Tissue snapshot: Kruger plans to implement AI, automation at more facilities over time based on initial success of first phase of AI project at Sherbrooke tissue mill; projects will focus on Kruger's supply chain, operational excellence, waste reduction

Sample article from our Tissue & Hygiene

LOS ANGELES , March 29, 2022 () –

Kruger Products L.P. has now rolled out OpEx – its operational excellence program – to all its sites and most of its assets, Dino Bianco, CEO of KP Tissue and Kruger Products, said during Kruger's Q4 2021 earnings call on March 10, 2022.

"We are focusing on increasing the depth of knowledge, training and culture around OpEx," he said. "Looking ahead, our focus will be on asset reliability and waste reduction in 2022."

Based on the initial success of Kruger Products' AI project at its Sherbrooke tissue mill in Quebec, the company plans to move forward with further implementation of other facilities over time.

"These AI projects will be focused on our supply chain, creating a predictive and prescriptive capability to manage our business," Bianco said. "The combination of AI and automation should gradually provide additional benefits for our network."

Based on industry benchmarking, AI can provide a potential 10% lift in overall equipment effectiveness, a 10% to 15% reduction in costs, and a 15% to 20% reduction in maintenance.

"We haven't carried out a complete assessment of these potential benefits yet, but they will increase our productivity, and offset inflationary pressures for the future," he added.

Kruger hasn’t yet finished the four-stage AI project at Sherbrooke. Of the project’s four planned phases, the company finished Phase 1 with good success as it relates to operational excellence – much of it around getting centerline predictability – and is starting Phase 2.

Kruger is getting out of the production planning stage and into integrating those production plans, as well as looking at areas like waste reduction.

"We're through the first phase, moving to the second phase, and now we're starting to talk about where do we go next in terms of what facility do we start rolling this out at," Bianco said. "So it will be with us over several years, as we (brake) and speed up with respect to the investment and the returns that we get across the different sites."

Sherbrooke was the best place to start because the facility had new assets and the technology platform to do it, he added. At some of the company’s other sites, Kruger will have to "beef up our technology platform and our data capture to be able to bring it on board," he said. "So we need to do some of that ahead of time before we're able to bring it to our other facilities."

Bianco said Kruger's "focus on operational excellence, including our OpEx program and AI investments, will help us improve manufacturing and supply chain performance for the future."

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