OEMS Can Help Navigate Supply Chain Disruptions

Industrial companies across the globe still feel the lingering effects of disruptions caused by the pandemic.

The pulp and paper industry is no exception. Producers continue to be impacted by shortages and delays for critical materials (for instance, steel, copper, or semiconductors) and machinery. The issues are especially pronounced in Europe, where steel supplies have been constrained, largely from production curtailments due to high raw material and energy costs and tightening emissions standards.

As a manufacturer of rotating equipment, among other products and technologies, Siemens Energy is experiencing many of the same challenges paper producers face when it comes to supply chain disruptions and material shortages. Delivery times for some specialty alloys have increased by 8-12 weeks over the past two years. This has impacted the production of certain rotating machinery types, including steam turbine generator sets, which often serve as the primary source of electrical power and process steam for pulp and paper production plants.

We recognize the impact these equipment delays have on mills undergoing expansions or cogeneration plant upgrades and are taking proactive steps to ensure ontime delivery.


We are working closely with our own suppliers to extend collaboration agreements and reduce the lead time associated with critical materials and manufacturing components. In addition, safety stock levels of many parts have been increased to mitigate risk should disruptions persist. We have found that the key to success in the current environment is making suppliers and vendors an integrated part of our supply chain. Paper producers can benefit by replicating this same approach with their suppliers, particularly those providing mission-critical machinery.

Siemens Energy has also initiated an internal project focused on improving supply chain resilience to better manage potential future shocks that may result from exogenous events or shortages. The fruits of these efforts are already trickling down and being felt by our customers throughout the paper industry. While we expect that this will continue as supply chains are hardened, there are proactive steps plant operators can take to ensure that equipment delays do not impact production.

First and foremost is early engagement.

When performing an upgrade or a facility expansion project, it is common for equipment selection to occur during the front-end engineering design (FEED) stage. Yet there are advantages to working with equipment manufacturers earlier during the conceptual or planning phase; it contributes to a more optimized plant design. This is even more critical in pulp and paper plants, where heat and power demands must be carefully balanced.

Involving manufacturers early also reduces the likelihood that delayed delivery of the steam or gas turbine generator will push back start-up. Often, it is possible to reduce installation and commissioning time by shifting part of the work scope (i.e., rerouting of piping) before the turbine package arrives onsite. In these cases, activities can be performed concurrently with those of other vendors at the facility. Again, this effectively de-risks project execution by removing items from the critical path.

Additionally, with potential delays for some major spare parts, it is prudent for mill operators to do all that they can to prevent unplanned failures and extend maintenance intervals. Implementing remote diagnostic services (RDS) on rotating equipment assets supports these objectives.

RDS facilitates a collaborative, datasharing model between the plant operator and equipment manufacturer. With RDS, mills can implement an early warning system that alerts operations personnel to performance anomalies (indicating a need for maintenance) before a breakdown occurs. Analytics can also be used for decision support (i.e., how to best manage degrading performance until the next planned maintenance outage). This helps plants employ a more predictive maintenance regime, leading to shorter outages and optimization of spare parts inventories.

These tactical measures (and others) can go a long way in alleviating the strain caused by supply chain disruptions, particularly in the short term. First, however, the industry must re-evaluate traditional ways of working and engaging over the long term. Companies should consider equipment manufacturers as partners rather than simply suppliers by involving them from the earliest phases of projects. The strong collaboration will benefit both parties and ultimately facilitate continuity across the supply chain.

Tobias Panse is senior vice president of steam turbines and generators for Siemens Energy’s Transformation of Industry business. Visit siemens-energy.com.