Because of the capital involved in starting up an exploration venture, keeping costs to a minimum is usually one of the highest priorities for the business. This can be very challenging, considering that there are many requirements for reporting on areas such as active tenements, expenditure, payroll and others that necessitate expensive systems that can only provide some of the needed functionality. Essentially, an enterprise system is needed at a time when the business does not have the necessary capital to implement one.
Nevertheless, the likelihood is that spreadsheets and lower cost tools will not be sufficient to manage your exploration activities, and therefore we’ve put together a few key areas to consider when evaluating a suitable solution that will give you the appropriate “bang for your buck”.
There is a significant amount of legislation in Australia around the necessary land permits and permissions needed by exploration ventures to conduct exploration activities. In order to maintain ownership of these leases, or tenements, companies need to provide frequent reports to regulatory authorities as part of Form 5 compliance. Challenges can be faced if mandatory reporting dates are missed or expenditures incorrectly assigned across your tenements (see Financial Management considerations below).
Consider the following when looking at a system for managing your tenements; anniversary date based reporting, Automated Form 5 generation and integration with your general ledger for spend tracking.
There are two core aspects to consider on the financial side. Firstly, the expenditure associated with your tenements may not be linked to your general ledger, creating extra processes. Without a solution, you may also have difficulty in assigning costs (either by percentage or one-by-one) to your tenement portfolio.
The second aspect is your more standard financial concerns such as payroll, cash flow and joint venture reporting. Many of these are usually bundled up within a larger enterprise system, but as mentioned previously, this can be fairly cost prohibitive for more junior explorers.
Normally, there can be a very high cost to implementing a system, as well as the additional fees for maintaining an on premise solution, managing servers, IT infrastructure and so on. This gives an organisation very little flexibility in terms of growth, and limits financial wiggle room. However, an ERP package that has been specifically developed to operate on a monthly subscription can be a great option for ventures just starting out. With no initial capital outlay, this provides much needed breathing room to focus on key exploration activities to prove the feasibility of progressing into the later stages of mining.
Ability to grow
The only thing worse than investing into a costly system is realising that you are quickly outgrowing it. The subsequent “rip and replace” will be yet another financial challenge. This is an often forgotten aspect when selecting a system, and can be seen as a “we’ll cross that bridge when we get there” issue. To counteract this, an exploration company can act more strategically by investing in a system that’s able to grow as you need it to.
What exploration package is right for me?
Ultimately, the right exploration software package for you will come down to your specific requirements and objectives.
We’ve gotten to know many exploration companies over the last few years, and upon hearing their needs, we’ve repackaged our core ERP to meet their needs at this early stage of their operation. We understand the unique challenges, and have created a template that meets all the core needs of an exploration venture, provides a flexible subscription model and room for growth in the future.
Speak to us today about your exploration venture, we’d be happy to listen to you.