Emerging bioenergy business at Finnish independent industrial sawmills

Finnish forest industry is in the middle of a radical change. Deepening recession and the falling demand of woodworking industry´s traditional products have forced also sawmilling industry to find new and more fertile solutions to improve their operational preconditions. In recent years, the role of bioenergy production has often been highlighted as a part of sawmills´ business repertoire. Sawmilling produces naturally a lot of by-products (e.g. bark, sawdust, chips) which could be exploited more effectively in energy production, and this would bring more incomes or maybe even create new business opportunities for sawmills. Production of bioenergy is also supported by government´s climate and energy policies favouring renewable energy sources, public financial subsidies, and soaring prices of fossil fuels. Also the decreasing production of domestic pulp and paper industry releases a fair amount of sawmills´ by-products for other uses. However, bioenergy production as a part of sawmills´ by-product utilization has been so far researched very little from a managerial point of view. The purpose of this study was to explore the relative significance of the main bioenergy-related processes, resources and factors at Finnish independent industrial sawmills including partnerships, cooperation, customers relationships and investments, and also the future perspectives of bioenergy business at these sawmills with the help of two resource-based approaches (resource-based view, natural-resource-based view). Data of the study comprised of secondary data (e.g. literature), and primary data which was attracted from interviews directed to sawmill managers (or equivalent persons in charge of decisions regarding bioenergy production at sawmill). While a literature review and the Delphi method with two questionnaires were utilized as the methods of the study. According to the results of the study, the most significant processes related to the value chain of bioenergy business are connected to raw material availability and procurement, and customer relationships management. In addition to raw material and services, the most significant resources included factory and machinery, personnel, collaboration, and geographic location. Long-term cooperation deals were clearly valued as the most significant form of collaboration, and especially in processes connected to raw material procurement. Study results also revealed that factors related to demand, subsidies and prices had highest importance in connection with sawmills´ future bioenergy business. However, majority of the respondents required that certain preconditions connected to the above-mentioned factors should be fulfilled before they will continue their bioenergy-related investments. Generally, the answers showed a wide divergence of opinions among the respondents which may refer to sawmills´ different emphases and expectations concerning bioenergy. In other words, bioenergy is still perceived as a quite novel and risky area of business at Finnish independent industrial sawmills. These results indicate that the massive expansion of bioenergy business at private sawmills in Finland is not a self-evident truth. The blocking barriers seem to be connected mainly to demand of bioenergy and money. Respondents´ answers disseminated a growing dissatisfaction towards the policies of authorities, which don´t treat equally sawmill-based bioenergy compared to other forms of bioenergy. This proposition was boiled down in a sawmill manager´s comment: “There is a lot of bioenergy available, if they just want to make use of it.” It seems that the positive effects of government´s policies favouring the renewables are not taking effect at private sawmills. However, as there anyway seems to be a lot of potential connected to emerging bioenergy business at Finnish independent industrial sawmills, there is also a clear need for more profound future studies over this topic.

The role of selected non-timber forest products for rural areas in Laos: Case studies in Ban Napo and Ban Kouay communities

Non-timber forest products (NTFPs) are one of the major income sources for the rural population of Laos. An exploratory study was conducted to determine the role of non-timber forest products for rural communities of the study area. The study was carried out in two villages viz. Ban Napo and Ban Kouay of Sangthong district between January and March 2010. A semi-structured questionnaire was used to gather data from the respondents. Twenty-five respondents from each village were chosen based on their involvement in NTFPs collection and marketing activities. Statistically significant NTFPs income differences were not found between the villages and age groups of the respondents, however, significant differences were found in the annual incomes between farms size of the respondents. This study also analyzed the value chain structure of the three (See khai’ ton, Bamboo mats and Incense sticks) important non-timber forest products and the interactions between the actors in the case study areas. Barriers to entry the market, governance and upgrading possibilities have been discussed for each of the value chains. Comparison of unit prices at different levels of the value chains indicated uneven income distribution in favour of the intermediaries, factories and foreign buyers. The lack of capital, marketing information and negotiation skills restricted the villagers to increase their income. However, all the respondents have shown their satisfaction with their income from NTFPs.

Conflicts when Competitors Cooperate: Exploring Elements of Conflicts from a Business Network Perspective

Most of the existing research within the business network approach is based on companies that are operating on different levels within the same value chain, as a buyer and a supplier. Intercompetitor cooperation, i.e. cooperation between companies occupying the same level within different value chains, has not been studied to the same extent. Moreover scholars within the business network approach have usually described industrial relationships as long term, consisting of mutual commitment and trust. Industrial relationships are not static, but dynamic, and they contain situations of both harmony and conflict. There is consequently a need for more research both concerning intercompetitor cooperation and conflicts. The purpose of this study is to develop our theoretical and empirical understanding of the nature of conflicts in intercompetitor cooperation from a business network perspective. The focus of the study lies on issue and intensity of conflict. The issue of a conflict can be divided into cause and topic, while the intensity comprises the importance and outcome of a conflict. The empirical part of the study is based on two case studies of groups of cooperating competitors from two different industries. The applied research method is interviews. According to the findings of this study causes of conflicts in intercompetitor cooperation can be divided into three groups: focus, awareness and capacity. Topics of conflict can be related to domain, delivery, advertising or cooperation. Moreover the findings show that conflict situations may be grouped into not important, important or very important. Some conflicts may also be of varying importance, meaning that the importance varies from one point of time to another. Based on the findings of the study the outcome or status of a conflict can be analyzed both on a concrete and general level. The findings also indicate that several conflicts are partly hidden, which means that only one or some of the involved actors perceive the conflict. Furthermore several conflict situations can be related to external network actors.

Understanding the organic chain : The framework of the interaction between the actors in organic chains in relation to ecological modernisation of food production

The sustainability of food production has increasingly attracted the attention of consumers, farmers, food and retailing companies, and politicians. One manifestation of such attention is the growing interest in organic foods. Organic agriculture has the potential to enhance the ecological modernisation of food production by implementing the organic method as a preventative innovation that simultaneously produces environmental and economic benefits. However, in addition to the challenges to organic farming, the small market share of organic products in many countries today and Finland in particular risks undermining the achievement of such benefits. The problems identified as hindrances to the increased consumption of organic food are the poor availability, limited variety and high prices of organic products, the complicated buying decisions and the difficulties in delivering the intangible value of organic foods. Small volumes and sporadic markets, high costs, lack of market information, as well as poor supply reliability are obstacles to increasing the volume of organic production and processing. These problems shift the focus from a single actor to the entire supply chain and require solutions that involve more interaction among the actors within the organic chain. As an entity, the organic food chain has received very little scholarly attention. Researchers have mainly approached the organic chain from the perspective of a single actor, or they have described its structure rather than the interaction between the actors. Consequently, interaction among the primary actors in organic chains, i.e. farmers, manufacturers, retailers and consumers, has largely gone unexamined. The purpose of this study is to shed light on the interaction of the primary actors within a whole organic chain in relation to the ecological modernisation of food production. This information is organised into a conceptual framework to help illuminate this complex field. This thesis integrates the theories and concepts of three approaches: food system studies, supply chain management and ecological modernisation. Through a case study, a conceptual system framework will be developed and applied to a real life-situation. The thesis is supported by research published in four articles. All examine the same organic chains through case studies, but each approaches the problem from a different, complementary perspective. The findings indicated that regardless of the coherent values emphasising responsibility, the organic chains were loosely integrated to operate as a system. The focus was on product flow, leaving other aspects of value creation largely aside. Communication with consumers was rare, and none of the actors had taken a leading role in enhancing the market for organic products. Such a situation presents unsuitable conditions for ecological modernisation of food production through organic food and calls for contributions from stakeholders other than those directly involved in the product chain. The findings inspired a revision of the original conceptual framework. The revised framework, the three-layer framework , distinguishes the different layers of interaction. By gradually enlarging the chain orientation the different but interrelated layers become visible. A framework is thus provided for further research and for understanding practical implications of the performance of organic food chains. The revised framework provides both an ideal model for organic chains in relation to ecological modernisation and demonstrates a situation consistent with the empirical evidence.

Determinants and Consequences of Information Sharing with Key Suppliers

As companies become more efficient with respect to their internal processes, they begin to shift the focus beyond their corporate boundaries. Thus, the recent years have witnessed an increased interest by practitioners and researchers in interorganizational collaboration, which promises better firm performance through more effective supply chain management. It is no coincidence that this interest comes in parallel with the recent advancements in Information and Communication Technologies, which offer many new collaboration possibilities for companies. However, collaboration, or any other type of supply chain integration effort, relies heavily on information sharing. Hence, this study focuses on information sharing, in particular on the factors that determine it and on its value. The empirical evidence from Finnish and Swedish companies suggests that uncertainty (both demand and environmental) and dependency in terms of switching costs and asset specific investments are significant determinants of information sharing. Results also indicate that information sharing improves company performance regarding resource usage, output, and flexibility. However, companies share information more intensely at the operational rather than the strategic level. The use of supply chain practices and technologies is substantial but varies across the two countries. This study sheds light on a common trend in supply chains today. Whereas the results confirm the value of information sharing, the contingent factors help to explain why the intensity of information shared across companies differ. In the future, competitive pressures and uncertainty are likely to intensify. Therefore, companies may want to continue with their integration efforts by focusing on the determinants discussed in this study. However, at the same time, the possibility of opportunistic behavior by the exchange partner cannot be disregarded.

A Hub System for Cloud-Computing Based Business-Collaboration: Automating Ontology-Enabled Electronic Business-Service Discovery

The management and coordination of business-process collaboration experiences changes because of globalization, specialization, and innovation. Service-oriented computing (SOC) is a means towards businessprocess automation and recently, many industry standards emerged to become part of the service-oriented architecture (SOA) stack. In a globalized world, organizations face new challenges for setting up and carrying out collaborations in semi-automating ecosystems for business services. For being efficient and effective, many companies express their services electronically in what we term business-process as a service (BPaaS). Companies then source BPaaS on the fly from third parties if they are not able to create all service-value inhouse because of reasons such as lack of reasoures, lack of know-how, cost- and time-reduction needs. Thus, a need emerges for BPaaS-HUBs that not only store service offers and requests together with information about their issuing organizations and assigned owners, but that also allow an evaluation of trust and reputation in an anonymized electronic service marketplace. In this paper, we analyze the requirements, design architecture and system behavior of such a BPaaS-HUB to enable a fast setup and enactment of business-process collaboration. Moving into a cloud-computing setting, the results of this paper allow system designers to quickly evaluate which services they need for instantiationg the BPaaS-HUB architecture. Furthermore, the results also show what the protocol of a backbone service bus is that allows a communication between services that implement the BPaaS-HUB. Finally, the paper analyzes where an instantiation must assign additional computing resources vor the avoidance of performance bottlenecks.

Learning Challenges in Biogas Production for Sustainability : An activity theoretical study of a network from a swine industry chain

This study is about the challenges of learning in the creation and implementation of new sustainable technologies. The system of biogas production in the Programme of Sustainable Swine Production (3S Programme) conducted by the Sadia food processing company in Santa Catarina State, Brazil, is used as a case example for exploring the challenges, possibilities and obstacles of learning in the use of biogas production as a way to increase the environmental sustainability of swine production. The aim is to contribute to the discussion about the possibilities of developing systems of biogas production for sustainability (BPfS). In the study I develop hypotheses concerning the central challenges and possibilities for developing systems of BPfS in three phases. First, I construct a model of the network of activities involved in the BP for sustainability in the case study. Next, I construct a) an idealised model of the historically evolved concepts of BPfS through an analysis of the development of forms of BP and b) a hypothesis of the current central contradictions within and between the activity systems involved in BP for sustainability in the case study. This hypothesis is further developed through two actual empirical analyses: an analysis of the actors senses in taking part in the system, and an analysis of the disturbance processes in the implementation and operation of the BP system in the 3S Programme. The historical analysis shows that BP for sustainability in the 3S Programme emerged as a feasible solution for the contradiction between environmental protection and concentration, intensification and specialisation in swine production. This contradiction created a threat to the supply of swine to the food processing company. In the food production activity, the contradiction was expressed as a contradiction between the desire of the company to become a sustainable company and the situation in the outsourced farms. For the swine producers the contradiction was expressed between the contradictory rules in which the market exerted pressure which pushed for continual increases in scale, specialisation and concentration to keep the production economically viable, while the environmental rules imposed a limit to this expansion. Although the observed disturbances in the biogas system seemed to be merely technical and localised within the farms, the analysis proposed that these disturbances were formed in and between the activity systems involved in the network of BPfS during the implementation. The disturbances observed could be explained by four contradictions: a) contradictions between the new, more expanded activity of sustainable swine production and the old activity, b) a contradiction between the concept of BP for carbon credits and BP for local use in the BPfS that was implemented, c) contradictions between the new UNFCCC1 methodology for applying for carbon credits and the small size of the farms, and d) between the technologies of biogas use and burning available in the market and the small size of the farms. The main finding of this study relates to the zone of proximal development (ZPD) of the BPfS in Sadia food production chain. The model is first developed as a general model of concepts of BPfS and further developed here to the specific case of the BPfS in the 3S Programme. The model is composed of two developmental dimensions: societal and functional integration. The dimension of societal integration refers to the level of integration with other activities outside the farm. At one extreme, biogas production is self-sufficient and highly independent and the products of BP are consumed within the farm, while at the other extreme BP is highly integrated in markets and networks of collaboration, and BP products are exchanged within the markets. The dimension of functional integration refers to the level of integration between products and production processes so that economies of scope can be achieved by combining several functions using the same utility. At one extreme, BP is specialised in only one product, which allows achieving economies of scale, while at the other extreme there is an integrated production in which several biogas products are produced in order to maximise the outcomes from the BP system. The analysis suggests that BP is moving towards a societal integration, towards the market and towards a functional integration in which several biogas products are combined. The model is a hypothesis to be further tested through interventions by collectively constructing the new proposed concept of BPfS. Another important contribution of this study refers to the concept of the learning challenge. Three central learning challenges for developing a sustainable system of BP in the 3S Programme were identified: 1) the development of cheaper and more practical technologies of burning and measuring the gas, as well as the reduction of costs of the process of certification, 2) the development of new ways of using biogas within farms, and 3) the creation of new local markets and networks for selling BP products. One general learning challenge is to find more varied and synergic ways of using BP products than solely for the production of carbon credits. Both the model of the ZPD of BPfS and the identified learning challenges could be used as learning tools to facilitate the development of biogas production systems. The proposed model of the ZPD could be used to analyse different types of agricultural activities that face a similar contradiction. The findings could be used in interventions to help actors to find their own expansive actions and developmental projects for change. Rather than proposing a standardised best concept of BPfS, the idea of these learning tools is to facilitate the analysis of local situations and to help actors to make their activities more sustainable.

Operationalizing Supply Chain vs. Supply Chain Competion

Competition is an immensely important area of study in economic theory, business and strategy. It is known to be vital in meeting consumers’ growing expectations, stimulating increase in the size of the market, pushing innovation, reducing cost and consequently generating better value for end users, among other things. Having said that, it is important to recognize that supply chains, as we know it, has changed the way companies deal with each other both in confrontational or conciliatory terms. As such, with the rise of global markets and outsourcing destinations, increased technological development in transportation, communication and telecommunications has meant that geographical barriers of distance with regards to competition are a thing of the past in an increasingly flat world. Even though the dominant articulation of competition within management and business literature rests mostly within economic competition theory, this thesis draws attention to the implicit shift in the recognition of other forms of competition in today’s business environment, especially those involving supply chain structures. Thus, there is popular agreement within a broad business arena that competition between companies is set to take place along their supply chains. Hence, management’s attention has been focused on how supply chains could become more aggressive making each firm in its supply chain more efficient. However, there is much disagreement on the mechanism through which such competition pitching supply chain against supply chain will take place. The purpose of this thesis therefore, is to develop and conceptualize the notion of supply chain vs. supply chain competition, within the discipline of supply chain management. The thesis proposes that competition between supply chains may be carried forward via the use of competition theories that emphasize interaction and dimensionality, hence, encountering friction from a number of sources in their search for critical resources and services. The thesis demonstrates how supply chain vs. supply chain competition may be carried out theoretically, using generated data for illustration, and practically using logistics centers as a way to provide a link between theory and corresponding practice of this evolving competition mode. The thesis concludes that supply chain vs. supply chain competition, no matter the conceptualization taken, is complex, novel and can be very easily distorted and abused. It therefore calls for the joint development of regulatory measures by practitioners and policymakers alike, to guide this developing mode of competition.