Question
I need long paragraph for each paragraph. Thank you. I need five long each paragraphs please. Name each paragraphs please. First paragraph: problem Statement. Second
I need long paragraph for each paragraph. Thank you.
I need five long each paragraphs please. Name each paragraphs please.
First paragraph: problem Statement.
Second Paragraph: 1th Analysis (solution 1)
Third Paragraph: 2th Alternative (solution 2)
Fourth Paragraph: Recommendation
Fifth Paragraph: Implementation
Case:
AGNICO EAGLE MINES: RETAINING AN INUIT WORKFORCE IN CANADA'S NORTH
In April 2012, Chris Stanson sat at his desk following a long meeting with his boss, Eric Bellefeuille, the general manager of the Meadowbank gold mine (Meadowbank) in Nunavut, Canada (see Exhibit 1). Stanson was the human resources superintendent at Meadowbank and was employed by Agnico Eagle Mines (AEM), one of the world's largest gold-mining companies. Stanson was deeply concerned. Meadowbank was facing some significant challenges related to its workforce, which could limit the long-term growth and sustainability of the mine. Both employee turnover and absenteeism were high and rising. The discontent seemed to be partially fueled by cross-cultural misunderstandings and a lack of advancement opportunities for certain employees. These "people issues" were adding to the already exceptionally high production costs. The mine was at a crossroads, and the workforce challenges needed to be addressed soon. The Meadowbank team needed to convince AEM corporate headquarters that their team was a top-priority investment. Stanson knew that he had the chance to influence thisand the company's future in Nunavut. COMPANY HISTORY AEM grew from humble beginnings. Paul Penna, the founder of the company, was a penny-stock salesman in the 1940s when he was exposed to the world of mining. In the early 1960s, Penna decided to buy shares in Agnico Mines Ltd., a silver-mining company that operated in Northern Ontario and Quebec. Through a proxy fight in 1963, Penna gained control of the company. In 1972, he merged Agnico Mines Ltd. with Eagle Mines Ltd., a gold-mining company, to AEM. AEM focused most of its mining activities in Quebec for the remainder of the century, acquiring several smaller companies and gold deposits with the aim of growing the company's annual production. During the early 2000s, AEM started to expand its scope into global markets, and the company made a series of acquisitions of companies and gold deposits in the United States, Finland, Mexico, and the Canadian North. With the aim of significantly increasing its production levels, the company spent approximately $2.7 billion on mine development and built five new gold mines between 2005 and 2010, thereby increasing gold production by more than 325 per cent. If the company continued to increase its gold production rate, it would soon become one of the top ten gold-mining companies in the world. However, such an intense period of growth inevitably led to certain challenges. In 2011, after only one year of operation at the Meadowbank site, a fire burned down the kitchen, bringing production to a halt. To make matters worse, later that same year, Meadowbank's life expectancy1 was reduced by three years, shifting from 2020 to 2017. This shortened life expectancy, coupled with the consequences of the fire, forced the company to write off more than $645 million from the mine's book value. The previous year's performance had not met shareholder expectations, and the 2011 annual report opened with a somewhat dispirited message from the chief executive officer (CEO) of AEM, who stated that "2011 was a disappointing year for Agnico-Eagle ... For a variety of reasons, we missed our production and cost targets." Yet, despite these setbacks, Meadowbank still accounted for roughly 27 per cent of the company's total gold production that year (see Exhibit 2). Meadowbank Operations The Meadowbank site was a testing ground for AEM's operations in the Canadian North. Located 300 kilometres (km) inland from the west coast of Hudson Bay and about 100 km north of Baker Lake (the closest community), Meadowbank had been a pioneering project for the company (see Exhibit 3). Previously, AEM had focused its mining operations in more southern locations. After pouring the first gold brick in 2010, the Meadowbank site had been in constant operation, maintaining production 24 hours a day, 365 days a year. The site was quite remote and only accessible by chartered plane or by a single road that ran 110 km through the Arctic tundra from Baker Lake, Nunavut's only inland Inuit community. Due to its remoteness, all the workers' needs had to be met on-site. Sleeping quarters, full kitchen facilities, a gymnasium, and recreation rooms were all built to accommodate the 400+ employees housed at the mine at any given time. AEM also covered the cost of employee transportation to the mine. From Monday to Thursday, the company chartered a plane to fly from Montreal to the site of the mine and back, with two fuel stops along the way one in Val d'Or, Quebec, and the other in either Churchill, Manitoba, or Rankin Inlet, Nunavut. For the Inuit employees, AEM chartered a smaller plane to fly between the communities in the Kivalliq region. With the exception of the employees from Baker Lake, who were brought to the site via the all-weather access road, the only way to transport employees from any community in the region was by plane. To manage the cost of transportation, most employees worked for two weeks straight and were then flown home for two weeks off. The total cost of producing an ounce of gold was $1,000 in 2011, an increase of 44 per cent from the year before (see Exhibit 4). To ensure that maximum production was met, the mine was in constant operation, with a 12-hour dayshift and a 12-hour nightshift. Employees were assigned to one shift or the other for the entire two-week period. CHALLENGES Working in such a remote location was not without its challenges. To keep such a large facility supplied with food and equipment, the majority of supplies had to be transported by barge to Baker Lake when the Hudson Bay was not frozen from June to September. From Baker Lake, the supplies were then transported 1 In the context of mining, life expectancy refers to the estimated time that it will take to remove all the ore from the ground. Determining the amount of ore in the ground as well as the amount of time it will take to remove it all is critical, as it can take many years to locate a gold deposit and then develop a mine around it. Reducing the projected life of the mine means that the company has much less time to earn back the sunk costs associated with building the infrastructure around the deposit. Small amounts of supplies could be brought in on the daily charter flight from Montreal. However, due to the cost, this delivery was limited to essential supplies and perishable goods. The mine had also faced some operational challenges. The extremely cold temperatures during the first two winters of operation had caused a high number of heavy-equipment failures. Haul trucks, drills, and dozers were frequently sent to the maintenance shop to be fixed. In addition, production was significantly reduced in March 2011 when the kitchen burned down. Rebuilding the kitchen and returning the site to full operation took months. However, these issues were not Stanson's main concern. As the superintendent of human resources, he was primarily worried about the mine's workers. His recent meeting with Bellefeuille had focused on the Meadowbank workforce and some of the systemic issues concerning recruitment, retention, and culture that had recently become quite noticeable. RECRUITMENT AND RETENTION To secure the local government support necessary to operate the site, AEM had signed an Inuit Impact and Benefit Agreement (IIBA) with the Kivalliq Inuit Association (KIA). The KIA was a regional body devoted to representing the interests of all Inuit within the region as well as to promoting the Inuit people's economic, social, and cultural wellbeing. AEM had agreed to a number of critical commitments in the IIBA, including increasing the number of Inuit employees to reflect the ratio of Inuit to non-Inuit workers in the workforce of the Kivalliq region; providing the Inuit with no less than 10 business days' advance notice of each opportunity for employment at the Meadowbank mine before announcing any such opportunity to non-Inuit peoples; and establishing for each 12-month period of operations at Meadowbank, a Minimum Inuit Employment Goal (MIEG) for each major activity. If AEM proved unable to meet the MIEG in a given year, the company had to show that significant efforts had been made to meet the MIEG and that a sufficient level of investment in training and upward mobility programs was in place to support Inuit employment. If AEM was found to be non-compliant for two years in a row, the company may have to pay penalties to the KIA to establish training initiatives outside the mine. In preparation for signing the IIBA, setting the MIEGs and providing advance notice of the upcoming vacancies had not been an issue. However, increasing the number of Inuit employees had proven difficult. The Inuit employee group had an extremely high level of turnover. In fact, of the 276 Inuit employees who had been hired in the past year, 229 had left their jobs within less than 12 months, resulting in an astounding 83 per cent turnover rate. Turnover in the non-Inuit employee group remained at industry levels or better and was no cause for concern. Additionally, the absenteeism rate had risen from two per cent in 2009 to 5.6 per cent site-wide in 2012 and had reached 20 per cent for Inuit workers on-site. In practical terms, this meant that 22 people were simply not showing up for work on a daily basis. As a result, training initiatives were constantly having to restart and few employees were actually completing their mandatory training. This issue was serious. At a mine such as Meadowbank, training was mandatory for several reasons: (1) to ensure that the employees had the appropriate skills to operate and maintain the heavy equipment and, therefore, avoid accidents; and (2) to comply with the Nunavut Safety Act as well as the Canadian Mine Act. Inspectors made fairly regular visits to the Meadowbank site and had the authority to issue sanctions or even shut down certain operations if they found serious safety violations. Exit interviews conducted with some of the Inuit workers made it apparent that the workers were leaving the mine for two main reasons. First, many felt that they lacked the skills and training necessary to qualify for the jobs that had been posted, and they did not understand how they could receive such training. This was an unforeseen challenge of establishing operations in Nunavut. As mining was a relatively new industry in the region, little to no training was available in the territory for potential employees. Elsewhere in Canada, workers could enroll in training courses to learn how to operate heavy equipment, work in a processing plant, or acquire trade skills. The training infrastructure necessary to feed the skill base that was required to operate a mine was not in place in Nunavut. Many Inuit employees who filled entry-level positions had no opportunity to advance. To make matters worse, the high-school graduation rate in Nunavut was the lowest in Canada, with only 49 per cent of the Inuit population aged 25 to 64 having received at least a high school diploma in 2006 (compared to 61 per cent of the non-Inuit population of the same age group within the territory). To top it off, even if an employee was able to get a job in a specialized field that had the potential for advancement, the process by which employees were given internal training and opportunities was unclear. The second reason was a combination of cultural values and understanding the "rhythm of life" at a mine. CULTURE AND MINE LIFE The Meadowbank workforce was a blend of Inuit, French as first language, and English as first language workers. The ratio of workers was roughly 4:4:2, respectively. When the mine first opened, a high number of equipment operators transferred to the site from other AEM operations in Quebec. Due to the high-risk nature of the working environment and the fact that a range of languages were spoken, English was established as the on-site working language. All training and communication at Meadowbank were conducted in English. This was a real challenge for some Inuktitut- and French-speaking employees, who felt that the language requirement represented a form of discrimination and voiced this formally through established feedback channels and informally during their work. Finally, it was also discovered through the exit interviews and discussion with Inuit community representatives that as mining work was new to the region, the Inuit workers from one of the seven local communities who applied for open positions at the mine often did not fully understand the level of commitment associated with the two-week rotational schedule. The separation from friends, family, and home proved to be a real challenge for many. Furthermore, the work-related expectations (i.e., regular schedule, night shifts, rigid production timetable, and hierarchy of authority) often conflicted with the traditional Inuit practices of hunting and fishing as well as the traditional values of family and independence. It was not uncommon for workers to fail to show up for work and instead go to take care of their family or to hunt. Taken together, these cultural differences fuelled the high absenteeism and turnover rates.
PROBLEM
"We need to fix this, Chris. And fast." The words were still ringing in Stanson's ears. He knew that his boss was right. The high turnover rate and constant training burden were costing the company and increasing the per-unit cost of gold. In a recent presentation at the Nunavut Mining Symposium (an event to discuss mining issues in the Canadian North), Bellefeuille had gone as far as saying, "We have had fires and production issues in recent years, but the most dramatic situation we have at Meadowbank right now is the absenteeism and turnover within our Inuit workforce." During their meeting, Bellefeuille had given Stanson the following directive for the coming month: develop an effective plan that will allow AEM to retain talented Inuit employees and reduce the Inuit turnover rate; promote a culturally sensitive and diverse workforce; and recruit a new pool of Inuit employees who could be trained to fill the 229 roles that had been vacated during the previous year. 2 Where to begin? Stanson began doodling on his notepad as he gathered his thoughts. He came up with a title for the plan, "Talent Management for a Culturally Diverse Workforce at AEM."
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