Technology Metals Review – Is it really all about Culture?
Well, here we are again, still in the rare earths doldrums with nothing of significance to talk about. Time for a change of tack. So I thought I would add to my previous writings and talk about the glue. That’s the stuff that holds it all together. And for the uninitiated, that glue is called culture.
You will, hopefully, have read all of my works on rare earths over the last few years on the science, the technology, the resource and it’s development, plus the skills and qualifications of management (well you can go back here and catch up). You will also have read at length about the success factors in rare earths development. But I haven’t as yet introduced the Corporate culture to the discussion. Why not? Well, you really need to understand all the other important components first before you can fully comprehend why I think culture is so critical to the success of a rare earths development, particularly outside of China.
So what is culture?
My Wikipedia definitions state:
“that complex whole which includes knowledge, belief, art, morals, law, custom and any other capabilities and habits acquired by man as a member of society.”
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“a social domain that emphasises the practices, discourses, and material expressions, which, over time, express the continuities and discontinuities of social meaning of a life held in common.”
“the way of life, especially the general customs and beliefs, of a particular group of people at a particular time.”
And many others around a similar theme. That theme, I put simplistically as: “The way things are done around here. It’s who we are, it’s what we believe, it’s what we stand for and at the end of the day, it’s the way we operate.”
So what has culture got to do with the development and operation of a rare earths project? (Or any project for that matter). Well, picture where we are today in the rare earths space. Obviously outside of China, but realistically out in the cold in terms of experience in rare earths development and operations. Let’s face it. We have not done this before! Well, not in recent memory. All of the previous expertise has gone by the way side. Anyone who wants to get into this game starts from scratch. Yes, you can leverage off knowledge, experiences and lessons from other projects but is rare earths different to nickel? Think about how far China has taken the quality standards since Molycorp shut up shop 20 years ago. The processing world is a different place now. Who are you going to be? How are you going to tackle the quality chasm that has opened up? What culture are we going to see?
In Australia at the moment, there is a big brouhaha about compliance, particularly around banks. Everyone is insisting upon a culture of compliance. Hmm. What would that look like? What structures, processes and practices would be evident? I would expect lots of tick the box rear-end covering. You would have to have a properly functioning whistle-blower process in play. Can you imagine working in compliance mode, ticking boxes on processes and outcomes, always looking over your shoulder in case a potential whistle-blower has you in their sights? I’m sitting here thinking of examples of resource companies who are espousing this compliance culture. And coupled with a hard line approach to cut costs, to operate at minimums, to pare to the bone. Can you imagine this culture being employed at a new to be developed rare earth hopeful? Can you see this culture as being successful in getting that project up and running against the Chinese competition? Can this culture resolve the quality chasm? Methinks not. Sure compliance is important. Sure cost control is important. But together! And as the highest priority items in development mode of a brand new industry! For my mind it’s a sure fire recipe for failure.
So what do I see as the approach to a successful culture? A culture that will take on new challenges, a culture that will stare down the adversity of changed technology, a culture that will welcome every opportunity to equal if not better the current Chinese performances. That culture is one of excellence. A culture where we do whatever is necessary to achieve superior results, where we challenge technology norms looking for better processes, where we all (and I do mean all) work together every minute of every day to work for a better future for our project. And we do so willingly. Not because a potential whistle-blower may be watching, not because we are trying to sail close to the wind with the regulator, not because it is the cheapest option, but because that is the way we work. We strive for excellence. But striving without guidance is like me taking on a Sumo wrestler. Well at wrestling that this! Destined to fail unless the guidance is ingrained, unless the acceptance of striving for excellence is ingrained (and the learning from failures), and unless all of us work together with excellence as an engrained goal.
This is not an easy culture to establish, this culture of excellence. But it can be done. If I can relate an example. I was asked to manage a newly commissioned chemical plant that was going through some teething problems. The previous manager was on his way home after his contract term had expired. Performance was below budget, costs were high, quality was so-so, housekeeping was poor, and employee relations had some improving to do. Six months later, the tonnes were above expectations, the costs were world class, the quality was peak-a-boo, the employees were happy, but the housekeeping! The chemical plant was to a new standard in housekeeping. We had a Zen Garden under the kiln so you could sit and relax over lunch, we had a themed walk-through garden that each employee passed through at the start and end of each shift, we had grape vines growing up the conveyor trusses. “Why?” I was asked. I replied: “Because you can!” If you strive for that culture of excellence and you bring all (there’s that word again) of the people with you, you can achieve something very special. And that is what is needed. In fact, I think it is essential, that a culture of excellence can be the only way to a successful rare earth development. Now how to do that? See you next month.
P.S. One year after my moving on, that same plant was back to crappy housekeeping with the gardens etc neglected, the grape vines gone, no Zen lunch. Still getting good tonnes and costs (but not improving). But the environment! A similar question was relayed to me. How can a culture deteriorate so quickly? I replied: “Because you can!”
Mr Mackowski is a qualified engineer in mineral processing with over 30 years technical and operational experience in rare earths, uranium, industrial minerals, nickel, kaolin ... <Read more about Steve Mackowski>