1
25-012
Approach to Selecting Research and Development Investment
Projects in Mining
Antonio Nieto
University of Utah, Salt Lake City, UT
Jesus Castillo
MineralsTech, Tucson, AZ
ABSTRACT
Research and Development (R&D) departments in the
mining sector are essential for creating new solutions on
productivity, safety, and sustainability. Nevertheless, the
selection of R&D projects is complex, often influenced
by subjective judgments and uncertainties. This paper
explores the application of the Multicriteria Decision
Analysis (MCDA) as a structured approach to evaluate
and prioritize innovation projects based on various crite-
ria such as safety, cost, environmental impact, and social
acceptability. By assigning weights and quantifying criteria,
MCDA enhances decision-making transparency and objec-
tivity. This study aims to show a method that facilitates
strategic thinking, resource optimization, and stakeholder
engagement, ensuring that selected innovations align with
the company’s long-term objectives and commitment to
responsible mining practices.
INTRODUCTION
One of the greatest and most persistent challenges that
mining companies or corporations face through their top
executives, managers, and various other decision-makers is
making the right decision when confronted with an invest-
ment opportunity to maximize the value when achieving
a desired outcome. In addition to the numerous obstacles
that hinder decision-making, there are numerous options
for investment project selection, where the ideal scenario is
to choose those that optimize the objectives of the decision-
maker and the organization (Lopes and Almeida, 2015).
Unfortunately, decision-making is often not a straightfor-
ward process and is influenced by factors such as uncertainty,
lack of information, and subjectivity. Various researchers
such as Nieto (2019), Jalalifar et al. (2009) and Safari and
Nikkhah (2019) describe the mining industry as one that
has traditionally relied on characteristics such as experience
and intuition in making decisions since they often lack
quantitative data and have insufficient information.
Thus, companies would include the judgment and
experience of experts to partake in decision- making pro-
cesses in selecting projects. However, Safari and Nikkhah
(2019) note that the majority of experts cannot avoid the
inevitable subjectivity of their own judgments.
Multicriteria decision analysis (MCDA), also known
as the Multicriteria decision method (MCDM), is a tool
that attempts to handle information with different indica-
tors in a comprehensive manner. MCDA enables optimal
decision-making when an individual is presented with vari-
ous alternatives with multiple criteria to be considered.
MCDA requires identifying the utility function and
weights for every attribute of an alternative option to then
be constructed into a unique cohesive criterion (Keeney
and Raiffa, 1993 Dyer, 2005). According to Fahrni and
Spating (1990), MCDA is useful for decision-makers who
want to be informed of the interdependencies between
projects, have multiple objectives/evaluation criteria, risk
preferences and face significant uncertainty.
The monetary and qualitative aspects of a project are
assessed by determining a set of attributes that are evalu-
ated on a utility scale (Verbano and Nosella, 2010). This is
done by assigning a utility function to the attributes (i.e.,
criteria). The utility function of each attribute is calculated
by assigning individual scores to the attributes of alternative
options which are used to evaluate the overall project utility
on the basis of each one (Nieto 2020, Verbano and Nosella,
2010). In doing so, whether an attribute is qualitative or
quantitative, it is mathematically transformed into a utility
value in a standardized scale.
25-012
Approach to Selecting Research and Development Investment
Projects in Mining
Antonio Nieto
University of Utah, Salt Lake City, UT
Jesus Castillo
MineralsTech, Tucson, AZ
ABSTRACT
Research and Development (R&D) departments in the
mining sector are essential for creating new solutions on
productivity, safety, and sustainability. Nevertheless, the
selection of R&D projects is complex, often influenced
by subjective judgments and uncertainties. This paper
explores the application of the Multicriteria Decision
Analysis (MCDA) as a structured approach to evaluate
and prioritize innovation projects based on various crite-
ria such as safety, cost, environmental impact, and social
acceptability. By assigning weights and quantifying criteria,
MCDA enhances decision-making transparency and objec-
tivity. This study aims to show a method that facilitates
strategic thinking, resource optimization, and stakeholder
engagement, ensuring that selected innovations align with
the company’s long-term objectives and commitment to
responsible mining practices.
INTRODUCTION
One of the greatest and most persistent challenges that
mining companies or corporations face through their top
executives, managers, and various other decision-makers is
making the right decision when confronted with an invest-
ment opportunity to maximize the value when achieving
a desired outcome. In addition to the numerous obstacles
that hinder decision-making, there are numerous options
for investment project selection, where the ideal scenario is
to choose those that optimize the objectives of the decision-
maker and the organization (Lopes and Almeida, 2015).
Unfortunately, decision-making is often not a straightfor-
ward process and is influenced by factors such as uncertainty,
lack of information, and subjectivity. Various researchers
such as Nieto (2019), Jalalifar et al. (2009) and Safari and
Nikkhah (2019) describe the mining industry as one that
has traditionally relied on characteristics such as experience
and intuition in making decisions since they often lack
quantitative data and have insufficient information.
Thus, companies would include the judgment and
experience of experts to partake in decision- making pro-
cesses in selecting projects. However, Safari and Nikkhah
(2019) note that the majority of experts cannot avoid the
inevitable subjectivity of their own judgments.
Multicriteria decision analysis (MCDA), also known
as the Multicriteria decision method (MCDM), is a tool
that attempts to handle information with different indica-
tors in a comprehensive manner. MCDA enables optimal
decision-making when an individual is presented with vari-
ous alternatives with multiple criteria to be considered.
MCDA requires identifying the utility function and
weights for every attribute of an alternative option to then
be constructed into a unique cohesive criterion (Keeney
and Raiffa, 1993 Dyer, 2005). According to Fahrni and
Spating (1990), MCDA is useful for decision-makers who
want to be informed of the interdependencies between
projects, have multiple objectives/evaluation criteria, risk
preferences and face significant uncertainty.
The monetary and qualitative aspects of a project are
assessed by determining a set of attributes that are evalu-
ated on a utility scale (Verbano and Nosella, 2010). This is
done by assigning a utility function to the attributes (i.e.,
criteria). The utility function of each attribute is calculated
by assigning individual scores to the attributes of alternative
options which are used to evaluate the overall project utility
on the basis of each one (Nieto 2020, Verbano and Nosella,
2010). In doing so, whether an attribute is qualitative or
quantitative, it is mathematically transformed into a utility
value in a standardized scale.