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The Strategic Management Paradigm and the Wood Building Products Industry: A Model of Strategies and Firm Profitability

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A model of strategies and firm profitability was developed and tested for the North American wood building products industry. Five strategic variables (adoption of process technology, grade sector focus, investment intensity, forward integration, relative market share) were used to predict firm profitability as measured by return on sales for the largest producers of wood building products in North America. Adoption of process technologies, grade sector focus (i.e., product quality), and investment intensity all had significant positive impacts on return on sales. From a managerial perspective, this research shows no advantage in larger market share beyond a minimal efficient scale. However, superior firm profitability was linked to the application of new process technologies, investment intensity, and the production of higher grade products. For. Sci. 38(4):786-805.

Keywords: Softwood; forward integration; market share

Document Type: Journal Article

Affiliations: Professor, Department of Wood Science and Forest Products, Virginia Polytechnic Institute and State University, Blacksburg, VA 24061-0503

Publication date: 1992-11-01

More about this publication?
  • Forest Science is a peer-reviewed journal publishing fundamental and applied research that explores all aspects of natural and social sciences as they apply to the function and management of the forested ecosystems of the world. Topics include silviculture, forest management, biometrics, economics, entomology & pathology, fire & fuels management, forest ecology, genetics & tree improvement, geospatial technologies, harvesting & utilization, landscape ecology, operations research, forest policy, physiology, recreation, social sciences, soils & hydrology, and wildlife management.
    Forest Science is published bimonthly in February, April, June, August, October, and December.

    2015 Impact Factor: 1.702
    Ranking: 16 of 66 in forestry

    Average time from submission to first decision: 62.5 days*
    June 1, 2016 to Feb. 28, 2017

    Also published by SAF:
    Journal of Forestry
    Other SAF Publications
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