For decades I have been saying the pulp and paper industry is one of the most exciting sectors in the manufacturing world. It is full of surprises, never ceases to be entertaining and is continually offering new ways to succeed. Now an outfit called Allrise Capital has once again reinforced my beliefs in this thinking.
Here in the United States, with a change in administrations, there is often a change in energy policy. It seems no different this time. If you will recall, many times I have said all energy policy is political. This has not changed. My confidential touchstone on energy activity tells me energy research requests are up, too.
Regardless of your personal beliefs or the science you (do) (do not) believe, carbon neutrality is in your energy future. There are many high-profile companies and CEOs involved in the "CEO Carbon Neutral Challenge" including our own advertising partner, SAP. The Carbon Neutral Challenge has a list of six guiding principles.
Occasionally you will run into a safety situation that is not covered by your training. What to do? My approach to such situations is multi-pronged. Urgency, risk, obvious and unknown are adjectives I would use to describe my approach in these matters, coupled with a heightened awareness of my surroundings.
Last week, we talked about excitement creating dangerous safety conditions. This week let's talk about the opposite--routine creating dangerous safety conditions. Because we work around large machinery, clamp trucks and so forth, which, for the most part behave as they should, we become complacent that about these items. Paper machines can kill--and they have. Clamp trucks can kill--and they have. Dynamic accidents (things flying apart, things falling) are dangerous.
One of the most dangerous times, at work, home or wherever is when we get excited. When excited, we often don't think about safety. How many times have you come into the mill excited (perhaps by the traffic you had just driven in)? How many times have you left the mill excited, with plans to go on vacation or do something else exciting when you got off shift that day? How do we fix this?
The pressure to meet production goals is directly in conflict with safety procedures unless you work hard and creatively to take the conflict out of this scenario, for there is a conflict here, no matter what anyone says. In reality, doing tasks the safest way is often the most efficient way.
I hate boneyards. These piles of junk provide a false sense of security, causing clueless managers to think there is something there that can get them out of a maintenance jam. I haven't kept track, but my perception is that boneyards in my past caused far more problems than they cured.
From July 1925 to December 1970, Popular Science Monthly, a familiar magazine here in the US, ran a feature called Gus Wilson's Model Garage. The typical story was an automobile owner who came to the garage with a vexing car problem. Gus, through his experience, wit and intuition, could figure out the problem and put the driver back on the road, problem solved. In our pulp and paper mills today, perhaps we need more Gus's.
Risking raising the hackles of the IT department, this writer thinks it is time to fold IT into maintenance, for that is what it often is. IT should be held accountable for downtime, just like regular maintenance. Downtime should be broken into scheduled and unscheduled, just like regular maintenance and KPI's should be kept on it. Recently, one major company in our industry experienced a ransomware attack. Within two months, the CEO suddenly retired. Coincidence perhaps, but who on the outside knows?
With experience, one can walk on to an operating floor and determine which faction, operations or maintenance, had the larger influence in a paper mill's design. It is really quite easy. The first giveaway is the width of the operating, or tending, aisle versus the drive aisle.
Is there anything left to be said about maintenance that I have not already said in the last twenty years of writing this column? Yes, there is always something to be said about maintenance. We have more tools, monitoring devices, tracking systems, more than we have ever had before, yet we still have unscheduled maintenance above the levels that should be acceptable in most mills. What should be our standard for maintenance? May I suggest the airline industry?
By accepting graffiti laden railcars on your site, you are approving of a certain level of mediocrity and malaise associated with your business. Further, you are contributing to a plague on society, every time those railcars pass through any town in the country, not just when they are near or on your property. Cleaning up the railcars will be a huge boost to the overall morale of society.
The containerboard industry sorely needs its own "conex" for rolls wider than 110 inches. This needs to be a system that allows rolls to be placed horizontally, or perhaps, at an angle to reduce the height normally achieved by vertical rolls.
Vertical transportation systems, that is, those which stack goods vertically, tend to occupy disproportionately more space than one would first think due to the need to have aisles to retrieve those goods in storage. From a floorspace allocation perspective, only half of the floor is devoted to storage, the other half is devoted to space for retrieval equipment to operate. One system I have seen that overcomes this problem is a vertical storage finished roll warehouse.
In transportation month last year, we talked about electric trucks. We are still talking about electric trucks today and for years to come.
Engineers and scientists have a propensity to save their data. Saved information can come back and bite your company and you. Many a career has been ruined by a fastidious hoarder. Even worse, most think, "it can't happen to me."
Project management is about leadership, not democracy. The objective is to complete the project at the least expenditure of time and money. Treat others with respect, yes, but have clearly defined roles for each person and hold them accountable for their piece, replace them if they cannot successfully accomplish their role. These days, we often spend too much time with our eyes off the prize.
Much of the mismanagement of capital projects could be eliminated, from my experience, if companies adopted the discipline of quasi-public funding project monitoring. These are projects which are not financed through balance sheets but by issuance of tax-exempt or taxable project specific debt. In the last thirty years, I have had experience as the Technical Advisor on 22 such projects (in pulp, paper, energy, steel, medium density fiberboard and cement) with an installed capital base of billions. I have seen a few things.
After nearly fifty-one years in the business, my anecdotal guess is that about half of capital projects are successful, meaning: on time, on budget and fulfilling the original scope. The rest suffer from a myriad of deficiencies.
To wrap up this month on energy columns, I thought I would go to the brightest group I know in the energy business--the National Renewable Energy Laboratory (www.nrel.gov) in Golden, Colorado. NREL had an end of year seminar on the future of energy generation in the United States, 2020 - 2050.
As we continue to talk about energy this month, we would be remiss if we do not bring up hydrogen as a potential fuel. Of course, hydrogen is the "perfect" fuel for combustion, for the "exhaust" is water (H2 + O => H2O). The problem in the past has been that it has not be plentiful or economical.
In a decade, I've moved from being a skeptic to saying some alternative energy sources just may be possible for our industry right around the corner.
Several times in this column over the years, I have told you to not demolish energy assets (that are in good shape) just because you stopped using them. Properly secure and preserve them and wait for policies to change. With an impending change in federal administrations here in the United States, expect an energy priority change within a year. This may come about by regulation changes or economics (the ranking of various fuel costs changing). These changes may be so severe they push some mills out of business.
This is supposed to be innovation and strategy month but up to this point, I have focused on innovation. Strategy is important, too, but strategy must be focused on solid science, statistics and mathematics. I have seen many strategic initiatives fail over the years. That does not mean we should stop doing them, it means we should make sure our foundation was solid.