UM panel explores changes in paper industry

ORONO – Maine’s paper industry has taken some hard hits in the last decade, but the paper industry isn’t alone when it comes to snags in the market and in demand.

“History is littered with companies who thought their product was the best and would always be used,” University of Maine School of Business professor John Mahon said Friday.

Mahon was part of a panel discussion attended by about 50 people concerning cultural and business changes in the paper industry at the Paper Days Symposium held Thursday and Friday at UM.

The event, titled “The Paper Industry Reinventing Itself,” was sponsored by the UM Pulp and Paper Foundation, along with the New England Paper Industry Management Association and the Maine Pulp and Paper Association.

Despite the industry’s decline, Maine is beginning to see some improvement, according to Gilly Hitchcock of Fortune Personnel Consultants, an executive recruiting company in Bangor.

“This is the most positive that really we’ve seen things in a couple of years,” she said.

She explained that the industry has become a leaner but stronger one that’s more focused and requires teamwork.

“The paper industry today is showing a lot of [innovation],” she said.

Dennis Castonguay, manager of Verso Paper and former mill manager of International Paper in Bucksport, agreed that there have been many changes in the industry during his approximately 30-year career, but he said the industry is becoming re-energized.

“This is fun. It’s been a great change for us,” he said, referring to IP’s sale of four of its mills, including those in Jay and Bucksport, to Verso.

He describes the new company as more focused, progressive and forward-thinking. Verso is centered on production of its lightweight coated paper for magazines and other publications and has goals of becoming the primary provider for North America.

Funding for research and development, capital improvements, and working as a team to have quick response to the market are important, he said.

Mahon offered a slightly different and humorous spin to the discussion.

“The danger I’m trying to raise with you is complacency,” he said.

Before Alexander Graham Bell invented the telephone, people said the telegraph would be around forever. Pharmaceutical companies denied that prescriptions would ever be sold over the Internet. The U.S. Postal Service never thought letter writing would become an “ancient technology.”

“The Internet is sucking up the First Class mail business like a Hoover,” Mahon said. If people in the paper industry aren’t careful and don’t keep their eye on the changing world, they are likely to find themselves in the same boat.

Future generations aren’t likely to rely on paper copies of anything – books, articles or newspapers, Mahon said.

Composite products made of wood and plastics are being used by the military for armor and even are being tested for jets and automobiles.

“GM is looking at an automobile as an information platform, not as an automobile,” Mahon said. Camera companies have adapted to the demand for digital cameras versus those that take film that must be developed.

Records, eight tracks, and cassette players have been replaced with CDs and MP3s.

“The future belongs to the bold,” Mahon said, and then he left the audience with an idea to ponder.

“If everything I’ve said is wrong, it’s been a humorous diversion. But even if I am just partially right, what does it mean for your industry?”