Strategic Change in The Forest Industry Towards The Biorefining Business

Technological Forecasting & Social Change 81 (2014) 259271
Contents lists available at ScienceDirect
Technological Forecasting & Social Change
Strategic change in the forest industry towards the

biorening business
Annukka Nyh a,, 1, Hanna-Leena Pesonen b
a
b
School of Forest Sciences, University of Eastern Finland, P.O. Box 111, 80101 Joensuu, Finland
Jyvskyl University School of Business and Economics, Finland
a r t i c l e
i n f o
Article history:
Received 11 January 2013
Received in revised form 16 April 2013
Accepted 19 April 2013
Available online 14 May 2013
Keywords:
Forest industry
Change resources
Change management
Forest biorefinery business
a b s t r a c t
The aim of the study was to explore the current forest industry's change features, necessary
resources and management for the biorefining business in Scandinavia and North America. A
total of 23 representatives from the forest, bioenergy and bioproducts sectors participated in
themed interviews in the last round of a three-phase Delphi study. In both Scandinavian and
North American forest industries, a conservative organizational culture and lack of financial
resources create barriers to change. The role of the forest industry in the forest biorefinery
consortium is largely seen to be that of a biomass provider. The scope of change depends on
context-specific features, such as biorefinery location and raw material availability. Operating
a commercial-scale biorefinery facility requires both new managerial and operational-level
skills. Readiness for change needs to be embedded in the organizational culture and the key
to attaining this is open-minded organizational management. It is believed that there are
innovative personnel in forest industry companies, yet the current culture does not encourage
such people to submit their ideas. Success in the biorefinery business cannot be achieved
without collaboration. However, sharing of profits among partners in the consortium will be
challenging.
2013 Elsevier Inc. All rights reserved.
1. Introduction
Many different driving forces are shaping developments
in the forest industry,2 and these have consequences for its
continuity. Some of the most prominent forces are largely
negative (e.g. industry structure and the maturity of some
product markets) and can only be addressed by changes within
the industry itself [1,2].
Better corporate performance depends on understanding
how industries evolve. Companies can improve their performance by adapting their investments to follow industry trends
rather than fighting against them [3]. Several frameworks have
Corresponding author. Tel.: +358 50 529 8507.
E-mail addresses: annukka.nayha@uef. (A. Nyh),
hanna-leena.pesonen@jyu. (H.-L. Pesonen).
1
Former afliation Jyvskyl University School of Business and Economics,
Finland.
2
In this study, forest industry is understood to include pulp, paper,
paperboard and wood products industries. The latter includes saw-milling,
plywood, chipboard, berboard and construction products industries.
0040-1625/$ see front matter 2013 Elsevier Inc. All rights reserved.
http://dx.doi.org/10.1016/j.techfore.2013.04.014
been developed in order to understand the structural changes

shaping the industries. For instance, changes within the
industries and sectors can be analyzed in terms of the S-curve
[4,5] and the closely related Product Life Cycle and Industry Life
Cycle [610]. These concepts suggest that industries start out
small in their development stage and then go through a period
of rapid growth, culminating in a period of shakeout. The last
two stages are a period of slow or even zero growth the
maturity stage and then a final stage of decline.
In some respects, the forest industry is facing challenges that
have already been seen in other manufacturing sectors. In
developed regions, the industry has significant capital assets
and large domestic markets, but production costs are relatively
high and markets are growing quite slowly or even declining [1].
Therefore, in many regions the forest industry has long been
characterized as a mature [11] industry with productionoriented [12,13], low-cost strategies [1416]. In contrast,
markets in emerging economies are growing rapidly and
production costs are generally lower, with the result that
many new investments are directed towards these countries,
260
A. Nyh, H.-L. Pesonen / Technological Forecasting & Social Change 81 (2014) 259271
further increasing their competitiveness. The result of this is

overcapacity in many emerging economies and a generally
negative outlook for prices and profitability, both globally and
particularly in many developed countries [1].
Although the S-curve framework is dynamic, and it focuses
on how industries evolve over time, it does not consider how
companies move across product generations (i.e. across
S-curves). Industry leaders may become trapped in a kind of
self-fulfilling logic of maturity if they take action based on an
oversimplified S-curve. In the event that they believe an industry has reached the mature phase of the S-curve, they
may wrongly assume that it is beyond innovation [3]. Styles
and Goddard [17] suggest that firms falling into the maturity
trap do so because they are competing in an industry where
many firms are pursuing the same strategy (i.e. being better at
the same game). Moreover, McGahan [3] warns of the
maturity mindset, which can leave many managers complacent and slow to respond to new competition.
It is obvious that no business can survive over the long term
if it cannot reinvent itself [18,19]. Yet maturity does not imply a
lack of opportunity, nor does it mean a lack of innovation:
many mature industries have been transformed by new technologies and new strategies [20]. However, the management of
organizational change tends to be random, reactive and ad hoc
with a high failure rate in change programs [2123]. Accordingly, it has been said that, Human nature being what it is,
fundamental change is often resisted mightily by the people it
most affects: those in trenches of the business [18]. One of the
interviewees in this study describes the need for change in the
forest industry:
I would say it's clear that we know it's going to change. I
would say it's not so clear what we need to do to get there. I
think the way I would look at it, the key decision-makers in
the forest industry are saying, OK, we know we have to be
ready to change the business model. But they're not quite
sure how it's supposed to go yet and so I think nobody is
well, very few anyway are blind, have put blinders on and
are just kind of continuing business as usual, so I think the
strategies are being almost constructed to have a lot of
exibility in them. (Forest sector representative, U.S.)
A need to innovate and redefine business models is
particularly urgent in the mature pulp and paper industry, with
its frequent mill closures and profitability problems [2427]. The
emerging bio-based economy (bioeconomy) is a promising
sector with notable potential for the future and many business
opportunities [28]. Biomass-based energy (bioenergy) and products (bioproducts) play an important role in society's transition towards a greener and more bio-based economy in general,
and they offer opportunities for the global forest industry in the
long run [1,2]. In particular, integrating biorefineries in the pulp
and paper industry seems to hold great future potential [29]. In
the present research, a forest biorefinery is defined as a multiproduct factory that integrates biomass conversion processes
and equipment in order to produce a variety of bioproducts like
fuels, fibers, and chemicals from wood-based biomass [3032].
The development of forest-based biorefineries may imply a
fundamental structural change in the traditional forest-based
industries, but so far our understanding of these potential
changes is limited [33]. Chambost et al. [29] state that forest
biorefinery implementation presents prominent challenges for

firms, related to key technological, economical, financial, cultural, and operational risks, and most importantly, enterprise
transformation.
This study is based on data from the final round of a threephase Delphi study concerning the diffusion (development and
implementation) of forest biorefineries in Scandinavia and
North America. The results of the first two rounds were reported
in previous papers [2,34]. In the two previous research rounds,
many statements by respondents indicated the rather passive
role of the forest cluster and a lack of change management,
implying that more proactive attitude and independent vision
from forest sector companies would be necessary for entering a
new business. The previous rounds also indicated that the forest
industry should evaluate the business environment and its strategies from a new perspective. Therefore, the previous research
rounds clearly revealed that as emerging biorefining economies
continue to evolve, there is a need for realistic estimates regarding the forest industry's change resources [2,34].
The main aim of this study was to explore the current forest
industry's change features, needed resources and management
towards the biorefining business in Scandinavia and North
America. The research explores the forest industry's move across
product generations and recognizes related challenges, particularly in management.
Change management approaches, specifically the change
kaleidoscope of contextual change [21], were used as a framework for analyzing the forest industry's change features in
regard to the biorefining business. The aim was not only to
explore the change process and related change management
capabilities within the forest industry, but also to evaluate the
actual new skills and know-how that are needed when developing and operating a commercial-scale forest biorefinery
facility.
2. Analyzing industrial change: contextual and
change features
2.1. Strategic change features
Balogun and Hope Hailey [21] emphasize that due to the
complexity of change tasks, successful change requires the
development of a context-sensitive approach. In other words,
the design and management of any change process should be
dependent on the specific situation of each organization
[23,35,36]. Consequently, organizational change cannot be
separated from organizational strategy, or vice versa [37,38].
Balogun and Hope Hailey [21] present a framework, the
change kaleidoscope, which can be used to help achieve successful change. The contextual features in the change kaleidoscope do not carry equal weight across all organizations. This is
why the framework is named after a kaleidoscope, as features
are constantly shifting in relation to the organization being
analyzed. The kaleidoscope can also change over time in response to change interventions, thus offering a tool for nonstatic change management. Even though in each change
situation the configuration of contextual features is unique,
certain questions remain constant in any change context.
These questions include the amount of time available for
change (see also [23,39]), the scope of the change required
[40,41], the degree of diversity within an organization [18,37],
the staff's readiness for change [23,37,39,40,42,44], the capability

and capacity to undertake change within the organization
(Section 2.2), the power relations [18,43] and what needs to be
preserved within the organization [40,41] (Table 1). None of the
individual features can be considered in isolation (i.e. the interrelated nature of all the kaleidoscope features should always be
observed). Furthermore, the contextual features may differ even
within one company, which increases the complexity of the
change process [21].
2.2. Resource-based approach
According to Grant [45], the resources of a firm are a central
consideration when formulating its strategy. Resources are a
primary foundation upon which a company can establish its
identity and frame its strategy, and they are the primary source
of a firm's profitability. The key to a resource-based approach to
strategy formulation is an understanding of the relationship
between resources, competitive advantage and profitability
in particular, an understanding of the mechanisms that sustain
competitive advantage over time. This requires the design
of strategies that can exploit to a maximum extent each
company's unique characteristics [45]. If organizations are to
achieve a competitive advantage, they require resources and
competencies that are both valuable to customers and
difficult for competitors to imitate. These kinds of competencies
are called a company's core competencies [46]. Likewise, a
company's success or even survival over the long term
requires that it upgrades its resource and capability base [20].
Thus, dynamic capabilities (that is, the ability to change strategic
capabilities continually) are important [8,47,48]. Critical management challenges lie in developing existing capabilities and
acquiring or creating new ones. Some of the most important
developments in strategic management research in recent years
involve a deepening of our understanding of what organizational capabilities are and how they develop [20].
2.3. Analytical framework of this study
261
in the forest industry. Though change frameworks are developed as tools to manage change, in this study they also proved
to be beneficial as approaches for analyzing the forest industry's
change features and related challenges, particularly scope,
preservation, readiness, capabilities and capacities towards
the biorefining business. In this study (see Results and discussion, Section 4), time is explored as a part of the contextual
features, whereas diversity and power features are interlinked
with capabilities and capacities. The power feature is explored
only from the perspective of the forest industry's role in the
biorefinery consortium (i.e. sharing responsibilities and dominance among different biorefinery actors). Accordingly, as
many change features are strongly interrelated, they will be
discussed in multiple sections.
The analytical framework followed in this study is presented
in Fig. 1. In the framework, we involved both features from the
change kaleidoscope approach and elements from the resourcebased approach. By doing this, we were able to explore both the
change management capabilities and the new capabilities that
are needed when operating forest biorefineries.
3. Data and methods

As a whole, the research project uses a three-phase Delphi
method, which is a technique for obtaining future knowledge
from selected experts. Typically the Delphi method is composed
of two or three stages, during which experts' opinions are
collected and information is combined and then returned to the
experts for re-evaluation. The analysis of this manuscript is based
on data from the third Delphi round. The Delphi technique is
generally considered to be an appropriate method for studies
that lack historical data and require the collection of expert
opinions [4952]. There are also several other studies that have
explored issues relating to renewable energy and the bioenergy
sector by means of the Delphi method [53,54]. Overall, taking
into consideration the scarcity of previous research using a
similar approach, the Delphi process is very suitable for
investigating the novel forest biorefinery business (see also
Our aim was to explore the most interesting and prominent

change features of the biorefining business that currently exist
Table 1
The contextual features of the change kaleidoscope [21].
Kaleidoscope
features
Time
Scope
Preservation
Diversity
Capability
Capacity
Readiness
Power
How quickly is change needed?

What degree of change is needed?
Which organizational assets (intangible/tangible) and
practices should be preserved/destroyed during the
change?
What is the degree of diversity among the staff in terms
of values and attitudes within the organization?
What is the level of organizational, managerial and
personal capabilities to implement change?
How many resources (cash, time, people) can the
organization invest in the proposed change?
How ready for change (awareness/commitment) are
the employees within the organization?
Where is power vested within the organization (i.e.
how much latitude of discretion does the unit needing
the change possess)?
Contextual features of
the forest industry
Readiness
Change features of the

forest industry
Resources
Capabilities required for

change management
Scope &
Preservation
New capacities
required for operating
biorefineries
Financing
Skills and know-how
Raw material availability
& sustainability
Research, collaboration
& innovations
Fig. 1. The analytical framework of the study.
262
[53]) and forest industry's change towards this business.

Accordingly, the opportunity to include geographically dispersed
specialists with backgrounds in different fields was a benefit of
the chosen methodology. During the entire Delphi process,
quantitative and qualitative materials were integrated in data
collection and analysis. This was believed to create a more full
understanding of the development and implementation of the
forest biorefinery business (see also [55]). The results of the last
Delphi round (and this manuscript) are based on qualitative
material and analysis.
The first two rounds, published earlier, presented key driving
factors for the forest biorefinery business [2,34]. The previous
research rounds clearly revealed that as emerging biorefining
economies continue to evolve, there is a need for realistic
estimates regarding the forest industry's change features, needed
resources and management as it moves towards the biorefining
business in Scandinavia and North America [2,34]. Therefore, this
study concentrates on exploring these issues.
A total of 23 representatives from the forest, bioenergy and
bioproducts sectors participated in themed expert interviews
in the U.S., Canada, Finland and Sweden in March to June 2011.
The study concentrates on countries (Finland, Sweden, Canada
and the U.S.) with good preconditions for the establishment of
forest biorefineries: high-quality research, development and
pilots, similar structures in the forest industry, and abundant
lignocellulosic biomass resources. Interviewees were chosen
from among the 125 survey respondents of the first Delphi
round,3 aiming at a comprehensive sample of respondents
from different backgrounds and countries. Respondents who
participated in both previous research rounds were preferred
in the last round. Six new respondents who were recommended by the other respondents, and were therefore presumed to
have good knowledge about the evolving forest biorefinery
business, were also added to the sample. The distribution of
respondents by country and sector is presented in Table 2.
In this study, there were several reasons to choose themed
semi-structured interviews [5961] as the data collection
method. In themed interviews, specific themes are determined in advance, but the precise form and order of the
questions are not known [59]. Due to the different backgrounds and levels of expertise of the respondents, as well as the
novelty of the biorefining business, responses were assumed to
be variable and divergent. Therefore, it was important that
during the interview, responses could be clarified and additional
questions could be asked. Furthermore, depending on the
respondents' backgrounds, certain themes were discussed in
greater detail in order to arrive at a deeper understanding.
The interview consists of three main parts: 1) key diffusion
factors promoting forest biorefineries, 2) forest industry corporate and business strategies, and 3) environmental and economic
3
In the rst Delphi round, the survey questionnaire was sent to 511
respondents. A total of 125 participants responded to the survey, yielding a
response rate of 24.5%. The aim was to generate a heterogeneous sample of
forest and bioenergy sector experts, researchers, company representatives,
authorities, and association representatives in North America and Scandinavia. The purposive sampling technique, which allows a researcher to
choose a case based on specic features of interest, was used; it was possible
to choose individuals with particular types of expertise [56]. Also, the
snowball sampling technique was applied, where the selection is based on
asking respondents in a selected group to identify further individuals who
meet the criteria of being suitable representatives for study [57,58].
Table 2
Respondents by country and sector.
Finland
Association
Consultant
Forest sector companies
Investors
Research
Total
Sweden
2
3
3
8
1
3
U.S.
1
4
1
4
10
Canada
Total
1
3
9
1
9
23
1
2
sustainability in forest biorefinery value chain companies

(Appendix A). The results presented in this manuscript are
primarily based on topics and questions covered in Part 2 (Forest
Industry Corporate and Business Strategies). The interview topics
and questions were formulated based on the results of the earlier
research rounds; the main idea here was to deepen understanding about the change features and resources of the forest
industry in relation to new businesses.
The interviews were conducted face-to-face or over the
phone in Finnish or English. The duration of interviews varied
from 45 min to 120 min. The interviews were recorded in
audio and transcribed by native English or Finnish transcribers.
Quotations are included in the manuscript for greater reliability
(see [56]). Some of the quotes presented in the manuscript are
translations from Finnish.
Transcribed interview texts were examined using the
thematic analysis method. This is usually described as a means
to derive a pattern or theme from seemingly random information. Thematic analysis is based on coding; themes and patterns
are found in the data in order to organize and interpret the
information. [62,63] The interviews were conducted and analyzed by one person; thus there is no variation depending on
interviewer. The starting point of the analysis was to identify
what material was most relevant in terms of the main research
questions. Accordingly, the data was first classified under the
main themes that were defined in the interview structure. In the
following phase, the data was carefully re-explored in order to
derive other interesting and relevant patterns.
One potential limitation of this study concerns the selection
of respondents: while each studied country yielded respondents, researchers and forest industry representatives were
most dominant. In this way, perhaps a true representation of all
the study sectors is not reflected. In addition, the countries with
the highest number of respondents were Finland and the U.S.
Moreover, it is likely that private sector representatives
(particularly from the forest industry) did not reveal details
about strategic issues. On the other hand, the confidential
atmosphere in the mutual interviews encouraged respondents
to express their opinions freely. Finally, due to the different
backgrounds of the respondents, certain topics were discussed
in depth while others were only brought up briefly.
4. Results and discussion
4.1. Contextual features of the forest industry
4.1.1. Current situation and need for change
The respondents of this study strongly indicated that forest
industries both in North America and Scandinavia are facing
challenging times. Decreasing demand for paper products,
cheaper raw materials and labor in new Asian and South

American regions are the main reasons for the difficult situation
and the need for change activities. The situation is acknowledged and widely discussed both by several other studies
(e.g. [1,2,27,29,64]), as well as by forest industry representatives and other respondents in this study.
I think the main issues are the huge development in Asia
what happens in the rest of the industry We've been into
this low-protability era for probably, you know, six, seven,
eight years. What's happening is consolidation, shut down.
You're seeing a huge change in the number of players.
They're just getting out of the business because they can't
make them survive anymore with the lower demand and
pricing. That's one of the big items going on. (Forest sector
representative, U.S.)
The pulp and paper industry is being displaced from all the
production in China and in Asia and in South America, and
we haven't invested in a new mill here in ages, so I think
they're bound to be displaced anyway. And the smart ones
will get on the bandwagon and nd a way to integrate, but I
think they'll be forced to change their habits more than
anybody and be faced with the potential of losing more
business. (Investor, U.S.)
Beginning in the mid-2000s, and over the last couple of
years in particular, there have been increasing efforts and
initiatives towards new products and business possibilities.
This search for new alternatives is also considered as the
greatest positive action in the forest industry during the last
decade. Likewise, many other studies (e.g. [6569]) have
described the structural change that is going on and the need
for new business models in the global forest products markets.
Accordingly, respondents indicated a great variety of potential
future outcomes, strategies and evaluations about new products. More specifically, they cited the importance of bio-based
products in the forest industry. It was also highlighted that, at
this point, it would be important for the forest industry to trust
its own capabilities and not fall into despair, as it should be
possible to take advantage of the emerging forest biorefinery
business early enough.
However, most of the respondents believed that traditional
products still play an important role in the forest industry's
future in Scandinavia and North America, despite facility
shutdowns in those areas and relocation to South America
and Asia. Production of long-fiber cellulose used for highquality papers is expected to remain almost at its current level
over the next decades. In addition, hygiene papers and
packaging materials will play an important role in the forest
industry's future. Many respondents also hoped that the
significance of the construction sector would increase and the
use of wood as a building material would be encouraged.
All in all, experts interviewed believed that the forest industry
is in a situation where new business development and start-ups
are crucial, given the mature or even declining state of many
parts of the business. In general, the respondents considered
forest biorefineries to be an environmentally and economically
sustainable new business opportunity (see also [70]), and many
of them believed that forest biorefineries will be part of the
263
future of the forest sector business in one way or another. Many

other studies point to the same conclusion (e.g. [65,7174]). For
instance, the European Forest Sector Outlook Study II [67] states,
The potential for bio-refining to influence the shape of the forest
sector is huge and is still uncertain. The experts interviewed in
this study also believed that, due to the forest industry's capital
intensiveness and traditional business culture, such changes
require powerful support from the core business, as well as a
strong managerial effort. Furthermore, respondents raised and
elaborated on interesting questions in the interviews: is the
forest industry ready for change, how does a new business fit
into the current business, and what kinds of resources are
needed for management of change as well as for maintaining
new business operations?
The last ve years has been a wake up, I think. The last
year or two, I think the Canadian industry has now
realized that there's a need for strategic planning. Well, I
think they're all realizing that they have to do this forest
biorenery and they're starting to do it. (Association
representative, Canada)
So it [implementing forest bioreneries] will be it will

be a challenge, but where there's money to be made, you
know, companies will nd ways to meet that challenge.
(Investor, U.S.)
4.1.2. The future of forest bioreneries

4.1.2.1. Basic concept for biorenery facilities and potential
products. As a basic biorefinery concept, respondents indicated
facilities with 100,000200,000 to 300,000 or even 500,000
tons per year of biofuel production capacity (in which Fischer
Tropsch diesel4 will be a principal product). Forest residues
(logging tops, pre-commercial thinnings, stumps) and mill
residues were considered to be the most significant woodbased biomass sources in future biofuel production. In Finland,
many respondents also believed that peat will play a significant
role in forest biorefinery facilities. Moreover, experts highlighted the evaluation of feasibility and the potential of various
feedstocks in addition to forest residues. In particular, urban
organic waste was believed to have future potential (see also
[2]).
However, in addition to high-volume bulk products the
significance of various low-volume, high-value bioproducts was
seen as crucial. A variety of new products were held to have
potential: synthetic polymers, viscose fiber derivatives, fuels
(butanol, ethanol), chemicals, medicines, cosmetics, nanotechnology products, intelligent paper and packaging, and composite
materials. Accordingly, it was believed that the forest industry
will have a diversified product portfolio: the production model
and end products will be critically dependent on local raw
material availability and the specific features of the facility into
4
The FischerTropsch process converts carbon monoxide and hydrogen,
called synthesis gas (syngas), into liquid hydrocarbon fuels (e.g. synthetic
diesel). Prior to the FT process, the coal, gas, or biomass is gasied to
produce this syngas, using intense heat and pressure, converting feedstocks
into hydrogen and carbon monoxide. Synthetic fuels burn cleanly, so they
offer improved environmental performance [75].
264
which the biorefinery will be integrated. Many respondents

presented scenarios about circular use or the economy of wood,
meaning recycling wooden materials through various processes
and purposes before finally generating energy. By contrast,
burning wood before processing was considered a significant
threat.
The respondents also believed that in the beginning, before
the most optimal biorefinery models and products are found,
there will be plenty of fluctuation and many start-ups that will
not be successful in the long term. It was also believed that
while governmental incentives can quicken and encourage
start-ups, businesses develop without governmental intervention in a more economically sustainable manner.
Estimates of the importance of new products varied greatly,
starting from 10% of total production to the highest estimates
of 50%. It was also mentioned that the most prominent factor
when selecting a product portfolio is the market price of the
end product. Some of the respondents also noted that even
though new products may have a relatively small share in
terms of quantity (10%), they can have a disproportionately
large share in terms of value. Chambost et al. [29] highlight in
their study that product portfolio changes should be carefully
designed as a driver of company profits, but must also be able
to meet other goals, such as addressing customer expectations
relative to existing and new products.
Overall, this study as well as several other studies and
reports indicates that forest biorefineries cannot be limited
to one raw material, process or product. Instead, the casespecific circumstances will define the biorefinery model that is
ultimately chosen [29,67,68,7782]. Interestingly, variation
between biorefinery models also means that forest companies
have to implement unique change strategies (see also [29]).
4.1.2.2. Location of forest bioreneries. The location of
biorerefinery facilities and the transporting of biomass
divided opinions both in Scandinavia and North America.
Some respondents believed that transporting bulky, lowdensity biomass will not be an economical option, nationally
or internationally. Hess et al. [83] have also mentioned
logistics of cellulosic feedstock that has low bulk density as a
prominent challenge for cellulosic biorefineries. Additional
negative effects of raw material exporting could include
reducing the national employment rate, stunting growth of
national products and adversely affecting the security of the
energy supply. Conversely, other respondents indicated that
a major factor will be labor costs, and thus biomass can be
exported for processing to countries where labor costs are
lower.
In North America, locating biorefineries within the continent was also a source of divided opinions. Some respondents
believed that the western United States and western Canada
will be the first to see an emergence of the biorefining business
and that the East Coast will be slower, as large pulp and paper
mills in the southeastern U.S. were understood to protect their
wood purchases. But other respondents believed that the pulp
and paper business on the East Coast will be the most favorable
option for the co-location of biorefineries. This view was
aligned with the prevailing opinion that first demonstration
facilities will be integrated with existing pulp and paper mills.
Moshkelani et al. [82] also suggest that incorporating a
biorefinery unit within an operating kraft pulping process has
prominent technological, economic and social advantages over

the construction of a grassroot biorefinery. Overall, it was
believed that the first demonstration plants would be
located in Scandinavia and North America, but in the future
the biorefining business may be directed to South America
and Asia due to their fast-growing biomass resources.
4.2. Change features of the forest industry
4.2.1. Readiness for change
Most of the respondents evaluated readiness for change and
the number of future-oriented actions in the forest industry to
have generally been low. The forest industry is seen as a
conservative industry, one that has resisted change and instead
focused on its current core businesses without long-term
visions or strategic planning. Accordingly, many respondents
indicated that there has not been enough attention towards
investments in new business, and forest biorefineries currently
do not have a prominent position in the forest industry's
strategies.
I came from that industry and that's just the way it is. They're
very difcult to change. Very, very difcult to change, even
when it's staring them right in the face and they know
they're going to fail. They know they're going to go bankrupt.
They still cannot force themselves to change. It's the most
insane thing I've ever witnessed in my life. (Forest sector
representative, U.S.)
Forest industry, there's a very large, proportion of people

who are, extremely conservative, extremely traditionalistic
and extremely afraid. I think the investment levels are so
high that it's good that they are cautious. But of course, if
you are waiting too long to jump on the train you will miss
it. But I think sometimes that they are a little bit overly
anxious. (Researcher, Sweden)
Are they really vigorously pursuing biorening technologies

and all of that? No. Maybe some are, but industry-wide, no
they're just trying to keep their noses above water and make
it from quarter to quarter. (Researcher, U.S.)
Many respondents believed that the main reason for this
slowly changing culture is the industry's capital intensiveness.
Furthermore, a lack of resources for research and development
was seen as a significant obstacle (see a more detailed description in Section 4.2.3.2). It was also mentioned that the forest
industry itself has been overly optimistic about the pace of
technology development and the diffusion of new technologies,
and thus it has not invested enough in new opportunities.
Interestingly, while there were several comments about the
forest industry's conservativeness and resistance to change at the
corporate level, at the same time the significance of innovativeness and vision among individual personnel members was seen
as positive and an important resource for future development.
It's not that there aren't visionary people and innovative
people in these companies. It's just as a company philosophy,
they're very slow to develop that and they have not supported their research and development. (Researcher, U.S.)
There were also respondents who believed that the forest

industry has been more future-oriented and strategic than
has been publicly indicated. Respondents also indicated that
many organizations have explored new business opportunities, and they have been discovered to be unprofitable. Thus,
opinions about industry conservativeness are not unanimous.
I think they were forward-looking, and I think they have
largely done the job. I think what they've discovered is how
hard that job actually is. We've got a lot of people who are in
the process of discovering that same thing. Well, okay, rst
off, the paper industry has looked at biofuels pretty much
continuously for over 50 years and has never found good
ways to get it to work they couldn't nd a way to make it
protable. So I don't think we should be suggesting that
they weren't looking at the business climate and they
weren't looking at future possibilities. (Researcher, U.S.)
Likewise, according to many respondents, both the need for
change and key drivers for change are widely recognized within
the forest industry, but actions and pathways largely still need
to be created. Many organizations have also recently started to
put more resources into new business options, and there are
many initiatives for forest biorefineries. Many respondents
expected to see several biorefinery projects started in the next
three to five years.
4.2.2. Scope and preservation
4.2.2.1. Compatibility of forest bioreneries with the traditional
organizational culture of the forest industry. The respondents
equally found arguments for and against the feasibility of forest
biorefineries and how they fit with the forest industry's current
core businesses and organizational culture. In particular, the
respondents believed that operations and scale when producing biofuels will fit well with traditional operations. As one
advantage of the biorefining business, the respondents remarked that the business is challenging enough that unique
skills, know-how and technologies cannot be easily copied by
other sectors. Overall, it was believed that the pieces are
starting to fall into place meaning the vision and the goals to
embrace the new technology and business, although change
will happen gradually.
There were also respondents, however, who believed that
organizational values and culture in the forest industry will not
support the biorefining business. Specifically, the production of
high value-added products was seen to be very different and
challenging for the industry, which traditionally focuses on bulk
production. Accordingly, forest biorefineries were believed to
require a very different set of skills, which could be challenging
to find in the forest industry.
It's different and requires different skills. You know, it's a
little bit scary. (Forest sector representative, U.S.)
Maybe not or let's say that yes and no; you see, if we're now
talking about this FischerTropsch fuel, such a big plant's
production must be quite extensive. But then, if we start
making some stuff that costs, say, 35,000 euros per kilo, then
it's somehow completely different. There we have to consider
everything in a different way. (Forest sector representative,
Finland)
265
New products would also require new contacts and marketing channels that can be difficult to find.
Well, it's partly quite suitable, because if you think of the
raw material it uses, it is quite okay. The only concern there
is that when you have a new product, you also have a
brand-new market and new clients, and all this stuff. Well,
that's what worries me the most for those who in a way
don't have a partner there. (Forest sector representative,
Finland)
Some respondents believed that biorefinery products will
take only a very marginal segment of the forest industry's
production in the future, which is to say that traditional assets
will be largely preserved in the industry (see also Section 4.1.2.1
regarding the potential share of new products).
Moshkelani et al. [82] suggested that the conversion of a
kraft mill from total pulp production to a complete biorefinery
could be done in stages, thus giving a company time for the
transformation and an opportunity to master new technologies, evaluate options and develop an appropriate business
plan. Chambost et al. [29] have also proposed a three-phase
implementation strategy for the forest biorefinery approach.
Furthermore, they highlighted that a biorefinery should not
only be considered as a project, but also as one industry
solution that drives critical innovation and a makeover of the
current corporate culture. From the perspective of the findings
of this study, a stepwise approach could help companies to
smoothly adapt to changes and reform their organizational
culture.
4.2.2.2. The forest industry's role in the consortium and
organizational structure of bioreneries. The most important
strategic competencies of the forest industry are knowledge of
raw material acquisition and knowledge of logistics. In other
words, the forest industry's role in the biorefinery business
is predominantly seen as a raw material provider or initial
processor. According to the majority of respondents, it is likely
that energy or oil companies will dominate in the consortium,
the most important reason being that they control distribution channels. However, some respondents believed that the
forest industry will be an equal partner in the consortium, and
contracts that protect the forest industry's rights will be
negotiated. Most of the respondents highlighted the importance of strategic alliances and partnerships that can create a
variety of synergies.
It's really difcult for a forest company to say, Well, I'm
going to start making some kind of a bioplastic without
having connections to one of those companies that can
market it (Researcher, Canada)
Certainly, I think biofuels and biochemicals have a possibility.

I guess, my view is more that unless the companies, the forest
products industries, really want to do the development
themselves, partner with the developers, I think it could be a
co-location opportunity. (Forest sector representative, U.S.)
Other studies have also indicated that forest industry
companies do not necessarily have to develop new technologies
by themselves when they are restructuring their businesses. For
266
instance, Ptri [84] found that value creation through collaboration has become increasingly important as a means of filling
the resource gap in the energy and forest sectors in the bioenergy
business. Firms can obtain knowledge through patents and other
immaterial rights or they can acquire companies with the relevant competitive knowledge and technologies [69,85]. These
companies can also come from outside the traditional forest
sector [85,29]. Chambost et al. [29] further highlight that biorefinery partners should be identified early on in the biorefinery
development phase. Catchlight Energy, a joint venture of
Weyerhaeuser and Chevron, is a good example of collaboration
between a forest products company and an energy company
aiming to produce cellulosic biofuels, Catchlight Energy intends to use Weyerhaeuser's land to grow renewable feedstock
for biofuels to supply Chevron's distribution and marketing
system [86]. Another example is Stora Enso (a forest products
company) and Neste Oil (an energy company), which had a
biodiesel project in Finland (that concluded in 2012 when the
companies decided not to proceed in building a biodiesel plant,
due to financial reasons) [87]. Cooperation between the two
companies will continue in the future, however, in the area of
other bio-based products. There can be also interesting
opportunities in the interface between the forest industry and
the chemical industry [68,88].
Responses regarding the organizational structure in the
biorefining business and the need for separate organizational
units were varied, from separate companies or legal entities to a
need for closely integrated units. It seems that at this point it
is difficult to give a straightforward answer, because actual
integration at the operations level is still unclear and no single
biorefinery model exists. Some of the biorefining processes that
are planned will involve modifying pulp mills, thus considerably
affecting existing operations. According to most of the respondents, integration at the operational level will be needed to
make biorefinery business profitable. Likewise, combining
leadership and management with existing business largely
depends on biorefinery partnership, model and degree of
integration. Some of the respondents also believed that legal
restrictions will determine the final organizational structure.
Overall, the respondents believed that planning and establishing
a functional organizational structure for forest biorefineries will
be challenging.
4.2.3. Resources
4.2.3.1. Capabilities required for change management. Transitioning
to the forest biorefinery business and changing the direction of
large organizations in general present great challenges for
leadership and management in the forest industry. According
to respondents, the forest industry needs leaders and managers
who have and are able to encourage vision and strategic
knowledge, as well as innovativeness, an enthusiastic attitude,
willingness to seize new opportunities and open dialogue with
stakeholders. At the same time, the previously mentioned issues
were seen as the most needed capabilities in the current forest
industry culture.
The management and the leadership? There isn't any such
thing in this industry. They're managing dollars, but they
are not managing their mills; they are not managing their
products. (Researcher, U.S.)
I think of leadership and management I need somebody

that understands the role of renewables and the cost of
sustainability and, you know, basically can gure out
strategies with a marketing team, with a product development team and ultimately with the executive team to roll
those types of products out, you know, so it's got to be
somebody who really understands the long-term benets,
has a vision for where the sector's going to go, but can build
on short-term tactics. (Researcher, Canada)
People from outside the forest industry should be hired.

There have not been good leaders in the forest industry.
The problem is that perspective is very narrow in forest
industry companies. For a common management culture,
it is useless that you only manage investments where the
most important question is where to invest this year. You
just produce goods, which you can do in the old,
undened manner without management culture, because
manufacturing is the most important issue. And that is
easy to organize because you don't need to think about
people. The change toward management culture, in which
you encourage people, it's too big. (Researcher, Finland)
According to Bjrkdahl and Brjesson [89], many forestbased manufacturing firms lack consistent strategies for
innovation. Furthermore, two capabilities are critical for
innovation in those firms: 1) management willingness and
awareness, and 2) the implementation of a strategy for
innovation (see also [21,90]). Similarly, Casti and Ilmola [91]
have recognized resilience to change, management of diverse
portfolios and broad visions by management as the greatest
future challenges in the forest industry. Hansen et al. [92]
discovered in their study on innovativeness in the global
forest products industry that company leadership also plays a
critical role in establishing the culture of a company. They
indicated that there must be an atmosphere that is open:
people must feel free to take risks or otherwise innovativeness will be stifled (see also [93]). Interestingly, over 70% of
forest, paper and packaging CEOs in the 16th Annual Global
CEO Survey [64] indicated that they will make changes to
increase R&D and innovation capacity.
According to this study, leaders and managers should have
broad and multi-disciplinary knowledge: insights from the
forest and chemical industries, as well as finding synergies
between different industries, were highlighted as significant
challenges for management. Accordingly, it was emphasized
that the forest industry should be very aware of the variety of
different options, in order to react and differentiate between
them when necessary. In addition, the respondents believed
that a variety of new options and the hype around the
biorefining business further complicate finding new ways to
operate and creating a future-oriented outlook. Cohen et al.
[76] also believe that the choice of a suitable technology during
the early design stage can be challenging for forest companies,
due to the paucity and inconclusive nature of the available
information.
In this study, profiling company-specific core competences
(rather than following competitors) was also considered to be
important. The forest industry needs leaders and managers who
understand features of value-added production in addition to
traditional bulk production. One of the prominent challenges

that respondents indicated was that higher-level management
in the forest industry usually comes from within the industry;
it was thus proposed that the forest industry should hire
management personnel from outside the industry in order to
widen the traditional product-oriented perspective of forest
industry managers.
If you think of executives as coming out of a single pool in
the university which isn't true, but it's a nice, simple
way to think of it they've got their choice of where to
go. And where do they go? Well, the very best ones are
going into IT, bio-tech, you know, some of them are going
into it's the exciting areas, communication that are
really moving and happening quickly. The blue chip areas,
the forest products companies and even the chemical
companies to some extent, they don't get the same vision
and leadership. You know, Steve Jobs isn't running
DuPont. (Researcher, Canada).
We're going to have to switch from commodity thinking

to how do you maximize, you know, how do you get the
most out of a highly valued product? And there's probably
going to be more R&D necessary per ton of production for
that. There will be more technical skills needed. There's
more marketing skills, more international capabilities in
terms of nding markets. (Investor, U.S.)
According to some respondents, the forest industry was
seen as an adversarial business that builds on competition,
where collaboration inside the industry as well as with
other sectors is neglected. In general, finding a compatible
partner and coordinating different organizational policies,
procedures and operation modes as well as investing
equally in collaborative efforts and overcoming lack of trust
between potential partners are seen as notable managerial
challenges when establishing a new business.
According to the respondents, the biggest challenge in
operating a biorefinery consortium will definitely be sharing
the profits between the partners. Some respondents believed
that the chemical and oil industries will dominate within the
consortium and reap the biggest benefits. This naturally
raises a requirement for the biorefinery management to be
able to negotiate fair contracts.
There will be no problem with the sharing of the prot.
Exxon will take the prot. (Researcher, U.S.)
I think we're probably more open at a production site to

share technology, share leadership, but I know that one of
the biggest challenges is who and how do they divide up
the economic value that's created? You know, is it based
on technology or is it based on the supply of the raw
material and logistics afterwards? That's going to be a
huge issue and the challenge to partnership is dividing up
the pie. (Forest sector representative, U.S)
Likewise, sharing managerial responsibilities between
different actors will be difficult for higher management.
Accordingly, important skills at the managerial level will be
267
an understanding of market development in the global

arenas, as well as the ability to commercialize and market
new products. It follows that a challenge for managers will be
finding new customers and contacts in new business areas.
It is also important that managers are able to recognize
potential areas of top-level know-how, and that they provide
enough resources to develop them. Management should put
more effort into developing human resources in general, and
individual skills should be appraised. Encouraging people to
study and enter the industry will be also important in order
to ensure that there are enough capable personnel to manage
and operate the new business. Hansen et al. [93] noticed that
many forest products companies do not have programs for
systematically capturing innovative ideas. They also [93]
believe that many managers in the forest products industry
do not associate continuing education and other similar
efforts as a mechanism for increasing innovativeness.
According to this study, important skills will also include
the ability to interact with researchers and communicate
ideas to the managerial level in order to find new possibilities
and understand the importance of renewables, in particular.
[The] intermediate step from researcher to management
is lacking, when we are talking about these new products
[i.e. those who understand this gap between new product
technology, manufacturing, and marketing]. Here we have
plenty of needs. (Researcher, Finland)
The forest industry should also actively inform and educate
its stakeholders about the course of sustainability social,
environmental and economic for the emerging biorefinery
business.
4.2.3.2. Capacities required for operating bioreneries
Financing. Many respondents indicate that forest
biorefineries have very high investment costs, and revenues
from this new business are not currently considered sufficient
in the capital-intensive forest industry. The capital cost of the
current business has been high, and therefore it is believed that
many organizations will largely concentrate on producing
traditional products and fulfilling the demand of current
customers and markets as optimally as possible. It is also
difficult to find private capital investors for the new business.
Some respondents suggested a rationalization of assets as the
most needed action by the forest industry in order to promote
forest biorefineries.
I think they were looking at it [developing bioreneries].
But you can't make money in the future. You have to make
your money now. And the one thing that the paper industry
is very much aware of is that they have to make the money
now. They don't have enough other nancial resources to
tide them over for 15 years until something turns around.
(Researcher, U.S.)
Cohen et al. [76] also found in their study on forest
biorefineries that economic and process integration-related
criteria are the most important for decision-making when
planning to implement biorefinery.
The respondents of this study considered high raw material
prices as one of the biggest threats for the new biorefinery
business, and it was estimated that when demand increases
268
there will be even more pressure on wood biomass prices. Cohen

et al. [76] also believed that feedstocks account for a significant
part of manufacturing costs in forest biorefineries, particularly in
the case of commodity biorefinery chemicals (such as ethanol).
The flexibility of a technology that could process different
feedstocks was thus expected to be important in their study.
On the other hand, some respondents of this study considered
wood biomass to be a nearly untapped raw material source with
huge potential.
Skills and know-how. The respondents believed that more
diverse skills are needed in biorefineries, compared to traditional forest industry practices. Overall, in order to operate
forest biorefinery facilities successfully, there needs to be a
balance between managerial and technical skills. Engineers
(chemical engineers, in particular) who are able to manage new
processes will be an important part of the forest biorefinery
staff.
They [the forest industry] hired too many managers and
not enough technicians or, or, you know, experts. So they
hired too many technicians and not enough management
experts. There never seems to be a proper balance of skills
that and that seems to be the biggest problem to date is
just that lack of balance. It's either engineers or too many
VPs. (Forest sector representative, U.S.)
All in all, respondents highlighted that the right set of
skills and knowledge can be achieved through collaboration
and partnerships (see Section 4.2.2.2). KorhonenSande and
Sande [94] also point out that T-shaped individuals with
breadth of knowledge and depth of expertise are needed in
mature industries when innovating and collaborating with
other partners.
As previously mentioned, the forest industry by nature
understands wood and related feedstock systems, logistics and
refining processes. However, it also requires a general understanding of all value chain operations, not only those operations
in which the forest industry has traditionally been involved.
Forest industry companies need to have know-how about
the whole value chain. You just cannot buy that from the
technology providers or from the consultants. (Forest sector
representative, Finland)
Raw material availability and sustainability. There are both
prominent opportunities and threats related to the wood raw
material used in the biorefinery business. Many respondents
believed that the use of wood is considered environmentally
sustainable, given its intrinsic status as a renewable natural
resource. It was also mentioned that the forest industry has a
long tradition of managing forests in an environmentally sound
way. Moreover, the forest industry has knowledge about
required environmental practices, certifications and regulations. Overall, the respondents clearly indicated that environmental sustainability is an important driver for the forest
biorefinery business in general (see also [70]).
There will be more efcient utilization of biomass. Companies are aiming at protability and here with the biorenery
concept we can achieve both [environmental and economic
sustainability] at the same time. (Forest sector representative, Finland)
However, in addition to price challenges related to raw

material, using wood as raw material was also seen as a threat
from the environmental perspective (particularly in the U.S.).
The role of NGOs, particularly various environmental groups, was
considered important in relation to the growing resistance to
disturbing forest ecosystems. Correspondingly, many respondents believed that environmental regulations will not support
the use of wood biomass in biorefineries in the long term.
Research, collaboration and innovations. Interview questions
about research and collaboration prompted many respondents
to reflect again on the forest industry's corporate strategies in
general, as well as its current state as a mature industry. The
respondents were unanimous in their opinion that forest
industry companies largely lack financial resources for research,
and only a few of the largest ones have the resources left for
in-house development. Accordingly, resources were seen as
being directed towards supporting current mills and the
development of existing processes and products. Here again,
some respondents stressed that visionaries and innovators are
not missing in the forest industry, but company philosophies do
not encourage new innovations and new ideas. Forest industry
companies were also criticized for copying each other's business
models, practices and products.
Less [research and development] now than they used to,
much less now than they used to. I think that's part of the
thinking of themselves as a mature industry. Thinking
that there's not much room for innovation has hurt them.
I can't think of a company now that has a really active
research program. Weyerhaeuser had the strongest one
for many years, but they keep cutting back on their staff.
(Forest sector representative, U.S.)
Then, if we want to keep it [technology and technology

providers] here, we really should allocate resources to
research activities and these types of developmental projects. And otherwise we'll end up having that cluster in
South America. Or if we are pessimists, then or optimists,
it will be in China. (Forest sector representative, Finland)
Interestingly, KorhonenSande and Sande [94] found in
their study that structural change in companies does not
necessarily hinder innovation; instead, change can strengthen the benefits of cooperation and crossfunctional relationships and thus, employees may become more responsive to
information that they get from other functions.
Some of the respondents in this study also brought up that
it is very understandable that forest industry companies do not
invest in in-house R&D. First, because equipment suppliers are
ultimately the ones who will be able to take advantage of new
technologies, they will market the technologies worldwide.
Second, forest industry stakeholders do not encourage investments in R&D because new technologies are available for
competitors almost instantaneously.
By contrast, there were many respondents who believed
that there are plenty of potentially successful projects and
research being carried out through national programs, research
institutes, universities and consortia in which different partners
can collaborate. Finnish respondents in particular highlighted
the traditions of the forest cluster for successful collaboration.

However, it was also believed that collaboration can be done in
basic research and development, whereas competition prevents
collaboration when development nears potential commercial
processes and products.
5. Conclusions and recommendations
The North American and Scandinavian forest industries are
facing a situation in which business development is crucially
needed, due to the mature or even declining state of many
parts of the business. The drivers for change are widely
recognized, but pathways and processes for new business and
product generations largely still need to be created.
Although the changes in the forest industry business
environment have been neither sudden nor surprising, pursuing new business and creating related change strategies and
procedures are not easy for any forest industry organization.
For the traditional, capital-intensive forest industry, the
conservative organizational culture and lack of financial resources as well as concerns related to raw material price,
availability and sustainability seem to create prominent
barriers to change, according to our results. It is understandable
that this capital-intensive industry cannot make investments
without careful consideration. However, excessive carefulness
and resistance to change can jeopardize the forest industry's
future survival. The danger of a mature mindset has been also
recognized by various other studies (see references in Section 1).
Overall, the future business models of biorefineries in both
Scandinavia and North America have many similarities and can
be characterized as follows: in the biorefinery consortium, the
role of the forest industry is largely seen as biomass provider.
High value-added products and FischerTropsch biodiesel will
be key, but in general the biorefining business needs to be
planned to support traditional core businesses. This is interesting because creating truly new customer value would
require breaking away from the dominant industry practices
(see also [92,93]). Like traditional forest industry facilities, the
biorefineries must also eventually be located in areas with
plenty of affordable biomass and low labor costs, even if the
first pilot and demonstration facilities are built in Scandinavia
and North America. Therefore, identification of national
strengths and the roles of companies in the biorefinery value
chains is crucial in order to succeed in the long term.
However, it is not possible to create exact forecasts and
propose business strategies for biorefineries that would be
suitable for every situation. Instead, a case-by-case evaluation
is needed. The scope of changes with needed resources and
transformational activities depends largely on biorefinery
location, degree and site of integration, chosen technologies,
availability of raw materials and specific knowledge of the
biorefinery partners. In addition, there should be an aspiration
towards focus and differentiation: pursuing the same models
as competitors will not be the best pathway to follow.
Chambost et al. [29] have also highlighted that biorefinery
products manufactured by different forest product companies
will likely be different, implying that firms must therefore
implement unique company transformations. Domsj in
Sweden, for example, is often considered a model example of
a forest industry company that has successfully changed its
product portfolio and strategies. The pulp mill was transformed
269
into a biorefinery that produces lignin and bioethanol, for

example, using conifer wood fibers as raw material. There are
several things that can be considered to be reasons for the
company's success; interestingly, such things have been
highlighted by the respondents in this study. The company
was acquired by new owners who saw new business
opportunities outside of the traditional core business, but
there has also been emphasis on their own R&D and aspiration
towards a broader product portfolio [69,95,96].
The need for change and diversification of product portfolios
in the forest industry raises many expectations and requirements for the forest industry and its management. Operating a
commercial-scale forest biorefinery facility requires both new
managerial and operational-level skills.
Based on the findings of this study, the following recommendations for forest industry companies and their management can be proposed:
Readiness, resilience and enthusiasm for change need to be
embedded in the organizational culture.
There needs to be visionary, open-minded and multidisciplinary corporate management leading the organizational
change in the company.
The company management should be able to develop and
manage diverse portfolios.
There needs to be open, equal and innovative dialogue both
inside the organization and with potential partners outside
the organization.
Management needs to encourage ideas, capabilities and the
innovativeness of individual employees in order to facilitate organizational level knowledge and competitiveness.
Companies have to attain skills and know-how through
collaboration and partnerships, as well as through educational
programs.
Companies need to carefully consider and identify their
own roles and tasks in the biorefinery value chain.
Companies have to negotiate equal contracts in the sharing
of profits in the biorefinery consortium.
Overall, success in the biorefinery business cannot be
achieved without collaboration and partnerships that combine
the right set of skills and knowledge. However, sharing of profits
between the partners in the forest biorefinery consortium will be
challenging. Those who solve this challenge by finding and
sustaining a successful consortium will likely be the future
leaders of the biorefining business. In sum, the forest industry
needs to transform its business in one way or another.
Correspondingly, there is an increasing call in our society for a
bio-based, green economy with related new business strategies
and models. The biorefining business can be a successful strategy
towards these goals.
Appendix A. Supplementary data
Supplementary data to this article can be found online at
http://dx.doi.org/10.1016/j.techfore.2013.04.014.
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Annukka Nyh is a researcher in the School of Forest Sciences at the

University of Eastern Finland. She prepared her Ph.D. thesis on diffusion of
forest bioreneries in Corporate Environmental Management program at the
University of Jyvskyl. Her main research interests are in the area of forest
sector foresight, bioenergy and bioproducts and sustainable businesses.
Annukka Nyh is the corresponding author and can be contacted at:
annukka.nayha@uef..
Hanna-Leena Pesonen is a Professor in Corporate Environmental Management at the School of Business and Economics of the University of Jyvskyl,
Finland. She holds a Ph.D. in Environmental Management and a M.Sc. degree
in Marketing. Pesonen's areas of expertise include material ow management, environmental management systems, green marketing, and strategies
for renewable energy systems. She has conducted research related to the
forest sector for several projects, the rst of which was her Doctoral thesis in
1999 (From Material Flows to Cash Flows An Extension to Material Flow
Assessment).

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Technological Forecasting & Social Change 81 (2014) 259271

Contents lists available at ScienceDirect

Technological Forecasting & Social Change

Strategic change in the forest industry towards the

been developed in order to understand the structural changes

further increasing their competitiveness. The result of this is

biorefinery implementation presents prominent challenges for

the staff's readiness for change [23,37,39,40,42,44], the capability

3. Data and methods

Our aim was to explore the most interesting and prominent

How quickly is change needed?

Change features of the

Capabilities required for

Fig. 1. The analytical framework of the study.

[53]) and forest industry's change towards this business.

sustainability in forest biorefinery value chain companies

cheaper raw materials and labor in new Asian and South

future of the forest sector business in one way or another. Many

So it [implementing forest bioreneries] will be it will

4.1.2. The future of forest bioreneries

which the biorefinery will be integrated. Many respondents

prominent technological, economic and social advantages over

Forest industry, there's a very large, proportion of people

Are they really vigorously pursuing biorening technologies

There were also respondents who believed that the forest

Certainly, I think biofuels and biochemicals have a possibility.

I think of leadership and management I need somebody

People from outside the forest industry should be hired.

traditional bulk production. One of the prominent challenges

We're going to have to switch from commodity thinking

I think we're probably more open at a production site to

an understanding of market development in the global

there will be even more pressure on wood biomass prices. Cohen

However, in addition to price challenges related to raw

Then, if we want to keep it [technology and technology

the traditions of the forest cluster for successful collaboration.

into a biorefinery that produces lignin and bioethanol, for

[2] A. Nyh, H.-L. Pesonen, Diffusion of forest biorefineries in Scandinavia and

[38] J.B. Rieley, I. Clarkson, The impact of change on performance, J. Chang.

[85] E. Eloranta, J. Ranta, P. Salmi, P. Yl-Anttila, Teollinen Suomi [Industrial

Annukka Nyh is a researcher in the School of Forest Sciences at the

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