A new manufacturing system has been proposed in order to improve the utilization of wood. This concept, called Value Activation, is focused on the basic understanding of wood, and the fact that there are properties that are not fully exploited in conventional wood manufacturing systems to date. The strategy is to activate these inherent properties by a better understanding of the fundamental behaviour of wood, combined with new applied process technology and the development of the required manufacturing systems. One basic idea within this concept is a new sawing pattern called star-sawing, which produces timber with two different shapes, viz., timber with rectangular and triangular cross sections. This method facilitates an efficient production of radially sawn timber with vertical annual rings, and without pith and juvenile wood. Computer simulations and in-practice tests demonstrate a high volume yield for star-sawn timber of pine and spruce. Results also show that shape distortion and crack formation as a result of any moisture change in this timber are minimized. Indentation resistance is higher and in-plane movement lower in radial than in tangential sections. The overall properties and appearance of radially sawn timber are seriously affected by splay knots and the associated fibre disturbance. These defects are often not acceptable in further processing. Accordingly, tests have been performed to remove such defects in star-sawn timber in order to produce knot-free boards and solid wood panels. In this process, the timber is finger-jointed to form knot-free lengths suitable for e.g. ceilings and floors. In addition, such lengths of the triangular timber may be used as raw material to produce high quality solid wood panels (solid laminated wood products) with vertical annual rings.