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Nearly three years ago, on Wednesday, June 20^th, 2020, I made a declaration that I was on a mission to repair the Owner-Contractor relationships in the mining industry.

Since then, I’ve been through a series of ups and downs on my pursuit to impact change.

Today, one thing is clearer than ever.

That is, in order to repair Owner-Contractor relationships in the industry, a transformation in the way we think is an absolute must.

We simply can’t go from an industry primarily composed of Zero-Sum thinking, to one of trust, partnerships, and collaboration.

No, instead it takes a transformation in thinking.

Which begs the question...How does one go about transforming something that seems to be encoded into our industry DNA?

Then it occurred on me… the way we change the industry is one person at a time.

In order to effect lasting change in a seemingly stagnant industry, stuck in the old way of doing things, we need individuals throughout the industry who think bigger.

And how do you go about transforming one person at a time?

A coach, a mentor, a new perspective and a new set of skills – that’s how.

Hear me out…

A few years ago, I came to the realization that each time I had undergone a significant transformation in my life, whether it be in my professional life, in relationships, in sports, or otherwise, it was with a coach.

Someone who could listen to my desires, help me to diagnose my challenges, and then work with me to develop a plan to accomplish my objectives.

You see, it’s really freaking hard to stand in front of a mirror, assess your own cognitive process, and then actively modify your thought patterns to achieve different, desired results.

Those of us fortunate enough to have had a mentor, we know the intrinsic value created when someone takes us under their wing and shows us our world through another perspective.

It can help you see your world differently.

I know it has for me more times than I can remember.

I’ll give you an example.

When I first started in the industry, I was a young buck working as a Contracts Administrator at an underground mine, as part of the Supply Chain Management organization.

This was about the same time SCM organizations around the world started aggressively pushing “cost savings” as their primary reason for existence.

And one of the ways we were pushing cost savings was by egregiously extending payment terms for contractors and vendors.

I was so green in my role, I didn’t understand how STUPID this was!

I was out there pushing Net 60, 2/10 Net 45, etc. thinking I was doing something beneficial for the business…making the company successful one nickel-squeeze at a time.

I remember the first solo business trip I took from Denver to Salt Lake City – I was there to negotiate a major coal contract to supply a soon-to-be-commissioned 200MW coal-fired power plant in Nevada.

At the time, the head of our SCM organization was pushing 2/10 Net 45 payment terms (e.g. the owner would take a 2% discount off of the invoice if they, the owner, paid in 10 days, or no discount for making a payment within 45 days).

I remember being surrounded by seasoned executives on both sides of the table.  When the meeting agenda came to payment terms, our technical lead kicked the negotiation over to me, and off I went trying to bend the coal suppliers to my will of 2/10 Net 45.

Looking back, I feel a bit ridiculous.  I thought I was doing good by trying to wrap their payment term elbows around their backs… hell, my yearly bonus was even tied to how I well I did and how much I could ‘save’ the company.

It wasn’t until one of my now longest standing mentors explained to me the way cashflow supplied the lifeblood of a contractor/vendor’s organization and the unintended consequences it caused to our net detriment.

For contractors/vendors, cashflow is the lifeblood of the business

Without it, contractors can’t operate effectively or efficiently, which translates to higher costs passed on to mining clients.

I bet the coal suppliers saw this from a mile away and upped their prices by 5% (or more), which made it easy for them to ‘concede’ to my request for a 2% discount.

And for what?  An extra 15 to 30 days of cash in an owner’s bank account?

It’s a fool’s trade.

I’d like to think I would have come to the same conclusion myself eventually…

But having a mentor taught me a valuable lesson, while the rest of the SCM organizations were busy drinking the cost-savings Koolaid.

What he taught me is the important lesson that owners and contractors are different…

They have different priorities, different assets, different business models.

This translates into different needs, and needs influence actions.

He taught me that in order to understand why a contractor behaved the way they did, you need to understand human behavior – why people do what they do – and how to influence behaviors to get the desired outcome.

It wasn’t about screwing a contractor, it was about understanding what makes them tick, and finding mutually beneficial ways to work together for the common good.

It sure isn’t rocket science, but it is a science nonetheless.

Which is why we are on a mission to develop the next generation of leadership.

Because developing the next generation of leadership gives us the best possibility of accomplishing our mission of transforming the way we collectively think about partnerships in the industry.

We don’t need any more young-buck-Jasons out there, ignorantly negotiating for discount payment terms for paper ‘savings’ that don’t focus on what really matters… value. Even causing damage to the critical relationship for what amounts to nothing.

The old way of one-sided business and carrying a big stick is evidently failing us.

Instead, we need to next generation of leaders equipped with new thinking, better thinking, in order to impact change.

One person at a time.

Is that person you?