(Part 1/3) Breaking a Dangerous Habit

Financial KPIs influence how a business is run, so reducing costs is a Production Manager’s key responsibility—and one we won’t argue against. What we do need to address is the type of cost reduction. Specifically one that turns out to be more expensive in the long run: limiting your number of PMC suppliers.

The short-term benefits of limiting your PMC suppliers

For papermakers, it’s convenient to only have one or two paper machine clothing suppliers. When a supplier is familiar with the papermaker’s situation, they can go beyond simply delivering the clothing. They can install those felts and fabrics, perform regular service measurements, supply consignment stock, and advise on paper machine settings. Production issues can also be solved quickly when each party is familiar with the other’s machines and processes.

For the supplier, being the single preferred partner is also a win. It means lower acquisition costs and a guarantee of large volume purchases. Plus, with experience of the papermaker’s machine, designing good felts and fabrics becomes easier. It’s a comfortable situation for everyone.

But we all know the comfort zone is the enemy of progress.

The dangers of limiting your PMC suppliers

The capital gains of comfort, efficiency, and cost reduction are only short-term. We need to look at the whole picture to understand the long term consequences for the papermaker, the machine clothing supplier—and our industry as a whole.

A dependence issue

The current status quo makes the papermaker dependent on their PMC supplier. Should something happen, like a take-over, experts leaving the company, strikes, or logistical problems, the papermaker is left with no alternative.

This dependency also leaves the paper mill itself with less and less knowledge of paper machine clothing and its relationship with their machine. It takes years to understand the specific complexity and peculiarities of an individual machine, only to find yourself tied to a moderately performing supplier because waiting for a new supplier to get to know your machine is too expensive.

Failure to innovate

Knowledge of each customer’s paper machine gives the preferred PMC supplier an enormous competitive advantage over other candidate suppliers—and the paper mill will not look for new PMC suppliers when they’re being adequately cared for.

Due to large sums of money and the perceived risk involved with PMC trials—and without the pressure of an immediate competitor—both the papermaker and PMC supplier play it safe. Instead of focusing on developing successful new machine clothing technology, they focus on reducing risk.

Safe in the short-term, this strategy is deadly in the long run, halting innovation and jeopardizing the future of the whole industry.

Fortunately, not all hope is lost

By making PMC performance more measurable—and more predictable—we reduce the risks associated with PMC trials. And when a mill runs more trials with less risk, they see the powerful benefits of innovation and increased competition: more paper production, with lower costs.

In part two, we explain how you can do just that.