Since its inception in 2013, SQM, a Santiago-based mining company, has been at the forefront of integrating lean management principles into the complex and demanding field of mineral extraction. By adapting these methodologies, SQM has navigated some of the industry’s most challenging hurdles, showcasing a commitment to continuous improvement that remains steadfast more than a decade later.

The Evolution of Lean Management at SQM

Initially branded as “M1,” SQM’s lean management initiative sparked a significant organizational cultural shift. This transformation extended beyond operational methodologies, recognizing the importance of fostering a strong production culture and enhancing worker safety. Carlos Díaz, CEO for lithium and potassium, explains that this cultural reorientation has since evolved into “M1+,” emphasizing digital technology and maintaining core values alongside advancements.

Commitment to Continual Improvement

Continuous improvement holds paramount importance at SQM, as highlighted by the company’s leadership. By focusing on advancements in both technology and organizational culture, SQM has achieved remarkable production gains—some plants reported increases exceeding 60% while simultaneously reducing operational costs by 20%. Safety metrics also saw improvements, with incident rates dropping two-thirds within the initial years of implementing these changes.

“It was really because of the cultural change that we saw results. We increased production in some plants by more than 60 percent while decreasing costs by 20 percent.”

Integrating Technology into Operations

SQM has actively woven technology into its operational framework, leveraging advanced analytics and artificial intelligence (AI). The shift towards M1+ reflects a recognition of the necessity to adopt these tools to efficiently manage increasingly complex processes. José Miguel Berguño, Senior Vice President for Corporate Services, noted that the organization reached its technological limits relying solely on human expertise, demonstrating the critical need for data-driven decision-making.

“We see technology as just a different type of tool. The real question is how you use the technology.”

Challenges and Focus on Sustainability

The demand for sustainable practices is intensifying, particularly within industries like electric vehicles that rely heavily on lithium. SQM’s commitment to sustainability is evident in initiatives such as the Salar Futuro project, which centers on sustainable brine-processing methods aimed at minimizing environmental impacts. Pablo Altimiras emphasized that sustainability inspires innovative thinking, leading to new opportunities for enhancing operational value.

Adapting to Market Conditions

Flexibility in operations is essential as SQM faces evolving market demands. Daily performance dialogues ensure alignment among teams in addressing challenges and developing cohesive strategies. Carlos Díaz highlighted the importance of integrating varied processes within the entire production chain and using data-driven models to maximize yield while minimizing resources.

“Our performance dialogues, held every morning, involve various teams discussing challenges and potential solutions, ensuring that everyone is aligned and working toward common goals.”

Leadership in Times of Change

Leadership has transformed within SQM as the organization continues evolving. Senior leaders now balance operational involvement with strategic foresight, actively participating in daily discussions to stay connected with workforce realities. As a result, leadership not only drives productivity and safety efforts but also fosters organizational well-being.

“Leaders achieve sustainable results and build culture. We need leaders who connect productivity, safety, and organizational well-being objectives.”

Future Challenges and Opportunities

Looking forward, SQM aims to safeguard its current operations while exploring new business prospects. The company identifies three key areas for growth: establishing a clear strategic framework based on solid diagnostic methods, enhancing operational processes through technological advancements, and prioritizing personnel development across all organizational levels.