Newsprint giant Abitibi beats supply chain woes

The world’s biggest newsprint supplier is turning the page on an IT upgrade that will see supply chain management tools installed in its 21 paper mills across North America.

Montréal-based Abitibi-Consolidated Inc. (ACI) has been using J.D. Edwards products since 1994. Most recently,

the company tapped PeopleSoft Inc. (which acquired J.D. Edwards last year) to develop an order management system that could replace a legacy tool first developed in 1974 and integrate it with its existing financials software.

ACI’s business model required that a solution be tailored to its needs, said senior vice-president, technology services, Bruno Tremblay.

“”It’s not typically on an SKU basis of business where we replenish inventory. We wait for the customer to place the order with the dimensions and the specifications and then we manufacture it,”” he said.

“”The trick on that was to take a former J.D. Edwards system that was SKU-based to a made-to-order system,”” said Francois Bertheau, a senior account executive with PeopleSoft Canada.

“”I would say that we probably modified 25 per cent of the distribution side of the application itself. A lot of stuff was done, but a lot of the major modifications were done with respect to SKUs versus made-to-order.””

Tweaking products to meet a specific vertical’s requirements has become commonplace in the software development business, said IDC Canada Ltd. software analyst Warren Shiau.

There are industry-specific packages available for everything from construction to wineries, although they tend to be aimed and mid-sized customers, since large companies were the early adopters of more generalized enterprise solutions, he added.

PeopleSoft has customers in the pulp and paper industry, but lacked a cash-to-order software piece that could meet its customers’ needs, Bertheau said.

The custom piece for ACI could be another arrow in the quiver for PeopleSoft to aim at customers in that market.

“”The idea was to develop a pulp and paper flavour of an order-to-cash system combined with the full ERP system,”” he said.

ACI is currently deploying PeopleSoft’s EnterpriseOne Customer Order Management and EnterpriseOne Advanced Planning (formerly part of J.D. Edwards’ OneWorld suite). The integration work was completed by PeopleSoft with services support from implementation partner EDS.

“”It’s totally integrated and that’s why we went with that solution. The former system we had was separate in the mainframe applications and different applications,”” Tremblay said. “”Now we have a totally integrated solution from the time the customer places the order to the time we collect the money.””

ACI has provided training on the system for its salespeople – a combination of classroom sessions and online learning, “”but we are still in the process of giving more and more training”” to take advantage of the full functionality of the software, Tremblay said.

ACI is in the midst of a company-wide upgrade, which has been implemented in stages since it deployed green-screen J.D. Edwards technology in the early 1990s. Some on ACI’s financial software is still on green-screen legacy architecture. The company saw its footprint grow in more recent years, adding to its IT workload. ACI merged with Stone-Consolidated in 1997 and acquired Québec pulp and paper firm Donohue in 2000.

The company’s financials are completely integrated across the enterprise, Tremblay said, but five of the 21 mills in the U.S. and Canada are still on legacy systems for non-financial applications such as purchasing and maintenance. The PeopleSoft EnterpriseOne rollout is almost finished in North America, with a planned upgrade to the company’s one U.K. mill to follow. After that, ACI will face a decision: Further deploy financial tools in a green-screen environment or replace the architecture altogether.

Since it bought J.D. Edwards, PeopleSoft has been in defence mode, Shiau said, making the former company’s customers happy and fending off attempts from rivals to steal that business. Overall, PeopleSoft has been quite successful by catering to the needs of J.D. Edwards users.

“”This specialization for Abitibi is one example of why a J.D.E. customer would stay in the PeopleSoft fold. They’ve kept J.D. Edwards’ product philosophy, and J.D. Edwards was very successful at looking at specific industries,”” he said.

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