Projects? What Do We Do Now?, 1998 Engineering Conference Proceedings

The economy is slow. The Cluster Rules have been set. We are still not making money. Corporate finance officers still say we can not spend capital dollars on our mills. What do we do now? We have all heard that we need to tighten our belt. We all grew up being told we should get our own house in order. Now is the time to do just that.

There are still many capital projects that can make money for almost every manufacturer. Energy conservation, water conservation, and waste minimization all present significant opportunities for mill management to improve the financial performance of a mill. In many cases the economics are there, the engineering know-how is there, the desire of the operating department is there, and the interest in improving the bottom line financial performance is there. So why don’t these projects get done? There has often been a disconnect between the financial management of a company and the technical management. Sometimes this disconnect was warranted. Many projects have been approved, been installed and the economical performance never materialized for one reason or another. The selection of capital projects is almost always dependent upon market conditions. And, there is a segment of capital projects that seem to get pushed to the bottom of the list time after time. What we want to talk about is reducing your operating costs. Who could possibly be against reducing operating costs? And, not reducing the operating costs by expanding capacity. That has not done a lot for us in recent years. How do we reduce operating costs? Well, energy conservation, water conservation, and waste minimization do just that. These types of projects allow us to tighten our belt and allow us to get our own house in order.