In this column, Aldo Barreto—Founding Partner & Co-CEO of Unilink—reflects onthe silent impact that exceptions have on mining supply processes, and how these situations can define operational continuity more than planned flow. 

With more than 13 years leading Unilink and a previous career spanning 11 years at SAP Ariba and Quadrem, Aldo brings an expert perspective on thenatural limits of planning, the operational weight of tail spend, and the need to manage urgent purchases systematically and strategically.

Structured sourcing and its weak point 

In mining operations, most of the supply chain operates within a structured flow. Framework agreements, defined inventories, and planned replenishment allow most operational requirements to be met with adequate service levels. 

However, experience in the field shows that the risk does not lie in this normal flow. The risk arises when an exception occurs. 

Supply exceptions can arise for a variety of reasons: 

• The material is not available in stock. 

• Consumption was higher than expected. 

• An unplanned failure occurs 

• The usual supplier is not available. 

• The actual lead time exceeds the planned lead time. 

• The requirement was not considered in the replacement plan. 

Regardless of the origin, the effect is the same: andthe request must be resolved outside the usual workflow, under conditions of greater urgency and uncertainty. 

A small segment in terms of expenditure, but intensive in terms of management 

From a budgetary perspective, this type of purchase represents a limited fraction of total expenditure. 

Studies by McKinsey and Boston Consulting Group show that tail spend typically accounts for between 10% and 20% of spending, but can concentrate up to 80% of operational transactions. 

This means that, although its financial impact is limited, this segment generates a significant operational burden for procurement teams. 

When a request deviates from the normal flow, the process changes: 

• Manual search for suppliers 

• Urgent requests for quotes 

• Rapid assessment of alternatives 
• Intensive monitoring until closing 

This type of situation involves: 

• High pressure on equipment 

• Longer cycle time 

• Lower visibility of the available market 

And, in critical cases, risk to operational continuity.

In a context of high asset utilization and favorable metal prices, the cost of a shutdown can far exceed the value of the required material. 

Even in mature and highly structured organizations, exceptions are part of daily operations. 

Because in mining: 

• The actual operation always deviates from the plan. 

• Market conditions change 

• Replenishment times are not entirely predictable. 

Therefore, beyond contracts and planning, operational continuity also depends on responsiveness when normal flow is insufficient. 

Looking ahead 

If exceptions are unavoidable, the challenge is not to eliminate them. 

The challenge is to manage them systematically, with market visibility, available alternatives, and response times compatible with the operation. 

Because in mining, supply performance is not defined solely by what works according to plan. 

It is often defined by the speed and effectiveness with which exceptions are resolved. 

References 

• McKinsey & Company. Long tail, big savings: Digital unlocks hidden value in procurement 

• Boston Consulting Group. Taming Tail Spend.