What is the secret to success for manufacturers operating in the mining equipment, technology and services (METS) sector? Brent Balinski spoke to a few to try and find out.

The application of data-driven technologies (and things like shifting appetites for energy sources) mean mining is changing rapidly. Exactly what the next decade will deliver is a guessing game, but the country’s number-one export industry, and the METS sector supporting it, will remain important to national prosperity well into the future.

Some parts of METS have been on the wane since the peak of resources investment in 2012, such as heavy machinery. IBISWorld estimates mining and construction machinery has shrunk by around 11% annually in the last five years. However, manufacturing makes up more than four-tenths of the METS sector, and there are manufacturers who are thriving. According to consultancy VCI, local METS businesses enjoy various natural advantages: operating in the world’s biggest, most sophisticated mining sector; proximity to Asia; and a talented workforce.

With mining, as with all of manufacturing, the future belongs to those manufacturers who can work smarter and adapt. According to extensive industry consultation in 2016 by METS Ignited, one of the Federal Government’s six Industry Growth Centres, success will involve factors like collaborating earlier and more effectively, aligning with the roadmaps of major miners, and closeness to the customer throughout the entire innovation cycle.

Ric Gros, CEO of METS Ignited, says the proliferation of data is changing the nature of innovation, citing the use of this in Industry 4.0-type applications.

“Anywhere in the value chain, if you’re leveraging Industry 4.0, your products and services will become faster, will become more economical and more effective,” says Gros. “Productivity levels in the mining industry have been going down on the back of mines getting deeper and grades getting lower. So the opportunity is anywhere where you can support improvements in productivity, and maybe a lot of that will come from leveraging what Industry 4.0 can bring to you.”

According to Gros, collaboration is becoming more important to success, both for miners and their suppliers. Where collaboration is strongest in the world, he adds, the same can be said of innovation, and the necessity of collaboration is changing the approach of many major miners.

Gros recently returned from Chile’s Expomin, and observes that the conversation among the global powerhouses is changing their approach to collaboration, realising the old ways of procuring don’t always work. He cites Codelco’s establishment of Codelco Tech to bring outside innovation into the company, and conversations with BHP mentioning open innovation.

This could be good news for Australian companies, who have, according to METS Ignited’s research, often struggled to break into the supply chains of Tier One miners, which “have looked to global OEMs in the main for collaboration and strategic relationships”.

The METS sector, of which export businesses make up 66%, makes a healthy contribution to the overall mining sector. Together, according to Deloitte Access Economics, it created $237bn in economic activity in 2015-16, and one-tenth of all Australian jobs. AMT spoke to three award-winning Australian manufacturers, each supplying local innovation to export markets, about the reasons behind their competitiveness. Here’s hoping the Tier One mining firms are paying attention.

Movus – “Does it make a horrible screeching noise?”

While some of the world’s biggest engineering companies have invested heavily in developing Industry 4.0 platform solutions, Brisbane-based start-up Movus sets itself apart in a very important way. Its FitMachine offering – a fleet of orange, hockey puck-like sensors that magnetically affix to machines – does not require a business to reinvent its operations and culture.

“What we’re trying to do is give the average maintenance engineer, reliability engineers, all those guys that work so hard to keep industry up and running, another tool that gives them the edge,” says Brad Parsons, Movus’ CEO and co-founder. “We’re trying to solve ‘Is this machine going to fail and when?’ That’s the key problem we’re trying to solve. We’re not trying to control the machine, to shut down the machine, to provide all those elements.”

The deliberately simple solution monitors the operational efficiency of machines. Sensors pick up and communicate three main types of information to the cloud, where machine-learning algorithms convert this data into something easily understood on a dashboard, accessible on a phone or tablet.

“We get new use cases pretty much every week, where somebody says ‘Can you monitor that?’ It’s like: ‘Yes, does it vibrate, does it get hot, or does it make a horrible screeching noise if it fails?’” Parsons explains. “It’s a bit more than that obviously, but that’s the general gist.”

The sensors take five minutes on average to install, using a five-step process prompted by an app. Each rapidly self-learns, comparing a machine’s behaviour to itself, and sending alerts if there’s an issue. The company is up to version seven of its sensor packages, which are manufactured by Brisbane’s Intellidesign. Sensors for the FitMachine solution-as-a-service (customers do not buy the sensors) can be updated over the web.

“We continue to get feedback from our customers, and they’ll say ‘What about this?’ or ‘Could we have that? It’d be really great if we could use them under this circumstance’,” explains Parsons. “We incorporate that back not only in the hardware but also on the software, be it on the sensors or all the way through to cloud and AI.”

The industrial IoT solution is suitable for a wide variety of machines, from chillers to fans to motors. It has obvious application for the mining industry, which puts a premium on maximum uptime for critical machinery, often operating in remote locations. According to Movus’ customers, about 60% of inspections add no value, and while maintenance can be made smarter and more efficient, unplanned downtime through machine failure can be particularly costly.

“Single machines could take out half a million dollars a day, and a single machine can take a plant down,” says Parsons. “So for them it’s really about identifying where the critical points are. So for example, coal process plants, we’ll be on 20 different types of equipment. From pumps, motors, screens, to you name it.”

At the moment, most of Movus’ clients exist outside of the sector, including in transport, building management and manufacturing. However, the appeal of Movus’ technology for mining applications is obvious, and was recognised via a KPMG Energise Accelerator Program Award in 2017 (Investor category). Parsons’ background includes a senior consultant role in Mining IT at CSC, whole another of the company’s founder has two decades’ mining industry experience.

The company’s potential in mining was also validated recently through a $4.8m Series A backing in April, with Telstra Ventures, Blackbird Ventures and Skip Capital among investors. According to The Australian Financial Review, revenue growth had been 30% per month for the 12 months before that. Parsons says the new investment will help move the company into new headquarters (it is currently on campus at University of Queensland) as well as improving the sensors’ functionality and hiring engineers who can find ways to better dig data-based insights out of what the sensors are capturing.

“Really the basis of the businessis to really transform the way industry does machine monitoring, machine management, machine maintenance,” says Parsons. “The personal drive for me was really: when you look at the world’s industries, they’re all backed by machines. And they use half the world’s energy through machinery. So we do something good for the planet, something good for industry, make people safer and more productive.”

Enduraclad – A trusted supplier

Though some startups (and established businesses) are staking their future on the Internet of Things (IoT), the future of mining will always involve things. Enduraclad International specialises in things, including hardfaced wear plates of chromium carbide and tungsten carbide, quenched and tempered wear plates, and ceramic liners. Based in in Henderson, Western Australia, the company has grown rapidly since Managing Director Jason Kell started the business from scratch in 2011.

Today Enduraclad’s headcount is around 40 staff across three workshops. Its capability statement tells you its core capabilities include automated sub-arc welding, CNC plasma and oxy profile cutting, stud welding, and plate pressing (up to 450 tons).

Enduraclud started out with donated tools and a borrowed plasma cutter, following Kell’s 15 years’ experience in various roles in New South Wales, at Cutting Edges in Revesby, and AOA in Wollongong. In those early days the business, Kell explains, depended on getting established companies “to give me a go”, and in turn to “build relationships with suppliers and gain trust immediately”. Funding purchases without cash meant building faith with suppliers “that I would be good for the money once I was paid from my customer”.

“This meant often having an open-book policy with my suppliers knowing who my customers were and how much I sold my items for,” Kell adds. “This may seem odd – however as I strengthened relationships with this, I was able to build a large customer base quickly knowing my suppliers would not go behind my back to secure the work direct. When an open-book policy is put into practice, the trust quickly follows.”

Enduraclad has established itself as a highly successful firm, mainly serving mining and earth-moving, but Kell adds: “There are key strengths in many applications unknown to our competitors.”

The company’s rapid growth won it a WA Telstra Medium Business Award last year. It has also recently undergone a Lean transformation with Think Perform to improve operations, prepare for its next phase of growth, and to help seize international opportunities.

“Exports are important for Enduraclad as it give us a chance to showcase our products to the world,” says Kell. “I aspire to grow Enduraclad and make it attractive for future leaders to take over one day and continue on its success.”

HMS Group – A load of potential

Jamie Howard has been involved in mining engineering his entire professional life. HMS Group, the full-service mining business he owns, operates within one of Australia’s major resources hubs: the Hunter region in NSW. Underpinned by his professional expertise and collaboration within this local ecosystem, Howard began development on the HMS Mini Loader in 2008, and it has started to get recognition in the last few years, including a third straight year of awards at the Diesel, Dirt and Turf Expo, a board award at the Hunter Manufacturing Awards, and a NSW Mining Suppliers Award.

The remote-controlled vehicle can handle loads up to 200kg. Its knee-high profile allows it to zip under operating conveyors and clean up spills. This saves the worker this back-breaking task and can save a coal-mine owner between $100,000 and $200,000 through not having to stop the conveyor.

“We’re getting a lot of calls now,” says Howard. “Manufacturing-wise, we’re very busy, for the local market as well as the international market. Business is thriving at the moment.”

Getting to this point from an idea in 2008 was not cheap or easy, and was not undertaken in isolation. Howard personally spent roughly $4m on R&D. About 20 HunterNet members contributed to the development of the loader. And of course, getting mining houses to pay attention to an Australian SME is a challenge.

“To engineer a machine is very easy; the commercialisation side is the hardest thing,” Howard says “We come from a mining manufacturing background, and we’re comfortable in that space, but to make a machine and commercialise it around the world is the hardest part: to have the major mining houses – companies in Brazil, Chile and also China – to recognise what you can offer them.”

He credits the assistance of the HunterNet business network, the Advanced Manufacturing Growth Centre (AMGC), and the Entrepreneurs’ Programme’s Accelerating Commercialisation grant. A HunterNet trade mission to China in 2014 exposed Howard to the potential of the Chinese market, which has roughly 10,000 minesites, mostly coal, according to Austrade. The Accelerating Commercialisation grant funded two Mini Loaders to be shown at the China International Mining Expo in 2016, leading to a channel partnership with JKZZ: crucial for becoming an international company.

“We’re now exporting all around the world, and what is nice to see is the global market recognising how innovative our company is,” says Howard. “We’re outside the box, and that’s what is highly attractive to all these companies. It’s about lowering operational costs, and to work smarter.”

The product also has potential in industries such as construction and manufacturing, and can be fitted with attachments including a trencher, forklift and sweeper. Howard declines to discuss current R&D efforts, but says these will always be important in staying relevant.

It has not been an easy path to international recognition and sales. Howard says what has been important has been a willingness to collaborate outside the company and offer something that provides an obvious way for a mining client to do their job cheaper and smarter.

“Companies are always approaching us to try to reduce operational costs, and with our technologies, we achieve that,” he says. “Regarding the conveyor belt systems, they don’t need to stop those, hence not having the labour force working around the hazards. And we’re reducing their risk.”

www.metsignited.org
www.movus.com.au
www.enduraclad.com.au
www.hms-group.com.au