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F or today’s companies, resilience is simply a must-have quality. Recent crises – from a worldwide pandemic and war to natural disasters and logistics bottlenecks – have shown that disruption is always lurking around the cor- ner. The packaging industry is not immune to crisis – but what can industry players do to build up their resilience muscles? Tero Eerikäinen , economist for European Packaging Papers at Fastmarkets RISI, comments that companies that can adapt quickly to market changes will succeed in both good and bad cy- cles. He says diversification will be the key in the future: a wide product portfolio and presence in multiple regions will increase resilience, ensuring that all the eggs aren’t in one basket. “The future regulation concerning cartonboard packages is likely to add more stress, which is why strategic business deci- sions need to offer a resilient operating plan capable of rapid re- actions in all market conditions,” believes Eerikäinen. Succeeding in an uncertain and constantly changing business environment requires cost-competitiveness, as near-term car- tonboard production capacity will grow faster than demand, in- creasing competition. “Moreover, quality is one of the advantages in competitiveness, and it has ensured a robust basis for the demand for cartonboard produced in Europe.” Eerikäinen also sees sustainability issues gaining ground: the origin of the materials used and emissions produced in carton- board manufacturing will have greater significance in purchas- ing decisions. How good is your radar? Nora Kärkkäinen , Vice President, Business Development, at Va- lona Intelligence, says that industrial players have a long history of risk assessment – but it turns out that the scope of the “risk radar” can be too narrow. “In addition, each organisation has its own blind spots. A lead- ing player can easily fall into the Expertise Trap, being over- confident and knowing ‘for sure’ what will happen in their in- dustry,” says Kärkkäinen, who has co-authored a book about strategic foresight. Kärkkäinen believes that working with various scenarios can help companies get a better handle on market challenges. “Run- ning scenarios is a key method for increasing resilience – and it has clearly become more popular post-Covid.” Anne Durchman , Head of Customer Success Management for the Nordics at Valona Intelligence, adds that companies would do well to think about their crisis response levels and reaction times beforehand – is there enough inbuilt capability to move quickly when the need arises?
“And even if multiple ‘hits’ come at the same time, you should still be able to function.” Durchman and Kärkkäinen point out that “af- ter-crisis” measures are equally important: what are the lessons learned, and what can we do better next time? “The key is to adopt a systematic approach to one’s risk radar to become more future-proof,” says Kärkkäinen. Expect the unexpected Markku Leskelä , Senior Vice President, Development, at Metsä Board explains that setting up different sce- narios is an important tool for improving resilience. This means conducting a thorough analysis of the busi- ness environment, including such factors as geopol- itics, technology, consumer trends, regulation devel- opments… “Scenario work is part of our continuous way of work- ing and is increasingly important,” Leskelä says, ac- knowledging the need to prepare for those black swans out there. Preparing for the unexpected means flexibil- ity within the organisation also increases. “Looking back, the Covid pandemic was probably the most unexpected black swan,” he says. However, the global packaging industry seems pret- ty well positioned going forward. “The need to package things is universal, after all.”
Change also yields opportunity Yet issues such as over-packaging remain – and there is lots of work to do in the field of recycling, for exam- ple. Leskelä points out that fibre-based packaging en- joys steady tailwinds, and new opportunities are open- ing for players like Metsä Board. “We want to keep heading in the right direction and continue to inspire our customers by showing them examples of what packaging innovation really means.” One intriguing driver of business right now is ar- tificial intelligence (AI). Leskelä reveals that Metsä Board mills are already using AI in various parts of the production process – for example, in quality con- trol. “With more efficient data-crunching, our oper- ational guidance also works better.” Anu Rehtijärvi , Market Intelligence Manager for Metsä Board, is part of Leskelä’s development team. She describes the field of market intelligence as chal- lenging: there are weak signals out there that will be- come significant market drivers over time – but how do you know which ones? “The answer lies in scanning the business environ- ment 360°, non-stop,” she says. Scenario work exposes some business-critical un- certainties – and a viable plan can be hatched for each contingency.
Via scenario work, some of the business- critical uncertainties will become exposed – and a viable plan can be hatched for each contingency.
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