Visions of the servitization of forest bioeconomy in the next ten years

Writer: Lia Laukkanen, forestry student UEF

Bioeconomy includes producing renewable resources, refining them, using and recycling them and the services that are based on them. In forest bioeconomy the servitization is constantly present. It does not happen quickly and it is a transition between already existing elements of the system. The amount of new products and services based on wood is expected to grow and thus escalates the regeneration of the forest sector, but most of the new products and services are still in early stages, so for example in the next ten years many services are still shaping and evolving into their final form. In forest bioeconomy the services are added in the products and product-based businesses shift step by step to service business. Some products can also be changed into services only, so the products are servitized.

Ten years is a relatively short time period, but in that time for example the resources can be integrated in a new way that can jointly produce solutions. Some examples of this are the new business models of circular economy, and forest bioeconomy is an integral part of circular economy and its markets. Digitalization and the development of technology are in key position on the field of forestry and in forest bioeconomy, especially when new solutions such as new sharing economy platforms and service systems are created. One goal of the innovation activity of the forest industry businesses should be more radical product-service-concepts which lead to greater evolution of technology of the processes. This will lead to better competitiveness and better productiveness of the businesses on the sector. This can be seen in the development of forest bioeconomy. Servitization can also be seen in the forest bioeconomy now and in the next ten years in a form of different (international) technology programs. For example Finnish-Swedish Wood Material Science and Engineerin Research Programme (2003–2006) conducted interdisciplinary research to e.g. develop ecological and cost-effective forest bioeconomy services. Such programs guide the development of the businesses working within the forest bioeconomy sector and the servitization of the products and the services that have originated from the servitization.

When forest bioeconomy is servitizated, it is possible to shift from system level to another, which is known as the possibility of paradigm shift to service-based forest bioeconomy. It means that new ways to organize the production are developed, but also that values and benefits are redefined. These new definitions can be something that do not exist yet, but will be invented and redefined in the next ten years. For example, developing new (forest) bioeconomy services in liaison with the clean-tech sector can create and open unexpected, new markets to the businesses operating within the bioeconomy sector. This describes well the constant activity of servitization, because even if the change itself isn’t fast, the new innovations and for example the business fusions (inclusively in the field of forest industry or different industries) can happen in a relatively short time period when new businesses and therefore new services are created. An example of this is the listed company Metso-Outotec, in which Metso was operating on the field of forestry industry as well.

The development of the forest bioeconomy services in the next ten years can be really fast, because even when switching from system level to another is not fast, the new innovations and services entering the markets and the servitization of the (new) products can be quite fast. Digitalization and bringing the services online, including the easier access via smartphones for example, give a chance to develop the already existing services alongside the new ones. Especially technology development is fast which can be seen as a rapid development of the forest bioeconomy services in the next ten years, especially as the new sharing economy platforms.