Possibilities offered by digitalization

Symposium on Wood Products Industries in Future Bio-economy BusinessApril 7, 2016, Sibelius Hall, Lahti, Finland

Jaakko Kuusisaari, Tieto

Applications in woodworking sector

© Tieto Corporation2

Sourcing Production Distribution Consumption

Forestry & harvesting

Logistics, Mill

reception, Wood yard,

Deinking

Recycled fibre

Pulp mill

Biorefinery

Sawmill

Converting

Converting

Wood products

Newsprint, P&W

Packaging

Hygiene wholesale / retail

Various – industrial materials, specialty papers, non-woven

Grid power & heat

Biochemicals,Biomaterials,

Biofuels

ConsumerPaper mill

Board mill

Tissue mill

Other fibre-based production line

Power plant

Setting the scope: Digitalizing the end-to-end forest industry value chain

Converting

© Tieto Corporation3

Sourcing Production Distribution Consumption

Forestry & harvesting

Logistics, Mill

reception, Wood yard,

Deinking

Recycled fibre

Pulp mill

Biorefinery

Sawmill

Converting

Converting

Wood products

Newsprint, P&W

Packaging

Hygiene wholesale / retail

Various – industrial materials, specialty papers, non-woven

Grid power & heat

Biochemicals,Biomaterials,

Biofuels

ConsumerPaper mill

Board mill

Tissue mill

Other fibre-based production line

Power plant

Wood Products: The impact of digitalization goes end to end

Converting

New business models and ways to create value, new market entrants

Profound change in customer behaviour and expectations

Ubiquitous connectivity, smart devices, big data,

powerful analytics

The age of the customer Data explosion and real-time visibility

Globally networkedeconomy

What “Digitalization” really is

Disruptivebusinessmodels

MegatrendsDisruptive forces are hitting the industry

• Resource scarcity – competition for fibre• Volatile energy and raw-materials cost• Industry restructuring• Demand volatility and short lead-times• Ageing population – workforce imbalance• Shift of balance in global economy• Global marketplace

• Additive manufacturing - 3D printing• Vehicle automation and robotics• Social connectivity, real-time, transparent• Data-driven economy• Demand-driven innovation• Super-high expectation on customer

experience

Global and industry Innovation, technology and behaviour

Forest Industry

Bioeconomy

Digitalization

Digital businessNew ways to create and share value

KnowledgeEcosystems

BusinessEcosystems

InnovationEcosystems

Platform based

business

Digitalized products and servicesDigital, intelligent and connected

Digitalized customer experienceIntelligent channels, integrated with physical

Digitalized business processes Intelligent, automated, agile

Re-innovate businessNew business models, value chains, networked business

From evolution to disruption

Evolution

Disruption

Digitalization journeyDigitalization is progressing on different levels and at a varying speed in different industries. Nevertheless, all industries will be impacted.

Digitalization should be seen as an opportunity. Although, it can also be a threat if you are not willing or capable to transform and innovate.

© Tieto Corporation8

SourcingForestry, Harvesting, Logistics Production and Converting Sales and Distribution Consumption

End-to-end wood products value chainDigitalization possibilities* on all levels and in all stages

Forestry &

harvesting

Logistics,

Mill

reception,

Wood yard,

Deinking

Recycled

fibre

Pulp

mill

Biorefinery

Sawmill

Converting

Converting

Wood products

Newsprint, P&W

Packaging

Hygiene wholesale / retail

Various – industrial materials,

specialty papers, non-woven

Grid power & heat

Biochemicals,

Biomaterials,

Biofuels

ConsumerPaper mill

Board mill

Tissue mill

Other fibre-based

production line

Power plant

Converting

Digital inventory and forest asset data

Digital marketing and forest owner engagement

Digital wood market Additive manufacturing,3D printed wood products

Digital marketing

Retailer e-channels

Logistics collaboration and optimization

Dynamic harvesting optimization

Dynamic production planning and optimization

Dynamic demand captureSupply chain visibility

Personalized services, on-line customization

Distribution center automation

Collaborative demand planning

On-line partner services

Scalable services and business models

Predictive asset management, monitoring

Digital productsProductivity tools

Crowdsourcing

Global transparent market

Collaborative innovation

Big data, analytics, end-to-end optimization

Consumer e-channels

New generation robotics

*only selected examples listed here - future possibilities are practically endless

© Tieto Corporation9

Leveragethe existing

Harvest the legacy including data and functionality. Modernize and createfoundation for the digital.

Digitalization journeyOrchestrate your future by leveraging the existing

Run business in dual mode

Balance the traditional and new while building digital future. Take up business as digital and digital as business.

Become an ecosystem driven business. Invest in digital foundation for agility and business innovation.

Orchestrate the future

Most of the time you cannot really manage digital disruption, but you can capitalize on it!