Finnish Sawmills Research Articles

Strategic Management Towards Competitive Advantage—Patterns of Internationalization in the Finnish and Swedish Sawmill Industries

The two Nordic European Union countries, Finland and Sweden, have common features and similarities based on their rich forest resources and sizable sawmill industry with internationalization mainly through exports. We compared the Finnish and Swedish sawmill industries and market developments since 1990 and discussed the most eminent country and firm-level differences. In this context, we conducted an academic literature review on strategic approaches of sawmill industries in these countries and mapped the drivers of competitiveness that we could identify from the studies published between years 1990 and 2019. In our study, drivers of competitiveness were identified to stem dominantly from the firm-level strategic decisions and use of internal resources and capabilities, whereas the factors related to the external environment were found to be less prominent. From a methodological perspective, the use of qualitative methods has become more common towards the present date, while the use of mixed approaches is very rare. Research on sawmill industry strategies is quite versatile, but more comparative studies are needed to increase understanding of the developments and state of complex sawmill business that is influenced by a myriad of internal and also external factors.

Selective hemicellulose hydrolysis of Scots pine sawdust

The depletion of fossil resources is driving forward the search for new and alternative renewable feedstocks in the production of renewable chemicals, which could replace the petroleum-based ones. One such feedstock is pine (Pinus sylvestris) sawdust, which is generated enormous amounts in Finnish sawmills yearly. However, prior to the utilization in high-value applications, it needs to be fractionated into its constituents. In this work, the objective was to produce monomeric hemicellulose sugars from pine sawdust without degrading cellulose or lignin simultaneously. The influence of the reaction temperature and time, as well as acid type and concentration, was studied. Based on the results, the temperature was the main distinguishing feature between cellulose and hemicellulose hydrolysis. Promising results were achieved with acid mixtures consisting of 0.5% sulfuric acid and 5.5 or 10% formic acid. At 120 °C with the reaction time of 2 h, the mixtures produced hemicellulose sugars with the yields of 62%. These yields were comparable to the yields achieved in similar conditions with 1.5% sulfuric acid or 40% formic acid. Therefore, by using an acid mixture, the concentration of a single acid could be reduced significantly. The solid fractions remaining after the hydrolysis consisted mainly of cellulose and lignin, which verified the selectivity of the hemicellulose hydrolysis. Also, the fractionation of the remaining solids confirmed that the utilization of all the sawdust components is feasible.

The future operating environment of the Finnish sawmill industry in an era of climate change mitigation policies

Sawnwood and its further-processed products play an important role in the mitigation of climate change; sawnwood, as well as its by-products from production processes, such as raw material (bark, chips, dust) for energy products (e.g. pellets, heating power), can substitute for other raw materials with higher carbon footprints. In this study, we integrate various foresight methods in analysing the future of the sawmilling industry in Finland. According to the results, climate change mitigation policies impact firstly through increasing energy costs and secondly through emerging energy products. The greatest uncertainties are related to the price of energy and the competitive situation of wood as a potential source of energy, both regulated heavily by EU- and national-level policies. In addition, the future development of biorefineries was regarded as a potential driver of change: the increasing demand for pulpwood would increase competition for the raw materials. From a managerial perspective, the Finnish sawmilling industry should thus consider adoption of new business models for joint production of wood, chips, and energy for heat and power. For the policymakers our study illustrates how important it is to take into account the causal effects on profitability determinants when designing policy measures.

Opportunities and Challenges in the Emerging Bioenergy Business: The Case of the Finnish Sawmill Industry

The resources of currently dominant fossil fuels are limited, and their use causes greenhouse gas emissions. Consequently, the public interest within the European Union has changed toward using renewable energy. Finland’s forest industry is one of the world leaders in producing and utilizing wood-based bioenergy. Hence, it is of interest to evaluate new value-creation opportunities and the consequent challenges that face the Finnish sawmill industry. In order to identify the strategic resources that enable developing competitive advantages in the emerging bioenergy field, we applied the natural resource-based view of strategy to the sawmill industry. In the empirical part, qualitative semi-structured interviews with managers of 23 sawmills based on the Delphi methodology were conducted in two phases. We identified partnerships with local community heat plants as a strategic resource for providing new business opportunities, apart from raw material availability and existing technologies. Although the Finnish sawmills have a long tradition in energy production, most energy-related investments have been made only during the past decade, and the sawmills would be keenly interested in increasing the efficiency of using their by-products through new investments. In conclusion, the Finnish sawmill industry being the local producer of wood-based bioenergy can support meeting the ambitious national target for renewable energy production for 2020. However, the volatile bioenergy policy changes act as a major factor of uncertainty in predicting the future development of the business environment and further increase the risk level for future investments.

Pellet promotion in the Finnish sawmilling industry: The cost-effectiveness of different policy instruments

Abstract The demand for wood fuels is increasing as several countries have targets for different types of wood-based energy, e.g. pellets. Sawmills are a source for wood fuels since they can refine their by-products into energy products. We present a model of a profit-maximizing sawmill, and analyze the production and investment decisions of thirty large-scale Finnish sawmills. The model allows the investigation of required policy incentives that enable sawmills to realize the production targets set for pellets. We analyze the policy costs of the investment, production and input subsidies. We found that the production subsidy is an efficient policy instrument.

Network co-operation as a source of competitiveness in medium-sized Finnish sawmills

In the Finnish sawmill industry, inter-firm collaboration has often been brought up as a means of creating a competitive edge in global markets by achieving economies of scale. According to the resource-based view (RBV), a firm can evaluate its current or potential partners by considering firm-level collaboration as a portfolio of complementary strategic resources. The specific focus of the study is on examining the types and forms of sawmill co-operation, how the co-operation emerged and which firm-specific resources are mainly related to co-operation. Based upon this, we can see how the managers of medium-sized sawmills perceive network co-operation as facilitating the achievement of a sustainable competitive advantage. The empirical data for this study were collected by interviewing 16 managers and employees in medium-sized non-integrated sawmills, a joint-venture marketing company and other co-operative partners. The findings of the study show that meaningful and beneficial co-operation partnerships exist in the Finnish sawmilling industry, but the sawmill managers do not perceive this collaboration as a strategic resource. The marketing company was the only firm in this study that relied on its co-operative networks in seeking a sustainable competitive advantage. To make more of co-operative partnerships, the principles of co-operative networking should be understood better in the sawmilling industry in order to know what to expect from co-operation. Furthermore, the managers should have the courage to engage in more extensive co-operation in order for strategic rents to materialize. Since the selection of the right partners is fundamental, further studies could be conducted on the reasons behind failed or terminated co-operative arrangements to gather further empirical knowledge in this subject area.

Research method and improvement of log rotation in sawmills

Log rotation studies were performed at 14 Finnish sawmills during the years 2003–2005. In the investigation of automatic log rotation, the materialized degree of log rotation for each log was calculated from photos captured from a digital video recording. Rotation errors (D) for individual logs and again the accuracy of the automatic log rotator was determined from optimized angle values of the log measuring system and materialized angle values calculated from the still photos. The accuracy of the log rotation varied considerably between sawmills. The rotation error average of the automatic log rotation varied from –23.6° to +11.4°. This means that in some cases the logs were under-rotated and in some they were over-rotated, on an average. Standard deviation of the rotation error (s) of the automatic rotator varied from 4.4° to 22.9°. The results of the simulation indicated that the performance of the log rotation system can be improved by adjusting the log rotator control. In addition to the zero degree error on an average rotation (or near to zero), the corrected values have a significantly smaller standard deviation of the rotation error, and the number of correct rotations was significantly higher compared to the situation before the adjusted rotation commands. At Sawmill 1, standard deviation of the rotation error was reduced by 40.9% from 14.9 degrees to 8.8 degrees. At the same time the number of correct rotations (–10°≤ D ≤ +10°) increased 4.0 fold from 20.1% to 79.4%. At Sawmill 2, standard deviation of the rotation error was reduced by 23.8% from 10.5 degrees to 8.0 degrees. At this sawmill, the rate of accepted rotations increased 1.9 fold from 42.6% to 81.0%. According to previous research, 2.5° decrease in standard deviation of the rotation error (from 10.5 to 8.0°) in square sawing means about 0.5% increase in value yield. For example with 10 million Û annual sales of sawn timber this means 50 000 Û extra profit.

Assessing the resource usage decisions and financial performance in Finnish sawmills within the resource-based view framework

Lahtinen, K. 2009. Assessing the resource usage decisions and financial performance in Finnish sawmills within the resource-based view framework. 40 p. Dissertationes Forestales 89. Available at http://www.metla.fi/dissertationes/df89.htm. The business environment of Finnish sawmills has changed notably since the 1990s due to the internationalization of operations and increased competition from the emerging producer countries. Especially for the sawmills in higher cost-level countries, the ability to create value with special products and providing customer services have been emphasized as crucial to business success towards the present date. Still, empirical evidence of those linkages between the strategic choices and the competitiveness of woodworking firms is largely lacking. The purpose of the study is to examine, within the resource-based view (RBV) framework, the impacts of resource usage decisions on the financial performance of Finnish largeand medium-sized (LM) sawmills in the 2000s. The study materials comprise literature, firm-level financial accounting information and interview data analysed with a literature review, a regression analysis and the multi-criteria decision analysis (MCDA) method. According to the results, resources associated with access to raw material, reputation and services, collaboration and technological know-how have affected the financial performance of LM sawmills the most during the current decade. Reputation, services and collaboration have the highest strategic potential while the strategic capacity of raw material and technological know-how in enhancing the competitiveness of LM sawmills is more ambiguous. The resource valuations of the managers and the actual influence the resources have had on LM sawmills’ financial performance have not corresponded in all cases. Some of the managers’ least valued resources have actually been strategic resources for sawmills and vice versa. The results indicate that, when seeking solutions to enhance sawmills’ competitiveness, managers should also take into account the less conventional resources in the strategic planning processes of the firms. Compared with this study, the results could be generalized in the future by gathering interview data from a larger sample and by increasing the number of accounting periods in performance measurements. In addition, since the challenges of the global business environment are similar for all woodworking companies operating in the higher cost-level areas, new research information could also be acquired by gathering comparable homogenous firm-level data from several countries.

Financial performance in Finnish large- and medium-sized sawmills: The effects of value-added creation and cost-efficiency seeking

The business environment of Finnish sawmill industry has changed notably since the 1990s. As a result of these changes, maintaining competitiveness and acceptable business success in sawmilling is more challenging than before. Manufacturing higher-priced value-added timber products has been highlighted as the main option for achieving sustainable financial performance, but its outcome has not been studied previously. In this paper, the effects of cost- and value-added components on the firm-level financial performance of 27 large- and medium-sized Finnish sawmills in 2000–2004 are evaluated by using regression analysis. The proportions of material and salary expenses of turnover are applied as measures of relative cost-efficiency. The commitment to value-added creation is assessed by the share of investments and value-added of the turnover. The results indicate that cost-efficiency indicators explain shorter-term financial performance better, than value-added creation, which affects longer-term financial performance and future turnover growth. Thus, from the managerial point of view, in the short term, cost-efficiency is a prerequisite for the business, while in the long term, value-added creation is also needed to support the economic sustainability of the business.

Cyclicality in the Finnish and Swedish sawmill industry, 1970–2000

The overall purpose of the article is to analyze cyclicality in sawmills in Finland and Sweden during 1970–2000. We focus on providing answers to two research questions. Firstly, what kind of business cycles, in terms of key economic indicators, has the sawmill industry experienced during 1970–2000? Secondly, what kind of structures and processes have typically caused, enhanced and upheld cyclicality in the Nordic sawmill industry? The first question is answered by providing historical data on the following market-related economic indicators: the cyclicality of prices, demand, and production levels. Our answers to the second question are based primarily based on our interviews with key managers in several Finnish and Swedish companies in the sawmill industry. We have divided structures and processes underlying cyclicality into what we call operational structures and behavioural regularities. By operational structures, we mean the more objective circumstances, even physical objects. By behavioural regularities, we mean the more subjective patterns of behaviour that are typical for managers in the industry due to their cognitions of the typical industry logic or ‘recipe’.

Monoterpene and wood dust exposures: work-related symptoms among Finnish sawmill workers.

Monoterpenes and wood dust are released into the work environment during sawing of fresh wood. Symptoms related to exposure to monoterpenes and wood dust include irritation of the eyes, mucous membrane, and skin. We studied 22 sawhouse workers who process pine and spruce in 1997-99. Exposure to monoterpenes was assessed by determining monoterpenes in air and verbenols in urine by gas chromatography using flame ionization detection. Wood dust was determined gravimetrically. A questionnaire was used to evaluate work-related subjective symptoms. Exposures to monoterpenes (geometric mean, GM) among sawhouse workers were 61-138 mg/m(3) and 2.0-13 mg/m(3) during processing of pine and spruce, respectively. Urinary verbenol correlated well with worker exposure to the alpha-pinene fraction of monoterpenes. The inhalable dust concentration in the breathing zone was 0.5- 2.2 mg/m(3) during pine processing and 0.4-1.9 mg/m(3) during spruce processing. The prevalence of symptoms, in the eyes or respiratory tract, was high during both seasons and in connection with either tree species. The highest monoterpene concentration (GM), in the breathing zone, measured during processing of pine, was less than one-fourth of the Finnish occupational exposure limit (OEL, 570 mg/m(3)). Verbenol concentrations in postshift urine samples reflected accurately the exposure to monoterpenes. The concentrations of inhalable dust (GM) were less than one-half the Finnish OEL (5 mg/m(3)). No significant differences in dust exposure were observed among tree species processed. Work-related symptoms appeared to correlate with monoterpene exposure during processing of pine and with wood dust exposure during processing of spruce.

Characterization and control of terpene emissions in Finnish sawmills.

This article describes an experimental study of terpene emission rates during fresh pine and spruce sawing and processing. Total terpene emission was determined by summing the product of the exhaust airflow rate and the mean concentration in the exhaust. Terpene concentrations were measured at fixed sampling points between the sawing lines. Terpene emission during pine sawing was found to be around 10 times greater than that during spruce sawing. The emission rates given here can be used to predict emission rates for various production rates. The predicted emission rates can be used in mass balance models to predict concentrations or required airflow rates to achieve the target concentration level.

Exposure to monoterpenes in Finnish sawmills.

Exposure to monoterpenes in Finnish sawmills.

Concentrations of 2,3,7,8-chlorinated dibenzo-p-dioxins and dibenzofurans at landfills and disposal sites for chlorophenolic wood preservative wastes

Concentration patterns of 16 key 2,3,7,8-substituted PCDD/F congeners were analysed at ppt levels in waste, soil, sediment and leachate samples from 3 mixed-waste landfills, 2 sawmill dumps and the disposal site of the factory which produced the mixture of 2346-TeCP, PCP and 246-TCP used as wood preservative at Finnish sawmills. At this site, I-TE sum of 21 ngg −1 (DS) was observed in leachate discharge dike sediments, the main contributing analytes being 123678-HxCDF, 1234678-HpCDF (at a level of 700 ngg −1) and 1234678-HpCDD. Also OCDF (at 490 ngg −1), OCDD and 1234678-HxCDD were among the most abundant congeners. In sawmill dump wastes, OCDF or HpCDF was dominant, followed by 4-substituted HxCDD/Fs; the maximum I-TE sum was 2.1 ngg −1 (DS). Even in most landfill leachates OCDF and 123678-HxCDFs; were the most abundant and important congeners, but the highest I-TE sum (360 pgl −1 in the aqueous phase of perched water) was mainly attributed to 2378-TCDD.

Evaluation of workers' exposure to 2-ethylhexanoic acid (2-EHA) in Finnish sawmills

Exposure to a new wood preservative agent (Sinesto B), whose active ingredient is 2-ethylhexanoic acid (2-EHA), was determined by urinalysis of the parent chemical and its metabolites in workers employed in four Finnish sawmills. The excretion of these chemicals was compared with the inhaled dose analyzed in air samples collected at the breathing zone and with the percutaneous absorption determined by epicutaneous sampling. The main route for entrance of 2-EHA into the body is by breathing, because the urinary concentration of 2-EHA correlated linearly with the concentration of 2-EHA in the air (r = 0.70). There was no correlation between skin contamination and urinary levels of 2-EHA. In most cases the highest urinary concentrations of 2-EHA were found immediately after the work shift. Therefore, in order to evaluate a worker's exposure, the urine sample has to be taken immediately after the work shift. Workers in cranes had the highest exposure to 2-EHA, which describes well the evaporation of Sinesto B into the ambient air. 2-EHA was not found in the urine of non-exposed workers.

Teknologinen muutos Suomen teollisuudessa 1885–1920 (Technological change in Finnish industry 1885–1920) by Timo Myllyntaus, et al

328 Book Reviews TECHNOLOGY AND CULTURE Teknologinen muutos Suomen teollisuudessa 1885—1920 (Technological change in Finnish industry 1885-1920). By Timo Myllyntaus, Karl-Erik Michelsen, and Timo Herranen. Helsinki: Finska Vetenskaps Societeten, 1986. Pp. xii + 265; figures, tables, notes, bibliog­ raphy. Mk 167.00 (paper). It has traditionally been thought that industrialization, which started in Britain, follows the same pattern: weaving mills, ironmak­ ing, steam power. This was true in the leading industrialized coun­ tries, but there can be other paths to modern industry; Finland offers an example of this. Its smaller population and its natural resources did not allow it to follow the above pattern. However, Finland had other opportunities, and this book is concerned with technical and economic aspects of the most important period in the industrialization of Finland, the years 1885 to 1920. It is a great shame that the book, well planned around its central thesis and also well written, has been published only in Finnish. If it had appeared in a language with a broader appeal, it would have offered good comparative material on the history of the industrial­ ization of the small countries of Europe. It aims to depict the details of technological change, to measure the change, and to explain the relationship between technology and the economy in the metal industry, the sawmill industry, and the papermaking industry. In addition, a chapter is devoted to the economics of energy, which is held to be the indicator of the effectiveness of industrial activity. In international terms, Finland’s results in iron and steel, the basic areas of modern industry, were insignificant. Simply, the difficulty was that almost no iron ore suitable for mining had been found in Finland, and no coal at all. The iron industry, based on foreign ore and charcoal, fell a long way short of the technical standards general in Europe and this gap grew rather than narrowed. A typical feature was that the smelters had a small capacity. On the other hand, although production increased only slightly, it did manage to satisfy most of the raw material requirements of the domestic machine tool industry. While the metal industry lagged behind in international terms, the machine tool industry developed strongly; thus a profound structural change took place in the metal industry as a whole. Finnish machine tool manufacturers attained international standards, and before the First World War they were able to manufacture almost all the machines that the other industrial sectors required, except for very large steam engines, complete paper machines, and weaving looms. In fact, there was sufficient technology to build such machines but no financial point in doing so, since demand was limited to a few machines for the whole country. A shipbuilding industry producing TECHNOLOGY AND CULTURE Book Reviews 329 iron-hulled ships, principally for use around the coasts and on inland waterways, also emerged at this time. Furthermore, the Finnish machine tool industry was very important in other industrializing areas. The timber industry was a big source of orders and needed to turn to foreign producers for only a small part of its requirements. Indeed, the fast-growing timber industry provided the impetus for technological advances in the machine tool industry. The timber industry was responsible for the industrialization of Finland. Finnish sawmills changed from water-driven saws to steampowered ones, with a consequent manifold increase in capacity. The pulp and paper industry, based on the use of wood (in particular, spruce) and water, was born in the 1860s, but grew rapidly. The timber industry produced almost entirely for export, with a value of about 65 percent of the total value of Finnish exports. But interna­ tional markets forced the industry to be competitive technically, and Finnish sawmills and papermills could hold their own as regards productivity. The technology required for modernization was based partly on innovations from abroad and partly on domestic develop­ ment work. An especially interesting feature was that the new timber industry’s consumption of wood increased several-fold; the purchase of this wood and its felling and transport allowed money to spread to the rural areas. Income from modern industry was obtained by many people, much of it going to the remotest...

Polychlorinated phenols and their metabolites in soil and earthworms of sawmill environment

Topsoil and earthworm samples collected from three Finnish sawmill environments were analysed for polychlorinated phenols, 2,3,4,6-tetrachloro- and pentachlorophenol, and their metabolites. Analyses were carried out by gas chromatography/mass spectrometry using a selected ion monitoring technique and by dual-channel gas chromatography using quartz capillary columns and two electron capture detectors. The total chlorophenol concentrations ranged from ca. 260 to 480 μg/g (dry weight) in soil and from ca. 140 to 3500 μg/g fat in earthworms. The most important metabolites in soil were chlorinated dihydroxy-benzenes (also at ppm level); only traces of chlorinated anisoles were detected in soil. 2,3,4,6-Tetrachloroanisole and pentachloroanisole were found at ppm level in fat of earthworms.

Cancer incidence of workers in a Finnish sawmill.

The cancer incidence of 1,223 sawmill workers with continuous employment of at least one year between 1 January 1945 and 31 December 1961 was followed until 31 December 1980. Separate analyses were made for the 801 workers hired after 1 January 1945, and smoking habits were surveyed. Among the men, 90 cases of primary cancer were detected versus 83.5 expected and among the women 55 cancer cases versus 44.5 expected. Skin cancer was in excess among the men, especially among those employed after 1 January 1945. Lip, mouth, and pharynx cancer and lymphomas were also slightly in excess among the men, as was leukemia among both sexes. Workplace exposure, especially to chlorophenols, may be associated with the excess skin cancer and the slight excess of lymphomas, but this finding should be further evaluated with special emphasis on well-defined exposure data.

The competitive position of the finnish sawmill industry in the 1920s and 1930s

Abstract The days of glory of the Finnish sawn timber exporters lasted from the beginning of the twentieth century to the early 1930s. During this period the sawmill industry was unquestionable the major industrial sector in the country, measured by the gross value of its output. In foreign trade, sawn timber accounted for about 40% of Finland's total exports. In some years nearly half of the total export revenue was earned by this sector alone. At the end of the 1970s and the beginning of the 1980s, sawn timber accounted for only 7-8 % of exports and the sawmill industry had slipped far from the top, even measured by total output value.

Chlorophenol exposure in sawmills.

Personnel exposures to chlorophenols were measured in ten Finnish sawmills where a chlorophenolate salt formulation was used for the blue stain control of sawed wood. The concentrations of chlorophenols in the air were usually well below the occupational limit value of 0.5 mg/m3. However, high concentrations (above 10 mg/m3) were measured inside heated kilns. Additionally, high concentrations were detected in the urine of workers whose skin came into contact with chlorophenol solution, indicating that chlorophenols are rapidly absorbed through the skin. The concentrations of chlorophenols in the air were low in trimming-grading plants where treated boards are handled, but some of the chlorophenols was bound to wood dust which is deposited mainly in the nose. The risks associated with the impurities contained in chlorophenol preparations (chlorinated dibenzodioxins and dibenzofurans) and the need for epidemiologic studies on possible cancer risks in sawmill work are discussed.