Sawmill 4.0 Using floor-level data to drive productivity

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1 Sawmill 4.0 Using floor-level data to drive productivity OptiSaw Vancouver April 25 th François Léger, PMP Solutions Jean-Sébastien Pelletier, Maibec

2 Agenda Introduction Industry 4.0 Sawmill 4.0 : Maibec first steps in Industry 4.0 Innovations to come Keys to success

3 4 business areas: Lumber Siding Eastern white Cedar shingle Cedar mulch About 900 employees 70 years old family-owned company Lumber production: St-Pamphile, Qc: 140 MMBF Masardis, Maine: 100 MMBF (acquired in 2015)

4 Maibec Agile and flexible manufacturing process Broad range of valueadded products Main supplier for the siding plant Over 30M$ invested since 2013 Sawmill upgrade New planer mill

5 We are an intelligent manufacturing solution developer and integrator We enhance sawmill profits and operational excellence We provide turn-key solutions; complete with training & continuous improvement Over 25 installations in North America You go live within 1 to 4 weeks Our expertise in Industry 4.0: Involved in research programs Active attendant and speakers v PMP Solutions celebrates its 10 th anniversary!

6 Industry 4.0 It's Not the Big That Eat the Small... It's the Fast That Eat the Slow

7 The 4 th Industrial Revolution is On

8 Industry 4.0: The Story (1/4) It started in Germany Realizing that information systems play an increasing role in factories Germany industry organizes itself and defines Industry 4.0 concept German state and Industry join forces to activate the fourth industrial revolution

9 Industry 4.0: The Story (2/4) The Threat Google and Apple threaten the German automotive industry by its navigation tools in cars. They were increasingly understanding how drivers use their car and they were appropriating customer relationships.

10 Industry 4.0: The Story (3/4) The problem to solve Produce very small custom batches at the same cost as mass production Gain in AGILITY to keep for themselves the added value requested by customers

11 Industry 4.0: The Story (4/4) The Answer Invest in technology Challenge business models and integrate "the customer Expand business relationships with its supply chain partners.

12 Video

13 Four Design Principles in Industry To connect and communicate people and machines 2. To create copy of the physical world by digital plant models 3. To support humans for solving problems 4. To use cyber physical systems to make decisions on their own

14 Industry 4.0 in Canada 2 weeks ago in Montreal 700 people : Government, industrials, venture funds Political will: Announcement of a 800M$ investment in smart manufacturing from the provincial government Presentation of many success stories showing fast ROI using Industry 4.0 design principles Maibec could have been one of them

15 Sawmill 4.0 Maibec First Step in Industry 4.0

16 Back in the Days Voice of the Customer Recent feedback is negative Grade has been pushed too far without having feedback from customer There was a will to improve overall mill performance All experimentations to test improvements are manual Evolutive vision thanks to mill tours in North America and Europe Kilns are a pain Bottleneck Poor drying quality, cost on fiber quality was up to 26 $/MBF Moisture issues during Grade inspections 110 MMBF/Y in 2006

17 How Can we Unlock the Bottleneck? Option 1: Buy a new kiln Increasing capacity would allow to slow down drying of highquality products, and thus reduce loss Normal decision when you think you ve done all possible improvements 3M$ project Option 2: Improve drying practices PMP Solutions suggest that having a better knowledge of what is getting in and out would allow a tremendous improvement Based on the traceability of the products Potential gain estimate: 40$/MMBF Maibec management chose Option #2

18 Kilns Sawmill Planer mill Kilns Planer mill Connect and Communicate How to measure the drying results: Moisture content first Sample: 100 pieces/kiln All pieces : to pcs/kiln Manual Automated Link kilns and the planer mill: Traceability labels on packages

19 Support People for Solving Problems How to analyze and diagnose drying results Too dry Great Oops! Too wet Quick and easy visual analysis of overall performance MC distribution color code PMP Solutions 3D view of all packages inside the kiln It speeds up diagnostic! Mechanical problems inside the kilns Problems with stock rotation in the yard Problems with packages mix

20 Use Systems to Make Decisions We measure, then we see The sawmill produces 100 different products Species, weight, dimension, length Scheduling tools No choice! We have to group them in kiln - But how? We create 12 drying rules of packages mix in kilns New challenge! Respect the rules at all the time We developed scheduling tools Scheduling tool brought new opportunities Easier to forecast finish products Lower inventory Ease rescheduling after disruption

21 Average price vs Random Length price up by > 50$MBF in Sept 09 November 2007 >50$/mbf September 2009 Better Drying Results 50$/MBF increase in Average Selling Price

22 Results: Throughput Value Increase From 24% to 46% in high-value grades +50$/mbf Access to new markets Increase 20% of drying capacity Equivalent to adding a new kiln Reduce outsourcing No more overtime done by loaders Scheduling was almost a full-time job and it now takes less than 2 hours per week Better drying quality 5% increase of productivity at the planer mill Better customer satisfaction Implementation of a continuous improvement process ROI:0,22 ; less than 3 months New kiln is no longer required

23 Additional Recognition US recognition of the best of breed manufacturers

24 Maibec Achieved the Four Design Principles of Industry 4.0 To connect and communicate people and machines To create copy of the physical world by digital plant models To support humans for solving problems To use cyber physical systems to make decisions on their own But honestly, we did not know at that time the concept of Industry 4.0

25 Pursuit of excellence Value-added products customer segments 2011 Invest in technology Expand business with partners 2014 Capture the value

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28 This is Only the Beginning Information leads to innovation and innovation is an on-going process Increase

29 Connect & Communicate Stay Alert! Real-time information brings action and empowers your team New decision making tools New contextual information New types of alarms New forecasting information Decisions can be taken within seconds Every aspect of the process can be monitored PMP Solutions

30 Business Intelligence Tools Big data is a new world that is now accessible BI provides a quick and easy to read insight of overall mill s performances

31 Industry 4.0 is more than just a flashy catchphrase. A confluence of trends and technologies promises to reshape the way things are made. McKinsey Consultancy Firm Real-time and geolocated inventory in the yard

32 Keys to Success Takeaways

33 A New Manufacturing Culture From Floor Level to Upper Management Owners have to share the vision Offer support Impact on processes is major and will change priorities There should be only one system Integrated system Connected to the ERP (it won t replace it), PLC, WMS Accepted and adopted by everyone Do not underestimate change management

34 Fail Fast, Fail Cheap Our failures RFID Trying to connect everything = too much is like not enough Trying to get information about what is going on in the kilns Accept to fail and try something else. Persisting is usually not the solution Make the right technological choice Choose a technology that supports your vision Have a good understanding of the technology chosen, of its strengths and weaknesses/limits What do you need to make it a success?

35 Advices for Operations Be agile to react quickly and easily to the market needs Flexible operations Maximization of equipment use Rigor of execution Automated scheduling Listen to your customers Work on improving the global value of your operations Don t focus only on the recovery Keep on investing to modernize your operations Buying new equipment is the easy way but often not the most efficient Invest at the right places to support your vision

36 Thank You! Questions?