From Forest to Factory

Roland Hülsmann is a truck driver at a wood-processing company that manufactures fiberboard. He whistles contentedly to himself, having just unloaded his last tree trunk, setting it down in the company’s lumber yard with the hydraulic arm of his lumber carrier. His shift is now over – a whole two hours earlier than usual – thanks, in part, to the fact he can easily locate the forest collection points, or piles, where timber suppliers leave their lumber to be collected for use in production.

This increased efficiency is the result of a decision taken by Mr. Hülsmann’s employer to implement the SAP Business All-in-One industry solution it.wood timber developed by Bielefeld-based SAP full service provider itelligence. But this extraordinary solution has also brought benefits for Hülsmann himself. For years, he has driven into the nearby forests three times a week to load up his lumber carrier with wood that his company has ordered from the forest management authorities. These authorities and other wood suppliers provide the geographical coordinates for locating the various lumber piles.

Google Earth – lumber location made easy

The latitude and longitude data provided by suppliers is stored in it.wood timber as GPS data. However, the SAP industry solution also uses an XML interface to link in GPS-based route planners such as Map & Guide and Google Earth. This means that the precise geographical coordinates of each individual pile can be transmitted direct to the GPS systems fitted in the lumber carriers. This data even includes instructions on where the drivers have to branch off public roads. As a result, Hülsmann and his fellow truck drivers can track down their own specific piles quickly and easily.

Gone are the days of truck drivers being handed locations scribbled, often inaccurately, on their order slips. This inefficient process often meant that drivers wasted valuable time searching for the right pile and trying to double-check vital information with their co-workers back at headquarters.

Visualizing positioning data at the click of a mouse

But this industry solution does not just benefit the truck drivers. Integrating the pile data also makes scheduling far easier by providing controllers with an immediate overview of the precise geographical location of the piles selected for collection. Map & Guide and Google Earth are shown in it.wood timber as additional buttons for the scheduling of collection orders.

By simply clicking on these additional buttons, the positioning data for piles and additional information stored in it.wood timber – for example type of wood, quantity and identifiers – are transferred to Map & Guide or Google Earth and displayed on-screen. This visualization makes it a great deal easier to plan routes for wood procurement. Operators can group together the individual piles selected to ensure that the collection route is as efficient as possible. This process also involves specifying the order in which truck drivers should collect individual piles, which prevents any unnecessary or additional journeys, thus saving time and money.

Controlling logistical processes centrally

However, this high-performance solution is not just ideal for scheduling processes, it also allows users to centrally map the entire logistical process of wood procurement. This delivers a reliable, end-to-end flow of data and materials that spans the entire workflow from agreed order volumes to the piles in the forest and the processing plant.

The initial stage in wood procurement involves using basic planning to agree orders with wood suppliers. These orders specify the required type and quantity of wood and provide a rough timeframe for when the order should be delivered. Once the supplier has cut, measured, sorted and labeled the order and prepared it for collection, he notifies the plant, providing all relevant information. This information is added to the supply order and automatically fed into financial accounting processes, where the order is approved for payment.

Automatic adjustment for discrepancies

Once a specific quantity of wood has been incorporated into production planning, the scheduling operator builds an overview of the piles that are available and creates collection orders that are dispatched to in-house or external lumber carriers for the required volume of wood. When this wood has been delivered to the plant and unloaded in the lumber yard, it is measured and lab tests are performed to establish its quality, for example its moisture level.

Lab workers input the results of their tests in the industry solution, thereby calculating the actual quantity and value of the incoming wood that is to be posted in the books. If this data differs from the information on the delivery note, corrective postings are made in the form of credit notes or deductions as necessary. This applies equally to both internal accounting for deliveries made by in-house trucks and to trucking orders using outside companies.

Two heads are better than one

The SAP full-service provider itelligence developed this solution in close cooperation with Fiberboard GmbH, a subsidiary of the Classen Group. The company manufactures MDF boards to which, for example, laminate surfaces are applied. Due to the versatile nature of the material, worldwide demand for MDF has grown continuously over recent years. It was in response to this rising demand that the Classen Group, a wood processing company based in Kaisersesch, Germany, took the decision to establish its own MDF plant in Baruth, Germany – Fiberboard GmbH.

The company has been supplying the wood-processing sector with fiberboard since 2007, and annual output is currently approximately 400,000 m3. In order to feed this production, the company needs some one million cubic meters of lumber, which is primarily sourced through the German forestry industry.

All aspects of lumber acquisition covered

Due to the high volume of lumber and wood chips that Fiberboard requires, the company needs to plan its acquisitions well in advance. It was therefore essential that the system covered all aspects of lumber acquisition. Although Fiberboard – like all the other German sites in the Classen Group – uses SAP ERP as part of an integrated IT strategy, the standard functions of this solution were unable to provide optimum support for wood purchasing.

SAP ERP therefore needed to be extended with special functions for sector-specific processes in the wood industry. To help map pile information such as geographical positioning data and quantities, itelligence extended the delivery plans supported by SAP ERP to include the relevant data objects. An in-house pile collection order now identifies discrepancies in terms of quality and quantity that can occur between the provision and delivery stages due to the fact that wood is a natural product. These discrepancies are identified through measurements or laboratory testing. it.wood timber also covers all accounting procedures for wood procurement and transporters.

Development from scratch

One particular challenge for the project was that the new industry solution had to be developed in parallel with the construction of the new plant. The new solution had to go live at the same time as the construction of the new site was completed, as all wood procurement processes were to run on the new system from the very outset.

Everything ran smoothly. From day one, Fiberboard was able to use it.wood timber to procure lumber and wood chips based on specific information. The SAP industry solution not only maps wood specifications such as length, diameter and quality, but also the handling specifications that apply to forestry resources, and transportation requirements. What’s more, the solution also manages data from partners such as forest owners, forestry authorities and trucking companies. The system even incorporates the purchasing contracts agreed with various suppliers, including volume, grading and scheduling. Supplier data complete with GPS details for locating the piles awaiting collection then ensures a smooth transition from forest to factory.