::The Center for Paper Business and Industry Studies::

Research Highlights

The research highlights are organized along the 5 CPBIS themes of research and are issued from CPBIS research projects.

GLOBALIZATION

Competitive Strategy, Industry Structure, and Innovation

Chinese Demand: Findings indicate that paper consumption in China has grown in lockstep with GDP but has the potential to increase more rapidly given the comparatively low usage of paper per capita. Demand has grown more responsive to price with increasing privatization of the Chinese economy since 1993.

ENTERPRISE EFFECTIVENESS

Competitive Strategy, Industry Structure, and Innovation

Industry Consolidation (and Antitrust): A variety of studies examine the changing competitive structure of the industry and its performance across time. Historical studies document the role of antitrust in shaping industry structure and competitive strategy. They suggest that government policy, which blocked firms from achieving market dominance in particular product segments and regions while tolerating diversification into new markets, may well have discouraged certain forms of innovation. Economic analysis of consolidations since 1970 indicate that increasing consolidation has been accompanied by improved price-cost ratios, but that firms have not generally succeeded in pushing prices higher. Overall economic performance, despite the improved ratios, has lagged during this period of increasing concentration.

Forest Biotechnology: A modeling exercise suggests that genetically engineered loblolly pine containing 20% higher specific gravity, if substituted for 20% of existing plantings in the Southeastern U.S., could generate as much as $300 million in savings per year in a standard linerboard mill operating in the region. Existing tree breeders who reviewed the model affirm its presumptions regarding forest practice as realistic.

Business Practices and Mill Management

MRO Supply Chains: Response to a survey of mill managers, though limited, indicates that mills are limiting the number of contractors for maintenance, repair, and operations and are entering into contracts of longer-term duration. This result suggests that mills are positioning themselves for ongoing partnership arrangements with suppliers, which have proved beneficial in other industries.

Business Practices and Mill Management

Integrated Environmental and Economic Performance: Working in collaboration with industry partners at two newsprint mills, researchers developed novel spreadsheet-based accounting systems intended to map traditional economic performance measures alongside a set of measures based upon resource inputs and outputs (expressed in terms of mass, energy, etc.). This work provides tools for alternative assessment of mill performance under different regulatory and economic conditions.

Price Forecasting: Researchers developed a tool for forecasting prices for linerboard, semi-chemical medium, hardwood pulp, and softwood pulp. It is freely available on the web.

Trucking Logistics: Corrugated box plants vary considerably in the ways they organize outbound shipments. While most have turned to third-party operators to handle scheduling, contractual arrangements vary significantly. Potential savings through use of best practices range from 9-33% at three plants studied in detail.

COMMUNITY

Competitive Strategy, Industry Structure, and Innovation

Historical perspectives: Research completed in this area traces the long history of innovation and competitive strategy in the American pulp and paper industry, including several examples of product innovation. One line of research here maps the industry’s response to water pollution regulations, paying particular attention to how such regulation influenced investments in research and, ultimately, deployment of mill technology. This project considers the role of collaborative research and its effectiveness in promoting innovation. This project helps orient newcomers to the industry and provides lessons from past experience that should prove useful as the industry responds to future changes in the competitive and regulatory environments.

Black Liquor Gasification: Researchers assessed existing and potential networks among mill managers, community officials, government regulators, and scientific researchers who might organize efforts to promote black liquor gasification, one of the most promising alternative technologies in pulp production. They conclude that a strong basis for potential collaboration exists, but raise doubts about whether such collaboration will be mobilized given spotty research funding and a strong current commitment to improving existing boiler performance.

WORKPLACE TRANSFORMATION

Business Practices and Mill Management

High Performance Work Systems: A survey of human resource managers offers a profile of various workforce practices deployed at paper mills during the past decade. As of September 2004, the results covered some 31 plant locations.

COMMERCIALIZATION

Business Practices and Mill Management

Market Pulp: Careful modeling indicates that mills producing napkins could improve their financial performance by using pulps of enhanced quality. Alternative pulps, if resulting in savings of approximately 5% in manufacturing or in products carrying a 5% price premium, would generate increasing returns even if they cost as much as 16% more than current pulp. Tests evaluate characteristics of various pulps and suggest which ones might offer economic returns of this sort.