Pioneering digital transformation in the paper manufacturing industry, HHP GLOBAL is urgently deploying a smart factory system to conquer the international market, especially countries with high requirements for Net Zero (zero emissions).
Overcoming difficult years
About 10 years ago, a paper factory in the “port city” that fell into the bank’s bad debt list was “revived” after a rather daring restructuring investment decision by Ms. Tran Thi Thu Phuong and her associates. That was Hoang Ha Hai Phong Paper Joint Stock Company, the predecessor of HHP GLOBAL Joint Stock Company.
Ms. Tran Thi Thu Phuong, General Director of HHP GLOBAL Joint Stock Company.
Having many years of experience in the fields of finance and banking, Ms. Phuong is still just a "newbie" in the field of paper production.
“The initial journey was really difficult. After 8 months of upgrading the equipment line, as soon as the boiler was put into operation, people came to protest. After finding out, we found out that the previous owner did not care about environmental issues, which negatively affected people's lives. Therefore, when we took over, people were worried that the factory would cause pollution again, so they strongly reacted. We had to work with the authorities continuously and despite our best efforts, because the line was being renovated, we could only ensure that it met the prescribed standards. Those were the dark years of my life,” Ms. Tran Thi Thu Phuong, General Director of HHP GLOBAL Joint Stock Company, recalled her first “tribulation”.
Trying every way to cope with difficult technical, population and environmental problems, the situation seemed to have stabilized, but then challenges piled on challenges when just a few years after operating the factory, the paper industry market went down. Revenue was affected, while financial needs for investment activities arose much more than initially expected. The young company was seriously short of money. Hundreds of worries surrounded "female general" Tran Thi Thu Phuong.
“Those were extremely difficult years. Besides worrying about salaries for staff and workers, paying bank interest, we also had to worry about business, sales, handling relationships with local authorities, residents in the area surrounding the factory... There were times when I thought I had to give up, many times I wondered why I decided to take this path... However, I still had a strong belief that my motives were pure, I wanted to bring jobs, I wanted everything good for everyone, then surely God would not let me down,” Ms. Phuong confided.
And indeed, after the first 5 challenging years, the company successfully IPO'd, becoming a publicly listed company, stock code HHP; for the past 4 consecutive years, the company has continuously been in the Top 500 fastest growing enterprises in Vietnam; contributing hundreds of billions of VND in tax revenue to the state budget.
Gradually becoming more involved in the paper industry, one of Ms. Phuong’s “pains” is that many people assume that paper manufacturing companies are associated with the image of environmental polluters. She is determined to change the community’s perception of this.
“In fact, whether or not it causes pollution depends on people's awareness. As soon as we held the decision to invest in a new factory, we decided to invest in a truly classy factory, with modern equipment and technology that meets international standards, with a total investment of over 1,200 billion VND. In fact, about 900 - 1,000 billion VND can also be invested in a pretty good factory, and the ability to recover capital will be much faster, but with this level, we cannot achieve the goal of "becoming number 1" in the paper industry in the North. With the boldness and recklessness of the company's leaders, we now have a Green Factory (LEED Silver - a certificate granted by the US Green Building Council), the equipment and machinery are all the newest and most modern in the world at the time we purchased them," Ms. Phuong continued the story.
Urgent deployment of smart factories
In early 2023, by chance, when taking friends to visit a project in the investment phase, Ms. Phuong talked about her passion and cherished plans, the keyword "smart factory" was uttered as if it had been in her subconscious for a long time, now emerging and taking shape clearly.
After a period of surveying and planning, in May 2023, HHP GLOBAL signed a contract with ITG Technology Joint Stock Company (ITG Technology), a prestigious and experienced unit in the field of smart factory implementation, to officially implement the iFACTORY 3S Smart Factory Project. ITG's team of experts plays a consulting and accompanying role, while HHP GLOBAL's Technology Engineering and Research and Development Department is the specialized force in this important digital transformation journey.
The smart factory construction project complies with the international standard ISA 95 of the American Society of Automation and is flexibly implemented based on the specific situation at the enterprise, to ensure suitability and efficiency.
Supporting the fact that all smart factory software solutions are researched and developed by Vietnamese experts of ITG, Ms. Phuong commented: "In fact, Vietnamese people are very good, why do we have to rent/buy foreign products and solutions when foreign products and solutions are very expensive, and the ability to customize flexibly is not as good as Vietnamese products and solutions".
Mr. Nguyen Tien Vinh, Deputy General Director of HHP GLOBAL, Director of 3S iFACTORY Smart Factory Project
Deputy General Director Nguyen Tien Vinh personally took on the responsibility of Project Director of the 3S iFACTORY Smart Factory at HHP Paper Mill (Hoang Ha Paper Mill) in Hai Phong.
For many months now, the "Commander-in-Chief" of the Smart Factory Project has been "camped out" in the "port city" to closely monitor each milestone of the project's progress.
Mr. Vinh said that the roadmap for implementing the smart factory management model includes 3 steps: Digitalization; Advanced application, and Comprehensive digital transformation.
The digitalization step will be basically completed in 2023. HHP GLOBAL will use 3S ERP as a platform to digitize all activities related to strategy, purchasing management, sales, accounting, human resources, etc. In addition, it will focus on deploying 3S MES production management software to optimize all production operations from input material import to finished product export. Data from the production line will be automatically extracted and updated to the 3S iFACTORY software system through IoT sensors.
By 2024, HHP GLOBAL will rapidly and synchronously deploy almost all smart factory applications. In particular, 3S ERP software will support calculations to optimize resources, such as raw materials, machinery, labor, etc. 3S MES software supports optimal production planning and scheduling. Production orders are pushed directly to workstations. Thereby, limiting losses due to inaccurate planning, ensuring delivery progress with partners and customers. In addition, the software also allows quality control before - during - and after production to minimize unnecessary waste, such as optimizing paper size, reducing input and output inventory.
By 2025, the entire operating system will undergo comprehensive digital transformation, changing the entire operating process from manual methods to electronic and automated systems; management will shift from incident resolution to proactive and real-time management, with governance and decision-making based on KPI indicators.
In the modern production line system, important equipment is imported from major European manufacturers.
The favorable condition for HHP GLOBAL's journey to deploy a smart factory is a very modern production line system. Important equipment is imported from European manufacturers with very large brands. Some less important equipment is imported from leading Chinese manufacturers.
“With a smart factory, the important factor is a highly automated production line, modern measuring and controlling equipment, ensuring the accuracy of the automation system. Almost all of our measuring and controlling equipment is imported from reputable large companies such as BTG from Sweden, KOHL from Germany, or Siemens, ABB equipment…”, Mr. Vinh noted.
However, in addition to the advantages, Mr. Vinh also faced many difficulties: “Smart factory is a new model for the entire paper manufacturing industry, not just for HHP GLOBAL. The 3S iFACTORY Project Director is a rather difficult task, causing me a lot of worry and pressure. First of all, it is about resources. We have to find human resources who are knowledgeable about information technology and have professional qualifications suitable for the paper industry to arrange them in important positions in the smart factory. Next, the paper factory model is very complex, if the task is wrong, it can turn from smart to not smart. Without an overall vision of the factory process, it will be very difficult to put the smart factory into effective operation”.
Ready to conquer the international market with high demands on Net Zero
Up to now, HHP GLOBAL is considered one of the pioneering enterprises in digital transformation in the paper manufacturing industry in Vietnam.
Deputy General Director of HHP GLOBAL affirmed that smart factories will help businesses increase their competitiveness and be ready to meet the requirements of customers in international markets. Because smart factories will control the production process well, reduce costs, product prices, control energy sources and emissions well, and ensure product quality.
Smart factories will be a complementary element for HHP GLOBAL to realize its Net Zero commitment by 2035.
Smart factories will be a complementary factor for HHP GLOBAL to realize its Net Zero commitment before 2035 (while the Vietnamese Government commits to Net Zero by 2050).
Recently, HHP GLOBAL signed a contract in principle with TeamSustain - an Indian company with a team of experienced experts in consulting factories to implement Net Zero. According to the consultant, the factory's data will be pushed to the blockchain technology application system.
“With a modern management model, we will create a better impression in the eyes of international partners right from the first contact. On the other hand, in the world today, large corporations have implemented ESG (sustainable development) strategies and have a roadmap for Net Zero commitments. If we do not ensure the necessary standards and criteria for Net Zero, Vietnamese exported goods will have difficulty entering markets like Europe. We realized this early on, so we built a roadmap for developing smart factories and green factories right from the beginning, even though we knew this was a very challenging goal,” Mr. Vinh confided.
“Currently, many customers such as Nike, Apple, Amazon... are committed to their value chain being a green chain, all input products must have green certification. With smart factories and green factories, we are confident that HHP GLOBAL's export products are ready to meet all criteria of international customers. The investment cost for our products may be increased now, but we also have enough conditions to increase the selling price accordingly. Our orientation to participate in the global supply chain will not be to compete on low prices but will be to create high-quality international standard products,” Ms. Phuong further illustrated.
In mid-October 2023, HHP GLOBAL was named in the Top 3 enterprises awarded the Vietnam ESG (environment - society - governance) Initiative 2023 by the Ministry of Planning and Investment and the United States Agency for International Development (USAID), and was also selected as a "Pioneer Enterprise" in the IPSC Private Sector Competitiveness Enhancement Program. Thanks to this, the company has received additional funding from the program to implement and replicate sustainable business initiatives.
“We aim to make HHP GLOBAL a model of smart factories in the paper industry in Vietnam by 2026. Another unique feature is that we have also embarked on a journey to train emotional intelligence (EQ) for all employees to achieve a bold goal: By 2030, 90% of employees in the company must be happy people. This index will be measured by employee experience software in the 3S iFACTORY smart factory model. The happiness of each individual will be the luggage to help HHP GLOBAL become a “happy enterprise” and confidently reach out to the big sea,” General Director Tran Thi Thu Phuong emphasized.
Vnexpress.net
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