When Xstrata bought MIM Holdings in 2003, there was an opportunity to create a new workplace culture in the north Queensland business, which covered copper, zinc and coal, ran 15 operations and employed in excess of 6000 people. Chief executive Charlie Sartain asked his leadership team on ways of engaging people in the business to create value. So they took to the floor, and managers and executives became part of interview teams that spoke to 450 people at every level to procure their ideas.

Xstrata head of human resources David McLoughlin said what emerged was a clear picture of what worked and where the roadblocks were. There was too much bureaucracy; managers had to talk to five or six levels of leadership to get a decision; there were endless loops of non-value adding paperwork; and people were bored, frustrated and feeling too stifled to be creative and innovate.

“It was the exact opposite of the culture we were trying to create,” he said. “People wanted challenges, opportunities where they could make a difference, opportunities to develop new skills and recognition for the effort they had put in and the value they had created.”

The resources boom had already created a massive skills shortage, a high turnover rate and a need to generate interest among local communities to ensure a new workforce. McLoughlin said it was obvious during this change process that Xstrata had to understand and promote what it was that the company offered as a business that its competitors did not.

The company took a broad view, not only to improve internal operations, but also to look outward to the community to educate them about mining and opportunities for work; and become proactive in creating towns where people wanted to live and stay.

Within two years, there have been tangible results: staff turnover sits below 15% in an industry where the average turnover rate is between 30% and 40%, and safety performance is at record highs. On a local level, new businesses and services are moving to Mt Isa and there is a mini-housing boom that has prompted Xstrata to donate a large parcel of land to the council to build an estate called Healy Heights.

Education and training

One of the main challenges facing Xstrata was to create a skilled workforce to fill the growing number of vacancies in a booming industry.

At an International Education Forum in Brisbane in April, McLoughlin said Xstrata had two strategies: to look 10-20 years ahead and try to create policy and curricula that would serve the future; and to work in local communities to create real pathways, real opportunities and real skills.

The approach has been broad and lateral, looking for real opportunities. When executives heard the University of Queensland School of Metallurgy was in trouble, it committed $1.5 million over 10 years to fund the Xstrata Chair of Metallurgical Engineering to fund a new Bachelor of Engineering, double major in Chemical and Metallurgical engineering, and support research.

However, the more immediate problems were in local communities. Mining had failed to attract young people because they were not familiar with the industry and the careers and opportunities available. Xstrata began by talking to parents and children and working with local educators to introduce information and work experience programs into schools. The company now has one of the most intensive and largest vocational and graduate training schemes in Australia.

The secondary school program begins in year seven and eight with tours of the mine and operations. In year nine, it offers structured work experience that includes work shadowing in different areas of the business. Year 10 offers six to eight weeks of work experience in one stream, over the year, that becomes part of the school credit certified at level 2-3. By year 11 and 12, the program is beefed up again and there are bursaries and scholarships offered throughout the north Queensland operations.

The school-based apprenticeships scheme comprises three days a week at school, one day at TAFE and one paid workday in the business.

McLoughlin said students received their higher school certificate, earned some money, and had a head start for employment or further education. “There are some fantastic success stories. We have one young guy who was a dropout at the end of year 10 and was ready to leave school. He was given a school-based apprenticeship and is now the best apprentice we have and is talking about going on to become an electrical engineer,” he said.

The formula of information and work-based training is also breaking down perceptions of singular career paths in the industry. The motivation is to get people into the industry and show them the different pathways and how they can blend together.

Xstrata has 96 first-year apprentices – 72 of whom are in the first year, 11 are school-based and the remainder are adults. That number will grow to 400 in the next two years.

Other programs include a partnership with TAFE to establish curricula to produce a higher quality tradesperson in two-and-a-half years rather than four, and a multi-million dollar training facility to offer state-of-the-art apprentice training.

“Two years ago when we started putting this program together, we couldn’t attract high quality candidates, now the challenge is managing the hundreds of applications,” McLoughlin said.

It is a similar story with tertiary education. Two years ago, the company was struggling to attract 400 applications for its graduate roles. This year they closed applications at the 1700 mark.

McLoughlin said the supply and demand gap was wider than it had ever been but the company had built a strong brand in the recruitment market place. “When people come here to work they get responsibility, they get experience and they get rewarded, and we tell them that,” he said.

Bureaucracy busters

Another part of the new management style is an avid program of bureaucracy busting that underpins everything that Xstrata does.

“To use human resources as an example: when I arrived there was a plethora of policies sitting on shelves and a lot of my day was taken up with paperwork,” McLoughlin said. “We put it to one side. Now human resources has five key elements and 15 core policies in the business. None of them are more than a page to a page and a half.”

He said across the board people were now free to innovate in their work area, and it had created a culture where...click here to read on.