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Rinnakkaistallenteet Luonnontieteiden ja metsätieteiden tiedekunta
2017
Services in the forest-based
bioeconomy - analysis of European strategies
Pelli Päivi
Informa UK Limited
Tieteelliset aikakauslehtiartikkelit
© Informa UK Limited, trading as Taylor & Francis Group All rights reserved
http://dx.doi.org/10.1080/02827581.2017.1288826
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Services in the forest-based bioeconomy – analysis of European strategies
The increasing role of services for business making has been recognised in the forest-based sector, yet a systematic analysis of this emerging phenomenon is lacking. The current study derives from service research three perspectives for analysis: services activities separate from primary production and
manufacturing–processing, services outputs separate from tangible products, and service as strategic, i.e., business model consideration how value is created.
Document analyses have been carried out to examine how these perspectives are identifiable in the European-level bioeconomy and forest-based sector strategies, as well as in a number of major strategic partnerships beyond the bio-based industries, i.e., the research and innovation programmes of processing industries, manufacturing, energy-efficient buildings and green vehicles. The upstream and downstream strategies tend to differ on their approach to services. This paper contributes to the forest sector research by introducing two distinct perspectives from the service research literature to address the increasing role of services in the context of evolving bioeconomy: 1) explicating the role of services in the bioeconomy supply chains in order to improve efficiency and existing processes, and 2) elaborating service as a means to better understand the changing business models and modes of value creation which may lead to system-level changes.
Keywords: services, forest-based sector, bioeconomy, service research , foresight
Introduction
The increasing role of services for business making has been recognised as an emerging phenomenon in the forest sector (Niskanen et al. 2007; Weiss et al. 2011; Hetemäki &
Hänninen 2013; Toppinen et al. 2013; Näyhä et al. 2015). Forestry is a knowledge- based activity including data and information services, research, education and training.
Services sector activities, such as recreation, nature-based tourism, and various activities related to non-wood goods and services are traditionally important for local economies (Pettenella et al. 2006). In the forest industry, the tangible and intangible components of company offerings have become increasingly difficult to separate;
2 product quality dimensions including services or environmental features are especially important in business-to-business markets (Toivonen et al. 2005; Räty et al. 2014). Most forest-based sector products are raw materials and intermediate products, but they can be engineered to meet specific customer needs. Intelligent packaging for food and pharmaceuticals or pre-fabricated wooden elements and modular building solutions for construction serve as examples of such products (Näyhä et al. 2015).
For the most part, forest-based sector operations are described and analysed as linear value-adding chains (see FTP 2013b; EC 2013c). The role of services remains hidden in the production processes, and, consequently, services remain outside of the scope of otherwise comprehensive analyses such as the European Forest Sector outlook by UNECE/FAO (2011). The possibility for a structural change within the forest industry due to the increasing significance of services is missing also from the sectoral foresight analyses (Hurmekoski & Hetemäki 2013). Furthermore, the opportunities in services sector activities, such as forest-related tourism, recreation and health services remain less investigated and utilised, while the focus is on the already-existing value chains (Niskanen et al., 2007; Weiss et al. 2011; Hetemäki 2014).
In national economic terms, in the European countries, services, i.e. the services sector, contribute to approximately 70–80% of national value added and employment (Eurostat 2015). However, the above-mentioned examples from forestry and forest- based industry production illustrate that services extend beyond the conventional services sector. This study connects the forest-based sector research to research on services in economics and business disciplines, such as service sector analyses, service marketing and management. It is a scoping study within the field of foresight studies to elaborate how the phenomenon of increasing role of services can be addressed in the forest-based sector context and with regard to the evolving bioeconomy.
3 During the past few years, the concepts of bioeconomy, bio-based economy and green economy have appeared as frameworks for the visions and strategic orientations of the forest-based sector organisations (FTP 2005, 2013a; CEPI 2011; FOREST EUROPE 2011; UNECE/FAO 2014). The concepts seem to be used interchangeably;
for example the new EU forest strategy (EC 2013a) refers to “bio(-)economy”, “bio- based economy” as well as “green economy”. The core message in these strategy documents is that the forest-based sector is one of the key sectors to contribute—and already contributing—to the envisioned bioeconomy. Yet this role is not fully
recognised and the forest sector renewal is not duly addressed in the EU bioeconomy strategy (Kleinschmit et al. 2014; Nabuurs et al. 2014; Ollikainen 2014).
The strategy and action plan “Innovating for Sustainable Growth: A Bioeconomy for Europe” defines bioeconomy as encompassing the production of renewable biological resources and their conversion into food, feed, bio-based products and bioenergy including agriculture, forestry, fisheries, food and pulp and paper
production, as well as parts of the chemical, biotechnological and energy industries (EC 2012a). In addition to this, national as well as industry strategies, NGO reports and policy recommendations have been prepared related to bioeconomy. The bioeconomy visions include transformations as a core element, but it varies whether the focus is on the industrial base, re-industrialisation and technological roadmaps (EuropaBio 2010) or on the wider sustainability issues and socio-economic changes needed (WWF 2009).
Overall, bioeconomy can be described as an evolving concept, reflecting the varying emphases by different actors and the processes at the international and national levels (Schmid et al. 2012; McCormick & Kautto 2013; Staffas et al. 2013). The visions and strategies of the forest-based sector, for their part, contribute to the definitions of a bioeconomy.
4 This study examines how the bioeconomy and forest-based sector strategies at the European level consider services and related developments thereof. Firstly, based on the service research literature, we define three concepts of service: 1) services activities separate from primary production and manufacturing–processing, 2) services outputs separate from tangible products, and 3) service as a strategic—i.e. business model—
consideration of how value is created. These concepts are then utilised as an analytical framework for reviewing the bioeconomy and forest-based sector strategies, as well as the documents of key strategic partnerships beyond bio-based industries.
To the best of our knowledge there has been no systematic analysis of the role of services in the bioeconomy strategies. In the forest sector, in turn, services have been addressed in the COST Actions E30 “Economic integration of urban consumers’
demand and rural forestry production” and E51 “Integrating Innovation and
Development Policies for the Forest Sector” (Niskanen et al. 2007; Weiss et al. 2011).
These analyses, however, did not explore the alternative conceptualizations evolving in the service research field. This paper aims at introducing a new perspective and
analytical frameworks how to assess the increasing role of services in the evolving forest-based bioeconomy.
Materials and methods
Conceptual framework
The conceptual framework for this research is based on the service research literature, and it provides three perspectives to assess services and service (Table 1). The approach developed by the authors is simplified for the purpose of this particular analysis. It combines three levels of analysis how services can be detected from strategies and development programmes: 1) services activities in economic sectors, i.e., what types of
5 production or functions there are; 2) services outputs as company offerings, i.e., what types of products are exchanged, and 3) service as strategic consideration, i.e., a business model definition how value is defined, created and captured.
[Table 1 here]
Firstly, services activities can be derived from the definition of services sector industries, including market services such as wholesale and retail, transportation and storage, accommodation and food services, financial and insurance services and various business services, and non-market services, such as public administration, education, health and social work services, arts, entertainment and other services, as well as the activities of households as employers (Eurostat 2008). Statistics for the national value added and employment of services are based on this definition. The perspective is production focused: services are defined as activities other than production and extraction of raw materials, conversion of materials or assembly of products. The services activities can be addressed as support functions for production or as standalone businesses. Support functions can be found within all sectors—i.e. primary production, manufacturing–processing, services sectors—whereas standalone business is here understood as services sector activity. The literature recognises the role of knowledge- intensive business services, such as accounting and legal services, information
technology, R&D and consulting, important for growth and innovation in other sectors (Miles 1993, 2005; den Hertog 2000; Toivonen 2004; Kox & Rubalcaba 2007).
The second category, services outputs, refers to an offering by a producer or service provider to the customer. The perspective is product focused: services are defined based on their characteristics distinct from physical products. Services are intangible, deeds or performance; services are heterogeneous, different at each time of delivery; services are inseparable, produced and consumed simultaneously; and services
6 are perishable, it is not possible to store them (Shostack 1977; Levitt 1981; Lovelock 1983; Zeithaml et al. 1985). Services outputs can be produced in all sectors. In
manufacturing, the increasing role of services has been called servitisation: products are extended with services (Vandermerwe & Rada 1988), and companies gradually shift their operations towards services (Oliva & Kallenberg 2003). The combinations of tangibles and intangibles are described, for example, as “product and service bundles”
(Cohen & Whang 1997), “product–service systems” (Mont 2002), “integrated
solutions” (Brady et al. 2005) or “hybrid offerings” (Ulaga & Reinartz 2011). The trend is towards increasing the supply of services together with the physical products (Neely et al. 2011; Stehrer et al. 2014). As an example, the offerings of machinery and
engineering companies to the pulp and paper industry include not only the installed- base product, but often also maintenance and other after-sales services (Kuusisto 2006).
Similarly, in the forest sector, a fibre-based packaging company offers not merely a paperboard product that is timely delivered, but seeks to increase its role in the customers’ processes by introducing services (Viitamo 2013).
Use of these two categories to address services separate from other industrial production and product categories is challenging as borderlines between the traditional economic sectors become blurred. In fact, services are distributed among all economic and social activities (Coombs & Miles 2000; Bryson & Daniels 2007; EC 2009a;
Stehrer et al. 2014). Furthermore, the emergence of new technologies creates new types of services connected with the production processes, such as digital and sensor
applications, bio-technology or nanotechnology services (Carlborg et al. 2014; Gallouj et al. 2015). The above definition of intangible, heterogeneous, inseparable and
perishable services has been criticised for poor suitability to the existing offerings, such as internet-based services and applications, and for the rigid product–service dichotomy
7 assumed (Vargo & Lusch 2004; Edvardsson et al. 2005; Bitner & Brown 2008). Yet, the service research emphasizes the special characteristics of services that make them unique and, thus, cannot be addressed or developed using the same models than tangible products. Interaction between the provider and user may lead to better understanding of the supplier’s and customer’s processes and to new angles for developing the operations and connecting the supply chains more optimally. These activities are knowledge- intensive based on mutual learning and accumulation of both tacit and explicit knowledge through interactions (Toivonen 2004; Miles 2005). In service research innovation is increasingly approached through a view towards synthesis, i.e., seeking for commonalities across all productive activities (den Hertog 2000; Gallouj & Savona 2009), or, at a company level, viewing services and innovation within a business strategy framework (Carlborg et al. 2014). There is innovation in services, i.e., in and by the services sector companies, as well as service innovation based on mutual learning in all socio-economic activities (den Hertog & Rubalcaba 2010).
The third perspective to services stems from the marketing field and is also discussed in the strategic management literature. It is process oriented and defines service as a strategic consideration of the company’s business model. Instead of the
“manufacturing logic” (Normann 2001) of producing tangible or intangible outputs, the attention is on rethinking the concept of value and value creation. Customers do not seek to buy goods or services, but fulfil their needs both in business-to-business and business-to-consumers exchanges. The producer cannot create value alone, but value is defined as “co-produced” with the consumer (Prahalad 2004), “co-created” through interaction with multiple actors (Gummesson 2008; Vargo & Lusch 2011), or the emphasis is given to the customer, who creates “value in use” as a separate sphere from the co-creation in interactions between the producer and customer (Grönroos & Voima
8 2013). Under this perspective service quality is assessed in terms of customer
perceptions, not by the standards defined by the producer. Therefore from the marketing perspective the service context applies to all activities, whether it is that of services industries, public institutions, non-profit organisations or manufacturers of products (Grönroos 1983, 1990). Instead of considering value creation as a linear process of successive value-adding stages in production, the focus is on interactions and resource integration (Normann & Ramirez 1993; Vargo & Lusch 2004; Chesbrough & Spohrer 2006; Bitner & Brown 2008). Service and value creation can be investigated at the micro level, i.e., interaction between a provider and customer (e.g. Storbacka et al.
2012), among business-to-business networks (Håkansson & Snehota 1989) or in wider system-level interactions, for example in the interplay of technological and human systems (Maglio & Sphorer 2008) or for sustainable business (Enquist et al. 2015).
Data on strategies
The focus of this study is on the forest-based sector, and the viewpoint towards a forest- based bioeconomy is extended to the further downstream value chain stages. The review does not aim to be exhaustive but to identify the key strategic partnerships at the
European level for R&D and innovation with regard to the forest-based sector and bioeconomy. National and regional strategies are not included in the analysis.
As a first step, relevant documents were sought by reviewing the EU bio(- based)economy strategy documents, including also the Lead Market Initiative on bio- based products. Based upon the strategy implementation, the Public-Private Partnership (PPP) on Bio-Based Industries Joint Undertaking (BIC 2013) is included in the analysis.
The documentation sourced on the forest-based sector at the European level includes the EU Forest Strategy (EC 2013a) with its accompanying documents and the
9 Forest-based Sector Technology Platform (FTP) vision and research agenda (FTP 2013a-c). Furthermore, the UNECE/FAO Rovaniemi Action Plan (2014) as well as the FOREST EUROPE (2011, 2014) are included. Although they use the terms ”green economy” or ”green bio-based economy”, their target is the forest-based sector as defined also in the EU-level strategies.
FTP has participated in the European bioeconomy technology platform cooperation, and the documents of cross-sectoral activities are part of the analysis (BECOTEPS 2011; Star-COLIBRI 2011). The FTP vision and strategic research and innovation agenda refer to the roadmap of the Confederation of European Paper Industries (CEPI 2011) as well as a number of strategic partnerships beyond the above- mentioned bio-based industries, which are included in the analysis: the contractual PPP on Energy-efficient Buildings, on Factories of the Future and on Green Vehicles. In addition, the FTP documents refer also to the technology platforms of textiles and biofuels, but after consulting the materials available (EBTP 2015; Textiles ETP 2015), these are considered included in the PPP Bio-Based Industries Joint Undertaking.
Furthermore, based on the bio-based industries’ strategy, the contractual PPP Sustainable Process Industry is also included in the analysis. Its target industries are cement, ceramics, chemicals, engineering, minerals and ores, non-ferrous metals, steel and water sectors, but it refers to forestry and pulp and paper industries, and the above- mentioned Star-COLIBRI and CEPI roadmaps (A.SPIRE asbl. 2013).
Analysis
The review of the strategy documents has been carried out based on the conceptual framework presented above. All authors contributed to the conceptual framework. The main author was responsible for selection of the source materials and content analysis of
10 the documents. Findings were discussed in the group of authors, thus, examining the points where categorization was ambiguous. The question is whether—and how—the services activities, outputs and/or strategic orientations to value creation are identifiable in the bioeconomy and forest-based sector strategies. The quality of the analysis is to be assessed based on the transparency of the review setting, clarity of the concept
definitions, their use and the conclusions reached.
Results
Next, the results are grouped into the three service concepts: services activities, services outputs and service as a strategic consideration of how value is created. Table 2
provides an overview on the results. The fourth category “services to society” emerged from the materials and it is presented under a separate subtitle: this aspect is already discussed in the forest sector research (Niskanen et al. 2007), but not within the three socio-economic categories defined from the service research.
[Table 2 here]
Services activities in bioeconomy: support functions to production
In the analysed bioeconomy strategy documents (EC 2002, 2005, 2010, 2012a-b;
German Presidency 2007; BECOTEPS 2011; Star-COLIBRI 2011; BIC 2013) the services activities can be identified from the necessary support structures and operations for realisation of the bioeconomy goals. These activities relate to the following:
coordination, financing and procurement; research and development; engineering;
technology and knowledge transfer; testing, standardisation and certification; legislation and regulation enforcement; monitoring and information systems; management of biomass production and supply chains; risk management; education and training; and
11 communication and information activities. The support services are not explicated in the strategies, but the agricultural advisory and extension services, advisory and business support services are specifically mentioned in this respect (EC 2012b; BIC 2013).
Although the innovation potential of cross-sectoral collaboration is highlighted in several bioeconomy documents, this refers to collaboration between the agro-food, forestry, energy and biorefining sectors (BECOTEPS 2011; BIC 2013). There is no explicit indication of the role of services sector companies; knowledge transfer networks and clusters are mentioned as a means to support innovation (EC 2012a, 2014), including expert services, contractual research and consultancy (BECOTEPS 2011).
In the forest-based sector strategies, support services can be identified for sustainable forest management, information and monitoring services, education and training, advisory services and communication (EC 2013a; FOREST EUROPE 2011, 2014; UNECE/FAO 2014), as well as further downstream also in the supply chain and resources management as well as logistics (CEPI 2011; FTP 2013b-c). Service business potential is recognised in (eco)tourism, but this is not further elaborated.
The PPP strategies for the process industry, manufacturing, energy-efficient buildings and green vehicles indicate a number of examples for services activities, including support services as well as business opportunities. These include existing services, such as technology R&D, engineering, product and process design,
architecture, project management, monitoring and information, procurement, financing, insurance, logistics and transport. New services are identified in the intersections of old sectors and as new types of services emerging from technological advancements.
Among examples are the following: cross-sectorial value chain management, closed- loop life-cycle services and service concepts for risk evaluation, management and
12 mitigation (A.SPIRE asbl. 2013; EC 2013d-e; EGVI 2013); services around carbon and natural environment accounting, climate change modelling, ecosystem design,
management and land use planning (A.SPIRE asbl. 2013); design and management of product systems, open-supply chain concepts and tools, such as cloud services and manufacturing apps (EC 2013e); energy services, refurbishment services and mobile factories (EC 2013d); and services for e-mobility and smart grids management (EGVI 2013).
Services outputs in bioeconomy: inherently connected with a tangible product
The bioeconomy strategies set the goals for developing new (bio)products, markets and processes (EC 2009b, 2012a; BECOTEPS 2011; Star-COLIBRI 2011; BIC 2013). The added value of bio-based products is conveyed through the idea of renewability, carbon neutrality and overall sustainability. Examples of better functionalities or new and improved performances for products are bio-based materials in lightweight, better- performing components for the automotive and construction industries (Star-COLIBRI 2011) and personalised medical treatment solutions and diagnostics contributing to improved healthcare services (EC 2002, 2005).
Compared with this, the forest-based sector strategies define their goal as developing new value-added “products and services” (CEPI 2011; FTP 2013b-c).
Services are often referred to as “non-wood goods and services” and potential is recognised in tourism and ecosystem services (EC 2013a; FOREST EUROPE 2011, 2014; UNECE/FAO 2014). The new value-added products, in turn, are illustrated with several examples, including the bioactive functions of materials already mentioned above, but also the high performance of wood-based materials, such as better acoustics and positive impact on indoor air quality (CEPI 2011; FTP 2013b; EC 2013c).
13 The PPPs beyond bio-based industries indicate new combinations of products and services, such as life-cycle services to improve material flows or product-enhancing services to improve process efficiency. Improved modularity and interoperability across value chains are envisaged with sensor technology and the Internet of Things (IoT) (EC 2013d-e; EGVI 2013). Services are more and more embedded in the processes. For example, process industries and manufacturing indicate eco-design as a tool to improve customer industries’ performance both for the economic feasibility and sustainability of operations (A.SPIRE asbl. 2013; EC 2013e).
Value creation in bioeconomy: production processes as service
In bioeconomy strategies, customer-orientation can be identified within the production processes. This refers to the industrial (eco)systems of biorefineries, integrated
solutions, closed-loop systems and industrial symbiosis (BECOTEPS 2011; Star-
COLIBRI 2011; BIC 2013). The envisaged new business models include the possibility of farmers and forest owners finding new opportunities in the supply chains of
biorefineries (Star-COLIBRI 2011) and new small-and-medium-sized companies emerging as spin-offs from the R&D processes (BIC 2013).
Both in the bioeconomy and forest-based sector strategies, the customers further downstream, i.e., consumers and users are described as a target of information and education to ensure public acceptance of the new technologies and bio-based products (EC 2002, 2005, 2009; BECOTEPS 2011; Star-COLIBRI 2011; BIC 2013). Solutions are defined and tested and their safety ensured by R&D and industry usage.
Information, credible criteria and certification are needed so that consumers can make informed choices. In addition to this, the forest-based sector strategies emphasise the consumers’ needs as a cornerstone for developing products, and as a means towards this
14 aim, they mention improved market information and analytical tools, such as better foresight and future demand projections (CEPI 2011; FTP 2013c).
The PPPs on the process industry, manufacturing, energy-efficient buildings and green vehicles indicate customer or user involvement as part of the design process of a new product or solution; users are possible contributing partners to innovation and their involvement is a means to improve the uptake of new products and solutions (EC 2013d-e; EGVI 2013). For example, consumers and users are recognised to have an important role in improving the efficient use of resources and development of recycling, reuse and the overall material flows (A.SPIRE asbl. 2013), in realising the technological potential in energy-efficient buildings (EC 2013d) and in ensuring acceptance of new mobility solutions (EGVI 2013).
Forest-based sector strategies: services to society
The forest-based sector strategies highlight “services to society” as a major contribution from the sector operations (FOREST EUROPE 2011; EC 2013a; FTP 2013;
UNECE/FAO 2014). Since this concept of service is at a higher societal level than the mere business approach illustrated in the previous three concepts, the category is presented separately. Services to society refer to the ecosystem services—services provided by forests—and the sustainable management and use of natural resources, which contributes to preserving and enhancing the ecosystem services and benefits the society through the provision of multiple goods and services. Also, the contribution of the forest-based sector to rural employment and income is emphasised.
The bioeconomy strategies, in turn, mention the importance of natural ecosystem services, but otherwise they mainly discuss the “benefits” that the implementation of the strategy will contribute to the society, such as improving the
15 management of Europe’s renewable biological resources, the decoupling of economic growth from resource depletion and environmental impact, making the transition towards a post-petroleum society and tackling of the challenges associated with climate change, land use and global food security (BECOTEPS 2011; Star-COLIBRI 2011; EC 2012a; BIC 2013). The phrasing is similar to the other strategic partnerships considered in the analysis, which highlight their contribution to resource-efficiency as making a contribution to solving the grand challenges.
Discussion
The strategies of the bioeconomy and forest-based sector focus intensively on production processes, product substitution by bio-based alternatives and resource
efficiency. The impact of services on employment and income creation or on innovation gains limited attention, although the strategic partnerships beyond bio-based industries indicate that the support services for production can also be seen as a market for the existing as well as new service companies. Interestingly, although the emerging service business opportunities relating to the natural resources, such as the environmental accounting and climate change mitigation services, are recognised in the forest-based sector strategies, they gain much more attention in the other strategic partnerships than in the bioeconomy strategies. The document analyses do not reveal whether this
indicates that services industries are not recognized as already an important provider of income and employment in a bioeconomy, or that services are taken for granted rather than one of the core functions to be developed for a bioeconomy. In the forest sector research similar questions have been raised for entrepreneurship (Niskanen et al. 2007) and for knowledge management of innovation (Weiss et al. 2011): The attention is focused on the tangible resources and material flows, although also the intangible
16 resources, such as knowledge assets, networks, trust, both technology-enabled and non- technological processes are important for production, business making and the socio- economic developments at large. The service research, in turn, emphasises interactions and makes the role of users, customers, and beneficiaries explicit in value creation. This is a different perspective than what is found in the forest-based sector or bioeconomy strategies.
The analysed strategies depict two types of customer orientation. The
bioeconomy and forest-based sector strategies focus on business-to-business operations, whereas the strategies from the process industry, energy-efficient buildings,
manufacturing and green vehicles also recognise customers further downstream, consumers and users as possible contributing partners to innovation; they analyse the impact of enabling technologies not only on production and supply chains, but also on the use and consequent changes in the overall operation modes. The document analyses do not provide a direct explanation for such difference between the upstream and downstream of the value chains. However, the changing operation modes described in in the further downstream strategies can be interpreted as an indication of overall socio- economic and technological changes underway, which would be crucial to connect with the upstream natural resources sectors and the evolving bioeconomy too.
The service research provides two analytical frameworks to address the
phenomenon of increasing role of services. Firstly, in a “manufacturing logic” services activities and services outputs are something that can be separated from other types of production and other types or products; developing services requires different concepts and models than product development (cf. Gallouj & Savona 2009). Services and related new business opportunities emerge as recognisable inputs and outputs in the production processes. Inputs are support services, either as outsourced services or
17 expertise sourced in by extending in-house capacities, or, for example, by joint ventures or mergers of companies. Outputs can be understood as new business and income generation by services extending and adding on to the physical products. Services are important to study in the context of bioeconomy supply chains, because the service research indicates that services contribute to improved efficiency, to dissemination of good practices and new technologies, and in general, the increased supplier–customer interactions may lead to improved processes and continued product development.
Secondly, the “service logic” or “service-dominant logic” understands that both tangible products and intangible services can be seen as service. Focus is on systems of value creation; value is co-created in resource integration of multiple actors, such as producers, suppliers, customers, users, beneficiaries and stakeholders (Vargo & Lusch 2004; 2011; Chesbrough & Spohrer 2006; Bitner & Brown 2008; Gummesson 2008).
Compared with the linear value-added chains which are developed under the control of a producer, the service systems are dynamic interaction processes and their outcomes are not predictable. Changing business models may also disrupt the existing operation modes at system level. For example, when a company extends its offerings with services, it interacts with the customer and gains more information. Enabling
technologies provide new means to connect with customers, users and beneficiaries, to collect data on their processes and to design solutions. These developments extend beyond the production-oriented value chains: data become raw material for
understanding what customers and users do with the new biodegradable materials, how they operate with the new diagnostic functionalities embedded in products or where they utilise wood’s performance for better indoor air quality. Interactions may lead to unexpected combinations of resources and novel value propositions outside the existing value chains. These processes connect also with the less-developed areas in the forest-
18 based sector strategies (see above: tourism, recreation and health services, non-wood forest goods and services): new products or combinations of the tangibles and
intangibles are not defined solely by producers, but in more close interaction with users and beneficiaries by leaning on their needs, resources, capabilities and networks.
The bioeconomy strategies and visions have been criticised as being overly techno-knowledge oriented, overriding sustainability issues, the role of practitioners’
knowledge and also the alternative pathways towards a bioeconomy (Schmid et al.
2012; McCormick & Kautto 2013). The two service research frameworks discussed above can be utilized to extend the bioeconomy strategies from mere technological and material processes to wider socio-economic transformations. The service research conceptualizations are focused on markets. Consequently also environmental sustainability becomes addressed through the socio-economic processes and the interlinked changes in society and technology. For example, climate change mitigation measures could be connected with services and service innovations related to early warning systems, hazard prevention, mitigation and recovery; the knowledge-based data and models would be extended into knowledge-intensive systems that involve users and beneficiaries, experts as well as practitioners and decision makers (cf. Toivonen 2004).
An assessment of the usefulness of these conceptualizations for the evolving
bioeconomy requires elaboration of concrete examples or case studies. For example what the analyses could contribute to non-market activities and outputs, mitigation of negative externalities or trade-offs between provisioning of different forest-based goods and services remains to be further explored.
This study is limited to the selected bioeconomy and forest-based sector strategy documents at the European level and with the emphasis on the technological orientation of the R&D strategies and innovation partnerships. In other words, the analysed
19 documents provide less material for the non-technological aspects of a future forest- based bioeconomy. Furthermore, using strategies as data sources limits the analysis to the preferred futures defined in the target sectors. This has the effect of excluding weak signals, possible change factors and disruptive developments—whether they are
technological, social, economic, environmental or political—from the analysis.
Accordingly, these aspects should be further explored in the future research (cf.
Hurmekoski & Hetemäki 2013).To conclude, although the bioeconomy and forest-based sector strategies pay limited attention to services, the developments are already on the radar of other strategic partnerships of the forest-based sector. The forest sector foresight would benefit from the analysis, not only of the future services but, more so, the systemic changes behind the increasing role of services as well as their impact on the future needs and society at large. This way, the analysis could also respond to the criticism presented about the bioeconomy strategies concentrating on one technology scenario mainly and omitting alternative pathways towards bioeconomy.
Disclosure statement
No potential conflict of interest was reported by the authors.
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27 Table 1. Three service concepts, an analytical framework for the document analysis.
Perspective Definition Clarification of categories Literature references (e.g.) Production-focused view,
i.e. how production is organized
services activities: Coombs & Miles 2000; Kox &
Rubalcaba 2007; Gallouj &
Savona 2009, den Hertog &
Rubalcaba 2010 as support to production activities as inputs to production
(in any sector) as standalone business business (service sector) Product-focused view,
i.e. what is offered to the customer
services outputs: Shostack 1977; Levitt 1981;
Lovelock 1983; Zeithaml et al.
1985 as intangible offerings company offering to a customer
or user as embedded in physical
products
part of the tangible product, such as performance or functionality provided to a customer or user Strategic orientation, i.e.
business model definition how value is created
service: Grönroos 1990; Vargo & Lusch
2004; Gummesson 2008;
Chesbrough & Spohrer 2006;
Bitner & Brown 2008 as process to create value strategic orientation of the firm,
business model and the logic of operations, how value is created
Table 2. Services in the bioeconomy and forest-based sector strategies, results in summary.
Services activities Services outputs Service Other services / service highlighted
support services
stand- alone business
intangible offerings
services embedded in products
strategic orientation to value creation Bioeconomy (incl. EU
bioeconomy strategy / KBBE; BECOTEPS;
Star-COLIBRI; PPP Bio-based industries)
x (x) (-) xx
industrial systems / platforms / symbiosis
Ecosystem services, services or value to society
Forest sector (incl. EU forest strategy;
UNECE/FAO;
FOREST EUROPE)
x (x) (x) (-)
value-added chains Ecosystem services;
services to society
Forest-based sector (incl. FTP, CEPI;
Forest-based Industry blueprint)
x (x) (x) xx
value-added chains Ecosystem services;
services to meet changing needs of society
Other strategic partnerships (PPP Sustainable Process Industry, PPP Factories of the Future, PPP Energy Efficient Buildings, PPP Green Vehicles)
xx xx (-) xx
industrial systems, open systems, customer-/ user- orientation
-
x = included, but not necessarily explicated, xx = included and explicated with several examples, (x) = recognized as a sideline activity/output, not within the scope of the strategy, and (-) not mentioned.
