Forestry giant lumbers from mainframe to Web-based app

A Vancouver-based company is betting its new software will allow it to see the finances for the trees.

Canadian Forest Products Ltd. (Canfor), the largest producer in Canada of softwood lumber and market pulp, is cutting down

its mainframe system for a Web-based application, according to John Tolkamp, general manager, information services.

With the help of integrator PricewaterhouseCoopers (PwC), Canfor is bringing in Oracle Financials, part of the E-Business Suite. Tolkamp says there are several project drivers, but return on investment is at the top of the list.

“”We’re going to the Oracle Web client server architecture. That allows us fairly significant operational savings,”” Tolkamp says. “”We’re (also) moving to a much more open platform, so we’re improving our ability to integrate other applications in with the Oracle financial systems.”” He says there are about 19 such applications.

Key to the integration is the middleware technology layer that is also part of the project. “”We’re moving more towards document messaging sets than the traditional hardwired type of integration or flat-file type of integration that was done before,”” he says.

Companies involved with projects of this scope are often tight-lipped or vague about how success or failure will be measured. Tolkamp, however, says he knows exactly how to gauge it. “”Success in this project is fairly straightforward. Are we running our financials on Oracle? The second is, are we able to turn our mainframe financial system off and no longer have to pay the support fees and the operating fees on that system?””

Tolkamp says the responsibility for the mainframe is outsourced, but when the contract ends the company stands to save about $1 million a year. That savings, combined with having the skills to manage the new system in-house and prior experience with Oracle, made it the natural choice, he says.

The focus on business applications in the forestry industry is rare, according to Craig Campbell, e-business leader for PwC global forest and paper group. He says there are very few forest and paper companies in Canada that have implemented any form of enterprise resource planning solutions.

“”They embrace technology very much as it relates to process technology on the shop floor, and that’s something where they are definitely progressive,”” Campbell says. “”Business technology is not a priority. The priority with forest and paper companies is the plant and equipment, cost reduction at the mill level and streamlining and de-bottlenecking the pulp and paper manufacturing. That’s the priority and that’s where capital gets allocated.””

With so few companies focusing on business applications, Campbell says Canfor could end up with a business advantage, and Tolkamp says it is on the way.

“” The project is going really well at this point; we’re very happy with how it’s progressing,”” Tolkamp says. “”We’ve done some training with the end users and they’re all very happy with Oracle as well.””

CanFor started the project in January and expects it to be completed by October.

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