Management Controls Highlights Top Trends and Predictions for the Paper Industry
- Published: March 05, 2024
By Ken Naughton, President, Management Controls
The paper, film, and foil converter industry has proven resilient to its economic, social and environmental challenges since its humble beginnings. In today’s environment of heightened technical advancement and greater-than-ever focus on employee well-being and productivity, there are several industry-leading trends that will impact decision-making through 2024.
Hunt for Skilled Labor
According to the U.S. Chamber of Commerce, there are 9.5 million job openings in the U.S., but just 6.5 million unemployed workers. Finding highly skilled tradespeople might be one of the greatest obstacles for the paper, film and foil converter industries.
Industry leaders will continue to seek new ways to recruit and retain talent, including:
- Financial assistance to offset barriers to entry;
- Enhanced strategy to increase involvement from under-represented groups;
- Increased safety standards; and,
- Higher pay.
As these sectors work to boost their labor force, leadership still has to learn how to do more with less. And many are turning to other options like outsourcing and managed services to keep production efficient.
Adopting tech solutions to support ongoing challenges caused by a lack of skilled labor will likely continue throughout 2024. Managed services, IoT-based devices and other tech have proven effective resources as the industry strives to do more with less. Tech solutions can help businesses optimize and augment their existing heavy asset industry staff.
Access to Automation
The rapid growth of automation, AI-powered software and access to real-time data continues to be a growth driver in the industry. McKinsey predicts the increased use of automation is creating “a ‘software-defined’ paradigm for industrial automation.”
The drivers behind greater tech stack adoption stem from the need to address slim teams and keep existing teams safe and working as efficiently as possible. Critical safety data like fatigue management, accurate badging in and out and knowing which machines are in use at all times can help management more effectively oversee resource allocation. By making more informed decisions, they can easily see who may be overworked or underqualified on various project sites and could be a risk to overall safety.
By leveraging automation and real-time data, along with increased demand, paper, film and foil converter industry players have seen significant growth in safety, efficiency and business over the last year despite economic challenges.
For example, several significant players in the paper industry have taken large steps in implementing Industry 4.0 technology for automated processes like predictive maintenance and streamlined analytics.
Continued Industry Growth
Despite 2022’s 40-plus-year high inflation and continued threats of a recession, not to forget ongoing supply chain and raw material sourcing challenges, the converter industry continues to gain momentum. The global converting paper market was valued at $42 million in 2022 and is expected to reach $556.2 million by 2030. It’s no wonder when you consider that Amazon alone delivers 1.6 million packages a day.
While the industry and project sizes are expected to continue growing, so does the importance of consistent cost management oversight and reporting across sites. Having immediate access to clean, usable data that can easily be cross-referenced in the same format from site to site will streamline project management operations and keep paper, film and foil converter industry businesses running smoothly.
Capital Expenditure Analysis Shifts
As the industry continues to flourish and with capital expenditure plans rolling out, the paper converter sector will likely find itself under the microscope. Considering the impacts of ongoing economic challenges, business leaders overseeing large capital projects are finding immense value in taking a closer look at CapEx. They need to understand where and how resources are being spent and where cost savings can be derived.
As the industry realizes the value of automation and real-time data, leaders can use these tools to make CapEx analysis much simpler so they can review and find areas where spending can be cut or reduced.
For example, having accurate data into the cost of labor and time spent by contractor teams onsite compared with overall productivity and cost of materials can help significantly. Paper converter leadership can get a clearer understanding of where money is being spent and can make informed decisions when planning future projects.
Growth Resources
Identifying and addressing these challenges and opportunities is critical for paper converter industry leaders to continue down the path of predicted growth. Having ample resources — particularly for labor and capital — will unlock growth opportunities. However, having the right tech tools and management tactics in place to balance both human and financial capital will make all the difference in long-term industry success.
ABOUT THE AUTHOR
Ken Naughton is a leading authority on the challenges of contract work management and is currently the President of Management Controls, leading and growing the company towards continued success and expansion. He has been with MCi since April of 2011, previously holding the positions VP of Consulting Services and Chief Operating Officer. Ken has over 25 years of Oil and Gas experience. Before his time with MCi, Ken was an executive in Accenture's Energy and Chemicals practice. During his 15 years at Accenture, Ken worked with Energy and Chemical super majors to successfully deliver a wide range of solutions and projects targeted towards value creation. In his experience, Ken has gained expertise in executive level relationship management, project execution, business development, project management, and staff development.
