Jouni Pykäläinen

Decision making among Finnish non-industrial private forest owners: The role of professional opinion and desire to learn

Abstract The primary basis of contemporary forest planning research, which assumes the forest owner to maximize his or her expected utility, has left aside cognitive and social patterns of reasoning in real decision-making situations. To add on to present knowledge, the decision aid needs were approached by assessing different ways of solving decision problems among non-industrial private forest (NIPF) owners in Finland. The study investigated how the diversifying goal structure of NIPF owners would be reflected in practical decision-making strategies. Semi-structured in-depth interviews and qualitative analysis were used to acquire a deeper understanding of NIPF owners’ decision making. Altogether, 30 purposively selected owners from southern Finland provided information to analyse the level of sharing decision power and eagerness to learn in decision making. Five decision-making modes were distinguished among the interviewees: (A) substantial trust in professionals, (B) desire to learn for self-reliance, (C) sequential, managerial judgements, (D) balanced, considerate decision making, and (E) strong decisions of ones own. According to these modes, corresponding decision aid approaches were constructed. The results show a broad variety of problem-solving strategies and thus decision aid needs. To facilitate unprompted and genuine decision making, the presented modes should be taken into account when owner-orientated forest planning services for NIPF owners are developed.

Alternative priority models for forest planning on the landscape level involving multiple ownership

Abstract The study presents four ways to formulate a landscape level forest planning model for group planning using a heuristic optimization method called ‘HERO’. The HERO method is composed of two primary steps: first, forest management goals are defined; then a management plan is sought to fulfill the defined goals. The planning models consider the landscape (whole area) and forest holdings as separate hierarchical levels. Within the planning models, each participants forest management goals are defined using additive priority functions consisting of weighted sub-utility and/or achievement functions. Maximizing the achievement function minimizes the deviation from the target value for the corresponding goal variable. (i) The integrated top-down model uses achievement functions on the landscape level and sub-utility functions on the individual holding level; while (ii) the integrated bottom-up model uses achievement functions on the holding level and sub-utility functions on the landscape level. (iii) The integrated utility maximization model consists of weighted sub-utility functions on both the landscape and the individual holding levels and (iv) the integrated regret minimization model uses achievement functions on both levels. The use of different priority models was illustrated in a case study, which consisted of four neighboring private land holdings. In general, the priority models worked in a logical way. Large deviations from the targets could be prevented by using achievement functions in the overall priority models. On the other hand, the differences between the models were not very large, and the results of only one case cannot be generalized. It seems that all the alternative priority models might have use in different planning situations. However, interactive use of the models should be preferred.

Defining the forest landowner’s utility–loss compensative subsidy level for a biodiversity object

New, cost efficient and voluntary biodiversity protection tools may require bidding price definition on part of the seller. Both the seller and the buyer can withdraw from negotiations if they find that the conditions of the protection contract are unacceptable. However, it can be very difficult for non-industrial, private landowners to define the bidding price demand for their biodiversity objects. The terms of the protection contract, the production possibilities of the forest holding, the forest owner’s multiple forest management goals and their substitutability, and the possible monetary subsidy paid for biodiversity protection should all be simultaneously taken into account when estimating the owner’s price demand for protecting the biodiversity object. This study strives to provide relief in resolving this problem by presenting an approach in which the landowner’s utility–loss compensative subsidy can be defined based on the owner’s forest-holding level utility function and the production possibilities of the holding. The properties of the approach are illustrated by four planning cases in which the length of the protection period (permanent or 20-year temporary protection) and the holding-level goals were varied. The utility functions of the cases were derived by selecting numeric goal variables for the goals, and by defining weights and sub-utility functions for these variables. Varying subsidies for protecting an old-growth spruce stand were included into the simulation of “No treatment” schedules for the examined stand, and the holding-level total utility was maximized for every price level. The utility–loss compensative subsidy was found when the holding-level total utility equaled the total utility achieved in the plan where the stand was regenerated. This subsidy, however, is not necessarily the exact price that the owner should ask from the buyer; all prices above the defined subsidy level will increase owner’s utility if the buyer accepts them. It was concluded that the presented approach provided consistent results in the four cases and that it thus offers valuable decision support for current biodiversity-protection programs.

Predicting timber harvests from private forests—a utility maximisation approach

Abstract Forest owners’ values and the ownership structure of forest are changing continuously. One probable consequence of the current trends in Finland is that the significance of forest-related income will decrease, which may have a significant impact on the round wood supply. This study developed and demonstrated a new method, which allows policy makers to make forecasts on the future timber supply. The method is based on the assumed temporal changes in the distributions of the importance of different forest management goals. The distributions are converted into utility functions, generated separately for each forest holding. The utility functions are maximised, using heuristics, to obtain the optimal forest management plans for the holdings. The regional cutting budget is calculated by summing the removals of the optimal treatment schedules of stands over the whole area. The method was demonstrated by assuming four different scenarios for the forest management goals, in which the importance of net income from realised cuttings decreased by 0%, 25%, 50% or 100% in 60 years. The decrease was compensated for by an increased importance of the other goals, namely economic security, recreation, and nature values. The calculations were made with three different methods. Methods 1 and 2 derived the optimal plans directly for the whole 60-year period while Method 3 developed three consecutive 20-year plans. Method 2 assumed that the holding is sold or inherited once in 20 years with an abrupt change in the management goals. In Methods 1 and 3 the goals changed only gradually. The results were logical, indicating that the more the importance of net income decreases the lower the future timber supply will be.

Services in the forest-based bioeconomy – analysis of European strategies

ABSTRACT 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, that is, 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, that is, 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.

An approach for examining the effects of preferential uncertainty on the contents of forest management plan at stand and holding level

A proper forest planning process includes the assessment of the decision-makers’ preferences concerning the future forest use. For some owners, it may be a difficult task to express their preferences exactly and in the form that is required for planning calculations. This study presents a new kind of approach for analyzing the effects of preferential uncertainty. The approach consists of examination of the differences in the actual decision variables in forest planning, i.e. selected treatments for stands between holding-level forest plans. In example calculations, the preferential uncertainty was examined from three different viewpoints: the uncertainty in the weights of the objective variables; the uncertainty in the partial utility function; and the combination of these two uncertainty sources. One thousand preference realizations were generated for each of these uncertainty sources. More than one treatment schedules are proposed for stands that are affected by preferential uncertainty. These stands were detected from among the resulting set of 1,000 forest plans. With this done, two potential decision-making strategies, an adaptive behavior strategy and a threshold proportion strategy, were applied as guides in decision-making for stands, which have more than one treatment alternative selected in the produced optimal forest plans. The adaptive behavior technique required that the forest owner select one treatment alternative for at least one stand that has more than one proposed treatment alternative. The treatment alternatives having frequencies exceeding the given threshold frequency were all accepted simultaneously in the threshold strategy. The main benefit of the approach is to present the effects of uncertainties in a way that can be easily understood by the actual decision-makers. It is a promising tool for practical decision-making situations because at least Finnish non-industrial private forest owners quite often focus on making stand-level forest management decisions. It is also suitable for examinations of other uncertainty sources such as timber prices or inventory data.

Interactive Method for Supporting Forest Owners in Biodiversity Protection Decisions

Voluntary biodiversity protection tools have been adopted for practical use in many countries where non-industrial private forest ownership includes invaluable biodiversity resources. This has created a new kind of decision problem for individual forest owners: they should be able to define their conditions for entering into a biodiversity protection contract including sometimes a predetermined subsidy. This study presents a holding-level method for examining this decision problem. The method is based on utilization of interactive optimization where the possible subsidy has been included in the protection (no treatment) alternative of the examined stand. Generally, interactive optimization means that the landowner pinpoints the best plan by interactively studying and learning the production possibilities of his/her forest holding. Following changes made to the objective function by the forest owner, new solutions are presented for forest owners’ evaluation. If the “No treatments” option is selected in optimization for these areas, the forest owner would benefit more—in the current location of the production frontier and with the current subsidy—from entering into the protection contract than from cutting the specific forest area. In the case study, we demonstrate that the values of the holding-level goals, production possibilities of the planning area and the levels of the subsidy have a significant effect on the optimal decisions relating to biodiversity protection on the stand level.

Using the ComBio decision support system to assess whether energy wood and/or pulpwood should be harvested in young forests

The operational environment of forest-chip procurement in Finland is challenging, because increasing production is raising the costs due to the limited availability of biomass. Integrated harvesting of industrial roundwood and energy wood is one solution to lower the costs of biomass procurement from young forest stands. In addition, integration creates flexibility for operations management because the procurement can be adjusted to meet the current demand for wood biomass. The recovery options of young forest thinning consist of pure industrial roundwood, pure energy wood, and integrated harvesting of both industrial roundwood and energy wood. However, without calculation tools, the outcomes of the alternative recovery options are difficult to see before operations have been carried out, because operational variables such as bucking diameter and bolt length have a direct influence on the accumulation of roundwood and energy wood. This article presents the ComBio decision support system, which can be used to produce information considering biomass recovery options, compare these options, and support selection among them. ComBio’s structure, input data, model estimation procedure, and methods for comparison and decision support are introduced. Finally, a demonstration of ComBio is carried out with sample forest data.

Constructing forest plans interactively based on owner-driven evaluation of the holding- and stand-level alternatives

In this study, an interactive forest planning process corresponding to the practical demands was developed and further tested in a challenging forest planning situation in northeastern Finland. The process includes prior preparation of alternative stand-level treatments and a small amount of holding-level forest plans; an interactive planning session consisting of the primary choice of the forest owners profile; the owners selection of the best holding-level plan; and finally a local improvement of this plan. The method as a whole aims to bridge the gap between the prevailing planning culture that has developed for private forest planning over three decades in Finland and the planning approach suggested by multiobjective forest planning theory. The usability and characteristics of the process were evaluated through an exercise set given to both forestry students and forest professionals. Tests of the process indicated, among other things, that comparison particularly of stand-level alternatives and offering owners the possibility to make changes and truly affect the end-result of the planning process are seen as important characteristics of the process.

Service-Based Bioeconomy—Multilevel Perspective to Assess the Evolving Bioeconomy with a Service Lens

Increasing role of services is often described as the increased share of services sector employment and value added in economy, although research on services addresses also the multiple ways how services are embedded in socio-economic processes and innovation. Integration of products and services is perceived with potential to improve efficiency in manufacturing as well as sustainability of operations. Improving technologies provide new means to organize production and define how value is created, distributed and captured. This paper seeks to assess the blurring borderline between manufacturing and services and its impact on the primary and processing industries within the evolving bioeconomy conceptualizations. An analytical framework is presented based on service research in the marketing discipline and the multi-level perspective to socio-technical changes; ‘service-based bioeconomy’ highlights the role that the further downstream industries have in defining the future bioeconomy. The analytical framework is illustrated in an empirical study context of the Finnish bioeconomy strategy with three mini-cases where the value propositions of traditional forest-based industries, emerging bio-industries and their further downstream customers are analyzed: biorefineries’ supply to sustainable textiles, wood-based solutions for sustainable built environment, and forestry solutions for biomass production and beyond.