Domtar Ashdown: the virtues of Kaizen.

What is a Japanese concept of continuous improvement doing in the middle of Arkansas? Helping Domtar make its Ashdown Mill more productive in a highly competitive market.

When Montreal-based Domtar Industries Inc. purchased the Ashdown, Arkansas, USA mill from Georgia-Pacific in 2001, it introduced the Domtar culture--including a continuous improvement process based on the Japanese principle of "Kaizen." The mill has since used Kaizen and other processes to continuously improve and meet tough global challenges in its key paper grades. Building on a strong operating base inherited from the mill's previous owners, Domtar has worked to improve the efficiency of the mill and its workers.

"This is an excellent mill," said Buddy Allen, general manager of the Ashdown mill, in an interview earlier this year. "I can't say enough good about it. We have an extremely strong technical base and a very good employee mix in operations, technical, and maintenance--and we want to keep it that way. We have a good relationship between our union and management. I've negotiated two contracts since I've been here, and they have both gone very well. We share a lot of information with our union and they embrace the Kaizen process."

The Ashdown Mill was built in 1968 with one paper machine. A second machine was added in 1975; a third machine and a new pulp line in 1979; and a fourth machine and another new pulp line in 1991. With 1200 employees, the mill has annual paper production capacity of 900,000 tons and annual market pulp sales of 175,000 tons. The mill produces uncoated freesheet papers, including MICR (Magnetic Ink Character Recognition), offset, copy paper, repositional notepad, trade book, and check paper, as well as ECF bleached kraft hardwood and softwood pulp. It is one of the largest uncoated freesheet mills in North America and is ISO 9001 and ISO 14001 certified.

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COUNTING ON KAIZEN

Kaizen--an approach that Domtar also uses at its other mills and facilities--is focused on problem resolution and improvement, using cross-functional, multi-discipline teams that include representatives from operations, maintenance, accounting, technical, purchasing, and other mill groups. Participation on a Kaizen team is voluntary, and the selection of participants is a joint effort of union and management.

"The teams have mandates to examine the root causes of problems we have identified and come up with solutions," said Allen. "What makes this process different from any that I've been involved with is that team members implement their own solutions, with the full support of management. Kaizen has produced major returns for us; it has cut millions of dollars out of our cost base. Kaizen gives us an opportunity to tap the intelligence of our employees rather than the pocketbooks of the shareholders. It has given all 1200 people who come through that gate each day an opportunity to make a difference and have fun."

The Ashdown Mill began using the Kaizen process about three months after being acquired by Domtar. While the mill had used other continuous improvement processes, Kaizen took the process to another level.

"The key step is having people immediately implement their own solution. In many continuous improvement processes, you make a recommendation and then noodle around with it for six months before making a decision. All that time you could have been reaping the benefits."

Allen cites a particularly successful Kaizen project in the woodyard, where a chip-conditioning unit had an extremely low uptime--less than 50%. Domtar assembled a Kaizen team with a mandate to find a solution in two weeks. The team came up with a root cause and spent about $6000; the unit now has 98%+ uptime and has dramatically reduced production of oversized chips.

COMPETING IN WORLD MARKETS

Continuously improving mill operations is vital for the Domtar Mill since it operates in a brutally competitive communications papers market. "From a North American perspective, we are a very competitive mill," said Allen. "Based on benchmarking data, we are one of the leaders in the communication paper business. However, some of the big, high-speed machines that are going in overseas have an advantage over our current equipment."

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To reduce the technical gap with new machines, the Ashdown Mill is making targeted upgrades. For example, the mill recently upgraded the dryer section steam system on PM 61 by installing Deublin stationary siphons, resulting in an important productivity improvement. The mill is also installing a new headbox on PM 62 and is rebuilding the continuous digester to get better plug flow and increased retention time.

"We think the digester project will significantly improve the consistency of the softwood furnish, and that should improve sheet profile," said Allen. "We are always examining how our machines can keep up with quality demands and improve efficiency."

RELIABILITY AND MAINTENANCE

Domtar Ashdown is also committed to keeping its existing equipment at peak performance and is known for its excellent maintenance program. "Operations and maintenance are not separate in this mill," said Allen. "They are single team. One thing I'm very, very pleased about is that there are no silos in this mill. We have centralized maintenance planning, but area-based maintenance execution."

Allen also said that the mill has good discipline for maintenance planning, scheduling, and adherence to schedule. "When we take a machine down for its 'field day,' that shutdown is carefully planned--down to naming the person performing the task 10 days prior to the machine going down. When we have major shutdowns, we plan six weeks out," he said.

The Ashdown Mill is in the process of moving toward reliability-driven maintenance, which should allow the mill to predict the need for equipment maintenance rather than assume the need for maintenance. "It's time for us to take the next step," said Allen. "Rather than taking that piece of equipment down every six months because of an assumption that it needs to be taken down, we actually monitor the health of that piece of equipment and take it down when it is needed."

According to Allen, uptime on the paper machines is world-class. "Very few machines in the world run at the uptime level that our machines do," he said. "Our maintenance downtime--both scheduled and unscheduled--is significantly better than what would be considered benchmark or world class."

MEETING THE GLOBAL CHALLENGE

Machine improvements and efficient maintenance help the Ashdown Mill compete more effectively in the global communications papers market. The mill is also competing more effectively by emphasizing its natural market advantages. Domtar is currently installing a system to make it easier for its customer base to do business with the company by providing a single window from order entry to billing.

Domtar also wants to make reliability and great customer service key competitive advantages. "We want customers to understand that they can depend on us every day, 365 days a year," said Allen. "Customer service is what will differentiate the North American supplier and the Ashdown Mill. Not only do we want our technical representatives listening to our customers, we want our operators to sit down and listen to customers and then come back and develop remedial action for that customer's concerns.

"Basically, we want to respond to our customer base as if they were across the street from our mill," Allen continued. "That will differentiate us from foreign competitors--along with getting our product to that customer on time, plus or minus one hour from the promised delivery time. We know that international competitors can make a good product, but reliable service can be a powerful competitive advantage."

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TRAINING AND DEVELOPMENT

Programs like Kaizen and reliability-centered maintenance require a high level of training and development, and Domtar Ashdown has invested in several key training programs. One of the most important, said Allen, is training on the core business philosophy of the mill and the Domtar corporation.

"Our business philosophy training reflects the tremendous desire by our president and CEO, Raymond Royer, and his Executive Committee that all of us understand where we are as a company, where we're going, and how we want to be viewed. We talk a lot about values, respect, entrepreneurship, integrity, perseverance--those types of qualities are pretty important at the end of the day.

"Our focus is on what we call the three pillars: the shareholder, the customer, and the employee," continued Allen. "Every employee in the Ashdown Mill has been through training on the three pillars. Additional training is focused on how we are going to become the desired supplier to our customer base. It focuses on our employees making a good impression the first time. This training has helped us understand Domtar's philosophy of meeting and interacting with the customer base."

Of course, training in the Kaizen process is also key. All employees--and particularly the front line worker--have the opportunity to be trained in two-week Kaizen programs. They learn the tools and processes of Kaizen the first week and work on the mandate they have been given in the second week.

"We will have eight 'learning' Kaizens this year and about 30 'quality and productivity' Kaizens where the team takes a mandate and pursues it through to implementation of a solution," said Allen. "We had one Kaizen on retention of soda in the system and one on proper utilization and mix of chemicals. By the time they finished, the teams had developed five Q & P Kaizens, and we have already done two of those this year."

At Ashdown, each area of the mill has a training coordinator that is jointly selected by management and the union. That person is taken out of the workforce and is made responsible for training employees as well as material development. "That approach has worked very well for us," said Allen. "These coordinators are trained in gap analysis and are trained to lead the process."

GAINING MOMENTUM

The Domtar Ashdown Mill is looking to move from strength to strength this year. According to Allen, last year the mill had its best ever safety performance; the lowest level of customer quality complaints; best ever environmental performance; and the best operating efficiency.

In 2004 the mill, as did the industry, faced significant cost pressures in the areas of fiber, energy and transportation; however, with good mill performance as outlined above we were able to mitigate a significant portion of these costs. Our people focus on what is within their control--working safely and efficiently to produce a quality for our customers."

One of the most satisfying aspects of the job for Allen is the employee "buy-in" to the culture of the mill. "We had a quality audit here a while back, and the auditor commented that our employees are really taking on the business culture. That's because every employee has a discretionary effort--things they can do if they really want to. If they believe they have an opportunity to spend that discretionary effort, they will do that. All of a sudden, you move from compliance to commitment. I think we're tapping into that now. I'm having probably the best time at work that I've had in a long time."

WHAT YOU WILL LEARN:

* How the Domtar Ashdown mill makes vital improvements by using the Japanese technique of Kaizen.

* Key improvements the mill is making in equipment, processes, and maintenance.

* How training and development are creating a more responsive, empowered workforce.

ADDITIONAL RESOURCES:

* Domtar Web site: www.domtar.com.

RELATED ARTICLE: ENTRY-LEVEL ENGINEERING PROGRAM

One of the key programs carried over from the former owner of the Ashdown mill, Georgia-Pacific, is an entry-level engineering program that takes entry level, college-educated engineers and rotates them through a full range of jobs at the mill in three-month cycles.

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"My commitment to them is 'I'm going to give you five years experience in 18 months,' and we've lived up to that," said Buddy Allen. "We take people out of college and put them through our own rotation system. They are aggressively challenged in all areas of the mill--purchasing, environmental, writing work orders, chemical recovery, woodyard, paper machines, and converting. At the end of each three-month rotation, they make a presentation on what they accomplished and what they would change. The program has served us very well. We've had that program in place since 1996."

The results have been outstanding, according to Allen. "One of our entry level workers became a facilitator on an Information Technology project. He didn't know a lot about IT projects when he started, but that didn't make any difference--he did an outstanding job."

ALAN ROOKS, EDITORIAL DIRECTOR

ABOUT THE AUTHOR

Alan Rooks is Editorial Director of Solutions! magazine. Contact Alan at [phone], or by email at: [e-mail].

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