--- title: How Technology Helps the Mining Sector Conquer 10 Common Operational Challenges description: Discover how technology empowers mining companies to overcome 10 common operational challenges, from contract management to cost control. image: https://blog.managementcontrols.com/hubfs/Mining_Tablet_Guy.jpg --- [Skip to content](https://blog.managementcontrols.com/how-technology-helps-the-mining-sector-conquer-10-common-operational-challenges#main-content) Search - There are no suggestions because the search field is empty. 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[Track University](https://managementcontrols.docebosaas.com/learn/signin) - [Company](https://blog.managementcontrols.com/how-technology-helps-the-mining-sector-conquer-10-common-operational-challenges#) Show submenu for Company - [About MCi](https://managementcontrols.com/company/about-mci) - [Meet Our Team](https://managementcontrols.com/company/meet-our-team) - [Upcoming Events](https://managementcontrols.com/events) - [Our Customers](https://managementcontrols.com/company/our-customers) - [Careers](https://managementcontrols.com/company/mci-careers) - [Contact Us](https://managementcontrols.com/company/contact-us) MANAGEMENT CONTROLS BLOG # How Technology Helps the Mining Sector Conquer 10 Common Operational Challenges Posted by  [ Bruce Grissom ](https://blog.managementcontrols.com/author/bruce-grissom)  on  Tue, 29 Oct 2024 09:45:00 -05:00 ![](https://blog.managementcontrols.com/hs-fs/hubfs/Bruce_HS.jpg?width=50&name=Bruce_HS.jpg) Find me on: [**](https://www.linkedin.com/in/bruce-grissom-19273439/) [![](https://blog.managementcontrols.com/hubfs/2024%20Website%20Dev%20Assets/linkedinshare.png)](https://www.linkedin.com/shareArticle?url=https%3A%2F%2Fblog.managementcontrols.com%2Fhow-technology-helps-the-mining-sector-conquer-10-common-operational-challenges&title=%3Cspan+id%3D%22hs_cos_wrapper_name%22+class%3D%22hs_cos_wrapper+hs_cos_wrapper_meta_field+hs_cos_wrapper_type_text%22+style%3D%22%22+data-hs-cos-general-type%3D%22meta_field%22+data-hs-cos-type%3D%22text%22+%3EHow+Technology+Helps+the+Mining+Sector+Conquer+10+Common+Operational+Challenges%3C%2Fspan%3E) ![Mining_Tablet_Guy](https://blog.managementcontrols.com/hs-fs/hubfs/Mining_Tablet_Guy.jpg?width=657&height=438&name=Mining_Tablet_Guy.jpg) Recent U.S. laws have driven a wave of [proposals](https://www.technologyreview.com/2023/03/13/1069658/us-minerals-industries-are-booming-heres-why/) for new mining, minerals processing facilities, and battery plants, aimed at reducing dependence on foreign suppliers by strengthening domestic supply chains. Australia, with its vast mineral resources and strong trade ties with the U.S., plays a key role in this shift toward more local sourcing of critical materials  Both nations are preparing for growth in clean technologies and electric vehicles, determined to avoid the supply chain disruptions of 2020. Australia, particularly, stands to benefit as a major supplier of essential minerals like lithium and cobalt.  The U.S. [Inflation Reduction Act (IRA)](https://www.technologyreview.com/2024/01/25/1087027/climate-subsidies-inflation-reduction-act-mining-critical-minerals/) is a prime example of legislation supporting this shift, offering EV tax credits for vehicles that meet specific requirements, including sourcing minerals from the U.S. or free trade partners like Australia.  As this momentum continues, mining leaders in both countries must tackle operational challenges, particularly in managing contractor spending, where technology can offer powerful solutions. Let's explore the top 10 challenges facing the sector and how technology can help solve them.  ## How Technology Ensures Vendor Terms and Conditions Accuracy  **1. Contract vagueness** – Field personnel responsible for work execution seldom have access to vendor contracts or knowledge of an individual contractor’s contract terms and conditions. Technology closes this gap allowing field personnel to focus on safety and efficient execution of work. **2. Incomplete and inaccurate timesheets** – Mine site supervisors don’t have access to gate information or the vendor’s contract terms and conditions. As a result, vendors add things to their timesheets that they are not eligible for and haven’t earned. Technology closes this gap by auditing who comes in and out of the gate in real-time connecting everyone to their vendor contract terms and conditions. This quickly gives management the information needed to pay what vendors have actually earned.    **3. Unconfirmed labor charges** – This occurs when mining companies have work performed outside of access control systems and can’t confirm the information in its entirety. Contractor spend management technology closes this gap by taking real-time data from the access control systems, which saves time, reduces paperwork, and ensures accuracy.  ***![Mining_Control_Panel](https://blog.managementcontrols.com/hs-fs/hubfs/Blog%20and%20Social%20Images/Mining_Control_Panel.jpg?width=657&height=262&name=Mining_Control_Panel.jpg)*** ## Using Technology to Close Financial Gaps  **4. Unverified equipment and material charges** – Mine site supervisors don’t have access to the complete picture for equipment charges or material markups. When a vendor submits an invoice for rental equipment and materials with or without a timesheet signed by management, auditors can’t verify its accuracy.     Technology closes this gap by ensuring, for example, that the lowest possible rate for each individual piece of equipment is applied and that the markup on materials is accurate. It gives the client a real-time view of the allocations and holds the vendor accountable for agreed-upon terms. **5. Mixing up time and material vs. lump sum **– This can lead to double billing for both labor and equipment. The right software platform can ensure all contractors and equipment are paid for the exact number of hours they earn each day or net-billable time. Technology closes the gap and eliminates double billing. **6. Payments processed without invoice verification** – This happens because they are three groups involved in work performed at a mine. Procurement creates a great contract. Maintenance, Capital, and Outage/Turnaround execute work at the sites. And Accounts Payable processes the invoices. Technology closes this gap by automating the entire process, allowing each group to focus on what they do best. Technology also audits every approval by field personnel in real-time, eliminating the gap in the time it takes vendors to invoice.   ## Conquering Human Error and Lack of Oversight with Technology  **7. Inaccurate purchase order allocation for labor, equipment, and materials** – This is a widespread problem due to the number of manual handoffs. Mine site supervisors don’t know what is in vendor’s contracts because they haven’t read or don’t have access to contracts when they sign a timesheet. Vendor supervisors include things on timesheets they are not entitled to per the contract terms and conditions for that site. Contractors and equipment may be recorded on multiple timesheets for the same time period or at the wrong rate/skill. Materials recorded on multiple timesheets with incorrect markup. Vendor Timekeepers transfer charges from timesheet to invoices for the wrong cost object. Technology closes this gap by fully automating the entire process, from contract creation to invoice processing.   Contractor spend management technology knows which contractors, equipment, and material markups are accounted for and automatically applies all contractual terms and conditions.   **8. Invoicing incorrect skill classifications and non-billables** – Craftsmen at different skill levels should be paid at different rates, but this can easily be handled inaccurately without the right technology. For instance, a mining site could have four skill levels of blasters paid at four different rates. When supervisors sign off on timesheets, skill classifications are not typically included. These blasters might be invoiced and paid the wrong, highest possible skill rate, even if they have not been approved for the increase.    **9. Liabilities exceeding purchase order amounts **– Most sites rely on their vendors to notify them when POs are about to reach their limit. Technology closes this gap, putting controls in place to notify the site leadership as POs near their limits. Also, the data is in real time and is not dependent on invoice timing, thus eliminating late invoicing surprises.     **10. Discrepancies caused by using expired contracts and rates** – As contract terms and conditions change during ongoing projects, the opportunity for errors will increase. Technology closes this gap. Mismatch errors are generated in real time, and vendor timekeeper personnel to take corrective action prior to invoicing.   ***![Mining_people_blog](https://blog.managementcontrols.com/hs-fs/hubfs/Blog%20and%20Social%20Images/Mining_people_blog.jpeg?width=657&height=370&name=Mining_people_blog.jpeg)*** ## How Contractor Spend Management Technology Transforms Mining   Too many mining organizations make operational decisions in the dark by using siloed, home-grown systems. If the above scenarios sound familiar, consider alternative solutions for managing your vendor’s labor, equipment, and material spend. The right platform should measure, track, and help you make more informed decisions around routine maintenance, shutdowns, turnarounds, outages, and more—all in one place.  Contractor spend management technology is necessary for mining companies that want to comply with governmental regulations. It provides proof of compliance for things like journeyman to apprentice ratios and prevailing wage requirements.  The multi-billion-dollar mining industry is poised for significant change and growth as the U.S. and Australia seeks to bolster its supply chains with metals vital to the energy transition movement. According to [Deloitte](https://www.deloitte.com/global/en/about/press-room/global-mining-metals-report-explores-key-trends-shaping-industry-future-2024.html), “While many mining and metals providers are already influential forces for economic development, there is a tremendous opportunity for them to become greater instruments of progress.”  With those opportunities come these 10 common operational challenges. But mining industry leaders can conquer them with the help of the right technology, like a contractor spend management platform that can help mining companies overcome hurdles and find widespread success.   Take the next step—learn how myTrack helps mining companies be more successful. 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