business. In a maintenance application, a work request goes to a planner. The planner appraises the criticality of the request, gives it a work order number, and assembles associated documentation (work procedures, sign-off documents). The maintenance team leader assigns the work to a maintainer, signs off on work completion, and files the wad of paper. The maintainer may have to find additional procedures should the work scope change. This flow of information can be achieved electronically, often automatically. Scheduling software keeps track of time commitments of subscribers, and attempts to reconcile constraints. Video conferencing is sometimes used to supplement a multiple-participant voice conference call. Until recently, such a medium demanded dedicated digital telephone ISDN lines or a satellite link to send video images between conference rooms. Now a video conference can occur with each participant at a computer connected to a packet-based network (or the Internet). The advantage of this medium is to exchange images as well as voice amongst conference participants in different locations. More valuable than jerky, grainy pictures of the other attendees, a video conference can allow a white board diagram to be shared and worked on by a number of people. In the mining industry, projects could be worked on concurrently by company teams where the members are globally dispersed. Thus the optimum team, possibly from a range of associated companies, can be assigned without necessarily bringing the team together geographically. Technical experts can contribute without having to leave their corporate office. Project work and data access can be handed off between team members in different time zones to reduce completion time.

Data Warehousing Groupware is good at showing how information evolves over time, but not at capturing transactions in realtime [Orfali 1996]. Data warehousing allows an organization to preserve the quality of its data. Data quality means ensuring that data in one location is not only accurate, but also consistent with copies of that data in other locations. Data marts are small data warehouses used as trial implementations. A data mart typically groups data from a number of databases in a related business area, and later becomes part of an enterprise-wide data warehouse. A number of Canadian mining companies are pursuing data warehousing projects [Goddard 1997]. Executive Information Systems (EIS) and Decision-Support Systems (DSS) allow access to a data warehouse, both to find out what has happened in the organization, and to investigate what-if scenarios. CIM Bulletin – May 1999 8


EIS/DSS ranges from query/analysis tools through On-Line Analytical Processing (OLAP) to data mining and agent-based searching. Realistically, a DSS is more valuable to a staff person or line manager making tactical decisions (based on information) than to an executive making strategic decisions based on less certain and more qualitative knowledge of a broader situation. Query/Analysis tools are most useful when they allow easy interrogation of the warehouse (without forcing you to learn specific commands for querying a database). OLAP lets the user examine multiple dimensions of data. The power of this access to data is to work through what-if scenarios. Data mining software tools give some structure to the data to ease the task of wading through many dimensions of data, using tree structures or other mappings to link data together. The user selects data sets of interest, which are then graphed for visualization. The graphical user interface allows disparate data to be displayed in context, giving a uniform interface to heterogeneous data. Web pages link to data at different places on the network, identified by a unique Internet Protocol (IP) address and file name. These ways of interacting with information make it easier for someone to see a trend and make a business decision. Data mining techniques can also look for relationships amongst data sets that are not visible by eye. The computer does the work to find a needle in a haystack. Correlation analyses, time series prediction, and intelligent multi-agent search techniques are all used to automate the process of finding relationships amongst data.

Web Browsers Web browsers have become the preferred method for interrogating servers for information. This information can be in many forms: text, images, sound, video, even interactive virtual worlds. Web browsers are platform independent; that is, they run the same way on different types of computers. Browsers use standard protocols over TCP/IP networks to exchange information. HTTP servers send data in HTML format and in other formats recognized by plug-in applications spawned automatically by the browser (client). Java allows a server to start a process on the client, which means that other types of programs can run within the browser environment. This makes Java independent of a given type of computer, which is an advantage for legacy business information systems, but at the expense of speed. The usual flow of data is from server to client, but clients also send information back to the server, through forms or Java applets. The servers connect to databases that log the data; communication with open databases usually use SQL (Sequential Querying Language) calls.

Data Navigation and Visualization The challenge of extracting information from mine information systems is not usually one of lack of data. Bridges to supervisory control and data acquisition (SCADA) systems used to control material handling and mill processes archive process data in LAN-accessible databases. Data may reside in different locations on the network: databases, spreadsheet files, and document management systems. At Syncrude, process and maintenance engineers use spreadsheets tied to the Plant Information System, which update automatically. Spreadsheets are good tools for analyzing data. But anyone who has tried to find a related trend in two columns on different sides of a spreadsheet understands how difficult it is to relate different data. There may be hundreds of different types of data to compare. OLAP and data mining permit data navigation. But in a mine, much of the information is directly related to physical processes and equipment. A computer can provide access to information in the geographical or geometric context of where it occurs.


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Virtual World An effective method for seeing the relationships between different types of data in context is to display the data in a computer-generated representation of the equipment or ore body of interest. A Geographical Information System (GIS) displays data in context, but it allows little interaction or animation of the activities being observed. A virtual world is a map of the mine, and more. It is a computer-generated representation of the mine that can incorporate any information of interest about the mine that is archived in a database. Example data types are the ore body delineation, core drilling locations and ore grade estimates, mine geometry survey data, haul roads, bench layout, drilling and blasting equipment location, fragmentation information, mucking equipment location and production data, haul truck fleet positions, payload, operator name and shift number, machine status, time until next maintenance, and time since last refueling. Different types of data can be included, such as iconic representations of equipment locations, animation of shovel motions and fleet movements, still images of surge pile height or cracks being monitored in structures, video clips of mobile equipment and material on conveyors, even sounds of processes. The virtual world offers a uniform interface to heterogeneous data. Because most of the mine model geometry does not have to be updated regularly, a virtual world is an economical way to show a virtual environment over low-bandwidth communication links. The virtual world updates its display from databases or direct data streams from on-board systems. The user can interact with the virtual world to zoom in for more detail, and click on objects to pull up additional information not normally displayed. This representation is a very intuitive user interface; the user simply flies around or clicks on a location of interest to get associated information. For example, connecting monitoring equipment over a wireless network to a graphics workstation allows equipment condition to be monitored and production to be animated in real-time. Figure 3 shows how information about mining equipment can be displayed in a “virtual mine,” either by zooming in for displayed information of machine status, or by linking to spreadsheets that track process data. Because the virtual world allows interactions with the user, one of us has actually operated an excavator remotely using this system [Lipsett 1998].

Virtual Mine

Mill Process Status

Machine Status

Figure 3: Mine Status in a Virtual World


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In a mine information application, a full 3D representation may be unnecessary. For a surface mine, a 2D map with an icon for each piece of equipment and process component is sufficient, and easier to navigate. Clicking on a machine icon brings up a schematic or other view of the machine, which is then interrogated by point and click for information of interest. Virtual worlds are accessible in web browsers with plug-ins for viewing sites in Virtual Reality Markup Language (VRML) format. VRML does not yet allow for full interactivity, although the standard calls for such functionality. With improved graphics rendering capability in desktop PCs, virtual worlds will soon be an effective means for visualizing mining processes.

Machine Communications Machine communications means computers talking to computers. Such communication may be a workstation talking to a server within the same organization or across organizations, a data acquisition computer on a piece of mobile mining equipment sending data to a process data management server over a dedicated link, or a miner’s handheld computer downloading an electronic maintenance procedure in the shop. LAN and Internet connected computers have standards for network communications. Mining suffers from the “last-mile” problem of getting planning information to workers on equipment, and collecting production and status information from the mine to make operational decisions. Surface mining operations for oilsands are becoming increasingly physically removed from the mill (bitumen extraction plant and upgrader). Economies of scale and expanded production will reduce unit operating costs, with the result that, per item of production mining equipment, oilsands mining companies will have fewer staff managing the mining assets. Optimized production and maintenance will only occur with timely and accurate measurements of machine state. Because fewer people will have to make more equipment work better at longer distances, there is an increasing need for remote monitoring of mining processes. Ultimately, some remote operation of equipment will also be done, reducing the need for operators to travel to the work site. In underground mining, CATV and leaky feeder communication systems provide high-bandwidth communication links within the mine. In the harsh environment underground, maintaining the system is a challenge, but it is possible to have highly reliable communication with the surface. From the surface, terrestrial or satellite communications allow data transfers to other operations, head office, vendors, and other providers of goods and services. Truck and shovel bench mining is the preferred bulk mining method for oilsands: mobile equipment requires mobile monitoring systems. The present measurement infrastructure is limited to point-to-point data serving and low bandwidth broadcast of fleet dispatch and alarm codes. Vendors have not offered a strategy for serving data other than a limited set of specific parameters (identified by them), either through licensed FM dispatch radio systems or ISM-band, spread-spectrum point-to-multipoint radio systems. For condition-based maintenance and advanced performance monitoring systems, additional monitoring systems must be deployed. If a vendor offers a system that is not expandable, then a custom monitoring system must be developed. Commercial off-the-shelf (COTS) solutions are preferred, as they can be supplied and supported by a number of technology providers. COTS mobile computing systems are generally based on TCP/IP protocol, which fits a WAN architecture. There are three types of monitoring applications: • •

Temporarily installed data acquisition and analysis computers, Permanently installed embedded computers that collect a range of data, so significant on-board processing, and transmit processed results, and • Permanently installed small, embedded systems that monitor a few parameters on an occasional basis, and communicate only in alarm conditions. Embedded computers include microcontrollers at the low end, and Intel-based PCs running a stable operating system (OS) at the high end. For example, Aquila’s AMP system, Caterpillar’s VIMS and CAES all contain PCs. For simple monitoring jobs, a few sensors can plug into a microcontroller that does simple CIM Bulletin – May 1999

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data reduction and logical testing for alarm conditions, and then sends a symbolic (text) message to the miner who has to take action when a fault occurs. The person receives only the required information in a timely and accurate manner. Telemetry from an embedded system should be flexible enough to use different media: direct network connection, public telephone system (modem or cell modem), two-way pager, or radio network. When communicating directly with people, the communication method will depend on the receiver’s preference, and the available bandwidth. A supervisor or inspector reviewing machine status at a desktop computer can check a form, an annotated schematic or digital image, listen to an anomalous sound file, or view a video clip. A miner in the field may prefer to get information as a pager message, and email message, a fax, or even a voice mail message. In this regard, machine communications emulate human communications. Figure 4 illustrates how information can be collected automatically, archived for review, and used to modify operations to suit changing conditions.

Figure 4: Machine Communications to Improve Human Decisions

Conclusion Technological change and organizational restructuring have been observed to bring gains in productivity and market share in other industries. The opportunities exist for the Canadian mining industry to undertake Business Process Re-engineering through EC. The scenario presented in the opening of this paper is only one illustration of the possibilities that can be achieved through the implementation of EC in the mining industry. A further example might have referenced the relationship with a mine's customers and the opportunity to market mineral and metal products directly via the Internet. Whatever the application, the following observations appear to be significant when contemplating the implementation of EC [Kearney 1998]: •

Be prepared to introduce novel changes to processes and radically change the way business is presently conducted in the non-connected environment. EC is a strategy, not a technology implementation.


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Mottola, L.; Lipsett, M.; Scoble, M. Transforming the Mining Industry through Electronic Commerce •

Start with a pilot project on a small scale to achieve quick results and generate excitement about the use of electronic commerce.

The Internet is an enabling technology, providing a forum where people can “meet” electronically to do business. As business systems become computer-based, business methods are evolving to take best advantage of this new forum. While computers can automate some business processes and transactions, humans must still make those decisions that involve incomplete information. EC can only work when there is effective means for these systems to make someone’s job easier and more productive. Technology is the easy part of the answer. People still have to use these systems, and they have to understand system limitations to use this powerful set of business tools well. Trust relationships have to extend beyond the boundaries of a corporation, as information flow increases. The value of business information as a commodity of its own will be part of these new ways of doing business. The full impact of EC will only be attained though a significant investment in both education and technology.

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