1. Introduction

Since the term “4th Industrial Revolution” first appeared at the World Economic Forum (WEF), also known as the Davos Forum, in January 2016,¹⁾ it has gradually been replaced by the term “artificial intelligence” (AI), which has quickly become a widely recognized buzzword.

At the Davos Forum, it was declared that the 4th Industrial Revolution would drive the global economy toward disruptive innovation through the integration of automated, intelligent machines. This transformation could profoundly impact the very existence of societies and nations.

However, the emergence of AI is not necessarily good news for societies, as its negative impacts must also be carefully examined. According to a 2016 White House report, approximately 83% of low-wage jobs in the U.S. are at risk of being lost due to automation.²⁾

The paper industry is one of the sectors negatively impacted by AI, particularly due to the advent of the internet, widely regarded as one of humanity’s greatest inventions. Once considered a leading industry in the 1980s, it has faced a continuous decline, with many companies struggling to survive, let alone achieve sustainable growth. Many bookstores have disappeared, and printed materials such as newspapers and magazines have steadily declined, replaced by digital formats and the internet. In the printing industry, documents have been substituted with paperless tools through digitalization. Bookless libraries are becoming more common, supplanting physical books, while postal mail is increasingly being replaced by digital communication. Unfortunately for the paper industry, these trends are expected to accelerate in the AI era, advancing at an unprecedented pace.

When confronting the enormous impacts of AI on the paper industry, developing a sustainable growth strategy is essential. Without such a strategy, survival will be extremely challenging, let alone achieving sustainable growth.

2. The Core Technologies of the AI Era

The following transformations have occurred from the 1st Industrial Revolution to the 4th Industrial Revolution, culminating in the current AI era.³⁾

1) 1^st Industrial Revolution: Steam engines and mechanical production.

2) 2^nd Industrial Revolution: Mass production.

3) 3^rd Industrial Revolution: Computers, the internet, and automation.

4) 4^th Industrial Revolution: Artificial intelligence, big data, IoT (Internet of Things), 3D printing, robots, and drones.

At the Davos Forum in 2017, it was declared that the 4th Industrial Revolution would drive the global economy toward disruptive innovation through the integration of automated and intelligent machines. This transformation may profoundly affect the very existence of societies and nations.

The following belong to the representative core technologies in the AI era.

2.1 Artificial intelligence (AI)

As the name suggests, AI stands at the forefront of technological advancements, serving as the “brain” among the core technologies of the AI era, much like the brain governs other organs in the human body.

The following are examples of jobs and roles being replaced by AI technologies.³⁾

1) Drivers (Cabbies, Truck drivers, etc.) by self-driving technology.

2) Customer representatives by Bots.

3) Cashiers by AI Shopping Tech (Amazon Go),

4) Cook jobs by Robotic kitchens.

5) Couriers job by delivery drones and robots.

Such examples are rapidly expanding. It is no wonder that AI technologies will soon become as integral to our lives as the internet is today. It seems wise to consider which of our current jobs may be replaced by AI technologies in the near future.

2.2 Block Chain technologies

Blockchain technologies refer to a decentralized and distributed digital ledger system that records transactions across many computers in a way that ensures the data is secure, transparent, and cannot be altered retroactively. This system allows participants in the network to verify and record transactions without needing a central authority, such as a bank or government.

Key features of blockchain technology include:

Decentralization:

Traditional systems rely on a central authority (e.g., a bank or government) to verify transactions. In contrast, blockchain operates on a peer-to-peer network, where all participants (nodes) have equal authority and work together to validate transactions.

Transparency:

Every participant in the blockchain network can view the entire history of transactions, ensuring transparency. Once a transaction is recorded, it cannot be changed or deleted without consensus from the network.

Security:

Blockchain uses cryptographic techniques to secure data. Each block (which contains a list of transactions) is linked to the previous one, forming a “chain.” This makes it extremely difficult to alter any information in the blockchain without disrupting the entire chain, ensuring data integrity.

Immutability:

Once a transaction is added to the blockchain, it is immutable, meaning it cannot be modified or erased. This feature makes blockchain particularly useful for applications where trust and accuracy are critical, such as financial transactions, supply chain tracking, and contract management.

Smart Contracts:

Some blockchain systems (like Ethereum) support smart contracts, which are self-executing contracts with the terms directly written into code. These contracts automatically execute actions when predefined conditions are met, reducing the need for intermediaries.

Some of the applications of Blockchain Technology include:

Cryptocurrencies:

Blockchain is most commonly known for supporting digital currencies like Bitcoin, where it records every transaction in the Bitcoin network.

Supply Chain Management:

Blockchain can track goods from origin to destination, ensuring transparency and preventing fraud.

Healthcare:

Blockchain can securely store medical records and ensure that patient data is shared only with authorized individuals.

Banking and Finance:

Blockchain enables faster, cheaper, and more secure transactions, reducing the need for traditional banking intermediaries.

In summary, blockchain technology has the potential to revolutionize various industries by providing more secure, transparent, and efficient methods for managing data and conducting transactions. Some even suggest that blockchain could be more revolutionary than the internet itself.⁴⁾

2.3 Three-Dimensional (3D) Printing Technology

3D printing technology (also known as additive manufacturing) is considered one of the core technologies of the AI era. It is a revolutionary process that creates three-dimensional objects by building them layer by layer from a digital design. Unlike traditional manufacturing methods, which often involve cutting away material from a solid block (subtractive manufacturing), 3D printing adds material layer by layer to construct the object, minimizing waste.

3D printing technology is widely used in both rapid prototyping and additive manufacturing. Its applications are expanding across various industries, including the production of furniture, toys, food, and even parts of the human body.

It is important to note that 3D printing is not the same as conventional printing of papers or documents. Rather, it is a manufacturing technology, not a printing technology.

In the future, 3D printing is expected to become a key platform for various manufacturing industries, including the pulp and paper industry.

2.4 The Internet of Things (IoT)

IoT refers to the network of physical objects, devices, and systems that are embedded with sensors, software, and other technologies to collect, exchange, and process data over the internet or other communication networks.

IoT devices are connected to the internet or other networks, enabling them to transmit and receive data. This connectivity is typically achieved through wireless technologies like Wi-Fi, Bluetooth, or cellular networks. These devices are equipped with sensors that gather data from the environment (e.g., temperature, humidity, motion, location) and actuators that take action based on the data (e.g., turning on a light, adjusting a thermostat).

IoT has been widely applied across various fields:

Smart Homes:

IoT is used in smart homes with devices like thermostats, lights, security cameras, and appliances that can be controlled remotely through smartphones or voice assistants.

Healthcare:

IoT devices in healthcare include wearable health trackers, smart medical devices, and remote monitoring tools, helping to collect real-time health data and improve patient care.

Smart Cities:

IoT is applied in smart cities for traffic management, waste management, energy monitoring, and public safety. For example, IoT sensors can monitor traffic flow and adjust signals in real time to reduce congestion.

In conclusion, IoT is transforming industries, homes, and cities by connecting everyday devices to the internet, allowing them to collect, exchange, and act on data.

2.5 Robot Technologies

Robot Technologies refer to the development and application of robots-autonomous or semi-autonomous machines designed to perform tasks traditionally carried out by humans or other machines.

These technologies combine various fields such as mechanical engineering, electrical engineering, computer science, and artificial intelligence (AI) to create robots capable of performing a wide range of functions, from simple tasks to complex, interactive processes.

Robots are increasingly replacing the jobs of blue-collar workers, especially for routine, mundane, or dangerous tasks such as firefighting and hazardous material handling.

The development of robot technologies is advancing rapidly, with the goal of creating robots that closely resemble humans, known as humanoid robots.

Many modern robots rely on AI and machine learning to perform tasks autonomously or learn from their experiences. For example, AI helps robots recognize objects, navigate environments, and optimize their actions based on feedback.

The following robot technologies are currently being developed:

1) Autonomous Robots (Self-Driving Robots):

These robots operate autonomously, without direct human control. Examples include self-driving cars and drones. They rely on sensors, GPS, and AI algorithms to navigate and perform their tasks.

Humanoid Robots:

Humanoid robots are designed to resemble humans in both appearance and behavior. Typically equipped with two arms, two legs, and a head, they are used in areas such as research, human interaction, and entertainment. Examples include Honda’s ASIMO and SoftBank’s Pepper.

Medical Robots:

These robots assist in surgery, rehabilitation, and patient care. Surgical robots, such as the Da Vinci Surgical System, enable doctors to perform minimally invasive surgeries with high precision. Rehabilitation robots help patients regain mobility and strength after injuries.

Mobile Robots (Drones and AGVs):

Mobile robots include drones (unmanned aerial vehicles) and AGVs (Automated Guided Vehicles). Drones are used for tasks like aerial surveillance, package delivery, and agriculture, while AGVs transport goods within warehouses and factories.

Exploration Robots:

These robots are deployed in environments where human presence is difficult or dangerous, such as space exploration (e.g., NASA’s rovers), underwater exploration, and deep-sea research.

In summary, robot technologies are advancing rapidly, transforming industries from manufacturing to healthcare, agriculture, and beyond. These technologies offer significant benefits in terms of efficiency, safety, and precision, but also present challenges related to cost, complexity, and societal impact. As robotics continues to evolve, its integration into everyday life is expected to expand, offering new possibilities for automation and innovation.

It is prudent to consider how current tasks in the paper industry might be replaced by robot technologies when developing a sustainable growth strategy.

2.6 Drone Technologies

Drone technologies refer to the design, development, and application of unmanned aerial vehicles (UAVs), commonly known as drones. These are aircraft that operate without a human pilot onboard and are controlled remotely or autonomously. Drones are equipped with various technologies that allow them to navigate, capture data, and perform tasks in a wide range of industries.

Several types of drones are currently available, each designed for specific applications. Here are some notable types:

Consumer Drones:

These drones are typically used for recreational purposes or by hobbyists. They are often equipped with basic cameras and are used for photography, video recording, and personal use. Examples include drones used for capturing aerial images during events or outdoor activities.

Commercial Drones:

Commercial drones are used for professional applications across industries such as agriculture, construction, delivery, and cinematography. They often come with higher payload capacities, better sensors, and more advanced software. They can be used for aerial mapping, surveying, crop monitoring, or inspection tasks.

Industrial Drones:

Industrial drones are large and specialized for heavy-duty tasks, such as infrastructure inspection, pipeline monitoring, or construction site surveying. They can carry larger payloads, including high-definition cameras, LiDAR equipment, and sensors for environmental data collection.

Military Drones (UAVs):

Military drones are used for surveillance, reconnaissance, and combat missions. These drones are typically equipped with high-tech sensors, cameras, and weapons systems. Drones like the MQ-9 Reaper are used for long-range surveillance and targeted strikes.

Delivery Drones:

These drones are designed for transporting goods over short to medium distances. They are being tested and deployed by companies like Amazon and UPS for package delivery, reducing the need for traditional delivery vehicles.

Agricultural Drones:

Agricultural drones are used for precision farming, which includes tasks such as crop monitoring, pesticide spraying, and soil health analysis. These drones are equipped with multispectral sensors to gather data on crop conditions, enabling farmers to optimize their land use and resources.

Surveying and Mapping Drones:

Drones equipped with cameras and LiDAR systems are used for surveying and mapping large areas quickly and accurately. These drones are used in construction, land management, archaeology, and environmental monitoring to create detailed 3D models and maps.

In conclusion, drone technologies are revolutionizing industries such as logistics, agriculture, healthcare, entertainment, and defense. With advancements in sensors, AI, and autonomous navigation, drones are becoming more efficient and capable, offering innovative solutions for a wide range of tasks.

Together with robot technologies, drone technologies are transforming every industry, including the paper industry.

So far, the core technologies in the AI era have been discussed. However, it cannot be emphasized enough that these technologies are closely interconnected. Focusing on just one or two technologies in isolation is likely to miss the bigger picture.

3. Mega Trends and Marketing Myopia in the Paper Industry

The emergence of AI technologies is creating tsunami-like effects across industries, marking a profound shift that can be categorized as a mega trend.⁵⁾

A mega trend refers to a long-term, large-scale phenomenon or shift that significantly influences global societies, economies, cultures, and industries. These trends are typically driven by technological advancements, demographic changes, environmental factors, or shifts in societal values and behaviors.

Understanding mega trends is crucial for organizations to develop sustainable growth strategies. By aligning strategies with these trends, organizations can innovate, remain competitive, and address the evolving needs of society.

Unfortunately, the paper industry appears to suffer from marketing myopia, focusing primarily on short-term profit gains while overlooking the transformative and disruptive impacts of these mega trends. This narrow focus risks leaving the industry unprepared for the significant changes shaping the future.

To thrive in the AI era and beyond, the paper industry must recognize the importance of these global shifts and adapt its strategies accordingly. Failure to do so may jeopardize its long-term sustainability and relevance.

3.1 Marketing Myopia

At this point, it is worth mentioning the classic article by Theodore Levitt on “Marketing Myopia”.⁶⁾

“In truth, there is no such thing as a growth industry. There are only companies organized and operated to create and capitalize on growth opportunities. Industries that assume themselves to be riding some automatic growth escalator invariably descend into stagnation”.

Marketing myopia can be defined as a short-sighted, inward-looking approach to marketing that prioritizes the company’s needs over defining the company and its products in terms of the customer’s needs and wants. This perspective leads to a failure to recognize and adapt to rapid changes in the market. In the broadest sense, marketing encompasses everything from selling yourself and ideas to products and services.

One of the earliest examples of marketing myopia appears in the Christian Bible, where Esau sold his birthright to Jacob for a bowl of bread (Genesis 25: 29- 34). This serves as a clear illustration of trading long- term potential gains for short-term, immediate rewards. Other examples of marketing myopia include typewriters from Smith Corona, digital photography from Eastman Kodak, office automation from Wang, video and DVD rentals from Blockbuster, and mainframe computers from IBM. All of these products were once market leaders, and at the time, sales seemed to grow endlessly.⁷⁾

As previously mentioned, over the past few decades, the paper industry has experienced continuous decline due to the invention and widespread adoption of the internet, widely regarded as one of the greatest inventions in human history. Consequently, many companies in the industry have faced significant challenges to survival, let alone achieving sustainable growth. This trend is expected to persist and accelerate in the coming years.

As we now face the AI era, it seems pertinent to ask the paper industry the same question Prof. Levitt posed long ago: Do you know what business you are in? Every major industry was once a growth industry. Yet, some that are now riding a wave of growth enthusiasm are actually on the brink of decline. Others, once regarded as established growth industries, have ceased to grow. In every case, the reason growth is threatened, slowed, or stopped is not because the market is saturated, but because of a failure of management.

The above paragraph highlights that a failure of management could be responsible for the collapse of any industry. Jared Diamond supports this view, arguing that leaders of nations often block innovation to maintain control over their citizens.⁴⁾

This argument may seem unfair to some managements. However, it would be more accurate to say that the lack of creative individuals within an organization is the primary reason for its decline. This suggests that creativity should be the cornerstone of sustainable growth within an industry. This view was first proposed by G. Allan, who argues that the creativity and innovation of individuals should be considered the most important assets to an organization.^8,9) Allan’s view is supported by a White House report that identifies complex problem- solving, critical thinking, and creativity as the core competencies required in the AI era. Creativity is probably the last one that AI can replace, even if it is possible to do so. Needless to say, without creativity, the other two competencies cannot be developed. Therefore, it should be understood that creativity is the most critical core competency required in the AI era. Creativity is likely the last area that AI could replace, even if it is possible to do so.

3.2 Creative Destruction and Constructive Destruction strategy

A constructive destruction strategy is required for a company to have a sustainable growth(2). It is a concept rooted in the economic principle of creative destruction, introduced by economist Joseph Schumpeter.¹⁰⁾ It refers to technological advancements that disrupt existing industries, systems, or methods while simultaneously fostering innovation, growth, and the creation of new markets or industries.

Examples of Constructive Destruction Technologies are:

Artificial Intelligence (AI):

Automating tasks traditionally performed by humans, AI is reshaping industries from healthcare to manufacturing, while creating new opportunities in AI-driven innovation.

Blockchain:

Disrupting traditional financial systems, it provides secure and transparent alternatives for transactions, supply chains, and data management.

3D Printing:

Replacing traditional manufacturing processes by enabling rapid prototyping and on-demand production, reducing waste and transforming industries like healthcare and construction.

In essence, constructive destruction technology underscores the transformative power of innovation, where disruption paves the way for a more efficient, sustainable, and advanced future.

3.3 The Paper Industry - Characteristics

The general characteristics of the paper industry can be summarized as follows:

Raw Material Processing:

The industry relies heavily on processing raw materials into usable forms.

Cellulose Fibers:

Wood pulp, composed primarily of cellulose fibers, serves as the key raw material.

Capital-Intensive:

Establishing and maintaining paper production facilities require significant financial investment.

Mature Industry:

The paper industry has reached a mature stage in its global lifecycle.

Energy-Intensive:

Paper production demands substantial energy inputs.

Environmental Impact:

The industry is associated with air pollution and the generation of waste by-products.

Technology Level:

Generally, the industry operates with a relatively low level of technological innovation.

These characteristics are globally relevant, including in countries like South Korea, where cellulose fibers are typically imported.

3.4 Sustainable Growth Strategy of the Paper Industry

To develop a sustainable growth strategy for the paper industry, conducting a Strengths-Weaknesses-Opportunities-Threats (SWOT) analysis is essential.

SWOT analysis is a strategic planning tool used to identify and evaluate the Strengths, Weaknesses, Opportunities, and Threats associated with a business, project, or individual. This framework helps organizations assess internal factors (strengths and weaknesses) and external factors (opportunities and threats) to develop effective strategies and make informed decisions.

Components of SWOT Analysis:

Strengths:

Internal attributes that give an advantage over competitors (e.g., strong brand, skilled workforce).

Weaknesses:

Internal factors that hinder performance or competitiveness (e.g., outdated technology, lack of resources).

Opportunities:

External factors or trends that the organization can exploit (e.g., emerging markets, technological advancements).

Threats:

External challenges or obstacles that could negatively impact performance (e.g., new competitors, economic downturns).

Once the SWOT analysis is complete, the next step involves transforming weaknesses into strengths and converting threats into growth opportunities to build a robust and sustainable strategy.

Of course, enhancing existing strengths can be valuable, but relying solely on this approach may not suffice as a sustainable growth strategy in the AI era.

An example of transforming weaknesses into strengths can be illustrated as follows:

The paper industry heavily relies on importing pulp. One potential solution is to establish a paper production plant near the source of the pulp. In the AI era, globalization is essential, and addressing such issues solely at a domestic level could risk falling into the trap of marketing myopia.

The paper industry is often referred to as a “smokestack industry” due to its significant environmental impact. Developed countries, such as the USA, Canada, France, and Scandinavian nations (Sweden, Norway, and Finland), have been striving to reduce their reliance on trees as a raw material to protect forests. Consequently, developing cellulose fibers from non-wood sources—such as straw, bamboo, kenaf, and biomass from sugarcane or palm oil trees—has become an increasingly attractive alternative.

This approach is likely not only to alleviate environmental issues but also to increase profits, as pulp derived from non-wood materials and biomass is generally more cost-effective than wood-based pulp.

An excellent example of a sustainable growth strategy for the paper industry would be to develop cellulose fibers from the biomass of oil palm trees¹¹⁾ or sugarcane bagasse.¹²⁾

Palm oil is produced from palm oil trees, with Indonesia and Malaysia accounting for about 90% of global production. Once palm oil is extracted, the remaining biomass—such as the stem, empty fruit bunches, and fronds—is generated. This biomass is typically used as fuel, which contributes to global warming.

Accordingly, a country like Korea, which has papermaking technology but relies on importing pulp, could collaborate with Indonesia or Malaysia to develop cellulose fibers from palm oil biomass.

Developing cellulose fibers from biomass, such as palm oil trees and sugarcane bagasse, may take time and effort, but the investment will ultimately be rewarded.

As demonstrated in the example above, developing a sustainable growth strategy for the paper industry requires creative and innovative individuals capable of tackling such challenging tasks

Ironically, we must compete with our own advanced AI technologies. However, it is important to remember that we are the masters, not the technologies. Creativity will enable us to leverage AI to develop a sustainable growth strategy for the paper industry.

4. Conclusions

The emergence of the AI era has compelled every industry to develop a sustainable growth strategy. Core technologies such as AI, blockchain, and 3D printing are driving transformation, particularly in traditional manufacturing sectors.

To achieve sustainable growth in this new era, the creation of a paradigm grounded in constructive destruction is essential. Incremental changes or simple paradigm shifts are no longer sufficient.

The paper industry is no exception; if anything, its need for adaptation is even more urgent. In the AI era, the industry faces a double-edged sword: while AI offers immense potential to drive sustainable growth through innovation and efficiency, it also poses a significant risk of accelerating the industry’s decline or even obsolescence.

Creative individuals with innovative minds are the most valuable assets for any organization navigating these changes. They are vital for driving sustainable growth and are uniquely irreplaceable by AI technologies like robots.

Most importantly, a sustainable growth strategy for the paper industry must focus on working in harmony with AI technologies rather than competing against them.