ArticlePDF Available

Supply Chain Management and the Circular Economy: towards the Circular Supply Chain

Authors:

Abstract and Figures

Circular modes of production, known as the circular economy, are welcomed in political and business circles to overcome the shortcomings of traditional linear operating models. Academic literature on the circular economy is nascent however and little attention is given to supply chain management implications, regardless of the relevance of supply chain innovation towards a more resource efficient and circular economy. Based on a review of the literature, this article presents preliminary propositions concerning implications for the development of what we term 'circular supply chains', defined here as the embodiment of circular economy principles within supply chain management. Our propositions are based on the following arguments: a) a shift from product ownership to leasing and access in supply chain relationships; b) the relevance of structural flexibility and start-ups in regional/local loops; c) open and closed material loops in technical and biological cycles; d) closer collaboration within and beyond immediate industry boundaries; and e) public and private procurement in the service industry as a lever for the scaling up of circular business models. We discuss what these circular economy principles mean in terms of supply chain challenges and conclude with limitations and future research agenda.
Content may be subject to copyright.
1
Supply Chain Management and the Circular Economy:
towards the Circular Supply Chain
Roberta De Angelis
University of Exeter Business School
Streatham Court, Rennes Drive, Exeter, UK, EX4 4PU
rd283@exeter.ac.uk
Mickey Howard*
*Corresponding author: Department of Management, University of Exeter Business School,
Streatham Court, Rennes Drive, Exeter, UK. EX4 4PU
m.b.howard@exeter.ac.uk
+44 (0)1392 722153
Joe Miemczyk
ESCP Europe
527, Finchley Road, London, UK
jmiemczyk@escpeurope.eu
Paper accepted for publication by Production Planning & Control, 1
st
May 2017
(Special Issue: Supply Chain Operations in a Circular Economy)
Please reference this paper as follows:
De Angelis, R., Howard, M., and Miemczyk, J. (2017). Supply Chain Management and the Circular
Economy: Towards the Circular Supply Chain. Production Planning & Control. Forthcoming.
2
Supply Chain Management and the Circular Economy:
towards the Circular Supply Chain
Abstract
Circular modes of production, known as the circular economy, are welcomed in political and
business circles to overcome the shortcomings of traditional linear operating models.
Academic literature on the circular economy is nascent however and little attention is given
to supply chain management implications, regardless of the relevance of supply chain
innovation towards a more resource efficient and circular economy. Based on a review of the
literature, this article presents preliminary propositions concerning implications for the
development of what we term ‘circular supply chains’, defined here as the embodiment of
circular economy principles within supply chain management. Our propositions are based on
the following arguments: a) a shift from product ownership to leasing and access in supply
chain relationships; b) the relevance of structural flexibility and start-ups in regional/local
loops; c) open and closed material loops in technical and biological cycles; d) closer
collaboration within and beyond immediate industry boundaries; and e) public and private
procurement in the service industry as a lever for the scaling up of circular business models.
We discuss what these circular economy principles mean in terms of supply chain challenges
and conclude with limitations and future research agenda.
Keywords: Circular economy, closed-loop, strategy, structure, relationships.
1. Introduction
This paper explores the implications for supply chain management (SCM) in circular supply
chains (CSC) given the considerable rise in interest in the circular economy (CE) by both
practitioners and theorists (EMF and McKinsey & Company, 2012, 2013; EMF et al., 2015;
Yuan et al., 2006; Tukker, 2015; Webster, 2015; WEF et al., 2014), and the relevance of
supply chain innovation in the transition towards a CE (Aminoff and Kettunen, 2016).
Previous scholars have argued for the need for CE and SCM research to be combined (Sauvé
et al., 2016; Schulte, 2013; Seuring, 2004), hence we adopt this view as our starting point
with which to develop a framework of propositions. Our aim is to first examine links between
traditional SCM, sustainable SCM and the CE. We then highlight the sources of value
creation in a CE and discuss the implications for SCM in terms of opportunities and
challenges in the transition towards CSCs. In short, we ask: what are the implications for
supply chain management in circular supply chains?
3
We adopt a systematic literature review as our methodology, used to initially identify 84
papers which were reduced through a filtering process to papers using a selection of keywords
that specifically cover both the circular economy in general (n = 34) and supply chain
implications specifically (n = 21) (e.g. Tranfield et al., 2003; Denyer and Tranfield, 2009).
In
order to conduct our review consistently across traditional SCM, sustainable SCM and CE,
we used as our principle search terms: ‘circular supply chains’, ‘circular economy’, ‘closed
loop’, ‘sustainable supply chains’, ‘reverse logistics’ and other combinations comprising
similar terminology. The theoretical perspective of each paper was identified and recorded in
a database along with methodology, unit of analysis and reported findings. From this review
we identify themes that link CE to SCM, which are then used to develop a set of propositions
building on both these review papers and the practitioner literature. As an overall trend, the
following chart shows that from around 2012 published research on CE and the implications
for SCM have risen rapidly to 2016 (figure 1), with relevant articles continuing to emerge in
2017 (e.g. Geissdoerfer et al., 2017; Genovese et al., 2017)
Figure 1: Trends in number of publications linking CE and SCM by year
One of the challenges to linking the CE with SCM is that CE research is conducted
across a diverse set of disciplines ranging from environmental economics to management
science. The chart in table 1 shows the journals which were included in our review.
Table 1: Journals used in the review
The review in section 2 is conducted systematically, starting with circular economy, and
then supply chain management and the links with sustainability. The reporting in section 3
adopts an analysis or synthesis approach to the literature, using propositions to frame circular
supply chains and the implications for supply chain management. Section 4 concludes with
contribution, managerial implications, limitations and recommendations for further research.
4
2. Bridging CE and sustainable supply chain literature
2.1 The Circular Economy
There are many definitions of the CE proposed in both political circles (e.g. EC, 2015; UNEP,
2010) and practitioner literature (e.g. Accenture, 2014; EMF and McKinsey & Co, 2012;
2013; EMF et al., 2015; WEF et al., 2014). One of the most recent is from the European
Commission, who posits:
‘In a circular economy the value of products and materials is maintained for as long as
possible; waste and resource use are minimized, and resources are kept within the
economy when a product has reached the end of its life, to be used again and again to
create further value’ (EC, 2015, 1).
Because of assumptions around living systems as a viable model for the sustainable and
sustained development of socio-economic systems (EMF and McKinsey & Co, 2012; 2013;
Sauvé et al., 2016), the CE seeks to eliminate the concept of waste. Waste is seen as ‘food’
insofar as valuable materials are managed within technical and biological cycles (EMF and
McKinsey & Co, 2012). ‘Technical nutrients’ (e.g. metals) are designed to be suitable for
reusing, refurbishing, remanufacturing and recycling for a consecutive number of cycles of
production and use at the highest quality. ‘Biological nutrients’ (e.g. biodegradable materials)
serve a restorative purpose: they are designed to return to nature to build natural capital either
directly, or at their end of use across different supply chains (ibid).
As presented by the Ellen MacArthur Foundation and partners, CE thinking is not new.
Origins can be found in economics (Boulding, 1966; Pearce and Turner, 1990), industrial
ecology (Frosch and Gallopoulos, 1989; Lifset and Boons, 2012) management and corporate
sustainability literature (e.g. Benyus, 2002; Braungart and McDonough, 2002; Guide and Van
Wassenhove, 2009; Lovins et al., 1999; Pauli, 2010; Stahel, 2006), whose concepts have
started to impact the business community. Business models aligned with the performance
economy (Stahel, 2006) based on offering access rather than selling goods to satisfy
customers’ needs have emerged across some sectors (e.g. mobility, construction tools,
lighting, aerospace), with the potential to spread further because of advances in information &
communication technologies and increasing environmental awareness from consumers (Lacy
and Rutqvist, 2015). Industrial symbiosis - a field of industrial ecology literature - proposes
the exchange of by-products, materials and energy between companies in the same
5
geographical vicinity such as eco-industrial parks (Chertow, 2000) is gaining traction in
China (Murray et al., 2015), although widespread diffusion is still missing (Holgado et al.,
2016), with the exception of the eco-industrial park at Kalundborg in Denmark (Gregson et
al., 2015). While the application of green and sustainable supply chain practices have been
increasing for several decades (Genovese et al., 2017), it is within supply chains for consumer
goods where most environmental impact may reside (McKinsey & Co, 2016).
Although CE thinking is not new, it is only recently that it has gained attention from
the business community. This may be explained not just in light of the worsening ecological
trends, but also because of changing socio-economic and regulatory landscapes. Resource
price volatility caused by growing modern economies, a burgeoning of middle-class
consumers entering the market, increases in the sharing/renting economy, rising regulatory
pressures impacting on climate change and waste: all pose questions for the feasibility of
traditional, linear operating business models following the ‘take-make-dispose’ approach
(Accenture, 2014; WEF et al., 2014). Current macro-economic, regulatory and ecological
trends are raising the attractiveness of more resource efficient business practices to stay
competitive. Yet there are differences between CE thinking and its predecessors. Indeed, CE
thinking emphasizes economic and business opportunities (Aminoff and Kettunen, 2016;
Velis, 2015), which is perhaps not surprising as it seeks to engage the business community, a
significant lever in any transition (Franklin-Johnson et al., 2016). The practitioner literature
views the CE as an economy that provides multiple value creation mechanisms which are
decoupled from the consumption of finite resources’ (EMF et al., 2015: 23). The EMF
estimates that in the transition to a CE, consumption of primary materials in the European
Union (EU) could fall significantly in the food, construction and mobility industries ‘as much
as 32% by 2030 and 53% by 2050(EMF et al., 2015: 15). This would have a positive effect
on the competitiveness of EU manufacturing firms given that materials and components
account for 40-60% of their total costs, and that Europe depends hugely on imports of
resources such as fossil fuels and metals in the measure of about 60% (ibid). In addition to the
economic and business opportunities, it is argued that the CE can build prosperity without
further depleting natural capital (CISL, 2015; Gregson et al., 2015; Murray et al., 2015;
Schulte, 2013) and in doing so, it is also consistent with principles of inter and intra-
generational equity as raised in the 1987 Brundtland Commission Report (Ghisellini et al.,
2016). Therefore, an initial impression of the CE is that it does appear to address the three
pillars of economic, environmental and social sustainability, as discussed further.
6
Despite the CE gaining momentum in political and business circles, its discussion
within academic circles is more embryonic (e.g. Murray et al., 2015; Antikainen and
Valkokari, 2016; Geissdoerfer et al., 2017). Literature on the topic is fragmented and spread
across a number of more established fields, giving limited attention to implementation and the
implications for business models and supply chains (Aminoff and Kettunen, 2016;
Lewandowski, 2016; Lieder and Rashid, 2016). This is despite the significance of SCM in
terms of innovation and transitionary capability towards the CE (Aminoff and Kettunen,
2016; Hopkinson et al., 2016), and the substantial implications of CE principles for current
SCM practice (Nasir et al., 2016; Genovese et al., 2017). Acknowledging these somewhat
limited discussions in the literature from a business perspective of CE, this paper seeks to
conceptualize the implications for SCM (Table 2).
Table 2: CE themes with implications for SCM
Section 2.2 now considers sustainable SCM, including a brief review of lean thinking
and closed-loop supply chains (Linton et al., 2007; Wells and Seitz, 2005) for their links with
CE and the design and management of circular supply chains (Aminoff and Kettunen, 2016;
Genovese et al., 2017).
2.2 Supply chain management and sustainability
The concept of supply chains and consequently SCM arose in the early 1980s due to the
increase in global sourcing, and was used to describe the complexity of business-to-business
and business-to-customer networks. What we term ‘traditional’ SCM was first developed as a
purchasing and logistics concept (Cooper and Ellram, 1993), although has become closely
associated with operations, especially the performance-based control of material and
information flow between collaborating organizations (Defee and Stank, 2005; Cooper et al.,
1997; Hines et al., 2000; Hult et al., 2007). A central paradigm of emerging supply chain
literature at the time was to foster a better understanding of the elements ‘characterizing
strategic decisions that lead to supply chain structural development and performance’ (Defee
and Stank, 2005: 28). One of the most popular definitions of SCM is Christopher’s (1998: 5)
the management of upstream and downstream relationships with suppliers and customers to
7
deliver superior customer value at less cost to the supply chain as a whole’. The emphasis on
cost and throughput illustrates the traditional language of supply chains, where the system is
geared towards linear thinking around inputs and outputs. SCM focuses on multiple customer-
supplier dyads, starting with raw material extraction through production to final end
customers or consumers (Harland, 1996). Supply chains tend to be depicted as a focal firm
with upstream and downstream relationships (Christopher, 1998), although whether supply
chains are simple linear structures, or more like networks with interconnected supply chains is
the subject of some debate (Lamming et al., 2000). A typical example of traditional, linear
supply chains therefore is the fast-moving consumer goods (FMCG) sector, which focuses on
high levels of efficiency, volume throughput and customer responsiveness (e.g. Van Hoek,
1999;
Handfield and Bechtel, 2002; Holweg, 2005).
One of the most significant developments in supply chain strategy has been the
adoption of lean supply chains (Womack and Jones, 2003; 2005; Hines et al., 2004). Different
to the approach of the CE where waste is considered as ‘food’, lean thinking is presented as a
practical, step-by-step approach to eliminate waste in all its forms (e.g. inventory, waiting,
unnecessary movement etc) and can be applied to almost any organization, enterprise or
supply chain context (Womack and Jones, 1994; 1996; 2003). More recently, the connection
has been made between Lean and sustainability (i.e. ‘Lean and Green’) by scholars linking the
efficiency paradigm of ‘doing more with less’ with minimising the use of resources and
output of industrial emissions in order to protect the natural environment (King and Lenox,
2001; Simpson and Power 2005; Mollenkopf et al., 2010). While there is ample evidence to
demonstrate the benefits of this as an incremental approach (e.g. Womack and Jones, 1994;
1996; 2003), industry has yet to adopt Lean and eliminate waste with sufficient resolve to
meet the complex operational challenges presented by sustainability, such as the
implementation of a low carbon strategy (Correia et al., 2013). A further issue is that
efficiency-focused supply chains are at risk of disruption in industries facing turbulent and
volatile markets, particularly those with fluctuating commodity and raw material prices. As
world markets are increasingly disrupted by abnormal weather, terrorism, sole commodity
ownership (e.g. China), and price volatility (e.g. grain, oil, gas), the traditional practice of
supply chains designed exclusively around single strategies such as Lean or Agile is coming
to an end (Christopher and Holweg, 2011). Supply chain designers can no longer assume a
stable operating environment (Womack and Jones, 1994; Christopher, 2000), and are shifting
towards more flexible methods which counter the effects of constant disturbance. Christopher
8
and Holweg (2011) argue that the SCM principle of controlling an end-to-end process to
create a seamless flow of goods must be questioned, where assumptions over long-term
stability no longer hold true. Managing supply chains in an age of constant turbulence may
mean embracing volatility as an opportunity rather than viewing it as a risk by
understanding its nature and impact, and shifting the exposure to risk by considering methods
such as dual sourcing, asset sharing, postponement, flexible labour, rapid manufacturing and
outsourcing (Christopher and Holweg, 2011: 63).
Supply chain management’s associations with sustainability owe much to the early
interest in closed-loop reverse logistics, product recovery and remanufacturing literature
(Thierry et al., 1995; Fleischmann et al., 1997; Jayaraman et al., 1999; Guide and Van
Wassenhove, 2009; Loomba and Nakashima, 2012). Sustainable supply chain management
(SSCM) is now recognised as a term in its own right (Seuring and Müller, 2008;
Carter and
Rogers, 2008) and includes a range of associated topics including environmental and social
goals (Govindan et al., 2015), the need to understand value creation as opposed to damage
limitation (Krikke et al., 2013) and the importance of strategic supplier partnerships in
creating this value (Sarkis et al., 2011; Bell et al., 2013; Insanic and Gadde, 2014).
Carter and Roger’s seminal SSCM framework (2008) was arguably the first to
demonstrate the relationship among environmental, social and economic performance within
a SCM context. Building on Elkington’s concept of the triple bottom line (1998, 2004), they
suggest that at the intersection of all three factors there are activities that organizations can
engage in which not only positively affect the natural environment and society, but which
result in long-term benefits and competitive advantage for the firm’ (Carter and Roger, 2008:
364). Calling for greater vertical integration between buyers and suppliers as means of
reducing uncertainty and resource dependency towards achieving long-term economic
sustainability in a period of dwindling resources, the authors draw on multiple theories (e.g.
Resource-based view, Transaction Cost Economics) and examples of closed loop industrial
activity.
The decision to adopt a closed loop supply chain approach shows that the organization
has begun to consider the issues of environmental management and product lifecycle, and can
distinguish traditional supply chains from more sustainable closed loop supply chains (Guide
and Van Wassenhove, 2003). Yet introducing a closed loop or ‘reverse logistics’ supply chain
into the business is not simple, particularly as product recycling is rarely considered as a value
9
creating system (Guide et al., 2003). Closed loop supply chains started with the application of
new industry standards and focusing on green or eco-efficiency issues. This meant working
with suppliers to reduce the impacts of products and processes. Closed loop supply chains
require considerable investment in resources, initially in understanding the configurations of
information flows and parts distribution that serve the product whilst in use, and then
developing a collection system which takes back or ‘harvests’ the product at its end-of-life,
(e.g. Loomba and Nakashima, 2012) while securing the cooperation of customers, suppliers
and not-for-profit organizations (Kumar and Malegeant, 2006). The process of product
disassembly and remanufacturing can be particularly difficult as the condition of used
products may vary greatly, can be distributed across the world and, even if retrievable, they
may have to be discarded if damaged beyond repair. A combination of increasingly stringent
legislation (e.g. European law on vehicle scrapping & disassembly) and manufacturer led
initiatives means most industry sectors have active recycling schemes in operation, such as
photocopiers, computers and electrical products, although some end-of-life products can be
transported large distances for treatment at low cost but has transport-related environmental
impacts and sometimes social exploitation issues (Spengler and Schröter, 2003).
Closed loop supply chains are not only challenging in their design and operation, but
have important implications for the supply chain (Savaskan et al., 2004). They must combine
both traditional supply chain activity centred on efficient distribution, as well as reverse
supply chain activity such as the returns process, product repair / refurbishment, testing and
sorting, and remarketing (Guide et al., 2003). Yet despite reverse logistics systems being
practised since the 1920s (e.g. automotive), the strategic intent required to integrate the
concept of the closed loop supply chain into mainstream business activity is still lacking.
Closed loop or reverse systems are typically treated as a silo, isolated from the core business,
where common activities are yet to be established and not fully understood in different
contexts because of variations in product complexity and perceptions in managerial
importance (Johnsen et al., 2014). Haake and Seuring (2009: 9) argue that although many
companies have adopted sustainable procurement and supply strategies and are demanding
minimum performance from their suppliers, current approaches using SSCM frameworks
reveal some shortcomings in their ability to be comprehensive’. They argue that the chief
cause of the failings of SSCM is the inadequate approach when overall impacts along an
entire supply chain are considered. Table 3 presents some of the key issues faced by SCM in
terms of sustainability and closed loop supply chains.
10
Table 3: Key issues for SCM
3. Circular Supply Chains: implications for Supply Chain Management
While the previous section reviewed developments in SCM and CE, here we analyse the
implications for the development of CSCs defined as the embodiment of CE principles within
supply chains. First we compare traditional, sustainable and circular supply chains. Then, we
present our framework consisting of five propositions in support of CSCs and discuss future
supply chain challenges.
Until comparatively recently it was rethinking value at the product’s traditional end-
of-life phase that created new opportunities in terms of recycled component materials, with
facilities installed in the supply chain to enable remanufacturing and repair (Guide and
Daniel, 2000). Yet the practitioner literature on the CE introduces more comprehensive
notions of value creation deriving from a more efficient and productive materials usage and
defined as the power of the ‘inner circle’, ‘circling longer’, ‘cascaded use’ and ‘pure inputs’
(EMF and McKinsey & Co, 2012, 30-31; EMF and McKinsey & Co, 2013: 33-34).
According to the power of the inner circle some end-of-life strategies create more economic
and environmental value than others because they retain much more of a product’s embedded
materials, energy and labour (EMF and McKinsey & Co, 2012; Gorissen et al., 2016; Nasr
and Thurston, 2006). End-of-life strategies should be pursued as follows: 1) maintenance to
prolong durability; 2) reuse for the same purpose with either little or no change; 3)
refurbishment/remanufacturing involving replacements of some relevant components and
recovery of components to be used within a new manufacturing process respectively and 4)
recycling, i.e. the recovery of materials for the same or different purposes (EMF and
McKinsey & Co, 2012). Recycling is the least valuable options since it generally takes the
form of down-cycling rather than of up-cycling (ibid), with materials losing quality and thus
suitability for use within subsequent production processes (Braungart et al., 2007).
The hierarchy of strategies explains the power of the inner circle mechanism: tighter
loops, those closest to the original product serve best value…while outer loops…provide less
value’ (Webster, 2013: 552). Clearly, understanding of how customers use and dispose
products, i.e. expanding supply chains reach, is crucial to reap the benefits of the power of the
inner circle (Timmermans, 2016). Digital technologies which collect and analyse data across
11
the supply network enable companies to better understand customers’ preferences and thereby
capture value (ibid).
Figure 2: Traditional, sustainable and circular supply chains
Based on the previous literature review, figure 2 compares CSCs with traditional and
sustainable supply chains, highlighting the importance of key elements and how they may
change according to prevailing conditions or SC approach. We choose as our foundation
common elements such as strategy, structure, focus and flow, identified from our literature
review as constructs commonly adopted in emergent supply chain research (e.g. Cooper and
Ellram, 1993; Defee and Stank, 2005). Scale and scope were also added as a result of our
investigation of CE literature, particularly the ‘short and cascaded use’ aspect of material and
resources (EMF and McKinsey & Co. 2012).
3.1 CSC propositions and framework
In this section we develop propositions based on the potential impact of CE on supply chains,
with the supply chain challenges presented after each proposition.
An important element in the transition from traditional or sustainable supply chain
management towards CSCs is ‘the power of circling longer’ which involves extending the
period of time during which materials are kept in use (EMF and McKinsey & Co, 2012). This
can be achieved by prolonging products durability or increasing the number of consecutive
cycles of remanufacturing, repair, refurbishing and recycling (ibid). The powers of the inner
loop and of circling longer are relevant when considering the durable components of a
product, and less so when considering consumable ones. In a CE ‘consumables’ are made of
biological, non-toxic and restorative nutrients that can be returned to nature with no risk of
harm (EMF and McKinsey & Co, 2012). Consumables have a very short life span (e.g. food),
though for other products (e.g. packaging materials and textiles) it is possible to extend usage
and thus increase resource efficiency (EMF and McKinsey & Co, 2013). Textiles could
benefit from design for reparability and durability (ibid). The company Patagonia, for
example, designs sport clothing that lasts longer and it is suitable for repair and recycling at
the end of its useful life (Bocken and Short, 2016). On the other hand, durables are made of
12
technical nutrients (e.g. metals) that are not suited to the natural environment but to
consecutive cycles of production and use (EMF and McKinsey & Co, 2012). Durables are not
exchanged through a traditional sale transaction but rather are leased, rented or shared (ibid).
Some companies have already adopted servitized elements of circular business in their supply
chains where selling a service means customers pay only for what they receive, with the firm
retaining ownership of the lighting system e.g. Philips, ‘Pay per Lux’ (Ledvance, 2015), or
aero engine e.g. Rolls Royce, ‘Power by the hour’ (The Economist, 2009), and meeting the
associated long-term maintenance and repair costs. As information technology develops,
customers can upgrade their systems thereby raising efficiency, bringing further benefits as
well as controlling the flow of material returns using digitally enabled systems. Advances in
digital technologies are now sufficiently developed to facilitate CE implementation on a large
scale (Lieder and Rashid, 2016), offering opportunities for monitoring product performance
over the lifecycle, tracking and improving resource usage across the supply chain (Lacy and
Rutqvist, 2015; Preston, 2012), and enabling closer customer relationships to facilitate
product-service continuation or renewal (Lacy and Rutqvist, 2015). Hence, our first
proposition:
P
1:
Supply chain relationships will change in CSCs, shifting from product ownership towards
greater emphasis on leasing and service based strategies enabled by digital systems.
Strategic purchasing in the services sector represents a major shift in focus for a
profession still dominated by products, components and raw materials. If a transition towards
CSCs is to be achieved, procurement policy must shift the current emphasis on ‘best cost’
sourcing and pricing towards a more services friendly, relationship-based approach which
recognises the value of techniques such as lifecycle analysis, leasing and through-life
management. Some high value products, such as photocopiers, lend themselves easily to new
procurement techniques (e.g. pay-per-print), but there is also opportunity to analyse the full
range of assets used in the service sector. In order to maximise value and extend life of
products, different types of customer and supplier relationship strategies are needed which
deploy new incentives around percentage utilisation of assets.
Whereas the powers of the inner circle and of circling longer create opportunities for
value creation via circulating materials within the same supply chain, the power of cascaded
use suggests that value can be created and captured by flowing materials across different
supply chains (EMF and McKinsey & Co, 2012). This principle could be applied to
13
consumables. Food for example is contributing significantly to the generation of waste
whereas it could be returned to the natural environment once energy and other nutrients are
recovered. Indeed, agricultural waste in a CE is: a) reused where possible (e.g. reuse of
wood); b) treated for bio-chemical feedstock extraction (e.g. orange peels treated to obtain
sugars and bio-ethanol) (Balu et al., 2012), and c) sent to anaerobic digestion (EMF and
McKinsey & Co, 2012). Anaerobic digestion is a natural process involving micro-organisms
such as bacteria, which in the absence of oxygen converts the organic waste into two different
products (DECC and DEFRA, 2011). One of these is called digestate which is a fertiliser; the
other is biogas - a mixture of carbon dioxide and methane - which can be used in combined
heat and power engines to produce heat and electricity. Anaerobic digestion is more
environmentally sound as it avoids generation of further greenhouse gases (GHGs) emissions
through landfill, with additional benefits deriving from the production of renewable forms of
energies and biological fertilisers (ibid). The latter could be used to restore soil degradation,
one of the most serious environmental externalities deriving from food production, which also
prevents soil from retaining carbon (EMF et al., 2015). For example, British Sugar has
increased its revenue streams and reduced costs via converting waste streams and even CO
2
emissions from its core business of sugar production into inputs for other product lines such
as tomatoes, bio-ethanol and animal feed (Short et al., 2014). However, preventing food waste
in the first place is one of the aims of a restorative and regenerative CE, with positive
economic, environmental and social implications (e.g. reduced costs in the food supply chain,
reduced GHGs emissions and better food security) (WRAP, 2015). All of the above
mechanisms for value creation are enabled by the power of pure inputs (EMF and McKinsey
& Co, 2012). For materials to circulate properly within technical and biological cycles, their
purity and quality are essential features. These can be maintained if aspects such as design for
disassembly, ease of identification of components and exclusion of any toxic materials is
observed, with after-use collection improved so that contamination is avoided.
The sources of value creation have major implications for SCM. Most supply chains
are still linear in structure, with increased globalisation of business operations meaning that
products components are sourced worldwide (Preston, 2012; Velis, 2015; WEF et al., 2014).
This could represent a barrier to the recovery of materials, since the points of manufacture and
use are located in different and often very distant regions. While closing the loop across
global supply chains is still in its early stages and when implemented will involve high value
products, it seems that it is within regional and local loops that the majority of opportunities
14
for the development of CSCs lies because of the reduced geographic barriers (WEF et al.,
2014). This is not surprising considering that the CE takes its inspiration from the functioning
of living systems. Here, cyclical patterns are not only closed and thus waste is turned into
food, but they are also local and decentralised (Nielsen and Müller, 2009). For example: the
blossoms of a cherry tree bring forth a new generation of cherry trees while also providing
food for micro-organisms, which in turn nourish the soil and support the growth of future
plant-life’ (Braungart et al., 2007: 1342). On the other hand, within socio-economic systems,
cycles of materials have become increasingly global and open with significant levels of
leakage (Nielsen and Müller, 2009). Such ‘linear lock-in’ and geographic barriers raise
important questions for the development of CSCs. For instance, could small-medium
enterprises (SMEs) break linear lock-in because their size provides an in-built structural
flexibility? And, are CSCs more likely to be developed from start-ups rather than from large
incumbent firms attempting to transition their existing supply chains, where regional or local
businesses may offer a better chance for CE adoption? Recent research shows that it is start-
ups that may offer the greatest potential for sustainable business model innovations (Bocken
et al., 2016a). In addition, regional/local CSCs would be in line with the developing concept
of redistributed manufacturing, which consists of reshoring large-scale manufacturing sites to
more local, smaller ones (Prendeville et al., 2016). Redistributed manufacturing is crucial to a
more sustainable manufacturing industry and clearly intertwined with the CE, with one city
based project analysing the impact of localised and small-scale manufacturing plants on UK
city resilience (Freeman et al., 2016). Hence, the second proposition:
P
2
: CSCs requires structural flexibility and reduced geographic barriers with SMEs and
innovators within regional/local loops playing an important role in their implementation.
The introduction of new actors and subcontractors as shorter product cycle loops are
introduced means new risks for conventional supply chains. As the CE model advocates more
cascaded use, horizontal collaboration across traditionally competing supply chains will
emerge, introducing challenges around ‘coopetition’ and difficult decisions over whether to
share knowledge of material reprocessing, design and/or technology. Greater flexibility may
be required in the future as buyers and suppliers choose to collaborate via inter-connected
knowledge networks, rather than in-house R&D or stand-alone supply chain partnerships. On
the other hand, the downside of flexibility i.e. asset underutilization, may be minimized if
assets can be shared and reused for other purposes, as is the case for wooden pallets for
15
example, but this may require greater level of product standardization to minimize process
redesign for adaptation towards asset re-use.
CSCs expand the range of environmental and economic value that is created beyond
those attainable within so-called closed-loop supply chains. As noted earlier, the power of
cascaded use suggests that value creation stems from flowing materials across different
supply chains (EMF and McKinsey & Co, 2012). For instance, textiles can be designed
without the use of chemical substances and when reuse is no longer possible, natural fibres
can be used as secondary raw material serving insulation and filling purposes eventually
returning to nature at the end of their useful life (ibid). Cascading materials across different
supply chains creates additional revenue streams via selling secondary raw materials that can
be used for the manufacturing of a different product and thus expanding further downstream a
company’s supply chain. In addition, due to increased environmental regulation, resource
price volatility and supply risks, the providers of high quality secondary raw materials may
gain competitive advantage (Lacy and Rutqvist, 2015). Hence, the third proposition:
P
3
: CSCs must consider both closed and open material loops in technical and biological
cycles.
SCM professionals should view value not only in terms of a reduced waste approach
(i.e. Lean), but in how shorter loops can maximise the value of materials use and productivity.
More co-operative customer and supplier relationships during downstream collection and
return will help extend product life as their use is cascaded across further cycles of repair,
reuse, refurbish etc. This means different incentives will be needed to encourage customers
and suppliers to engage in material return, invest in remanufacturing, and generally improve
the overall quality of material input.
The opportunities for value creation identified in the powers of the inner loop, of
circling longer and of cascaded use can be captured if the principles relating to the power of
pure inputs are implemented first (EMF and McKinsey & Co, 2012). In a CE, the design of
products acknowledges technical and biological cycles. Therefore, CSCs could be
implemented only if products are designed in accordance with the requirements of these
cycles. A significant change in design practices is therefore crucial to implement CSCs (De
los Rios and Charnley, 2016). Design for a CE should be incorporated in the early stages of
the design process since product specifications cannot be modified easily once they are
defined (Bocken et al., 2016b). The resulting supply chains would be in contrast with
traditional closed-loop supply chains where returning products are not intentionally designed
16
and thus manufactured to enable closing the loop (Lieder and Rashid, 2016; Rashid et al.,
2013). Hatcher et al., (2011) argue that despite increasing attention devoted to design for
remanufacture, there is neither uptake in this type of design or of remanufacturing activities.
Nasr (2016) laments the lack of significant scale in global remanufacturing, with Souza
(2013) confirming that the relationship between new product design and recovery at end-of-
life is an area that merits further exploration. After the RSA’s launch of the Great Recovery
Project, it was concluded that the design of our products is far from being circular ready
(RSA, 2016: 5) where only a few products are designed for full end-of-life recovery (e.g.
upcycling). Further, when better designs do appear, the lack of a sound business case may
prevent the necessary investment from taking place (ibid). The RSA identifies four design
typologies that would enhance the circularity of products, namely: design for longevity,
design for service, design for re-use in manufacture, and design for material recovery (RSA,
2016: 14). If these design strategies are combined both resource reutilization within
production processes and higher durability are achieved (Lacy and Rutqvist, 2015). Similarly,
Bocken et al., (2016b) and Lieder and Rashid (2016) have argued that business model
innovation and product design strategies are needed to support the transition towards a CE
with Bocken and colleagues identifying several design strategies for ‘slowing resource loops’,
enabling the slowdown in the rate of resource utilization, and design strategies for ‘closing
resource loops’, enabling increased circularity in resource utilization. The first set of
strategies includes: design for reliability and durability, design for ease of maintenance and
repair, and design for upgradability and adaptability (Bocken et al., 2016b: 310). The second
set includes: design for a technological and biological cycle, as well as design for dis- and
reassembly (p. 311), which underlines the role of supplier involvement in CSCs.
Other issues affecting the application of the power of pure inputs are product
composition and after use collection. Ever more complex and novel materials which can be
difficult to identify and separate at the end-of-life stage are now used in the manufacturing
processes of products, with after-use collection methods often compromising the purity and
quality of materials (WEF et al., 2014). Both aspects; composition and after-use collection,
are negatively affecting the plastics industry. The lack of coordination within plastics supply
chains has hindered plastics circularity so far, with the consequence that 95% of plastic
packaging value is lost after its first use and creating significant negative environmental
externalities, for instance ‘there may be more plastic than fish in the ocean…by 2050(WEF
et al., 2016: 29).
Materials proliferation is developing faster than after-use sorting and
17
separation systems. The recent European Commission CE white paper confirms that there are
structural barriers to the uptake of secondary raw materials usage across Europe, such as the
uncertainty surrounding material composition, which the EC is committed to overcome
through the development of quality standards especially for plastics (EC, 2015). At the World
Economic Forum (January 2017), a ‘global plastic protocol’ was launched to start laying the
foundations of global standards for plastic packaging and after-use treatments (WEF et al.,
2017). Such challenges which relate to product design, composition and after-use collection
require the implementation of what Winkler (2011: 244) defines as ‘sustainable supply chain
networks’. These represent an extension of the traditional view of SCM, since multiple actors
(i.e. suppliers, customers, collection and sorting facility agents) are engaged in strategies
seeking to achieve not just cost efficiencies and customer satisfaction, but designing out the
concept of waste from the outset in the transition towards a CE (ibid). New suppliers and
customers bringing innovative ideas from outside the industry sector may be needed to fill
demand for returned products, such as in the carpet tile and composite textile sector
(Miemczyk et al., 2016). In the light of the discussion on pure inputs, designers should also
be incorporated in these networks, and regulators should facilitate the uptake of these
practices within the industry by devising standards for material composition and after use
treatment.
Clearly the CE requires a high degree of cooperation (Antikainen and Valkokari,
2016; Green Alliance, 2013), which is perhaps not surprising given the level of functioning
the CE is modeled on, similar to that of an ecosystem where both elements of competition and
cooperation is required to enable it to thrive (Sauvé et al., 2016). The Green Alliance, a
British think tank, has warned that the move to cooperate over the scaling up of circular
industrial systems is threatened by competition law, which may create unease in some
corporations over the decision to co-operate together (Green Alliance, 2013). This is not
because competition law prohibits collaboration, but because the law lends itself to various
interpretations over exactly what constitutes a monopoly, and where lawbreakers may incur
high penalties. Regulatory intervention at the government level and from the European
Commission is thus welcomed to provide clarity on the law so that it does not impede CE
collaboration (ibid). Hence the fourth proposition:
P
4
: CSCs are enabled by close supply chain collaboration with partners within and beyond
their immediate industrial boundaries, including suppliers, product designers and regulators.
18
In terms of innovation in the move towards CE, CSCs require a conceptual shift from
products and ownership, to access to services. CSCs are not only closed loop, but also open
with regard to the opportunity for materials to flow across different supply chains, and within
technical and biological cycles. New product development processes therefore will involve
suppliers as part of early supplier involvement, looking at new ways to extend product life
through additional of services and finding different uses for products as they reach the end of
the cascade (e.g. old car tyres converted to floor chippings). Ultimately, the way products and
supply chains are designed will reduce the demand for recycling, although a prolonged period
of transition involving the accommodation of ‘traditional, waste-based thinking’ is expected
before the full benefits of circular systems can take effect.
While manufacturing companies can develop their own CSCs and assist others
manufacturers in improving the circularity of their products by supplying recoverable
components, the contribution that the tertiary sector can bring towards the scaling up of more
CSCs cannot be overlooked. EMF and McKinsey & Co (2012) have argued that service
providing companies, as buyers of products, are important levers for the development of
circular business practices. Using their procurement policies, they not only could improve
efficiency in their own asset utilisation and thereby reducing the risks and the costs associated
with capital investments (e.g. leasing assets), but also promote the uptake of circular business
practices upstream of their own supply chains. For instance, suppliers could be asked to
reduce or use returnable packaging in their deliveries. The tertiary sector (i.e. services)
contribution to the development of more circular business practices could be very significant
considering that services account for over 70% of the EU’s gross domestic product and
employment (EC, 2016) and 78% of GDP in the USA (World Bank, 2017). Large service
organizations (e.g. health, finance) are particularly suited as their bargaining power and thus
ability to influence supplier behaviour is higher. Both private and public sectors could act as
levers for change, particularly the public sector with its large purchasing power (Walker and
Brammer, 2012) by stimulating demand for more sustainable products and services (Uyarra et
al., 2014). Public procurement across the EU accounts for 18% of the EU’s total GDP (EC,
2015) and thus the public sector as a whole could be a significant lever through its choice of
purchased goods (Correia et al., 2013). The European Commission’s recent CE paper seeks to
take action on green public procurement by revising or setting new standards that accord with
CE principles (EC, 2015). However, there is little research on whether service sector
procurement policies include circularity-based clauses. One example of buying guides for
19
European financial services shows that while there are requirements for recycling/takeback
for IT, this does not go much beyond current legal requirements (Johnsen et al., 2014).
Hence, the fifth and final proposition:
P
5
: Procurement policies both in the private and public sectors of service organizations are
an important lever for the transition to CSCs if they go beyond minimum legal requirements
to include the CE principles.
The issue of economies of scale will require more horizontal collaboration across
supply chains and between industrial sectors to maximise the opportunities for high volume
production. This aspect may require cross-industry standards via legislation, although is more
likely to emerge as voluntary cooperation between corporations.
Given the significant
contribution of services to GDP in western countries, involving the tertiary sector as well as
manufacturing is crucial in the transition towards the CE and CSCs. We raise the question
whether it is within more regional rather than global loops that CSCs are likely to be
developed, and where start-up companies and SMEs are likely to have the capability to drive
innovation towards CSCs and bypass the ‘linear lock-in’ of larger corporations. The issues
affecting the introduction of new product designs and after-use collection methods means that
traditional structures around supplier-manufacturer-customer must be extended to include
other actors such as designers, regulators and collection facilities for CSCs to succeed. The
‘global versus local’ debate is perhaps one of the biggest challenges facing the CE and
transition to CSCs, because of the difficulties over reaching a global-wide agreement whose
processes can be implemented at a local or regional level.
Table 4 Framework of CSC propositions
This section has presented CE thinking and discussed the implications for SCM
through our formulation of propositions, concluding each section by considering the
implications in terms of future challenges. Our framework of CSC propositions in table 4
builds on the elements of supply chain strategy, structure, flow, focus, scale and scope,
derived as themes from the literature review, reflecting the changes anticipated in SCM and
the shifts needed to achieve implementation. Such proposed changes to current models of
business practice will not occur overnight however, with some structural elements taking
20
longer across some sectors and requiring considerable effort and resources. In our conclusion,
we now summarize our contribution in terms of outcomes and propose a future research
agenda of opportunities to explore CSCs.
4. Conclusion
In this paper we have traced the origins of CE thinking and its more recent developments,
exploring traditional and sustainable SCM before considering the implications for what we
term CSCs. Our contribution is as follows: first, from the literature we distinguish and define
traditional, sustainable and circular supply chains. Second, given the limited attention that
supply chains have received in the context of the CE (Aminoff and Kettunen, 2016; Lieder
and Rashid, 2016), we propose five preliminary propositions as a framework which supports
CSCs and yield insights into the CE and SCM. Sustainable business models and SCM are
closely connected in the sense that the configuration of supply chains can affect the
development of a sustainable business model, and vice versa (Lüdeke-Freund et al., 2016).
Yet these two literature streams have a tendency to remain separated rather than inform each
other. By contrast, we start to lay the foundations for a more integrated discussion and to
consider what the implications are for SCM in a CE. Third, based on CE principles, we
discuss the key supply chain challenges facing managers, namely: extending the shifting
perceptions of value, mitigating risk through structural flexibility, introducing early supplier
innovation, more strategic services, and the issue of global vs. local distribution of
production.
In terms of a future research agenda, one major finding from our investigation was not
only the lack of literature bridging CE and SCM, but also very little information on the
practical side of how to introduce CSCs in a real-world context. Although cases on sector-
specific recycling and reverse logistics currently exist, there are no large-scale industrial
examples of CE principle adoption, hence the motivation for our study. We argue that the
concept of CSCs supported by propositions now provides a theoretical basis for a more
practical phase of investigation into the practicalities of widespread implementation. This is
increasingly relevant given the recent launch of the European Union’s ‘Circular Economy
Package’ and the 2017 release of British Standard 8001 ‘Framework for implementing
Circular Economy principles in organizations’.
21
It may also be appropriate to consider policy implications for the scaling-up of CSCs,
specifically from an energy perspective. Stahel and Reday-Mulvey (1981) observed that two-
thirds of energy consumption in the construction industry takes place during the extraction of
raw materials (e.g. steel). Consequently, the substitution of virgin raw materials with
secondary raw materials could lead to significant energy savings. Though the CE reduces
virgin materials consumption, is less wasteful and thus less energy intensive than a linear
economy (EMF and McKinsey & Company, 2012; ZWS, 2015), some recycling processes are
either energy intensive (e.g. recycling of chemicals) (Bjørn and Hauschild, 2013; Rammelt
and Crisp, 2014) or in other cases (e.g. glass recycling) demand almost the same amount of
energy as that needed for the production from virgin materials (Allwood, 2014). Despite the
CE relying only on renewable energy (EMF and McKinsey & Co, 2012), recycling and
reprocessing facilities need reliable energy sources to run consistently (Remsol, 2014). One of
the problems of renewable energy is intermittent supply due to variation in weather conditions
(Parente and Feola, 2015), though energy storage may offer a solution (Miser, 2015).
Questions remain however over the appropriate energy mix that can satisfy CE requirements.
The tertiary or services sector is another relevant opportunity to advance research at
the intersection between SCM and the CE. Service providers can be an important lever in the
development of CE-oriented practice in the business context as buyers of products (EMF and
McKinsey & Co, 2012). The service sector has received little attention compared to
manufacturing companies in corporate sustainability studies (Etzion, 2007; Maas et al., 2014).
The scaling-up of more circular business models and thereby of CSCs is also dependent upon
funding to enable investment in infrastructures, new technologies and research in alternative
and renewable materials. Yet the financing of circular business models is not without
challenges because of the different forms of capital needed, types of business model
implemented and cash flow changes in companies, as in the case of usage or performance
based contracts (ING, 2015). Access to financial resources therefore is one of the key
obstacles encountered in the setting up of circular business models (Roos, 2014).
Crowdfunding is one emerging approach which may suit the more collaborative approach to
business growth as envisaged by the CE, hence future studies could explore developments in
the financial sector that lift barriers which prevent circular business models from gaining
access to capital investment.
22
While we acknowledge the limitations of this paper in terms of its almost exclusive
basis on the literature (both scholarly and practitioner based), we encourage other scholars to
continue and extend our work into the realms of practical CE implementation, using empirical
research and case study investigations to demonstrate the role of supply chain innovation in
the transition towards the CE. This paper adopts a western perspective, yet for China and
India the CE represents a significant opportunity. Some argue that it is in China where
implementation of the CE is most advanced (Murray et al., 2015), and recent research shows
that India could benefit from CE implementation by 624 billion dollars per year in 2050
(EMF, 2016). Our ultimate aim is to encourage other investigators to test these concepts and
propositions, offering further insights into the potential of the CE and advance our
understanding of supply chain practice and theory.
References
Accenture. (2014). Circular Advantage: Innovative Business Models and Technologies to
Create Value in A World Without Limits to Growth. www.accenture.com
Allwood, J. (2014). Squaring the Circular Economy: The Role of Recycling Within a
Hierarchy of Material Management Strategies. In: Worrell, E., Reiter, M. (Eds.),
Handbook of Recycling, State-of-the-Art for Practitioners Analysts, and Scientists.
Elsevier, Amsterdam.
Aminoff, A., and Kettunen, O. (2016). Sustainable Supply Chain Management in a Circular
Economy. In: Setchi, R., Howlett, R., Liu, Y., and Theobald, P. (Eds.), Sustainable
Design and Manufacturing (p. 61-72). Springer.
Antikainen, M., and Valkokari, K. (2016). A Framework for sustainable circular business
model innovation. Technology Innovation Management Review, 6, 5-12.
Balu, A., Budarin, V., Shuttleworth, P., Pfaltzgraff, L., Waldron, R., and Clark, J. (2012).
Valorisation of Orange Peel Residues: Waste to Biochemicals and Nanoporous Materials.
ChemSusChem, 5, 1694-1697.
Bell, J.E., Mollenkopf, D.A. and Stolze, H. (2013). Natural Resource Scarcity and the Closed-
Loop Supply Chain: A Resource-Advantage View. International Journal of Physical
Distribution & Logistics Management, 43 (5/6), 351-379.
Benyus, J. (2002). Biomimicry: Innovation Inspired by Nature (2nd Edition ed.). Harper
Perennial.
Bjørn, A., and Hauschild, M. (2013). Absolute Versus Relative Environmental Sustainability.
What Can the Cradle-to-Cradle and Eco-Efficiency Concepts Learn From Each Other?
Journal of Industrial Ecology, 17, 321-332.
Bocken, N., Weissbrod, I., and Tennant, M. (2016a). Business model experimentation for
sustainability. In: Setchi, R., Howlett, R., Liu, Y., and Theobald, P. (Eds.), Sustainable
Design and Manufacturing (p. 297-306). Springer
23
Bocken, N., de Pauw, I., Bakker, C., and van der Grinten, B. (2016b). Product Design and
Business Model Strategies for a Circular Economy. Journal of Industrial and Production
Engineering, 33 (5), 308-320.
Bocken, N., and Short, S. (2016). Towards a Sufficiency-Driven Business Model:
Experiences and Opportunities. Environmental Innovation and Societal Transitions, 18,
41-61.
Boulding, K. (1966). The Economics of The Coming Spaceship Earth. In: H. Jarrett (Ed.),
Environmental Quality in A Growing Economy (pp. 3-14). Baltimore MD: Resources for
the Future/Johns Hopkins University Press.
Braungart, M., McDonough, W., and Bollinger, A. (2007). Cradle-to-cradle Design: Creating
Healthy Emissions - A Strategy for Eco-effective Product and System Design. Journal of
Cleaner Production, 15, 1337-1348.
Carter, C. R., and Rogers, D. S. (2008). A Framework of Sustainable Supply Chain
Management: Moving Toward New Theory. International Journal of Physical
Distribution & Logistics Management, 38(5), 360-387.
Chertow, M. (2000). Industrial symbiosis: Literature and taxonomy. Annual Reviews of
Energy and Environment, 25, 313-337.
CISL (Cambridge Institute for Sustainable Leadership). (2015). Rewiring the Economy.
Retrieved 2015 August: from www.cisl.cam.ac.uk
Christopher, M. (1998). Logistics and Supply Chain Management: Strategies for Reducing
Cost and Improving Service. 2
nd
Edition. FT: Prentice Hall. Harlow, England UK.
Christopher, M. (2000). The Agile Supply Chain: Competing in Volatile Markets. Industrial
Marketing Management, 29 (1), 37-44.
Christopher, M., and Holweg, M. (2011). “Supply Chain 2.0”: Managing Supply Chains in
the Era of Turbulence. International Journal of Physical Distribution & Logistics
Management, 41(1), 63-82.
Christopher, M. (2005). Logistics and Supply Chain Management: Creating Value-Adding
Networks. 3
rd
Edition. FT: Prentice Hall. Harlow, England UK.
Cooper, M. C., and Ellram, L. M. (1993). Characteristics of supply chain management and the
implications for purchasing and logistics strategy. The International Journal of Logistics
Management, 4 (2), 13-24.
Cooper, M. C., Lambert, D. M., and Pagh, J. D. (1997). Supply Chain Management: More
Than A New Name For Logistics. The International Journal of Logistics Management, 8
(1), 1-14.
Correia, F., Howard, M., Hawkins, B., Pye, A., and Lamming, R. (2013). Low Carbon
Procurement: An Emerging Agenda. Journal of Purchasing and Supply Management, 19
(1), 58-64.
DECC (Department for Energy and Climate Change), DEFRA (Department for Environment,
Food and Rural Affairs). (2011). Anaerobic Digestion Strategy and Action Plan.
Retrieved 2015 October from http://www.gov.uk/government/publications/anaerobic-
digestion- strategy-and-action-plan.
De los Rios, C., and Charnley, F. (2016). Skills and capabilities for a sustainable and circular
economy: The changing role of design. Journal of Cleaner Production (in press).
Defee, C. and Stank, T. P. (2005). Applying the strategy-structure-performance paradigm to
the supply chain environment. The International Journal of Logistics Management,
16(1), 28-50.
24
Denyer, D. and Tranfield, D. (2009). Producing a systematic review. In Buchanan, D.A. &
Bryman, A. (eds), The Sage Handbook of Organizational Research Methods, Sage
Publications, London, 671-689.
EC (European Commission) (2015). Circular Economy Package: Questions and Answers.
Retrieved 2015 December from http://europa.eu/rapid/press-release_MEMO-15-
6204_en.htm
EC (2016). Single Market for Services. Retrieved 2016 May from
http://ec.europa.eu/growth/single-market/services/index_en.htm.
The Economist (2009) Britain’s lonely high-flier. January 10
th
. (p.62-64).
Elkington, J. (1998), Cannibals with Forks: The Triple Bottom Line of the 21st Century. New
Society Publishers, Stoney Creek, CT.
Elkington, J. (2004), “Enter the triple bottom line”, in Henriques, A. and Richardson, J. (Eds),
The Triple Bottom Line: Does It All Add up?, Earthscan, London, pp. 1-16.
EMF (Ellen MacArthur Foundation), and McKinsey & Co. (2012). Towards the Circular
Economy: Economic and Business Rationale for an Accelerated Transition. Retrieved
2013 May from http://www.ellenmacarthurfoundation.org/business/reports
EMF, and McKinsey & Company. (2013). Towards the Circular Economy: Opportunities for
the Consumer Goods Sector. Retrieved 2013 November from
http://www.ellenmacarthurfoundation.org/business/reports.
EMF, McKinsey & Company and SUN. (2015). Growth Within: A Circular Economy Vision
for a Competitive Europe. Retrieved 2015 July from:
http://www.ellenmacarthurfoundation.org/books-and-reports.
EMF (2016). Circular Economy in India: Rethinking growth for long-term prosperity.
Retrieved December 2016 from http://www.ellenmacarthurfoundation.org/publications/.
Etzion, D. (2007). Research on Organizations and Natural Environment, 1992-Present: A
Review. Journal of Management, 33 (4), 637-664.
Fleischmann, M., Bloemhof-Ruwaard, J. M., Dekker, R., Van der Laan, E., Van Nunen, J. A.,
and Van Wassenhove, L. N. (1997). Quantitative Models for Reverse Logistics: A
Review. European Journal of Operational Research, 103 (1), 1-17.
Franklin-Johnson, E., Figge, F., and Canning, L. (2016). Resource Duration as a Managerial
Indicator for Circular Economy Performance. Journal of Cleaner Production, 133, 589-
598.
Freeman, R., McMahon, C., and Godfrey, P. (2016). Design of an integrated assessment of re-
distributed manufacturing for the sustainable, resilient city. In: Setchi, R., Howlett, R.,
Liu, Y., and Theobald, P. (Eds.), Sustainable Design and Manufacturing (pp. 601-612).
Springer
Frosch, R., and Gallopoulos, N. (1989). Strategies for Manufacturing. Scientific American,
261 (3), 94-102.
Geissdoerfer, M., Savaget, P., Bocken, N., and Hultink, E. (2017). The circular economy – A
new sustainability paradigm? Journal of Cleaner Production, 143, 757-768.
Genovese, A., Acquaye, A., Figueroa, A., and Koh, L. (2017). Sustainable Supply Chain
Management and the Transition Towards a Circular Economy: Evidence and Some
Applications. Omega, http://dx.doi.org/10.1016/j.omega.2015.05.015i.
25
Ghisellini, P., Cialani, C., and Ulgiati, S. (2016). A Review on Circular Economy: The
Expected Transition to a Balanced Interplay of Environmental and Economic Systems.
Journal of Cleaner Production, 114, 11-32.
Gorissen, L., Vrancken, K., and Manshoven, S. (2016). Transition thinking and business
model innovation-Towards a transformative business model and new role for the reuse
centers of Limburg, Belgium. Sustainability, 8, 1-23.
Green Alliance. (2013). Resource Resilient UK. A Report from the Circular Economy Task
Force. Retrieved 2015 April from http://www.green-alliance.org.uk
Gregson, N., Crang, M., Fuller, S., and Holmes, H. (2015). Interrogating the circular
economy: the moral economy of resource recovery in the EU. Economy and Society, 44,
218-243.
Govindan, K., Soleimani, H., and Kannan, D. (2015). Reverse Logistics and Closed-Loop
Supply Chain: A Comprehensive Review to Explore the Future. European Journal of
Operational Research, 240(3), 603-626.
Guide, V. and Daniel R. (2000). Production Planning and Control for Remanufacturing:
Industry Practice and Research Needs. Journal of Operations Management 18, 4: 467-
483.
Guide, V. D. R., Harrison, T. P., and Van Wassenhove, L. N. (2003). The Challenge of
Closed-Loop Supply Chains. Interfaces, 33(6), 3-6.
Guide, V. D. R., and Van Wassenhove, L. N. (2003). Closed-Loop Supply Chains: Practice
and Potential. Interfaces, 33(6), 1-2.
Guide, V. D. R. and Van Wassenhove, L. N. (2009). The Evolution of Closed-Loop Supply
Chain Research, Operations Research, 57, 10–18.
Handfield, R. B., and Bechtel, C. (2002). The Role of Trust and Relationship Structure in
Improving Supply Chain Responsiveness. Industrial marketing management, 31(4), 367-
382.
Haake, H., and Seuring, S. (2009). Sustainable Procurement of Minor Items–Exploring Limits
to Sustainability. Sustainable Development, 17(5), 284-294.
Harland, C. M. (1996). Supply Chain Management: Relationships, Chains and Networks.
British Journal of Management, 7 (1), 63-80.
Hart, S. L., and Dowell, G., (2011). A Natural Resource-based View of the firm: Fifteen
Years After. Journal of Management, 37 (5), 1464-1479.
Hatcher, G., Ijomah, W., and Windmill, J. (2011). Design for Remanufacture: A Literature
Review and Further Research Needs. Journal of Cleaner Production, 19, 2004-2014.
Hawken, P., Lovins, A., and Lovins, L. (2010). Natural Capitalism: The Next Industrial
Revolution (10th anniversary ed.). Routledge.
Hines, P., Lamming, R., Jones, D., Cousins, P., and Rich, N. (2000). Value stream
management: Strategy and excellence in the supply chain. Financial Times Prentice Hall.
Hines, P., Holweg, M. and Rich, N. (2004). Learning to Evolve: A Review of Contemporary
Lean Thinking. International Journal of Operations & Production Management. 24 (10).
994-1011.
Holgado, M., Morgan, D., and Evans, S. (2016). Exploring the scope of industrial symbiosis:
Implications for practitioners. In: Setchi, R., Howlett, R., Liu, Y., and Theobald, P.
(Eds.), Sustainable Design and Manufacturing (pp. 169-178). Springer.
Holweg, M. (2005). The Three Dimensions of Responsiveness. International Journal of
Operations & Production Management, 25(7), 603-622.
26
Hopkinson, P., Zils, M., and Hawkins, P. (2016). Challenges and Capabilities for Scaling Up
Circular Economy Business Models. A Change Management Perspective. In Ellen
MacArthur Foundation (Eds.) A New Dynamic 2 Effective Systems in a Circular
Economy. Ellen MacArthur Foundation Publishing (p.157-176).
Hult, G. T. M., Ketchen, D. J., and Arrfelt, M. (2007). Strategic Supply Chain Management:
Improving Performance Through a Culture of Competitiveness and Knowledge
Development. Strategic Management Journal, 28(10), 1035-1052.
ING (2015). Rethinking Finance in a Circular Economy. Retrieved September 2016 from
https://www.ingwb.com/media/1149417/ing-rethinking-finance-in-a-circular-economy-
may-2015.pdf
Insanic, I., and Gadde, L. E. (2014). Organizing Product Recovery in Industrial Networks.
International Journal of Physical Distribution & Logistics Management, 44(4), 260-282.
Jayaraman, V., Guide Jr, V. D. R., and Srivastava, R. (1999). A Closed-Loop Logistics Model
for Remanufacturing. Journal of the Operational Research Society, 497-508.
Johnsen, T., Howard, M., and Miemczyk, J. (2014). Purchasing and Supply Chain
Management: A Sustainability Perspective. Routledge: UK.
King, A. and Lenoz, M. (2001). Lean and Green? An Empirical Examination of the
Relationship between Lean Production and Environmental Performance. Production &
Operations Management. 10 (3), 455-471.
Krikke, H., Hofenk, D. and Wang, Y. (2013), Revealing an Invisible Giant: A Comprehensive
Survey into Return Practices Within Original (closed-loop) Supply Chains, Resources,
Conservation and Recycling, 73, 239-250.
Kumar, S., and Malegeant, P. (2006). Strategic Alliance in a Closed-Loop Supply Chain, A
Case of Manufacturer and Eco-Non-Profit Organization. Technovation, 26(10), 1127-
1135.
Lacy, P. and Rutqvist, J. (2015). Waste to Wealth: The Circular Economy Advantage.
Palgrave Macmillan: NY.
Lamming, R., Johnsen, T., Zheng, J., and Harland, C. (2000). An Initial Classification of
Supply Networks. International Journal of Operations & Production Management,
20(6), 675-691.
Ledvance (2015). Pay-as-you-go lighting arrives at Amsterdam's Schiphol Airport.
http://luxreview.com/article/2015/04/
Lieder, M., and Rashid, A. (2016). Towards Circular Economy Implementation: A
Comprehensive Review. Journal of Cleaner Production, 115, 36-51.
Lewandowski, M. (2016). Designing the Business Models for Circular Economy. Towards
the Conceptual Framework. Sustainability, 8 (43), 1-28.
Lifset, R., and Boons, F. (2012). Industrial Ecology: Business Management in A Material
World. In P. Bansal, & A. Hoffman (Eds.). Oxford Handbook of Business and Natural
Environment (pp. 311-326). Oxford Handbook Online.
Linton, J., Klassen, R., and Jayaramman, V. (2007). Sustainable Supply Chains: An
Introduction. Journal of Operations Management, 25, 1075-1082.
Loomba, A. P., and Nakashima, K. (2012). Enhancing value in reverse supply chains by
sorting before product recovery. Production Planning & Control, 23(2-3), 205-215.
Lovins, A., Lovins, L., and Hawken, P. (1999). A Road Map for Natural Capitalism. Harvard
Business Review, May-June 1999, 145-158.
27
Lüdeke-Freund, F., Gold, S., and Bocken, N. (2016). Sustainable Business Model and Supply
Chain Conceptions – Towards an Integrated Perspective. In Bals, L. and Tate, W. (Eds.):
Implementing Triple Bottom Line Sustainability into Global Supply Chains (pp. 337-363).
Sheffield: Greenleaf.
Maas, S., Schuster, T., and Hartmann, E. (2014). Pollution Prevention and Service
Stewardship Strategies in the Third-Party Logistics Industry: Effects on Firm
Differentiation and the Moderating Role of Environmental Communication. Business
Strategy & the Environment, 23, 38-55.
McDonough, W. and Braungart, M. (2002). Cradle to Cradle: Remaking the way we make
things. North Point Press: NY.
McKinsey & Company. (2016). Sustainability & resource productivity. Retrieved November
2016 from http://www.mckinsey.com/business-functions/sustainability-and-resource-
productivity/our-insights/mckinsey-on-sustainability-and-resource-
productivity/mckinsey-on-sustainability-and-resource-productivity-number-4.
Miemczyk, J., Howard, M. and Johnsen, T. 2016. Dynamic development and execution of
closed-loop supply chains: a natural resource-based view. Supply Chain Management: An
International Journal. 21 (4). 453-469.
Mollenkopf, D., Stolve, H., Tate, W. and Ueltschy, M. (2010). Green, Lean, and Global
Supply Chains. International Journal of Physical Distribution & Logistics Management.
40 (1/2), 14-41.
Miser, T. (2015). The Benefits of Energy Storage in an Era of Renewable Resources. Power
Engineering, 119, 42-45.
Murray, A., Skene, K., and Haynes, K. (2015). The Circular Economy: An Interdisciplinary
Exploration of the Concept and Application in a Global Context. Journal of Business
Ethics, DOI 10.1007/s10551-015-2693-2, 1-12.
Nasir, M. H. A., Genovese, A., Acquaye, A., and Koh, S. (2016). Comparing linear and
circular supply chains: A case study from the construction industry. International Journal
of Production Economics, http://dx.doi.org/10.1016/j.ijpe.2016.06.008i
Nasr, N. (2016). Remanufacturing and the Circular Economy. In Ellen MacArthur Foundation
(Eds.) A New Dynamic 2 Effective Systems in a Circular Economy. Ellen MacArthur
Foundation Publishing (p.107-128).
Nasr, N., and Thurston, M. (2006). Remanufacturing: A Key Enabler to Sustainable Product
Systems. Proceedings of the 13th CIRP International Conference on Life Cycle
Engineering – Towards a Closed Loop Economy, Leuven.
Nielsen, S., and Müller, F. (2009). Understanding the Functional Principles of Nature -
Proposing Another Type of Ecosystem Services. Ecological Modelling 220, 1913-1925.
Parente, R., and Feola, R. (2015). The Renewable Energy Industry: Competitive Landscapes
and Entrepreneurial Roles in Kyrö, P. (Eds.) Handbook of Entrepreneurship and
Sustainable Development Research Cheltenham: Edward Elgar Publication (p299-320).
Pauli, G. (2010). The blue economy: 10 years, 100 innovations, 100 million Jobs. Taos, NM:
Paradigm Publications.
Pearce, D., and Turner, R. (1990). Economics of Natural Resources and The Environment.
Harvester Wheatsheaf London.
PPC: Production Planning & Control: The Management of Operations. Call for Papers:
Supply Chain Operations for a Circular Economy. http://exploretandfonline.com.
28
Prendeville, S., Hartung, G., Purvis, E., Brass, C., and Hall, A. (2016). Makespaces: From
redistributed manufacturing to a circular economy. In: Setchi, R., Howlett, R., Liu, Y.,
and Theobald, P. (Eds.), Sustainable Design and Manufacturing (p.577-588). Springer.
Preston, F. (2012). A Global Redesign? Shaping the Circular Economy. Retrieved 2014
March from http://www.chathamhouse.org/publications/papers/view/182376.
Rammelt, C., and Crisp, P. (2014). A Systems and Thermodynamics Perspective on
Technology in the Circular Economy. Real World Economic Review, 68, 25-40.
Rashid, A., Asif, F., Krajnik, P., and Nicolescu, C. (2013). Resource Conservative
Manufacturing: An Essential Change in Business and Technology Paradigm for
Sustainable Manufacturing. Journal of Cleaner Production, 57, 166-177.
Remsol. (2014). Powering the Circular Economy: Why the Right Energy Policy is Vital to
Success. Retrieved: Nov 2015 from http://www.mrw.co.uk/Journals/2014/10
/10/h/f/y/ 20141009-Powering-the-circular-economy.pdf.
Roos, G. (2014). Business Model Innovation To Create and Capture Resource Value in Future
Circular Material Chains. Resources, 3, 248-274.
RSA (Royal Society for the Encouragement of Arts, Manufactures and Commerce). (2013).
Investigating the Role of Design in the Circular Economy. Executive Summary.
Retrieved 2015 June from http://www.greatrecovery.org.uk/resources/.
RSA (2016). Designing for a Circular Economy: Lessons from the Great Recovery 2012-
2016. Retrieved 2016 May from http://www.greatrecovery.org.uk/resources/new-report-
lessons-from-the-great-recovery-2012-2016/.
Sarkis, J., Zhu, Q. and Lai, K. H. (2011), An Organizational Theoretic Review of Green
Supply Chain Management Literature. International Journal of Production
Economics,130(1),1-15.
Sauvé, S., Bernard, S., and Sloan, P. (2016). Environmental Sciences, Sustainable
Development and Circular Economy: Alternative Concepts for Trans-disciplinary
Research. Environmental Development, 17, 48-56.
Savaskan, R. C., Bhattacharya, S., and Van Wassenhove, L. N. (2004). Closed-Loop Supply
Chain Models With Product Remanufacturing. Management Science, 50(2), 239-252.
Schulte, U. (2013). New Business Models for a Radical Change in Resource Efficiency.
Journal of Environmental Innovation and Societal Transitions, 9, 43- 47.
Seuring, S. (2004). Industrial ecology, life cycles, supply chains: differences and
interrelations. Business strategy and the Environment, 13(5), 306.
Seuring, S., and Müller, M. (2008). From a Literature Review to a Conceptual Framework for
Sustainable Supply Chain Management. Journal of Cleaner Production, 16(15), 1699-
1710.
Short, S., Bocken, N., Barlow, C., and Chertow, M. R. (2014). From Refining Sugar to
Growing Tomatoes. Industrial Ecology and Business Model Evolution. Journal of
Industrial Ecology, 18 (5), 603-618.
Simpson, D. and Power, D. (2005). Using the Supply Relationship to Develop Lean and
Green Suppliers. Supply Chain Management: An International Journal. 10 (1), 60-68.
Souza, G. (2013). Closed-Loop Supply Chains: A Critical Review and Future Research.
Decisional Sciences Journal, 44, 7-38.
Spengler, T., and Schröter, M. (2003). Strategic Management of Spare Parts in Closed-Loop
Supply Chains - A System Dynamics Approach. Interfaces, 33(6), 7-17.
29
Stahel, W. (2006). The Performance Economy (2nd Ed). Palgrave Macmillan.
Stahel, W., and Reday-Mulvay, G. (1981). Jobs for Tomorrow: the Potential for Substituting
Manpower for Energy. Vantage Press.
Thierry, M., Salomon, M., Van Nunen, J., and Van Wassenhove, L. (1995). Strategic Issues in
Product Recovery Management. California Management Review, 37(2), 114-135.
Timmermans, K. (2016). Digital Supply Chains Connect Circular Economy. Logistics
Management, May 2016, 18-19.
Tranfield D, Denyer D and Smart, P. (2003). Towards a methodology for developing
evidence-informed management knowledge by means of systematic review. British
Journal of Management, 14 (3), 207-222.
Tukker, A. (2015). Product Services for a Resource-Efficient and Circular Economy–A
Review. Journal of cleaner production, 97, 76-91.
Tukker, A., and Tischner, U. (2006). Product-services as a Research Field: Past, Present and
Future. Reflections from a Decade of Research. Journal of Cleaner Production, 14 (17),
1552-1556.
UNEP (United Nations Environment Programme). (2010). ABC of SCP. Clarifying Concepts
on Sustainable Consumption and Production. Retrieved 2015 from:
http://www.unep.org/resourceefficiency/Portals/24147/scp/go/pdf/ABC_ENGLIS H.pdf
Uyarra, E., Edler, J., Garcia-Estevez, J., Georghiou, L., and Yeow, J., 2014. Barriers to
Innovation Through Public Procurement: A Supplier Perspective. Technovation 34, 631–
645.
Van Hoek, R. I. (1999). Postponement and the Reconfiguration Challenge for Food Supply
Chains. Supply Chain Management: An International Journal, 4(1), 18-34.
Velis, C. (2015). Circular Economy and Global Secondary Material Supply Chains. Waste
Management & Research, 33 (5), 389-391.
Walker, H., and Brammer, S., 2012. The Relationship Between Sustainable Procurement and
E-Procurement in the Public Sector. International Journal of Production Economics, 140,
256–268.
Webster, K. (2013). What Might We Say About a Circular Economy? Some Temptations to
Avoid if Possible. World Futures, 69, 542-554.
Webster, K. (2015). The Circular Economy: A wealth of Flow. Ellen MacArthur Pub. Cowes:
UK.
WEF (World Economic Forum), EMF and McKinsey & Company. (2014). Towards the
Circular Economy: Accelerating the scale-up across global supply chains. Retrieved
2014 March from http://ellenmacarthurfoundation.org/business/reports
WEF, EMF, and McKinsey & Company. (2016). The New Plastics Economy - Rethinking the
Future of Plastics. Retrieved 2016 March from
http://www.ellenmacarthurfoundation.org/publications.
WEF, EMF, and SYSTEMIQ (2017). The new plastics economy: Catalysing action.
Retrieved January 2017 from http://www.ellenmacarthurfoundation.org/publications/.
Wells, P., and Seitz, M. (2005). Business Models and Closed Loop Supply Chains: A
Typology. Supply Chain Management: An International Journal, 10, 249-251.
Winkler, H. (2011). Closed-loop Production Systems: A Sustainable Supply Chain Approach.
CIRP Journal of Manufacturing Science and Technology, 4, 243-246.
30
World Bank (2017) http://data.worldbank.org/indicator/NV.SRV.TETC.ZS, accessed
2/2/2017.
Womack, J. P., and Jones, D. T. (1994). From Lean Production to Lean Enterprise. Harvard
Business Review, 72(2), 93-103.
Womack, J. P. and Jones, D. T. (1996). Beyond Toyota: How to Root Out Waste and Pursue
Perfection. Harvard Business Review. Sept/Oct, 140-144.
Womack, J. P. and Jones, D. T. (2003). Lean Thinking: Banish Waste and Create Wealth in
Your Corporation. 2
nd
Edition. Free Press, Simon & Schuster, New York: NY.
Womack, J. P. and Jones, D. T. (2005). Lean Consumption. Harvard Business Review, 1-11.
March.
WRAP (Waste and Resource Action Plan). (2015). Strategies to Achieve Economic and
Environmental Gains by Reducing Food Waste. Retrieved: 2015 October
from http://www.wrap.org.uk/sites/files.
Yuan, Z., Bi, J., and Moriguichi, Y. (2006). The Circular Economy: A new Development
Strategy in China. Journal of Industrial Ecology, 10(12), 4-8.
ZWS (Zero Waste Scotland). (2015). The Carbon Impacts of the Circular Economy.
Retrieved: Sept 2015, http://www.zerowastescotland.org.uk/CarbonImpactsOfThe
CircularEconomy.
31
Figure 1: Trends in number of publications linking CE and SCM by year
32
Figure 2: Traditional, sustainable and circular supply chains
33
Table 1: Journals used in the review
Journal Title No.
Business Strategy & the Environment 2
Chinese Management Studies 2
Comparative Economic Research 1
Ecological Economics 1
Economic Horizons 1
Economy & Society 1
Environmental Science & Technology 1
Greener Management International 1
Habitat International 1
International Journal of Environmental Technology & Management 1
International Journal of Production Economics 4
Journal of Agricultural & Environmental Ethics. 1
Journal of Business & Industrial Marketing 1
Journal of Cleaner Production 21
Journal of Industrial Ecology 9
Journal of Transport Geography 1
Logistics Management 1
Omega 1
Supply Chain Management Review 1
Systems Research & Behavioral Science 1
Thunderbird International Business Review 1
Total: 54
34
Table 2 CE themes with implications for SCM
Theme Issue Key references
Business strategies Ownership models
Business Models
Leasing
Hawken et al., 2000
Aminoff and Kettunen, 2016
Lieder and Rashid, 2016
EMF and McKinsey & Co, 2012
Structures Closed loops
Cascaded Loops Braungart et al., 2007
EMF et al., 2015
EMF and McKinsey & Co, 2012; 2013
Flows Technical (long cycles)
Biological (short cycles) Lovins et al., 1999
Braungart et al., 2007
EMF and McKinsey & Co, 2012; 2013
Priorities Value capture, broad view of
value (natural capital) Murray et al., 2015; Schulte, 2013; EMF
et al., 2015
Scale and scope Cope with lower volumes
Local & decentralised WEF et al., 2014
Nielsen and Müller, 2009
35
Table 3 Key issues for SCM
Theme SSCM issue Key references
SC strategy Beyond a ‘cost & price’ focus
towards triple bottom line
Lean and green
Cost of ownership and lifecycle
Volatility risks
Seuring and Müller, 2008; Carter &
Rogers 2008
King and Lenox, 2001; Simpson and
Power 2005; Mollenkopf et al., 2010
Christopher and Holweg, 2011
SC structure Beyond connected dyads
Networks including non-economic
actors
Harland, 1996;
Flows Reverse logistics, Closed loop, global
flows of supply and waste products
(e.g. steel, e-waste)
Guide et al., 2003
Govindan et al., 2015
Spengler and Schröter, 2003
SC Priorities
and Focus Efficiency vs Effectiveness
Value (social, externalities)
Sarkis et al., 2011; Bell et al., 2013
36
Table 4 Framework of CSC propositions
Theme P
x
CSC proposition
Strategy P
1
Supply chain relationships will change in CSCs, shifting from product ownership towards
greater emphasis on leasing and service based strategies enabled by digital systems.
Structure P
2
CSCs require structural flexibility and reduced geographic barriers with SMEs and
innovators within regional/local loops playing an important role in their implementation.
Flow P
3
CSCs must consider both closed and open material loops in technical and biological
cycles.
Focus P
4
CSCs are enabled by close supply chain collaboration with partners within and beyond
their immediate industrial boundaries, including suppliers, product designers & regulators.
Scale &
Scope P
5
Procurement policies both in the private and public sectors of service organizations are an
important lever for the transition to CSCs if they go beyond minimum legal requirements
to include CE principles.
... The creation of collaborative networks is acknowledged in the literature as a key driver towards a circular economy (Brown et al., 2018;De Angelis et al., 2018;Dora, 2019;Farooque et al., 2019;Leising et al., 2018;Mishra et al., 2019;Ruggieri et al., 2016;Witjes and Lozano, 2016). Businesses pursuing collaborative endeavors can overcome common circular economy inhibitors such as less accessible and expensive technology, lack of clear guidance and consensus, high upfront investment, or regulatory uncertainty (Mishra, 2019;Brown et al., 2018). ...
... Businesses pursuing collaborative endeavors can overcome common circular economy inhibitors such as less accessible and expensive technology, lack of clear guidance and consensus, high upfront investment, or regulatory uncertainty (Mishra, 2019;Brown et al., 2018). Compared to linear operations, the need for collaboration is even increased in a circular economy since, for instance, industrial symbiosis collaborative partnerships allow waste from a supply/process chain to become a resource for another one (De Angelis et al., 2018;Fraccascia et al., 2019). ...
... The management, contract/transaction design, and administration of novel circular economy collaborations, however, call for further exploration (cf. Korhonen et al., 2018;Meherishi et al., 2019;Fischer and Pascucci, 2017;De Angelis et al., 2018;Lahti et al., 2018). ...
Article
Full-text available
More than 40% of petroleum-based plastic materials produced are converted into packaging and half of those to food packaging. Around 95% of plastic packaging, however, is lost to the economy after a short first-use cycle and is often discarded in landfills or ends up in the natural environment. The circular economy is often promoted as a solution to the current inefficient production, use, and disposal of plastic food packaging, most frequently via recycling or reuse. While the concept of circular food packaging has lately been taken up by policy and industry initiatives in Europe, its implementation remains limited due to the high degree of cross-chain collaboration required. Nevertheless, literature on collaboration in the circular economy is still scarce and provides little guidance on how to build up effective circular partnerships. This research aims to fill this knowledge gap by answering the research question: “How do focal firms set up and choose collaborations for circular food packaging?” A qualitative Delphi method was used to develop a theoretical framework based on collaboration literature and refine it by means of semi-structured qualitative interviews with 17 food companies operating in Europe and circular packaging experts. Results show that the process of identifying and establishing collaborations for circular food packaging typically follows nine steps, spread over five phases. The study also found fourteen possible partner roles and nine partner characteristics that are important in the selection and evaluation of potential partners for circular collaborations.
... Within a circular economy, waste is reduced and seen as input for other products or chains. Technical nutrients can be continuously reused, refurbished, remanufactured or recycled, while maintaining their quality, and biological nutrients can return to nature to restore the natural supplies (De Angelis et al., 2018). ...
... However, the transition path from a traditional economy towards a circular economy is one with many hurdles (Ghisellini et al., 2016). The main challenge associated with implementing a circular supply chain is that the materials should circulate for a long period of time (De Angelis et al., 2018). In circular supply chains, value is created by the flow of materials not just within one chain, but across chains (De Angelis et al., 2018). ...
... The main challenge associated with implementing a circular supply chain is that the materials should circulate for a long period of time (De Angelis et al., 2018). In circular supply chains, value is created by the flow of materials not just within one chain, but across chains (De Angelis et al., 2018). For example, after initial use, a product may function as a second hand product, after which its materials may be utilized for the construction of new products, and later as raw materials for a different product category. ...
Article
Full-text available
The transition towards a circular economy puts pressure on organizations to purchase in a circular manner. The aim of this research is to investigate the role, behaviors, and characteristics of purchasers in the circular purchasing process, and the contextual factors that influence circular purchasing. To address this aim, we interviewed purchasers, supervisors and policy makers of seven Dutch organizations. The results of the comparative case-study show that the main roles of the purchaser are those of coordinator, facilitator and advisor, and that the successful circular purchaser can best be described as intrapreneurial, sustainability-minded and knowledgeable about the circular economy. Purchasers are successful in implementing circular purchasing when they share responsibility with budget holders and when they are part of organizations that have processes in place to ensure the inclusion of circularity in their purchasing projects. The drivers that influence the success of circular purchasing can be described as creating a sense of direction and grasping the complexity of the circular economy. Furthermore, the market, organizational, legal, conceptual and cultural constraints that limit the success of circular purchasing were identified.
... This supports mainly on the economic, partially environmental, and less on social dimensions. In contemporary literature, the CE is considered as a model to achieve sustainability in business and supply chain (De Angelis, Howard, and Miemczyk 2018;Luthra and Mangla 2018). ...
Article
Full-text available
Circular economy is gaining considerable attention among global business professionals, organisations, and academia. Industry and governments realise the fast depletion of resources & environmental degradation and a need for sustainable development. Despite this, there is a scarcity of literature related to the circular economy, the circular economy is effectively adopted through circular practices. Therefore, this study’s primary objective is to investigate the circular economy practices to transform an existing linear model into a circular economy model. In order to accomplish this objective, this research identified fifteen circular economy practices through the literature review and experts’ input. These circular economy practices are evaluated using CoCoSo and prioritised the circular economy practices based on their importance. Results show that the significant circular practice is ‘consumer awareness’, ‘legislation and policies’, ‘develop the circular culture’, ‘awareness among the supply chain partners’ and ‘designing products for circularity’. These are the practices that are essential to adopt for an organisation to adopt the circular economy effectively. This study facilitates managers to make an action plan for executing circular practices. By considering the prioritisation of circular practices, managers and professionals can optimise their organisational resources to adopt the circular practice effectively.
... From the supplier to the final customer. [67] 2018 De Angelis, R., Howard, M.; Miemczyk, J. ...
Article
Full-text available
As members of society, companies are exposed to social changes and pressures. Hence, an interest to be more environmentally friendly appears and rises in their core. Therefore, the supply chain management concept became ʺgreenerʺ with the development, among other practices, of reverse logistics programs. Both external pressures and internal factors, such as reducing costs and increasing operational performance, are motivating companies to pay more attention to the reverse flow. Unfortunately, there are still many boundaries that hinder the implementation of reverse logistics. Some of these obstacles include additional costs, the desire for deep collaboration with suppliers and customers, and the belief of some managers that are managing reverse flow that it is not worth the trouble. On the contrary, those who have assimilated its importance and advantages are interested in new and innovative tools that could contribute to more effective and efficient results, including the role of RFID technology.
... Circularity's early underlying principles are based on economic policy development while alleviating environmental and resources challenges. Extant studies have conducted at the nexus of SSCM and CE, but uncertainty and controversies exist in the linkages ( De Angelis et al., 2018 ;Liu et al., 2018 ). Emergy can be an effective ecological indicator to analytically link these fields-an integrated performance measurement system-for these two concepts. ...
Article
Emergy analysis has been gaining attention in its use as an environmental accounting tool. Its relationships and implications to sustainable supply chains and the circular economy are still not well understood, even with initial investigations into the relationship. Emergy analysis can potentially provide additional profound opportunities to advancing these sustainability-oriented fields. Emergy analysis—as a basis for economic, social and environmental performance measurements—uses donor side valuation approaches. We discuss how sustainable supply chain management and circular economy performance measurement methods can be expanded and effectively utilize emergy analysis using a donor-side evaluation. We provide insights into more effective environmentally sustainable supply chain and circularity performance evaluation, accounting, and appraisal using emergy based performance measurements. Our findings show that there is ample room for further application and theoretical development at the nexus of these topics. Practically, the measures and approaches for emergy analysis can help decision makers in organizations and across supply chains in managing material sourcing, supplier selection, and network and circular economy flow designs. A theoretical synthesis and research gaps are introduced to help guide future theoretical developments and practical investigations. This work is valuable for those seeking to advance research on sustainability and performance analysis for organizational and supply chain levels of analysis.
... Current modes of production result in unsustainable socioeconomic and environmental consequences ( Ansell and Cayzer, 2018 ;Freire, 2018 ): substantial long-term orientated changes are required and should be implemented through both sustainable products and sustainable industrial processes, from a technological, managerial, organizational and behavioural perspective ( Blok et al., 2015 ). The role of sustainability in industrial supply chains (SCs) is central in the industry and management related debate ( De Angelis et al., 2017 ;Tavassoli et al., 2020 ). Competition is nowadays occurring amongst whole industrial systems rather than single firms ( Massaroni et al., 2015 ;Shibin et al., 2017 ) and high advantages can be brought holistically addressing sustainability ( Carter and Rogers, 2008 ;Taticchi et al., 2015 ). ...
Article
The measurement of sustainability within industrial supply chains is becoming increasingly relevant, with both industry and academia calling for the development of a general and manageable set of key performance indicators (KPIs). With more than 2,000 performance measures already identified by the previous literature, the real challenge lays in the development of the right set of indicators. Stemming from a thorough literature review, we propose a novel set of KPIs, based on a Balance Score Card- Supply Chain Operations Reference integrated framework. Whilst including a limited number of KPIs, the proposed set: i) assures a balanced coverage of the sustainability pillars and related intersections; ii) addresses different decision-making levels, financial bases and components of performance; iii) simultaneously tackles the sustainability performance of an entire supply chain. We empirically validated the set in 3 supply chains and 7 focal firms, by assessing its completeness, usefulness and ease of use. The set resulted suitable for different contexts of application and appropriate for the evaluation of the sustainability performance of an overall supply chain. We conclude with remarks for academia, industry and policy-makers, also sketching directions for further research.
... On the basis of this evidence, this study is using social media analytics to understand the major themes of discussion on twitter of the people towards circular economy. Circular economy is about many actors working together to create effective flows of materials and information, in order to move away from linear economy, take make consume throw away approach of resources [10] to recycle, repair and reuse of resources. Therefore to quantify human perspective on circular economy diverse views of users on Twitter had been analysed. ...
Chapter
Organisations like UNDP, UNEP, CES and many more along with Fortune 500 companies have been sharing support towards the circular economy in order to bring focus towards long term sustainability. The purpose of this study is to explore the collective intelligence towards circular economy which may help in obtaining greater support from different stakeholders. For this objective, three research questions had been explored by analysing Twitter discussions on circular economy through content and network analysis. The insights reveal that users are discussing about all the three elements of circular economy, i.e., economic benefits, environment impacts and resource scarcity. The polarity of sentiments surrounding these elements of circular economy is also established and explained. Insights also indicate that artificial intelligence is strongly being perceived as a solution for resource optimisation, remanufacturing, re-generation of by-products and many more towards achieving circular economy objectives.
Thesis
Full-text available
Previous decades revealed two fundamental changes occurring in SCM: first, the concentration on core competencies and the outsourcing of the remaining functions steadily reduced the OEMs’ depth of production. This trend increased the importance of purchasing. Second, and in parallel, in purchasing the trend prevailed to reduce the number of suppliers and concentrate on a few buyer-supplier relations. Thus, the number of available suppliers sunk, often causing oligopolistic situations, while their importance increased. Additionally, from sustainability perspective, scarcity of raw materials and the increase of CSR and CE practises forced organisations to integrate sustainability, with CSCs as result. Consequently, these (mega)trends challenge purchasing to react with novel approaches. Therefore, by achieving a PCS, a buying firm can benefit from preferential treatment of the supplier. In the process to become a preferred customer, supplier satisfaction plays a crucial role. Next to the replication of Vos et al. (2016), this research will provide new insights by examining the directly and indirectly influence of corporate prestige – dissected into corporate reputation and corporate status - as well as the buyer’s adoption of CE principles on supplier satisfaction in order to obtain the PCS. Quantitative data is collected from 51 OEMs, as key suppliers, of a metal recycling company within the CSC. By using the partial least square–structural equation modeling, with support from SmartPLS, buyer’s reputation positively influences PCS, where status shows an insignificant relationship on both constructs. The same applies for the relation between buyer’s adoption of CE principles on supplier satisfaction and PCS. In addition, results show the significant effect of buyer’s adoption of CE principles on corporate reputation and reputation as underlying factor for the classical antecedents of Vos et al. (2016). This implies that future studies on satisfaction must consider prestige and sustainability as central variables in the ‘cycle of preferred customership’. Keywords: preferred customer status; supplier satisfaction; corporate prestige; status; reputation; sustainability; circular economy principles; and CE.
Article
Full-text available
Resource depletion is a concern for the global economy; many think that available resources on the planet will not be able to cater to an ever‐growing population. Thus, economies are trying to become circular, leaving behind the linear tradition linear approach. In the circular economy (CE), physical resources and energy are made to loop back into the supply chain (SC) for a more extended period. Proper selection of suppliers is an essential criterion towards proper execution of the CE principle in SC. In this research, we have constructed a framework for evaluating the supplier concerning the CE implementation. Further, this research identifies the criterion and sub‐criterion, which are pertinent for evaluating the supplier in CE context. Fuzzy‐based ‘Criteria Importance Through Inter‐Criteria Correlation (CRITIC)’ method is justifiably applied to determine the aggregated weights of the criteria. Finally, ‘Technique for Order of Preference by Similarity to Ideal Solution (TOPSIS)’ method is used to determine the suppliers' ranking in the Indian automobile industry. Six criteria and 24 sub‐criteria are obtained as per recent literature and then inputs from experts. ‘Environment’ criterion came out as the most favourable criterion with a subjective weight of 0.230. The current research is one of the first such attempts to provide criteria for supplier selection in a CE environment. The developed framework would help organisations in implementing CE‐based supplier selection. The identified criteria and sub‐criteria would provide organisations with means to evaluate suppliers and help suppliers develop an effective and efficient CE based on the SC.
Article
Full-text available
The circular economy concept is a novel economic model aiming to foster sustainable economic growth, boost global competitiveness, and generate new jobs. In order to make the circular economy mainstream, radical and systemic innovation is needed. Currently, a majority of the business modelling tools and methods lack at least some of the identified and needed elements for innovating business models in a circular economy. In this article, we build a framework for sustainable circular business model innovation by adding important perspectives: recognizing trends and drivers at the ecosystem level; understanding value to partners and stakeholders within a business; and evaluating the impact of sustainability and circularity. We present the results of a case study with a startup company, which was designed to test the framework and provide a concrete example of its usage and future development needs.
Article
Full-text available
Several discourses on environment and sustainability are characterised by a strong confidence in the potential of technology to address, if not solve, the ecological impacts resulting from physically expanding systems of production and consumption. The optimism is further encouraged by leading environmental engineering concepts, including cradle-to-cradle and industrial ecology, as well as broader frameworks, such as natural capitalism and the circular economy. This paper explores the viability of their promise from a biophysical perspective, which is based on insights from system dynamics and thermodynamics. Such an ecological reality check is generally ignored or underestimated in the literature on aforementioned concepts and frameworks. The paper ultimately reflects on what role society can realistically assign to technology for resolving its ecological concerns. While environmental engineering undoubtedly has something to offer, it will end up chasing its tail if the social and economic forces driving up production and consumption are not addressed.
Chapter
Full-text available
Re-distributed manufacturing (RDM) has the potential to be beneficial to business and society through creating jobs, reducing the environmental impacts of production, and improving organizational and societal resilience to future disturbances. The potential impacts of RDM for a city-region are complex and their exploration requires the consideration of a wide range of issues—societal, technical, logistical, and environmental. This paper discusses the use of an approach called Integrated Assessment to carry out an initial scoping of the issues. A research framework for RDM, and the key themes from a workshop that explored the causal relationships between different types of resilience, sustainability, and the manufacturing sectors are presented.
Chapter
Business experimentation is a key avenue for accelerating change for sustainability. In contrast to experimentation in natural sciences, benefitting from controlled situations, business experimentation aims to explore the diverse possibilities that a business could create value from, or understand what works in which particular situations in a real life business context. While at present most popular with start-ups, this paper argues that large businesses can also find inspiration in business experimentation to develop sustainable business models and accelerate positive change for sustainability. Five illustrative cases are included of business experimentation for sustainability by focusing on pivots (modifications) in the business model. This paper only scratches the surface of the potential impactful new research field of business (model) experimentation for sustainability. Future work on sustainable business experimentation for start-ups and mature businesses is viewed as a powerful future research avenue to accelerate change in industries.