UPM Annual Report 2016

52-53 / 176

UPM Annual Report 2016 52
In brief Strategy Businesses Governance Accounts
UPM Annual Report 2016 53
Stakeholders
BUSINESS AREA PRODUCT RANGE CUSTOMER INDUSTRIES COLLABORATION ACTIONS IN 2016
IMPORTANT CORPORATE
RESPONSIBILITY TOPICS
MAJOR CHANGES
IN CUSTOMER INDUSTRIES
UPM PULP Softwood, birch and
eucalyptus pulp
Tissue, specialty,
graphic papers and packaging
• Joint development projects with customers in technical
and sustainability issues
• Sustainability services and training for customers
• Launch of Pulp School
• Improvement of supply chain efficiency
• Strengthening sales support
• Food safety certification to cover all pulp mills
Safety, forest certification,
sustainable forestry, environmental
performance of mills, water use
and resource efficiency
• Growth of tissue and packaging board production
• Continued decline of printing and writing paper
industry in mature markets
UPM BIOFUELS Wood-based renewable
diesel and naphtha for
transport
Fuel distributors, transportation,
oil and petrochemicals industry
• Delivery volumes increased year-on-year
• Launch of UPM BioVerno renewable diesel in marine fleet in the
Netherlands
• Ensuring product functionality by comprehensive motor and fleet
testing
Reducing greenhouse gas emissions
and tailpipe emissions, biofuels-
specific sustainability certification,
social and traceability criteria in
targets set by the EU Renewable
Energy Directive
• Global increase of advanced biofuel volumes and
demand
• Waste- and residue-based biofuels are favoured
by both customers and legislation
UPM TIMBER Standard and special
sawn timber
Joinery, packaging, distribution
and construction industries
• Further focus on strategic markets and market-specific weighting
• Customer categorisation and customer-specific account plans
• Optimisation of raw material quality and usage
• Delivery accuracy
• Excellent service throughout the whole supply chain
Chain of custody, origin of wood
and forest certification
• Growing importance of East Europe as a production
area
• Instability and financial challenges in Egyptian market
UPM ENERGY Electricity and related
services
Nordic market, mainly
industrial consumers
• Internal service portfolio enhanced Low-emission electricity production,
active grid balance management
through load management and
balancing power, fish migration
• Structural changes in the Nordic electricity market
• Increased volatility of electricity market through
subsidised weather-dependent production capacity
UPM RAFLATAC Self-adhesive paper and
film label stock
Label printers, packers, brand
owners in durables, tyres,
A4, food, beverage, personal
care, pharmaceutical, retail
and logistics segments
• New scalable global operating model enabling further growth
• Expanding customer reach through increased distribution
and sales & service coverage
• Investment in significant capacity increase in Poland operating
platform
• Joint projects with customers and brand owners
• Sustainability and product safety solutions
Product safety, lifecycle analysis,
ecodesign and bio-based
components, waste management,
recyclability, responsible sourcing
and forest certification
• E-commerce increasing label use for packaging
& logistics
• Increase in automated product labelling & identification
• Retailer & distributor network development
• Adhesive technologies for demanding applications
• Legislation: Increase in mandatory product information
UPM SPECIALTY
PAPERS
Labelling and packaging
materials, office papers,
fine papers
Converters, distributors,
retailers, OEMs (original
equipment manufacturer),
printers, publishers
• Launch of UPM Changshu PM3 labelling materials and new
value-added products and services
• Joint development projects with customers
• Enhancing sustainability message further
• Customer focus throughout the organisation
Product safety, forest certification,
origin of wood and resource
efficiency, supplier audits at mills
Labelling materials:
• Growth in personal care products
• Increased share of e-commerce
• Increase in automated product labelling and
identification
• Retailer and distributor network development
Office papers:
• Quality upgrade and lower price in cut-size business
UPM PAPER ENA Magazine papers,
newsprint and fine papers
for various end uses
Newspaper and magazine
publishers, printers,
cataloguers, retailers,
merchants and converters
• Launch of New Future product family and Responsible Fibre
trademark (p. 35)
• Joint product and business development with customers
• Development of service offering
• Improved business interaction with customers
• Further development of digital service channel
Customer Online and its eOrder module
Safety, forest certification,
environmental performance, supplier
audits at mills, ecolabels, resource
efficiency and financial stability as a
supplier
• Digitalisation
• Consolidation
• Eco-tax in France
UPM PLYWOOD Plywood and veneer
products, thermoformable
wood material
Construction, vehicle flooring,
LNG shipbuilding and parquet
industries as well as furniture
and other manufacturing
industries
• Continuation of the ongoing work to improve supply chain
performance and service
• Introduction of value-adding services to customer offering
• Continuous customer and contract management
Forest certification, chain of custody,
product safety and resource
efficiency
• Increased need for services, stocks and short lead times
• Requirement for forest certifications has increased
within on-site construction end use
• More customer-driven specifications among industrial
end users limiting supplier’s possibility to differentiate
with a product
WOOD SOURCING
AND FORESTRY
Wood and wood-based
biomass (logs, pulpwood,
chips, forest residues etc.),
full forestry service
package offering
All UPM businesses using wood
or wood-based biomass, forest
owners
• Focus sourcing to areas next to the mills
• Sharpen the way of serving forest owners
• Development of digital solutions to improve customer service
Sustainable forestry, forest
certification, income and employ­
ment for people living in rural areas,
employee relationship with private
entrepreneurs
• Increasing wood demand and competition due to
pulp mill investments in Finland
CONTENTS
UPM offers a wide range of renewable and
recyclable products to be further processed
into a variety of useful everyday products,
and also provides services that meet the
needs of a versatile range of customers.
Continuous
dialogue and
collaboration
with customers
UPM’s businesses vary in the products and services they
offer. Each business has its own customer management
process and way of interacting with customers. A compre­
hensive understanding of the markets, knowledge of end
uses and an appreciation of customers’ needs form the
basis of UPM’s customer relationship management.
UPM’s target is to provide customers with solutions
that improve customers’ business processes, with a special
focus on creating mutual benefits with increased efficiency.
Product stewardship, sustainable rawmaterials and
industry-leading environmental performance are also at
the centre of UPM’s customer offering.
UPM’s interaction with customers is based on continu­
ous dialogue and regular customer satisfaction surveys.
In addition to a continuous working dialogue, UPM is
engaged in various development projects with customers.
Many of the projects are related to product development,
supply chain efficiency and optimisation, as well as the
co-planning of activities.
Customer satisfaction is measured regularly in most
businesses through customer satisfaction surveys. Based
on various business customer satisfaction surveys, the
overall total satisfaction with UPM as a supplier is 86%
(75%). The result is not comparable with the previous
year’s result due to changes in the survey methods. The
surveys act as a tool for further development, and bring
an important customer dimension to performance
management.
Interest in responsibility
Based on the dialogue and surveys, UPM’s customers take
an interest in the company’s responsibility performance
and the sustainability of its operations.
Customers value UPM’s comprehensive product range,
reliability and excellent environmental performance.
Product safety, forest certification and chains of custody,
resource efficiency, safety performance and the supply
chain are among the most important topics.
Customers are increasingly interested in compliance
with regulations, the UPMCode of Conduct and social
responsibility topics such as working conditions. The
significance of long-term financial performance and
profitability of the supplier have also increased.
UPM offers product declarations and environmental
data for most products as a tool to provide customers with
information on the sustainability of products and the
supply chain.
,
31
,
and