We help companies improve operating efficiency and effectiveness, deploy lean approaches, build operating skills, and adopt proven tools to eliminate waste and reduce costs.
The largest part of our work in the paper and forest products industry is helping clients in the areas of productivity and operations. Our productivity teams bring cutting edge knowledge, broad cross-industry experience, and leading practices in product and portfolio process optimization to help Paper, Forest Products & Packaging companies address common operating challenges. These include enhancing equipment and personnel efficiency in harvesting operations as well as in manufacturing facilities, converting facilities to respond to shifts in capacity of pulp production around the world, refining operations to respond to the rising cost and declining quality of recycled fiber, and increasing operators’ energy efficiency.
What we do
We also work with governments and industry organizations to address the severe energy and resource issues related to the sector, helping reduce energy consumption and its impact on the environment as well as address the shared desire to conserve the Earth’s forest resources and use them as wisely as possible.
Our teams collaborate with clients to improve specific aspects of their operations as well as transform entire operating models for companies expanding into new businesses or adopting new go-to-market strategies. We help clients streamline and at times reconfigure their operations, working with them to inject new approaches such as lean manufacturing into their operating models. We also bring deep experience in designing and implementing fixed cost reduction programs to shore up balance sheets and free up capital.
Examples of our work
For example, we supported a major North American pulp and paper company develop and execute a mill manufacturing improvement program that helped increase profitability by 2 percentage points and helped the firm exceed its savings target within four months of implementation. The client and McKinsey collaborated to diagnose and develop improvement ideas in four discrete areas: paper production, pulp production, energy & water usage, and chemical usage. The improvement effort was particularly challenging as many of the client’s machines were over 25 years old. McKinsey conducted a detailed Overall Equipment Efficiency analysis to identify the root causes of processing bottlenecks (such as paper breaks) and eliminate or reduce them. The efforts increased throughput by reducing paper breaks and related downtime by 20 percent.
Additional examples of how we helped clients address productivity and operating challenges include:
- conducting an energy efficiency diagnostic for a large paper mill to identify and reduce energy consumption and related expenses
- assisting a South American pulping operation in building a team of 'lean' experts and forming and training a change team to ensure adoption of new techniques
- working with managers at an Asia operation to improve supply chain planning and inventory management, as well as collaborating on a performance management system
We regularly work with McKinsey experts in our Strategy, Operations, and Sustainability Practices to deliver the best insights and build the skills needed by our clients, frequently combining expertise and solutions in “Total Operations Performance” programs for companies. We deploy a variety of diagnostic and benchmarking tools, such as a mill operations database developed by our practice, to evaluate operating efficiency and functional area contribution and to help our clients adopt practices proven to improve productivity in both. In response to the priority placed on energy efficiency, we developed a comprehensive approach to assessing energy consumption and savings potential from major fiber processing, pulping, and papermaking activities.
More information on our productivity expertise can be found through our Operations, Organization, and Sustainability Practices.