CISCO: 'It's Very Expensive To Do Business Here, And It's Starting To Affect People's Lives'

The rising cost of doing business in Australia isn’t going to go away in the short term and it’s starting to affect people’s lives.

Persistent market volatility has in the past 12 months forced Australia’s mining sector to make fundamental changes within their businesses in order to combat falling productivity rates, improve profit margins and maintain investor confidence.

According to a Deloitte report released earlier this year the cost of adding extra capacity to an existing iron ore operation in Australia has jumped from $100 a tonne in 2007 to $195 a tonne in 2012 while over the same period labour productivity fell.

Rio Tinto and BHP Billiton both realised to bring their businesses back in line cost control and productivity improvement programs needed to be implemented.

But to continue to boost productivity in the years ahead innovation will need to be injected into the sector.

Speaking at the Cisco Live conference in Melbourne today the networking company’s Vice President for Australia and New Zealand Ken Boal said miners were now demanding automation, and complete pit-to-port solutions to address productivity issues.

“Three or four years ago no one wanted to know [about innovation in mining], now with the economic factors people want to know about automation,” Boal said.

He said the current mining market is favouring Cisco’s business.

“We’re being pushed by the miners to come to the table and address the issues,” Boal said.

He said that while both Rio and BHP’s remote control centres were advanced, achieving the next level of productivity would require a common platform, more sensors, more capabilities, and enhancing autonomy at the remote operation level.

Boal said with changing economies innovation needs more attention from business and government alike.

“It’s very expensive to do business here and it’s starting to affect people’s lives,” Boal said.

“We need a vision, business and government leaders are searching for more productivity – we’ve got to get innovation back on the agenda.”

Boal said the productivity boosts a digital economy can deliver will take Australia forward.

Future productivity improvements and economic growth is going to emerge out of the ‘Internet of Everything’, a concept which Boal said will change the way companies do business, transforming the way people connect with the world, and how the world connects with people.

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