1. Industrial IT - A robust portfolio of interoperable solutions
Pulp & Paper
Document No. 2PAA101225

2. Growth and Profitability in Pulp & Paper
Not all companies have been successful in obtaining profitable growth. Value destruction is common in the pulp & paper industry.
- Average pre-tax return on capital employed (ROCE), % -
Value Creation
Cost of capital (8-12%)
Size of the bubble is relative
To the sales in USD in 2003
Value Destruction
Average growth rate 8.0%
-10 -5 5 10 15 20 25 30
- Average sales growth in USD, % / year -
Source: PWC Global Forest and Paper Summit 2005

3. Percent Planned Work (by Industry)
A shift in maintenance strategy can bring dramatic bottom line results
World class companies plan at least 95% of their maintenance activities
Planned maintenance has significant benefits over a reactive strategy
In a recent study, companies in all industries showed room for improvement
Source: HSBRT 2005

4. Return on Capital Employed
Improvements to ROCE by lowering capital costs can be made in the following areas using Industrial IT solutions.
Improvement Areas / Solutions
Production planning
MES application
Finishing
Overall equipment efficiency (OEE)
Asset utilization
Mill Operations
Integrated operations and maintenance
Integrated Production
Integrated planning, maintenance and operations
Benefits
Minimize grade change losses
Delivery date accuracy
Reduced WIP
Reduce time to market
More predictable capacities and delivery times
Reduce time to enter work order
Efficient review for accuracy and incident investigation
Maintenance scheduling based on production profitability

5. Industrial IT solutions
ABB has robust solutions for Pulp & Paper in each improvement area:
Planning = Collaborative Production Management
Finishing = Industrial IT System 800xA:
Real time production intelligence (RTPI)
Asset Optimization
Production Information
Mill Operations = Integrated operations and maintenance:
Industrial IT System 800xA
Integration with partner CMMS systems
Integrated Production = Integrated operations, planning and maintenance:
Industrial IT P&P solutions
Business logic and single information model from ABB and solution partners
CPM/MES
RTPI/OEE
CMMS

6. Focus on integration
Industry Trend: Where focus was on plant efficiency and production, customers are now placing new emphasis on data and information from both the manufacturing systems and the business systems

7. OEE identifies areas for improvement
Measuring real-time performance provides real time production efficiency data to understand the true performance and realize the full potential of production lines
True performance can be determined through real time measurement, analysis, and improvement of Key Performance Indicators (KPIs)
OEE (Overall Equipment Effectiveness) is a KPI and is one of the best measures of performance
Real time monitoring and alarming of asset KPIs facilitate fast, reliable implementation of corrective actions
OEE: Overall Equipment Effectiveness is maximized through efforts to keep control of and to eliminate production’s “six major losses”:
Theoretical Production Time
Planned Production Time
Gross Operating Time
Net Operating Time
Valuable
Operating
Time
Planned
Down Time
Unplanned
down Time
Losses
Speed
Quality
Equipment Failure
Setup & Adjustment
Idling & Minor Stops
Reduced Speed
Defects in Process
Start up Losses
Planning
Factor
(Pf)
Availability
(A)
Performance
(P)
(Q)
The KPI OEE is the multiplication of the Availability , Performance and Quality factor and takes all these losses into account, revealing the hidden plant. (OEE = A*P*Q)

8. Predictive maintenance strategy delivers value
Predictive maintenance compares the trend of measured physical parameters against known engineering limits for the purpose of detecting, analyzing, and correcting problems before failure.
Maintain on Condition
30%-40% savings over Reactive Maintenance
8%-12% savings over Preventative Maintenance
Benefits
Extend life of assets
Shift from prevent to correct
Catch potential problems before impact to quality or productivity
Avoid unnecessary tasks and focus on higher value work
Predictive maintenance revenue potential realized by leveraging existing conditions monitored by equipment and infrastructure (but otherwise ignored).

9. Mill integration drives even greater value
The greatest savings can be achieved when execution, maintenance and production planning are completely coordinated.
Total mill integration:
Integrate planning and maintenance scheduling
Optimize downtime around production to minimize overall cost
Integrated operations and maintenance:
Streamline work order entry
Provide failure condition data
Reduce investigation time
Ensures data integrity
Basic Integration:
Production requests synchronized from planning to production
Enterprise
Plan
(ERP/MES system)
Maintain
(maintenance system)
Execute
(automation system)
Mill Operations

10. Example: Operations & Maintenance Integration
The fan pump feeding stock to the paper machine has shut down. What happens next in the integrated maintenance scenario?
Sequence of Events:
Fan Pump Stops
Automation system asset monitors detect fault
Operator station receives alarm and asset condition details
Specific problem with fan pump motor identified automatically
Maintenance work order submitted electronically to CMMS
Mill Operations

11. Example: Operations & Maintenance Integration
The fan pump feeding stock to the paper machine has shut down. What does the planner do with the work order request?
Sequence of Events:
Maintenance planner receives work order request in CMMS
All detail information is included, eliminating the need for additional investigation
Detailed planning and scheduling of repair
Enterprise 
Results:
Identification of problem in complex machine
Automatic detection and communication to CMMS system
Verification of circumstances and conditions
of fault
Work order request with diagnostic detail
Mill Operations

12. Example: Operations & Maintenance Integration
The fan pump feeding stock to the paper machine has shut down. How does integrated maintenance benefit the paper mill?
Benefits:
Reduced investigation time
Easy identification of correct skill set
Maintenance engineer prepared with the right tools and parts
Reduced Mean Time to Repair
Optimized mill operating cost!
Enterprise
Planner sends right person with right tools and parts to fix the fan pump  
Work order request with diagnostic detail
Mill Operations

13. Example: Mill Integration
The fan pump feeding stock to the paper machine needs repair. How can closing the integration loop provide additional savings?
Sequence of Events:
Maintenance planner requests window for fan pump repair
IIT solution determines repair window based on production ROI
Maintenance schedules repair based on product profitability
Mill IndustrialIT Solution
Planning Module
Maintenance Module
Maintenance system has visibility into the production schedule and asset utilization plans
Repairs can be scheduled at the time of least financial impact
Planning is based on machine availability, condition and maintenance status
Work order request with diagnostic detail
Additional Benefits:
Predictive maintenance functionality enables scheduling of repairs, before failure, during a time of least economic impact
Maintenance costs become a component KPI
Operations Module

14. Industrial IT Architecture
At the core of Industrial IT is an information architecture that seamlessly links equipment and applications in real time. Industrial IT technology consists of:
Single window environment for information access
Context sensitive decision and action tools
Unique object-oriented architecture
Certified “building blocks” for maximum interoperability
Field bus technology support for intelligent devices

15. The Industrial IT information architecture …
… combined with the IIT ecosystem of interoperable products and solutions, enables ABB to deliver unprecedented business value.
Asset Optimization
Real time monitoring of asset health
Asset monitors trigger CMMS work orders
Identifies asset performance problems before failure
Automatic notification of asset conditions
Reduce preventable breakdown costs!
OEE Analysis Tools
Alert generation for non-productive equipment states
Integrated root cause analysis tools
Identification of improvement areas in real time
OEE display in single window environment
Reduce unplanned downtime!
Process Engineering Tools
Automatic configuration of 800xA loops, tags and configuration
Bi-directional data synchronization
Automatic population of controllers and I/O
Difference viewer to identify changes
Reduce engineering time!

16. The Industrial IT information architecture …
… combined with the IIT ecosystem of interoperable products and solutions, enables ABB to deliver unprecedented business value.
CMMS Systems
Automatic entry of maintenance work orders
Viewing of CMMS work orders from 800xA
Seamless integration between operations and maintenance
Single electronic audit trail
Reduce mean time to repair (MTTR)!
Field Bus Devices
800xA HART, FF and Profibus device libraries
Device asset monitors allow early identification of issues
Object types include faceplates, diagnostics, asset monitors and configuration support
Reduced integration and lifecycle cost!

17. Industrial IT Solution Architecture
Collaborative Production Management
Quality Control
Scanners & Actuators

18. Industrial IT Paper Solutions
Power plant
Machine health
Paper machine drives
Web
imaging
Chemical
delivery
Collaborative
production
management
Pulping controls
Wet end measurement
Quality control

19. The Proper Balance = Sustainable Competitive Advantage
Optimized Production Scheduling => Improved Cost of Sales
Optimal Balance of;
Manufacturing Efficiency
Customer Service
Supply Chain Costs
Higher machine flexibility (cost)
Higher inventory, transportation, and distribution costs
Reduce inventory levels
Longer delivery lead times
Smart Papers
WIP Reduction – 35%
Slow Moving Inventory Reduction – 40%
Customer Service Time Reduction – 11%
Manufacturing Cycle Time Reduction – 4% $
StoraEnso NA APS
3 to 5% Savings in COS
We can use this triangle to show just how competing priorities can lead to sub-optimization. Assuming we have a lean supply chain, we cannot get something for free - for example, if we want to improve paper machine efficiency by increasing the length of grade runs, we must increase inventory. Similarly, our sales force might want higher customer service levels - we can do this by either making more grade changes on the machines, stocking more inventory, or paying to expedite transportation costs. Financial staffs recognize that inventory consumes working capital and is a low-quality asset, so they always want to convert it to cash at the risk of lower service levels. Typical organizational practice creates behavior then, that causes us to optimize one side of this triangle while suboptimizing the enterprise. And as we will see later, this applies applies whether we are in a make stock environment or a make to order.
Fewer / Longer machine cycles
Higher Inventory Costs