Abstract This paper contains an analysis of the hard coal production process in Poland with selected indicators such as productivity, marginal productivity and the substitution of production factors. Current organization of the hard coal mining process is mainly characterized by the decreasing economies of scale, the loss of the average and marginal productivity. Static model of the production function indicates a 50% decrease in the average productivity in the years 2005–2013. This indicates the incorrect use of available production factors and poses a threat to further existence of mining companies. The reduction of production costs will be inevitable in this situation. The obtained results of the analysis led to creation of two innovative strategies of: flexible and stable coal mining production.