On Creating Value in Various Positions in the Value Chain – The Pulp and Paper Industry in China
In: Management Of Technology Innovation And Value Creation Selected Papers from the 16th International Conference on Management of Technology
AbstractThe global pulp and paper industry is undergoing a major structural change. Due to the varying comparative advantages of different countries, such as raw material costs and market potential, firms are revisiting their global manufacturing and sourcing strategies. China offers a huge market potential, and companies in the pulp and paper industry (PPI) are actively investing in manufacturing in China. This raises interesting questions concerning the orchestration of the value chain in this emerging market, as the comparative advantage of China does not lie in raw materials of the PPI. In this paper, we use data collected in the Chinese PPI industry to describe the current determinants of creating competitive advantage in various parts of the PPI value chain in China. The most interesting factors in the Chinese PPI are the increasing demand and production volumes and, in particular, the lack of wood-based pulp. This means that sourcing can be central to creating competitive advantage in this emerging market. The results of this study can help PPI firms to make strategic decisions.
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