1. Value added by optimal wood raw material allocation & processing
WoodWisdom-Net Seminar – Edinburgh 4-5 April 2017
Value added by optimal wood raw material allocation & processing
VARMA
Co-ordinated by Marika Makkonen – VTT Finland
Co-authored by Ina Ehrhardt – Fraunhofer Institute, Magdeburg, Germany
Presented on behalf of VARMA by
Shaun Mochan, Woodilee Consultancy Ltd. I

2. WoodWisdom-Net Seminar – Edinburgh 4-5 April 2017
What and Why?
The transnational VARMA research project investigated technical and business considerations of a wood allocation centre (WAC), defined as:
A virtual or real structure (facility or organization) that boosts efficiency of wood raw material supply by centralizing resources, operations and services for actors in the wood supply chain (network).
An important aspect of the WAC concept is that centralized wood allocation can direct the available wood to the most suitable customers, with the highest possible value added.
The specific approaches to centralisation vary between project partners from different countries (Finland, France, Germany and UK)
Increasing competition on wood raw material drive development of novel business models in European woodworking industry
In the VARMA project it is believed, that customer orientation is a key for future success.
Depending on national demands, business concepts of Wood Allocation Centre (WAC) will be developed, where stems are cut-to-length according to sawmills’ or other users’ needs.
WAC can be either virtual or physical structure, representing novel way for networking in woodworking industry
Central in new concepts are efficient information flows and tools, such as buking optimization model to be developed.

3. 12 Partners Who? Finland France Germany United Kingdom 4 Countries
WoodWisdom-Net Seminar – Edinburgh 4-5 April 2017
Who?
4 Countries
Finland
France
Germany
United Kingdom
12 Partners
- RESEACH -
FCBA Technological Institute
Fraunhofer IFF
Natural Resources Institute Finland
Technische Hochschule Wildau
VTT Technical Research Centre of Finland Ltd
Woodilee Consultancy Ltd UK
- INDUSTRY -
Federation of the Finnish Woodworking Industries
Georg Fehrensen GmbH
Holzindustrie Templin GmbH
James Jones and Sons Ltd
Koskisen Oy
Selection Vosges
<research and industry partners and other stakeholders involved, their countries of origin and roles>

4. Project highlights and final results
WoodWisdom-Net Seminar – Edinburgh 4-5 April 2017
Project highlights and final results
Compared to existing processes, critical improvements can be made by adding more flexibility to the wood value chains.
WACs are the “new” business partners in the wood supply chain and incur costs
Business models have to be created so that the total labour and costs to supply wood remain approximately the same or drop (for each partner in the process as well).
In collaboration with the industry partners, the performance indicators (list of indicators) were used to demonstrate the existence of potential savings and WACs’ capability to boost efficiency in wood supply operations (partner countries’ case studies and scenarios).
The organization of WACs in the project regions can vary greatly depending on the particular local conditions and structures. The results obtained in the VARMA project provide decision aids. Regional development of WACs, in turn, only succeeds when all of the stakeholders along the value chain are closely involved and cooperate. I

5. Expected impact and target groups
WoodWisdom-Net Seminar – Edinburgh 4-5 April 2017
Expected impact and target groups
Potential to create new business opportunities in the sector:
The potential for implementing WACs as new structures and organizational forms in private and state forests is a reality but requires CHANGE.
One reason is gaining competitive advantage. However, providing transparent consulting services to both parties (Private and State) may allow for a more standardized implementation system
The results and findings of the VARMA project facilitate the creation of suitable business models (analysis, evaluation, implementation).
The VARMA Toolset is a resource for the creation of forward-looking WACs.
Additional knowledge generated in the project / outcomes of the project
WAC improve information and material flows along the wood value chain and also contribute to sustainable pathways for use of timber as material (carbon capture) I

6. Lessons learnt and open questions
WoodWisdom-Net Seminar – Edinburgh 4-5 April 2017
Lessons learnt and open questions
In the Finnish industry case, the one-directional X-ray measurements would have required not only significantly more calibration measurements, but also resources to improve the knot recognition software, which had originally been developed for a somewhat different application.  Now we had to compensate for recognized data issues by ad-hoc models.  Alternatively, more accurate results could have been reached by using a ready-made multi-directional CT device.
The industrial cases differed significantly from partner country to partner country. The awareness and knowledge of commonalities/differences and opportunities for collaboration among international research partners obtained in this project should be applied to continue collaborative activities on a deeper level.
Engagement with the industry is critical, engaging with them to understand the complexities and concerns and mitigating this through interdisciplinary exchange and sharing of knowledge and data with practitioners and associated partners. I

7. Lessons learnt and open questions
WoodWisdom-Net Seminar – Edinburgh 4-5 April 2017
Lessons learnt and open questions
How to transfer the developed concepts and ideas into practice and most importantly, how to gain acceptance by the practitioners.
The organization of “customized” (timber) supply chain operations is a fundamental prerequisite for designing and establishing wood allocation centers as an element of economic and ecological value added.
Multidimensional decision spaces in which the stakeholders’ target criteria can interact and conflict exist especially in the supply chain operations interconnecting the forestry and timber industries.
More understanding is needed about the complexity of knowing the wood resource characteristics and how this resource interacts with the many different markets
International collaboration improved communication and understanding among industries and practitioners in the project regions
Support of efforts to establish new structures in private forests – use of select support and analysis tools from the VARMA Toolset I

8. Thank you for your attention!