Abitibi-Consolidated Deploys Supply Chain Management Apps

Paper company eyes decreased inventory, increased accuracy of deliveries with PeopleSoft applications

Paper company eyes decreased inventory, increased accuracy of deliveries with PeopleSoft applications

Pleasanton, CA — June 28, 2004 — Paper and wood products company Abitibi-Consolidated Inc. (ACI) has deployed a supply chain management (SCM) solution from PeopleSoft at U.S. and Canadian facilities in a bid to decrease inventory, increase accuracy of deliveries and automate the invoicing process.

Abitibi-Consolidated manufactures newsprint and uncoated groundwood papers, as well as various wood products, generating sales of $4.0 billion in 2003. With 15,000 employees, excluding Pan-Asia, the company does business in more than 70 countries.

Paper manufacturing companies like ACI struggle to accurately forecast demand to keep inventory at a minimum and efficiently store the paper supply while controlling the high cost of shipping paper. Because shipping can cost as much as 15 percent of total expenses for the company, it is critical to keep costs low while maintaining the quality of the product.

To tackle these challenges, ACI implemented PeopleSoft's SCM applications at 21 paper mills in the United States and Canada, deploying EnterpriseOne Customer Order Management and Supply Chain Planning applications.

With the new applications in place, ACI will be looking to streamline operations and reduce costs by making informed decisions on the capacity at the mills, the status of existing inventory and the proximity of the mills to the customer order.

PeopleSoft said that Customer Order Management provides ACI sales representatives real-time visibility into inventory, enabling the company to make more informed decisions on the availability of supplies and shipment delivery dates. By the end of 2004, ACI will deploy Supply Chain Planning, which will enable the company to better forecast inventory demand, according to the solution provider.

"With the PeopleSoft SCM solution, we were able to reduce our application support costs by half, and we expect to reduce them even more by the end of the year," said Barry Warren, vice president of sales services at ACI. "The PeopleSoft software puts data in the user's hands to be proactive to the needs of our customers. Customer service representatives have their world in front of them, with all their information needs in one location."

"Customer service, combined with real-time visibility into the supply chain, is the competitive differentiator for companies in the paper industry," said Peter Hill, vice president and global industry executive for asset intensive industries at PeopleSoft. "In the low-margin business of paper manufacturing, the ability to forecast inventory demands and adjust supply accordingly is crucial to maintaining a loyal, satisfied customer base."