Industry 4 - RISI · 2020: 10 GBit (5G) Global ... Consumer Electronics, Durable Goods, Fast Moving...

Industry 4.0Future of the Paper Industry

Berlin, March, 2016

2Copyright © 2016 StepChange Consulting - Driving Change to Deliver Results. All Rights Reserved.

When do we talk about Industry 4.0?

People, machines & industrial processes are intelligently networked People, machines & industrial processes are intelligently networked

Components interact independently with a production plant

People, machines & industrial processes are intelligently networked

Components interact independently with a production plant

Feedback is captured digitally, incorporated across the value chain, automatically triggering new events


Many names – same concept?

Industrie du Futur

Industry 4.0

High-Value Manufacturing

Smart Industry

Industrial Internet

Fabrica Intelligente

Smart Manufacturing

Industrie 4.0

IoT industrialIndustrial Internet of Things (IoT)

Machine-to-machine connectivity

M2M


Technological

trends

Industry

4.0

Macro societal

trends

Industry 4.0 is driven by several trends

Connectivity PersonalizationNetworked economy

Sensors High speed internet Cloud computing

Smart equipment

Networking&

Connectivity

Valuechain

integration

Smart products

Data analytics


…and change is clearly visible

Source: StepChange Consulting research

Wireless capacity

2015: 1 GBit (4G)2020: 10 GBit (5G)

Global amount of produced data2015: 7,9bn TB2020: 35,0bn TB

Smart packaging technology2015: € 17,3bn2050: € 173,0bn

Smart objects in 2020

2020: 50bn

Smart factory market

2050: € 350bn

CAGR: 58%

CAGR: 34%

Average cost of accelerometers2006: $ 2,02015: $ 0,40 CAGR: -16%

Number of smartphones2015: 2,6bn2020: 6,1bn

CAGR: 19%


Industry 4.0 is here…

Source: StepChange Consulting research

NOW !

Smart equipment Heidelberg: „Smart services“

Value chain integration UPM: “Mobile forestry”

Smart products Mevia: “Smart connected packaging”

Data analytics Sappi: “Big energy data”Energy

Networking & Connectivity Saica: „Connectedmaintenance“

https://www.youtube.com/watch?v=NBJV9z1-PXc&feature=youtu.be

https://www.youtube.com/watch?v=NBJV9z1-PXc&feature=youtu.be


Security is a key concern

Value chain security is only as good as its weakest link


Three main pre-requisites for I4.0

Security HumanResources

Technology Infrastructure


A survey of Industry 4.0 in the PPP industry

Geographie 93% of participants from Europe

7% of participants from rest of the world

Participants by

functions

43% Board members & C-level incl. GM

31% Department Manager

26% Other

Participants by

sub-industries

38% of participants from the pulp, paper and

packaging industry (PPP)

62% of participants from other industries (incl. FMCG,

machinery & technical services, chemicals, IT, etc.)


Summary of survey results

Industry 4.0 is considered important but not a game changer


Important but not a game changer

1) Customers include: Consumer Electronics, Durable Goods, Fast Moving Consumer Goods, Pharmaceuticals, Printing, Publishing and Retail

Q: Will Industry 4.0 impact your

industry?

Q: Do you expect Industry 4.0

to be a game changer for your

company?

13%

100%

98%

87%

Customers

Other industries

PPP industry

56%

79%

44%

44%

21%

56%PPP industry

Customers

Other industries

YesNo

Over 90% expect Industry 4.0 to have an impact on their industry

Only 44% expect it to become a game changer to their company



Few Industry 4.0 projects being implemented




Industry 4.0 is still in an early stage

29% state there is no Industry 4.0 work in progress

11%

21%

24%

9% 10%

36%

29%

15%

19%

45%

5%7%

10% 11%

6% 5%8%9%

4%

10%8%

Implemen-tation

Business plan development

Roadmap definition

Research phase

Single, uncoordinated projects

Strategic awareness

No work inprogress

Stage 0 Stage 1 Stage 2 Stage 3 Stage 4 Stage 5 Stage 6

1) All industries except pulp, paper & packaging2) Customers include: Consumer Electronics, Durable Goods, Fast Moving Consumer Goods, Pharmaceuticals, Printing, Publishing and Retail

PP

P-i

nd

ust

ry

Oth

er in

du

stri

es1)

Cu

sto

mer

s2)



Data analytics is a priority





Early stage work: most projects in data analytics, least in smart

products. Predictive analysis & supply chain focus

29%

12%

27%

Digitization of production processes

Supply chain integration

22%

Digital marketing

7%

Smart machinery

Predictive analytics

4%Other

Smart products

11%



Cost reduction is perceived as the key benefit






Industry 4.0 is not on the agenda of many companies and it seems the

PPP industry currently lacks to see the benefits beyond cost reduction

Cost reduction

47%

None 5%

34%Energy efficiency

New business models

16%

Sales growth 21%

Other

New products

3%

72%

28%

23%5) Mergers & Acquisitions

4) Energy strategy

22%

1) Product development & Innovation 51%

…

6) Diversification & New business models

2) Cost reduction

3) Marketing & Sales 30%

46%

12%12) Industry 4.0

…

PPP Industry priorities Industry 4.0 Benefits



Perception mismatch. Overconfidence?







Compared to other industries, pulp, paper & packaging industry is not

considered well-prepared for Industry 4.0

6) Aerospace 19%

5) Online Retail 20%

4) Machinery & Technical Services 21%

3) Consumer Electronics 25%

2) Automation, IT & IT Consulting 41%

1) Automotive

11) Various PPP segments

…

<=5%

47%

Q: TOP 3 industries regarded as most prepared

for/most active in Industry 4.0 by all respondents

29%

Equal40%

I don’t know23%

Worse

Better

8%

Q: How is PPP industry considering their

performance in Industry 4.0 compared to

others?

1) Including responses from all industries, the ranking among the TOP 3 do not have an effect on the result

48% of respondents from the PPP industry believe that their industry is BETTER or EQUALLY prepared than other industries








Key barriers are lack of awareness, difficulties to calculate

a business case and security concerns


Key barriers to implementing Industry 4.0

Key barriers are related to overall lack of awareness, the difficulty to

calculate a business case and related to security concerns

Awareness about the topic internally

Implementing common technical standards 27%

IT systems and infrastructure 25%

Ensuring data security and protection

29%

31%

19%Education and training of resources

Identifying opportunities and calculating ROI 47%

Changing the existing process/work organization 54%

…

1) Multiple answers allowed








Key barriers are lack of awareness, difficulties to calculate

a business case and security concerns


Industry 4.0 can revolutionize paper making

Number of trees

Tree health

…

Benchmarkdata

Productiondata

…

Supplyinventory

levels

Planned orders

Available capacity

Quality records

KPIsEnergy data

…

Supply data

Demanddata

…

Truck Utilization

rateTruck Humidity

level

…

R&DPlanning

Procurement Maintenance

Mill 1 (M1)

Mill 2 (M2)

Mill 3 (M3)

Production

Sales

Raw materialsSuppliers

LogisticsCustomer

BIG DATA


Industry 4.0 is in an early stage and the PPP industry is not sure how to deal with this new situation. Developing and quantifying business cases is a challenge

There is potential to be captured by the PPP industry by carefully implementing Industry 4.0 elements

In the long-term Industry 4.0 has the potential to revolutionize the paper making process

Industry 4.0 is about agility, lower costs and higher impact across all dimensions. Copy&Paste doesn’t work

Opportunities exist in the convergence of IT & Automation and further linking an organization to the external supply chain

Allowing entrepreneurial approach. Fostering small projects in an out of the box environment. Partnering across supply chain

Key take away’s


The information provided in this document is based on the responses of the survey participants and does not necessarily reflect StepChange Consulting views

StepChange Consulting is not in any way responsible for the survey results

StepChange Consulting merely provides a summary of the survey results and an interpretation thereof

Disclaimer


Who we are

Management consultancy specialized in the pulp

& paper manufacturing industry

Focus on sustainable performance improvements

Interdisciplinary and collaborative project

approach

International team of industry experienced

consultants

Primarily top tier paper & packaging companies

among client base (>€ 1bn in revenue)

Vienna office founded in 2006

US operations started in 2010

Projects in more than 25 countries

DRIVING CHANGETO DELIVER RESULTS


StepChange Consulting

“Driving change to deliver results”

Industry specific

Focused on pulp, paper and packaging

Industry experienced consultants

Customer specific concepts

Results driven

Value-add solutions

From strategy to implementation

Clear priorities and continuous success tracking

Committed partners

Know-How transfer to client personnel

Participate in project risk & success

Quality audits to track sustainable implementation progress


StepChange Consulting service portfolio

Our service portfolio ranges from strategy development to

operational performance improvement

Industry Services

Stakeholder Services

Wood & TimberPulp &

PaperDistribution

Converting &

Packaging

Strategy Definition

Operational Performance Improvement

Turnaround Management

Post-Merger Integration

Supply Chain Transformation

Raw Material Supply and Strategic Sourcing

Restructuring & Organizational Design

Sales Strategy and Effectiveness

Merger & Acquisition

Industry Studies

Investment Decision Support

Benchmarking & Performance Assessment

Market Research


Our experience is based on working across the globe – following

the footprint of our global clients

StepChange client & project locations

StepChange – Project locations

StepChange offices


StepChange Consulting publications Selection

StepChange conducts research on industry developments,

publishes articles and the “StepChange Essentials” book series

Available via www.stepchange.com/publications.html

Maintain, Improve or Invest? Capture!

A Review on Return on MaintenancePublished in ipw magazine, June 2012

No light at the end of the tunnel?

Survey Results RISI European Pulp and Paper

Outlook Conference 2012Published for 14th annual RISI European Pulp and Paper

Outlook Conference, March 6th, 2012

A roadmap without a map for the road

Strategic implications of the CEPI 2050 Roadmap on

the Pulp, Paper and Packaging Industry Published for 14th annual RISI European Pulp and Paper


Good Buy!

Part I: Strategic sourcing opportunities considering

TCO Published for 14th annual RISI European Pulp and Paper


Is your company ready for the current economy?

Survey Results RISI North American Forest Products

Conference 2011Published for 26th annual RISI North American Forest

Products Conference

The Crystal Ball

How Demand and Supply Planning can improve

business performance Published for 13th annual RISI European Pulp and Paper


2010 What’s Next?

Remaining cautious in post crisis euphoriaPublished for PRIMA 41th Annual Conference April 25th,

2010

The price is right

The quick guide to profitabilityPublished for 12th annual RISI European Pulp and Paper


Return to Business as Usual?

Survey results:“Visibility and Control in Turbulent

Times-2010“Published for 12th annual RISI European Pulp and

Paper Outlook Conference, March 9th, 2010

Post Recession Recovery?

Investing and attracting Capital in Russian Pulp

and PaperPublished in Russian magazine “Wooden Industry”,

February 2010

StepChange Essentials I

StepChange performance improvement

compendium, December 2009

Avoid Panic – Take Control!

Visibility and control in turbulent times. How

anticyclical behavior may help to capture

opportunity from the downturnPublished in PPI magazine, July 2009

Don‘t forget the customer!

Darwinism in effect. Customer retention and

margin management during the downturnPublished for PRIMA 40th Annual Conference, May 10th,

2009

Merchants’ survey — “A lot of activity ahead”

A survey among paper merchantsPublished in Pulp and Paper International, Oct 2008

Wood Sourcing — “Wood sourcing in Europe.

Which way forward?"

Controlling the wood value chain is a key success

factorPublished in Pulp and Paper International, May 2008

Logistics — "Trucking Around?"

Beyond transport rates; improvement

opportunitiesPublished in Pulp and Paper International, Sep 2006

Hard knock life pays off

A review of the global economic climate and the

financial performance of the Pulp and Paper industryMarch 2014

Old Europe?

Results of 2014 industry competitiveness studyPublished for 16th annual RISI European Pulp & Paper

Conference,10h March 2014

Merchants — in need or retreat?

European Results from Global Industry StudyPublished for 44th annual Prima Conference,26th May 2013

2013 Outlook: Cost Reduction and Restructuring

back


Conference 2013 Published for 15th annual RISI

European Pulp and Paper Conference, 22nd April 2013

StepChange Essentials II

StepChange performance improvement compendium June 2013

Accelerating Organizations to Deliver Results

Enhancing Operational Performance by Best

Practice Continuous ImprovementPublished for 15th annual RISI European Pulp and Paper

Conference, 22nd April 2013

A new Dawn?



Products Conference, October 3rd, 2012

One Step forward two Steps back

A four year review of Working Capital and

Liquidity DevelopmentPublished for 27th annual RISI North American Forest


Maintain, Improve or Invest? Capture!

A Review on Return on MaintenancePublished in ipw magazine, June 2012

No light at the end of the tunnel?


Outlook Conference 2012Published for 14th annual RISI European Pulp and Paper


A roadmap without a map for the road

Strategic implications of the CEPI 2050 Roadmap on

the Pulp, Paper and Packaging Industry Published for 14th annual RISI European Pulp and Paper


Good Buy!

Part I: Strategic sourcing opportunities considering

TCO Published for 14th annual RISI European Pulp and Paper


Is your company ready for the current economy?



Products Conference

The Crystal Ball

How Demand and Supply Planning can improve

business performance Published for 13th annual RISI European Pulp and Paper


2010 What’s Next?

Remaining cautious in post crisis euphoriaPublished for PRIMA 41th Annual Conference April 25th,

2010

The price is right

The quick guide to profitabilityPublished for 12th annual RISI European Pulp and Paper


Return to Business as Usual?

Survey results:“Visibility and Control in Turbulent

Times-2010“Published for 12th annual RISI European Pulp and

Paper Outlook Conference, March 9th, 2010

Post Recession Recovery?

Investing and attracting Capital in Russian Pulp

and PaperPublished in Russian magazine “Wooden Industry”,

February 2010

StepChange Essentials I

StepChange performance improvement

compendium, December 2009

Avoid Panic – Take Control!

Visibility and control in turbulent times. How

anticyclical behavior may help to capture

opportunity from the downturnPublished in PPI magazine, July 2009

Don‘t forget the customer!

Darwinism in effect. Customer retention and

margin management during the downturnPublished for PRIMA 40th Annual Conference, May 10th,

2009

Merchants’ survey — “A lot of activity ahead”

A survey among paper merchantsPublished in Pulp and Paper International, Oct 2008

Wood Sourcing — “Wood sourcing in Europe.

Which way forward?"

Controlling the wood value chain is a key success

factorPublished in Pulp and Paper International, May 2008

Logistics — "Trucking Around?"

Beyond transport rates; improvement

opportunitiesPublished in Pulp and Paper International, Sep 2006

Hard knock life pays off

A review of the global economic climate and the

financial performance of the Pulp and Paper industryMarch 2014

Old Europe?

Results of 2014 industry competitiveness studyPublished for 16th annual RISI European Pulp & Paper

Conference,10h March 2014

Merchants — in need or retreat?

European Results from Global Industry StudyPublished for 44th annual Prima Conference,26th May 2013

2013 Outlook: Cost Reduction and Restructuring

back


Conference 2013 Published for 15th annual RISI

European Pulp and Paper Conference, 22nd April 2013

StepChange Essentials II

StepChange performance improvement compendium June 2013

Accelerating Organizations to Deliver Results

Enhancing Operational Performance by Best

Practice Continuous ImprovementPublished for 15th annual RISI European Pulp and Paper

Conference, 22nd April 2013

A new Dawn?




One Step forward two Steps back

A four year review of Working Capital and

Liquidity DevelopmentPublished for 27th annual RISI North American Forest


Forest based industry in AustriaUbi es? Quo vadis?June 2014

http://www.stepchange.com/publications.html


Conferences and sponsorships Selection

We are frequently invited to speak at conferences and continuously

sponsor industry events

2014 2015

Moderator of CEO panel

2016

Sponsor of European Pulp & Paper Outlook Conference

Speaker and moderator at Executive PanelMarch 2016 | Berlin

Sponsor of North American Forest Products ConferenceSeptember, 2016 | Chicago

Sponsor of CEPI European Paper WeekNovember 22-24, 2015 | Brussels

Sponsor and Speaker at PapierfachtagungMai 10-12, 2016 | Graz

Sponsor of “Global CEO of the Year” categorySeptember, 2016 | Chicago

Sponsor of European Pulp and Paper Outlook Conference

Participant at Executive PanelMarch 10-12, 2014 | Prague

Sponsor of North American Forest Products ConferenceOctober 8-10, 2014 | Boston


Speaker at PapierfachtagungJune 4-5, 2014 | Graz

Sponsor of “Global CEO of the Year” categoryOctober 2014 | Boston

Sponsor of European Pulp and Paper Outlook ConferenceMarch 9-11, 2015 | Amsterdam

Sponsor of North American Forest Products ConferenceSeptember 28th-30th, 2015 | Chicago


Sponsor and Speaker at PapierfachtagungMai 20-21, 2015 | Graz

Sponsor of “Global CEO of the Year” categorySeptember 28, 2015 | Chicago

Industry 4 - RISI · 2020: 10 GBit (5G) Global ... Consumer Electronics, Durable Goods, Fast Moving...

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Transcript of Industry 4 - RISI · 2020: 10 GBit (5G) Global ... Consumer Electronics, Durable Goods, Fast Moving...