A Review and Typology of Circular Economy Business Model Patterns

ArticleinJournal of Industrial Ecology 23(1):36-61 · February 2019with 2,029 Reads 
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Abstract
The circular economy requires companies to rethink their supply chains and business models. Several frameworks found in the academic and practitioner literature propose circular economy business models (CEBMs) to redefine how companies create value while adhering to circular economy principles. A review of these frameworks shows that some models are frequently discussed, some are framework-specific, and some use a different wording to refer to similar CEBMs, pointing to the need to consolidate the current state of the art. We conduct a morphological analysis of 26 current CEBMs from the literature, which includes defining their major business model dimensions and identifying the specific characteristics of these dimensions. Based on this analysis, we identify a broad range of business model design options and propose six major CEBM patterns with the potential to support the closing of resource flows: repair and maintenance, reuse and redistribution, refurbishment and remanufacturing, recycling, cascading and repurposing, and organic feedstock business model patterns. We also discuss different design strategies to support the development of these CEBMs.

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  • ... Second, we held expert interviews with the partners responsible for general management and finance of the two companies, and with context experts for the specific regional situation. We analysed the interviews using the Smart Business Modeler (SBM, 2020), an interactive online tool based on the Business Model Canvas (Osterwalder & Peigneur, 2010), and business model patterns (Remane et al., 2017;Lüdeke-Freund et al., 2018;Lüdeke-Freund, Gold & Bocken, 2019), that enabled us to easily identify possible circular economy business model patterns. In their study on sustainable business models, Lüdeke-Freund et al. (2018) define a pattern as an illustration of "an ecological, social, and/or economic problem that arises when an organisation aims to create value, and it describes the core of a solution to this problem that can be repeatedly applied in a multitude of ways, situations, contexts, and domains." ...
    ... They do find that circularity fits their sustainability focus, and have therefore been designing and developing a circular product, a garden fence that is primarily made out of re-claimed and reusable A-type wood. This product matches the circular patterns reuse and repurpose (Lüdeke-Freund, Gold & Bocken, 2019), and the patterns design for upgradability and design for dis-or reassembly identified by Bocken et al. (2016). ...
    ... Company B's search for a circular product could match patterns such as reuse, repurpose, and design for upgradability and dis-or reassembly (e.g. Bocken et al., 2014;Bocken et al., 2016;Lüdeke-Freund et al., 2019); at the same time Company B is concerned about finding an appropriate inflow of materials, whatever the circular pattern. ...
    Conference Paper
    In our in-depth case study on two circular business models we found important roles for material scouts and networks. These key partners are essential for establishing circular business models and circular flow of materials. Besides, we diagnose that companies are having difficulties to develop viable value propositions and circular strategies.
  • ... When the concept of circular business models was introduced in the academic literature (e.g., Bocken et al., 2016;Geissdoerfer et al., 2018;Lüdeke-Freund, Gold, & Bocken, 2019), it initiated a discussion about business models aiming to "create, deliver, and capture value while implementing circular strategies that can prolong the useful life of products and parts (e.g. repair and remanufacturing) and close material loops (e.g. ...
    ... Despite the fact that circular economy business models are just emerging (Lüdeke-Freund et al., 2019), their practical and academic relevance have boosted the number of studies recently published on them. These include conceptual developments such as models and typologies of circular business models (e.g., Bocken et al., 2016;Lewandowski, 2016;Lüdeke-Freund et al., 2019). ...
    ... Despite the fact that circular economy business models are just emerging (Lüdeke-Freund et al., 2019), their practical and academic relevance have boosted the number of studies recently published on them. These include conceptual developments such as models and typologies of circular business models (e.g., Bocken et al., 2016;Lewandowski, 2016;Lüdeke-Freund et al., 2019). Various empirical examinations in the realm of circular business models to date have provided insights into their different aspects such as processes, roles, management mechanisms, or critical capabilities (e.g., Frishammar & Parida, 2019;Khan, Daddi, & Iraldo, 2020;Parida, Burström, Visnjic, & Wincent, 2019;Zucchella & Previtali, 2019). ...
    Article
    Full-text available
    This study investigates how the circular economy and business models are related in the current business and management literature. Based on bibliometric analytical procedures, 253 articles were retrieved from the Scopus, Web of Science, and ScienceDirect scientific databases. The articles were analyzed according to network analysis principles, and key terms were mapped into a network. We used VOSviewer to build the network, explore the most-researched terms and their relationships, and identify less-explored terms and research gaps. We furthermore conducted a qualitative review of selected publications to provide an illustration of quantitative results and delve deeper into the research topics. The main findings revealed the networks of current topics as they appear in the publications such as business models, the circular economy, circular business models, value, supply chain, transition, resource, waste, and reuse, and their most prevalent relationships. The results also highlighted several emerging topics such as those connected with managerial, supply-side, demand-side, networking, performance, and contextual considerations of circular business models.
  • ... Thus circular economy (CE) principles applied to business models support the exchange of materials among supply chain actors (Bocken et al., 2014) while delivering enhanced functionalities (Bocken et al., 2016). Along this line, CBMs have been recently considered as effective organizational solutions to tackle societal issues such as food waste (Lüdeke-Freund et al., 2019). It is widely accepted that food waste is an inefficiency of current food systems (FAO, 2011), with a third of all edible food that goes uneaten (EMF, 2019). ...
    ... those related to food) and to move from ownership (of food products) to functionality. In fact, research on CBMs and related strategies have been mostly developed in the context of technological materials and metabolisms and similarly application of product-as-a-service business models have largely focused on electronics, clothing, furniture and durable goods rather than food products (Lüdeke-Freund et al., 2019). ...
    ... The extant literature on CBMs has already acknowledged the role of consumers/users (Lüdeke-Freund et al., 2019), actively participating in the supply chain in order to valorize end-of-life products through reusing, cascading materials, refurbishing and upcycling (Tukker, 2015). Several CBMs are in fact based on the connection between consumers and upstream supply chain actors related to alternative activities concerning their purchasing and recycling habits (Borrello et al., 2017). ...
    Article
    Full-text available
    Implementing circular business models in food supply chains is an organizational solution to tackle the issue of household food waste, converting it in feedstock to upcycle within industrial symbioses. Adopting literature on practices of food consumption as theoretical framework, this paper analyzes consumers’ participation in circular business models. A conceptual model of the emergence of food provisioning practices in circular business models is designed and empirically tested, through a survey, in order to analyze consumers’ willingness to participate in an innovative food provisioning mechanism with retailers. Respondents were asked to choose whether to participate or not in a proposed program, and their choices have been modelled in an ordered logit model. 88% of interviewees declared sorting organic food waste as a normal activity in his household. 78.9% of participants accepted to participate to the proposed programs independently of the type of agreement’s attributes. 14.49% accepted only some programs depending on the program type, while 6.61% of respondents choose not to participate to any of the proposed program. Findings outline the expected participant as an individual already engaged in tasks to cope with risk in food provisioning and having already developed a long-lasting relation with a retailer. The study reveals also the opposite effect of concerns about tasks related to take-back system, such as food waste handling, and social desirability of recycling. Focusing on the business-to-consumers relationship, the paper suggests to practitioners interested in circular business models the possibility to adopt innovative ‘food-product-as-a-service’ approaches. Recommendations can be derived for future studies about the relevance of practice theory in the analysis of consumers’ engagement in circular business models.
  • ... The main researcher working on the field is Bocken (Nancy Bocken, The International Institute for Industrial Environmental Economics -Lund University), who has contributed to eight publications within this study's final portfolio (see Bocken et al., 2019;Bocken et al., 2018a;Bocken et al., 2016;Bocken et al., 2018b;Lüdeke-Freund et al., 2018;Jensen et al., 2019;Manninen et al., 2018;Tunn et al., 2019). The author has been doing research on sustainable business models, which includes circular business models and their many facets. ...
    ... As defended by Giampietro (2019), relying on nature to close loops will only slow the economic processes down. However, as defended by Lüdeke-Freund et al. (2018) just closing loops per se is neglecting. ...
    ... Material or energy surpluses are regarded by many businesses simply as costs, hence, these businesses struggle to see them as potentially useful inputs to others; therefore, the untiring search for narrow-minded, matter-of-factly, cost-reduction may hinder creative and effective loop-closing (see Lüdeke-Freund et al., 2018), which is at the core of CE. ...
    Article
    Natural resources are limited and society has long been unwisely consuming them, while Earth has been longing for care. Most existing businesses are based on linear models and a transition to Circular Business Models is necessary. Circular Business Models are business models that enable systems that are regenerative by nature; they seek maintaining resource value at its maximum for as long as feasible, and eliminating or reducing resource leakage, by closing, slowing, or narrowing resource flows. For a transition to circular business models to happen, researchers and practitioners need to know how to implement and manage them. Therefore, this paper’s aim is threefold: (i) identify researchers, topics of highlight and journals housing research on Circular Business Models worldwide, (ii) identify the main aspects that influence Circular Business Model implementation, and (iii) point the unaddressed subjects in the existing literature on Circular Business Models. To that end, a systematic literature review was conducted. The EndNote, Microsoft Power BI, and the VOSviewer software tools were used to manage references and build visual maps, respectively. Resource flow management, considerations on surpluses, system orientation, challenges to circular business models, system design aspects, influence of company size, possible rebound effects, customer consideration, company’s culture and behavior, and capacity building for CE have been the main aspects of current concern on circular business model investigation. The importance of increasing circularity through circular business models is mainly addressed through the importance of top management support and its action from the company’s core to the outside. Further investigations and partnerships from theoreticians and practitioners are expected to assist the evolution of the theme.
  • ... BMI is designed to address the market changes faced by companies, and current issues such as the increase of environmental and social concerns induce some companies to develop innovations in their BMs to better address these issues, primarily through the CE. Thus, companies whose focus is CE often develop BMI for CE (BMI4CE), which is an attractive concept for the rearrangement of both value creation structures and value chains that lead to the development of a more plentiful production and consumption system (Hofmann, 2019), rethinking and redefining the way to create, capture and deliver value (Lüdeke-Freund, Gold, & Bocken, 2019;Nußholz, 2017). ...
    ... Even with the challenges, there are benefits that enable the development of BMI4EC (Linder & Williander, 2017). They are geared to reverse cycles and resource life extension by repair and maintenance, reuse and redistribution, refurbishment and remanufacturing, recycling, organic raw material, and cascade and reuse (Hofmann, 2019;Linder & Williander, 2017;Lüdeke-Freund et al., 2019;Nußholz, 2017). Using thus closed-loop supply chains (Lüdeke-Freund et al., 2019;Nußholz, 2017), in order to minimize exploitation of virgin natural resources (Hofmann, 2019) through the formation of a more efficient and effective economic system (Pieroni et al., 2019). ...
    ... They are geared to reverse cycles and resource life extension by repair and maintenance, reuse and redistribution, refurbishment and remanufacturing, recycling, organic raw material, and cascade and reuse (Hofmann, 2019;Linder & Williander, 2017;Lüdeke-Freund et al., 2019;Nußholz, 2017). Using thus closed-loop supply chains (Lüdeke-Freund et al., 2019;Nußholz, 2017), in order to minimize exploitation of virgin natural resources (Hofmann, 2019) through the formation of a more efficient and effective economic system (Pieroni et al., 2019). Strategies are generally based on resource and material efficiency (Nußholz, 2017). ...
    Conference Paper
    Full-text available
    As a recent theme, research on Business Model Innovation for Circular Economy (BMI4CE) has increased in recent years, but it still needs to be deepened in industries that are specific and central to the negative environmental impacts, such as the fashion industry. This research aimed to identify what are the key elements of companies' BMI4CEs in the fashion industry. Exploratory and descriptive research was carried out by a multi-case study, which analyzed BMI4CEs of fashion industry companies in North America, Asia, and Europe. It was identified that the environmental and economic dimensions receive priority attention in the analyzed BMI4CEs. The results support the understanding that the key-elements common to fashion industry companies' BMI4CEs are: closed-loop and reduction of consumerism and materials use. Special focus can also be found in the search for elements such as reuse and new uses of materials and circular supply. Innovation and technology were identified in all cases, highlighting the role of digital technologies (e.g., blockchain) for BMI4CEs effectiveness in the fashion industry.
  • ... Circular Business Models (CBMs) are to translate the macro-ambitions of the circular economy (e.g., European Commission, 2018), into business practices. Based upon the business model literature (e.g., Osterwalder, Pigneur, & Clark, 2010), much research on CBMs addresses the question of how companies can create value while adhering to the principles of the circular economy (Lüdeke-Freund, Gold, & Bocken, 2019). Creating circular value is a challenge. ...
    ... Whereas De Angelis (2018) stresses that circular value creation is characterized by idiosyncratic mechanisms of value proposition, creation, delivery, and capture, most others instead suggest generic CBMs. The ReSOLVEframework developed by the Ellen MacArthur Foundation (2015) proposes six core strategies to not let the value of goods and materials fall to zero: Regenerate, Share, Optimize, Loop, Virtualize and Exchange; Lacy and Rutqvist (2015) suggest five generic ways to develop a circular advantage: circular supply-chain, recovery and recycling, product life-extension, sharing platform, product as a service; and Lüdeke-Freund et al. (2019) identify six generic circular business models: repair and maintenance, reuse and redistribution, refurbishment and remanufacturing, recycling, cascading and repurposing, and organic feedstock. ...
    ... The ing-form depicts more accurately that becoming circular is a process, and thus something that requires being approached through a processual stance (Bakken & Hernes, 2006). In contradistinction to the CBM literature that pitches linear and circular solutions as antagonistic alternatives (Ellen MacArthur Foundation, 2015;Lacy & Rutqvist, 2015;Lüdeke-Freund et al., 2019), and even speaks at times of full CBM (Urbinati et al., 2017), the Accus case suggests that there might not necessarily be a clear-cut distinction between linearity and circularity. Accus' CEO expresses this in his presentations to customers with the expression "as circular as possible". ...
    Chapter
    Full-text available
    This chapter report presents a case study of how Accus, a small Swedish company, worked on developing a circular business model for light sign production and installation to become more sustainable. Drawing on Actor Network Theory (ANT), the Accus case shows that circular business model development is a cooperative endeavor that rests on bringing together a large and changing array of human, as well as non-human, actors in a development process that is hesitant, imprecise, provisory, contingent, and reversible. The case exemplifies the difficulties for a small company to enroll other actors in a transition to circular business, and initiate a shift toward a parsimonious material order that challenges, transforms, and replaces worked-in linear supplier-customer relationships. Good intentions only reach up to a certain point. If more than exceptional firms are to successfully find partners to translate their circular ambitions into circular business practices, the competitive strength of linear solutions needs to be drastically reduced and delegitimized.
  • ... More precisely, it is considered that firms could profit from the circular economy adoption through the generation of environmental benefits associated with the reduced impacts and resource usage, cost savings generated from reduced natural resource requirements, and the new markets formation [13][14][15]. In other words, the predominant aim of a business model based on the circular economy is to help firms to generate value through the utilization of resources in multiple cycles, and waste and consumption reduction [18]. Although there have been considerable analyses that have discussed the advantages associated with the adoption of the circular economy, there has been surprisingly little empirical research that has determined the link between the circular economy and firm performance [8]. ...
    ... More precisely, the author stressed that the adoption of the circular economy infers income smoothing, instability reduction and improved customer retention, which leads to steady cash flow growth. In the same vein, previous scholars [18,33,34] agreed that reuse and redistribution yield high profitability and eco-effectiveness obtained by a positive economic and ecological I-O ratio. Similarly, in [35], it was indicated that the investment in the circular economy maximises the overall value of products and, eventually, the materials they are made from by taking an overall system perspective. ...
    Article
    Full-text available
    Although a substantial body of literature has analysed the potential benefits of the circular economy, empirical evidence on the relationship between circular economy-related activities and firm performance is scarce. Rather than analysing only the effect of the circular economy on firm performance, we empirically examine the effects of the different phases of the adoption process of the circular economy on firm performance. Therefore, in this paper, a multiphase framework of circular economy adoption is developed. Employing a propensity-score-matching model on the sample of more than 4000 European SMEs, we show that the adoption of circular economy activities improves firm performance as measured by productivity. In addition, our findings reveal that the impact of circular economy activities on firm performance is dependent on the different phases of the adoption process. Taken together, this study enriches current research on the circular economy by contributing to a more nuanced understanding on the relationship between the different phases of the adoption process and firm performance.
  • ... The next section will discuss major strategies for sustainable production and consumption and introduce sustainable business model (SBM) patterns as a way of supporting these strategies within the framework of SSC. Building on our prior work in this domain (Froese, 2017;Lüdeke-Freund et al., 2018a;2018b;2019a;2019b;Schaltegger et al., 2012;, the authors of this chapter will discuss the link between business models and SSC and introduce a framework focusing on sustainability strategies and SBM patterns. Finally, we will introduce some new ...
    ... To support business model designers, an increasing number of tools is already available (see the review in Breuer et al., 2018). The aforementioned 45 SBM patterns can already be used online, together with an additional set of 25 patterns for circular economy business models (Lüdeke-Freund et al., 2018a;2018b;Smart Business Modeler, 2019). ...
    Chapter
    Full-text available
    The main ideas discussed in this chapter relate to the role of business models in supporting strong sustainable consumption (SSC), different sustainability strategies and how sustainable business model patterns can become a means to design better production-consumption systems. These ideas can serve as a starting point for more comprehensive and balanced debates about how companies, that is, the major designers of modern production-consumption systems, can contribute to strong sustainable consumption. The authors ask readers to go beyond the often heard calls for efficiency and sufficiency business models, which too often ignore the fact that neither sustainability strategies nor business models unfold in a vacuum. Hence, it is important to consider multiple sustainability strategies and multiple business model design options simultaneously. The authors, therefore, call for approaches that consider both multiple sustainability strategies and multiple business model patterns in order to create better production-consumption systems that could help humanity to navigate an increasingly narrowing ‘strong sustainable consumption corridor’. (The complete book is available open access: https://www.elgaronline.com/view/edcoll/9781788117807/9781788117807.xml)
  • ... The CE conceives the business models that optimise resource flows and ensure closed-loop supply chains currently known as circular business models [5][6][7]. Although in previous decades recycling technologies have been applied and studied in various industries mainly from technical, mechanical or chemical perspectives [8][9][10], currently it is considered as one of the types of circular business models (CBMs) from the perspective of business model innovations in companies. ...
    ... Educating potential customers especially in B2B or B2G sectors on the quality and functionally of tyre-recycled rubber products may open additional opportunities to diversify customer segments and expand the market share in Latvia. Xpo -company does not obtain, but has a strong potential to acquire this opportunity with comparatively minimal efforts Source: created by the authors adapting from Ludeke-Freund and co-authors [6] From the perspective of new CMB, the use of pyrolysis for production of fuel from pyrolysis oil has not been successfully introduced in Latvia. The lack of proper certification to be used and sold this fuel in the market is one of the issues to be solved in order to maximise new CBM opportunities provided. ...
    Preprint
    Full-text available
    The end-of-life tyre recycling industry in Latvia faces significant issues on a national level and on a micro business level. The aim of the research is the clarification of opportunities for new circular business models within the tyre recycling industry in Latvia. Main research methods are literature review, semi-structured in-depth interviews and case studies, allowing to provide integrative analysis. In addition, design thinking methods contributed to conclusions on future opportunities of new tyre recycling business models. The research shows that the system is insufficiently supervised, and it does not facilitate the development of new environmentally friendly technologies and circular business models. A large share of tyres ends up in waste landfills, are incinerated or illegally stored, whereas only a small number of them are recycled. The traditional tyre incineration methods are ineffective and create adverse effects on the environment. Tyre recycling companies in Latvia are not active in adoption of new technologies and business models, thus they are performing with negative financial ratios and not ensuring financial returns on assets. This justifies the topicality of the research problem. The research results reveal that globally new opportunities are being actively explored on how to produce higher added value products from materials obtained in the tyre recycling process. In Latvia, it is possible to develop new financially viable circular business models in this industry, for instance, by producing tyre-derived aggregates for construction materials or pavement subbases. Besides the need for dynamic innovation capabilities of entrepreneurs, development of new business models in tyre recycling requires collaboration among various stakeholders. In addition, the government has a significant role in implementing the Green Public Procurement for the industries utilizing products gained after tyre recycling.
  • ... Bocken et al. (2014) divide sustainable business models into eight archetypes which are classified in higher order groupings and describe the main type of business model innovation: technological, social or organisational. A recent review and classification of circular business model patterns has been carried out by Lüdeke-Freund et al. (2019). These authors base their study on a morphological analysis of 26 current cases from literature and identify six major circular economy business model patterns: (1) repair and maintenance, (2) reuse and redistribution, (3) refurbishment and remanufacturing, (4) recycling, (5) cascading and repurposing, and (6) organic feedstock. ...
    ... Until now, some publications (Bocken et al., 2014;EMF, 2015;Lüdeke-Freund et al., 2019) show how to conceptualize and categorize sustainable or circular business models based on different strategies; they are presented as business model types in a wider context including environmental constraints. This study offers the first, consistent, circular business model typology with six different inter related business model types in the agricultural domain. ...
    Article
    Full-text available
    Shifting from a linear to a circular economy in the agrifood domain requires innovative business models, including reverse logistics, new visions on customer-supplier relationships, and new forms of organization and marketing strategies at the crossroads of various value chains. This research aims to identify and characterise different types of business models that create value from agricultural waste and by-products via cascading or closing loops. Conceptual and management insights into circular business models are still sparse. In total, 39 cases have been studied that convert agro-waste and by-products into valuable products via a circular economy approach. Semi-structured interviews and on-site visits of six representative cases have been done, and secondary data been collected. Data has been treated with content analysis. Cases are presented according to the type of organisational structure, resources, transformation processes, value propositions, key partners, customers, strategic approaches and innovation. Six types of circular business models are identified and discussed: biogas plant, upcycling entrepreneurship, environmental biorefinery, agricultural cooperative, agropark and support structure. They differ in their way of value creation and organisational form, but strongly depend on partnerships and their capacity to respond to changing external conditions. This study offers the first circular business model typology within the agricultural domain, revealing the interconnectedness of the six different business model types. It provides options for managers in positioning and adapting their business strategies. It highlights the potential of using biomass first for higher added-value products before exploiting it as energy source. Cascading biomass valorisation at a territorial level will increasingly be important for locally cooperating actors within a circular bioeconomy approach.
  • ... Scholars have devoted much time to analysing new business models and strategies related to CE (cf. Bocken et al., 2016;Lüdeke-Freund et al., 2018). Yet, there is also a need to reflect and examine these older CE initiatives and practices to understand their suitability and capacity to facilitate and address the emerging societal concerns evidenced within the existing CE debate. ...
    ... CE practices thus range from national programmes, e.g. China's 2009 CE 'Promotion Law' or international policies, e.g. the European Commission, 2014 CE 'Action Plan' (Ghisellini et al., 2016), to business models and individual company strategies (see Lüdeke-Freund et al., 2018). Scholars have sought to define CE activities through the potential value retention options that can be initiated throughout a product or material lifecycle, commonly described as the R-hierarchy. ...
    Article
    Full-text available
    The circular economy (CE) emphasises closing material loops to retain material value. The current practice of tyre recycling in the Netherlands, through a system of extended producer responsibility (EPR), appears an overwhelming success, with claims of 100% recovery. Yet, there is limited critical understanding regarding the system's circularity, considering alternative value retention options and resource recovery outcomes. This study analyses this Dutch tyre EPR system and reflects on how it can be improved from a systemic CE perspective. It uses a qualitative case study approach, using interviews and a review of policy, legal and EPR reporting documents. This paper assesses the governance of this sector and reflects on the existing system, including its circularity and value retention outcomes. Our analysis reveals seven central issues concerning how the EPR system currently functions, resulting in limited circularity and sustainability outcomes, despite high material recovery levels. To address these issues we recommend the continuous improvement of recovery and sustainability targets beyond a single product life cycle, a more transparent and inclusive governance system, as well as a greater focus on sufficiency strategies, e.g. design for durability and a broader transformation of transport models. This paper adds a practical understanding of the capacity of EPR to contribute to CE. Full text available (open access): https://www.sciencedirect.com/science/article/pii/S0959652620320898
  • ... In recent CE publications, the principle of cascading is mentioned as a method of retaining the 'added value' of materials as long as possible (Bezama, 2016;Mair and Stern, 2017;Gontard et al., 2018;Lüdeke-Freund et al., 2018). Cascading is understood as the sequential use of resources for different purposes, usually (or ideally) through multiple material (re)use phases before energy extraction/recovery operations, and is most established within IE (Olsson et al., 2018;Teuber et al., 2016). ...
    ... Examples of CE and cascading discussed in the literature includes product-service systems in the Dutch textile industry (Fischer and Pascucci, 2017), secondary construction and demolition streams (Husgafvel et al., 2018), end-of-life product management (Kalverkamp et al, 2017) and cascading as a CE action for new businesses models (Lüdeke-Freund et al., 2018). Most noticeably, Mair and Stern (2017) reviewed the conceptual interlinkages between CE and cascading; calling for both concepts to be combined, as both are concerned with extending the use of products/materials. ...
    Article
    Full-text available
    The principle of cascading, the sequential and consecutive use of resources, is a potential method to create added value in circular economy (CE) practices. Despite conceptual similarities, no research to date has explored how cascading has been operationalised and how to integrate it with CE R-imperatives (Reduce, Reuse etc.) to facilitate implementation practices. CE practices emphasise value creation and retention, yet, there has been little reflexive examination of explicit and intrinsic value considerations; namely, how allocation choices, i.e. the decision-making process, for resource utilization are made. This paper aims to (1) examine how cascading has been operationalised (empirically and theoretically) to understand its normative underpinnings and value considerations; and (2) integrate cascading with the CE practices in a manner that accounts for the complexities of material allocation choices. Through a literature review of 64 articles from three bodies of literature (CE, cascading and up/downcycling), plus additional material on sustainable development, we show the cascading concept is a suitable framework to direct material uses and provides an overarching concept to integrate with CE R-imperatives. From this, we propose a new theoretical framework that considers the socio-organisational necessities for a CE-cascading system, specifically by deconstructing the allocation choices and exchanges of product material combinations between actor groups. This considers a dual perspective of the physical aspects of materials and the social context in which material allocation is made. The framework transcends individual value chain actor configurations to propose an overarching steering/governance framework, based on the triple-P of sustainability (People, Planet, Prosperity), to examine and direct CE-cascading exchanges, between and above individual users/firms.
  • ... Most frameworks (e.g. Bocken et al., 2016;Scheepens et al., 2016;Mendoza et al., 2017;Lüdeke-Freund et al., 2018) state that design for circularity requires an approach which ensures circularity is achieved within and beyond the designs' lifecycle. On the one hand, a systems approach (requirement 1) is required in which the building component is regarded from within its wider system environment. ...
    Article
    Purpose The transition to a circular economy in the built environment is key to achieving a resource-effective society. The built environment can be made more circular by applying circular building components. The purpose of this paper is to present a design tool that can support industry in developing circular building components. Design/methodology/approach The tool was developed and tested in five steps. In Step 1, the authors analysed existing circular design frameworks to identify gaps and develop requirements for the design tool (Step 2). In Step 3, the authors derived circular design parameters and options from existing frameworks. In Step 4, the authors combined and specified these to develop the “circular building components generator” (CBC-generator). In Step 5, the CBC-generator was applied in the development of an exemplary component: the circular kitchen and tested in a student workshop. Findings The CBC-generator is a three-tiered design tool, consisting of a technical, industrial and business model generator. These generators are “parameter based”; they consist of a parameter-option matrix and design canvasses. Different variants for circular components can be synthesised by filling the canvasses through systematically “mixing and matching” design options. Research limitations/implications The developed tool does not yet support establishing causal links between “parameter-options” and identification of the most circular design variant. Practical implications The CBC-generator provides an important step to support the building industry in developing and implementing circular building components in the built environment. Originality/value Whilst existing tools and frameworks are not comprehensive, nor specifically developed for designing circular building components, the CBC-generator successfully supports the integral design of circular building components. First, it provides all the design parameters which should be considered; second, it provides extensive design options per parameter; and third, it supports systematic synthesis of design options to a cohesive and comprehensive circular design.
  • ... Despite these barriers, efforts are made by academia, governments, NGOs and businesses, who are all looking for ways to support the transition from a linear economy to a CE. Many aspects of CE have received academic attention, including CE definitions (Kirchherr et al., 2017); origin and principles (Blomsma and Brennan, 2017;Ghisellini et al., 2016;Murray et al., 2017); circular business models (Bocken et al., 2016;Linder and Williander, 2017;Lüdeke-Freund et al., 2019); the relationship between sustainability and CE (Geissdoerfer et al., 2017;Schroeder et al., 2019); and policy (McDowall et al., 2017;Milios, 2018). ...
    Article
    The circular economy is receiving increasing attention as having the potential to break with the current linear economy of unsustainable production and consumption. A circular economy promotes system innovations that aim to design out waste, increase resource-efficiency, and achieve a better balance between economy, environment and society. Ensuring a successful transition to a circular economy requires the ability to measure and report on progress. Currently, there are three levels of indicators for measuring circular economy: macro (global, national, regional, city), meso (industrial symbiosis, eco-industrial parks), and micro (single firm, product). A detailed understanding of how to measure and document progress towards a circular economy is lacking, especially on a micro level. This is a barrier for both producers who want to provide circular products and services, and for the consumers who want to know how to compare products. This paper helps to open the black box, not by developing a method for measurement, but by categorizing and assessing what is already being done. This paper reviews 30 indicators of a circular economy at the micro level, where the majority of indicators focused on recycling, end-of-life management or remanufacturing, while fewer indicators consider disassembly, lifetime extension, waste management, resource-efficiency or reuse, and the majority of the papers are published in the last few years. There is no commonly accepted way of measuring circular economy in general at the micro level, nor within the different circular economy principles of recycling, remanufacturing etc. As circular economy often is presented as a means to a sustainable development, the alignment between the three dimensions of sustainability and the reviewed indicators is analyzed, which showed that the majority of indicators focus on economic aspects, with environmental and especially social aspects included to a lesser extent. This biased approach to circular economy that favors economic aspects over environmental and social impacts can lead to sub-optimizations when companies apply circular economy and may lead to a narrower approach to sustainability than what has previously been the case. For future research it can be interesting to explore if the same bias exists on meso and macro level, but also to analyze how a more coherent approach can be standardized on micro level.
  • ... The second is the regenerate, share, optimize, loop, virtualize, and exchange framework, a checklist proposed by the Ellen MacArthur Foundation (2015) to drive circular economy innovation in companies. In addition, it is useful to recall the different patterns identified byLüdeke-Freund et al. (2019) in their review of circular economy business models through a morphological analysis of the alternative design options, in terms of repair and maintenance, reuse and redistribution, remanufacturing, recycling, repurposing, and organic feedstock.The area of value creation encompasses the creation of a product/service offer that, in accordance with the principles of circular economy, is able to preserve economic and environmental value, through the efficient usage of resources and closed loops(Nuβholz, 2018). Value creation in circular business models has been also associated with the maintenance of products and processes, the combination of resources and materials and the purchasing of upcycled waste, the total recycling of resources, the dematerialization of products, and on-demand production processes(Lewandowski, 2016;van Renswoude, Wolde, & Joustra, 2015).Value transfer recalls all those elements related to the customer segmentation and customer relationship that are traditionally included into the value proposition. ...
    Article
    The concept of circular economy is increasingly receiving attention in different domains, including strategic management, operations management, and technology management. It requires companies to design their business model (i.e., the value network, the relationships with the supply chain partners, and the value propositions towards customers) around a new concept of sustainable development that reduces consumption of natural resources and preserves the environment. However, extant research falls short in terms of explaining how companies design their business model according to the circular economy principles. Starting from this premise, the present paper provides a systematic review of the literature on the design of business models in the context of circular economy, aiming to offer an overview of the state of research and outline a promising research agenda.
  • ... Global resources are finite, and we are exceeding our planetary resource capacity (Lüdeke-Freund et al., 2019). As an important method of sustainable development, remanufacturing has many unique advantages. ...
    Article
    The shortage of resources and environmental pollution have become the social issues of world concern, they have seriously affected the sustainable development. Remanufacturing has been recognized as an effective technology helps to improve the energy and materials utilization, and reduce environmental emissions with a low cost. we performed a comprehensive literature review of assessing energy, environment, and economy in remanufacturing based on life cycle assessment method to summarize the development of remanufacturing technologies, conclude new progress of remanufacturing in energy, environment and economy and review the remanufacturing trend. Firstly, we reviewed the life cycle assessment (LCA) method and its application in remanufacturing assessment. Some remanufacturing assessment methods based on LCA were analyzed here. Secondly, a framework of assessing energy, environment, and economy in remanufacturing based on LCA was built. Corresponding assessment methods in remanufacturing were studied and summarized in dimensions of energy, environment and economy respectively. Then following the integrated studies of energy-environment-economic assessment in remanufacturing was also described. In this paper, the remanufacturing and assessment about energy, environment, economy based on LCA were described systematically, so as to better understand and apply LCA and promote remanufacturing. Finally, the limitations of the LCA method were discussed, furthermore, in order to catch up with the trend of the manufacturing industry, the integration of remanufacturing and emerging technologies was proposed at the end of the paper, which will be conducive to the continuous innovation of remanufacturing.
  • ... The origins of this concept can be traced back to the 1960s (Carson, 1962;Fuller, 1969;Hardin, 1968) and it refers to an economic system in which resource input and waste, emission, and energy leakage are eliminated or minimized (i.e. closing their loops) in order to achieve a positive environmental and economic impact simultaneously (Geissdoerfer et al., 2017;Lüdeke- freund, Gold, & Bocken, 2018). The transition to a Circular Economy requires the intentional design of new products and services, and experimentation with new business models to deliver them (Antikainen, Aminoff, Paloheimo, & Kettunen, 2017;Bocken, de Pauw, Bakker, & van der Grinten, 2016;Bocken, Schuit, & Kraaijenhagen, 2018). ...
    Article
    Full-text available
    Design for Sustainable Development refers to the application of a design process to solve a problem related to sustainability, such as creating a pair of shoes that can be recycled or managing waste collection in a large city. Since the origins of this concept in the 1960s, Design for Sustainable Development has been evolving, gradually broadening its scope over time from the design of products to the design of services, business models and wider ecosystems. In this evolution, designers have come closer and closer to business problems, thus becoming more strategic. In this paper, we explore this evolution from a business perspective. We visualize it into a framework and interview eight academic experts about the Strategic role of Designers for Sustainable Development. We find that the evolution can be framed around five topics: the strategic goal of designers, and their related perspective, language, key activities and main challenge. After discussing how the evolution took place around each topic, we draw implications for designers and managers who are willing to play an active role in the transition towards sustainable development.
  • ... Ghisellini et al., 2016;Kirchherr et al., 2017;Kalmykova et al., 2018;Prieto-Sandoval et al., 2018;Homrich et al., 2018); by CE business models (e.g. Lewandowski, 2016;Nußholz, 2017;Lüdeke-Freund et al., 2019;Manninen et al., 2018;Hofmann, 2019); by drivers and barriers (e.g. Ranta et al., 2018;De Jesus and Mendonça, 2018;Sousa-Zomer et al., 2018); and by methods of implementation (e.g. ...
    Article
    Full-text available
    The transition to a circular economy requires actions and policies. In the praxis of governance, a common way to steer the transition to a different state proceeds through the setting of targets. Thus far, no study has investigated circular economy targets in a systematic way. To bridge this gap, this study examines which targets can facilitate the transition towards a circular economy. The analysis focuses both on existing and new targets; the latter complement existing targets which are limited to a few discrete cases addressing only partially the goal of a more circular economy. A framework based on 10 common circular economy strategies (i.e. recover, recycling, repurpose, remanufacture, refurbish, repair, re-use, reduce, rethink, refuse) is applied to scrutinise the selected targets. The study clarifies that existing targets for recovery and recycling do not necessarily promote a circular economy, though they are the most commonly applied targets so far. Because of lack of efficacy of recovery and recycling, targets should instead favour other more powerful circular economy strategies. In relation to these, the study looks into new and existing targets showing how they can reduce waste, increase efficiency, close production loops, and maximise retention of the economic value of materials and products. In particular, the study proposes an expanded set of brand new targets for the transition to a circular economy together with a fresh view on targets aimed at scholars and decision-makers alike.
  • ... In circular economy literature presents several classifications or archetypes of circular economy business models (CEBMs). For example, Ludeke-Freund et al. identified 26 archetypes of CEBMs with different purposes, such as either as a mean to redefine value creation, or to offer clarity of terms [23]. Bakker et al. take a product design perspective to classify different CEBMs [24]. ...
    Article
    Full-text available
    Circular business models are often enabled by means of product/service-systems (PSS). The common perception is that such business models have enhanced environmental performance when compared to conventional business models rooted in the linear economy. This article investigates the environmental potential of developing a use-oriented PSS business model for Merino wool t-shirts intended for use by the British Ministry of Defence as an alternative to the present supply system based on synthetic t-shirts purchased from sportswear clothing companies. To conduct the assessment, we apply the life cycle assessment (LCA) methodology to quantify and compare the climate change impacts and impact potentials of the proposed PSS business model and of a reference business model. Results showed that there could be significant contribution of quantifying environmental potential for PSS business models when justifying the transition to a circular economy. However, when adopting LCA methodology for this purpose, the design of the PSS needs to be well thought to overcome some of the identified challenges. The article concludes by making the case that LCA studies can support the definition, design and value creation of the product/service-systems in early development stages.
  • ... However, as the following review shows, the range of classifications is not as diverse as the different terminologies let assume. Further, similar to sustainable business models (see Lüdeke-Freund et al., 2018b) and as highlighted by Whalen (2017) (2015), study a total of 120 cases across the world. Apart from the overall approach, both publications further have in common that detailed information on how exactly the clusters have been identified are lacking. ...
    Thesis
    Full-text available
    In the wake of increasing demands for raw materials and the changing climate, the circular economy concept has recently gained traction in academia, business and policy making. A central constituent in order to realize it, i.e. to shift to a system in which environmental impact is decoupled from economic growth by circulating products, components, and materials at their highest economic and resource value at all times, is the design and implementation of circular business models. Hence, over the last years, academics and practitioners alike have created tools and frameworks that support firms in coming up with new or more effective models. Further, emulating the evolution of general business model literature, researchers have started to propose circular business model definitions and classifications in order to consolidate the existing work and establish common ground. However, a clear understanding of what a circular business model really constitutes is still missing and a careful review of the existing literature reveals that the proposed classifications are either lacking methodological transparency or being purely conceptually derived. Consequently, from a positivistic stance, there is no basis for wider generalization and mid-range theory development. To address this gap, the thesis at hand constructs a conceptually grounded and empirically derived circular business model taxonomy. Following existing approaches to taxonomy development and building upon an extensive literature review as well as empirical data, it first creates an integrative framework on which basis circular business models can be described. In the process of its development, also a binary-coded matrix expressing the defining business model characteristics of 100 randomly selected firms is generated. This data is subsequently analyzed using hierarchical and non-hierarchical cluster analysis techniques. The final cluster solution reveals a set of seven major circular business model types which are further characterized on the basis of descriptive statistics and representative case examples. Split-sampling and the application of different cluster algorithms indicate that the solution is stable and a silhouette coefficient of 0.53 strengthens its internal validity. Finally, a comparison with existing classifications demonstrates the taxonomy’s usefulness. While not generating a definitive answer, the proposed circular business model taxonomy provides a novel perspective on the question of what types of circular business models exist and how they can be characterized. It offers a stepping stone for mid-range theory development and in combination with the review of 116 circular business model publications gives a comprehensive overview of the phenomena’s current manifestations. From a practical viewpoint, the thesis’ findings provide useful insights into the structure of circular business models thereby serving as a source of inspiration for the development of new models and as a tool for the strategic positioning of existing ones.
  • ... Circular economy focused research has grown quickly and is seen to hold promise to stimulate a sustainable transition. However, many contributions are conceptual and focus upon 'what' changes are required to product design [5,71], business models [12,72], and the required value-network [73,74]. Studies that explore 'how' to operationalise and implement such changes, especially collaboratively, are needed but are lacking [4,75]. ...
    Article
    Full-text available
    Collaborative innovation is necessary to explore and implement circular economy strategies. Yet, empirical investigations into such collaborations are scarce. It is unclear whether the circular context creates differences or represents adaptions within how collaborative innovation is conducted. We draw upon strategic management and open innovation literature to highlight what is known about collaborative innovation and the types of innovation conducted. We use these insights to investigate explorative qualitative case research into how practitioners in the Netherlands have conducted collaborative circular oriented innovation. Our findings show that open innovation criteria can aid our understanding and analysis. Key managerial considerations relate to the incremental or systemic nature of the innovation pursued, which induce different collaborative projects and knowledge management structures. For incremental innovation, we observe phases of collaboration, whereas for more systemic innovation, we observe a more collaborative portfolio and layered approach. Furthermore, the more radical innovation pursuits that explore slowing or recovery strategies, especially beyond business-to-business arrangements, challenge companies. A crucial challenge remains related to how to develop and assess collaborative and system-oriented business models in the transition towards a circular economy. Finally, future research is needed to assess whether the current modes of collaborative innovation are sufficient to deliver a circular economy transition.
  • ... Empirical studies could therefore analyse the interplay of different types of sustainability innovations and how these translate into different business model patterns (cf. Lüdeke- Freund, Carroux, Joyce, Massa, & Breuer, 2018;Lüdeke-Freund, Gold, & Bocken, 2019) and different business cases. Moreover, only a few barriers to sustainability innovation are explicitly addressed in the discussion of the mediating and moderating relationships. ...
    Article
    Full-text available
    This article introduces the business models for sustainability innovation (BMfSI) framework to study how business models mediate between sustainability innovations and business cases for sustainability. The BMfSI framework integrates two major perspectives (implicitly) found in the sustainable business model literature. The first is the agency perspective. It takes into consideration that some form of agency is needed, that is, “someone” who takes decisions and acts. Sustainable entrepreneurs are discussed as those agents who align their new or existing business models with sustainability innovations in order to be successful in business and to create value with and for stakeholders. The second perspective is the systems perspective, which acknowledges that business models are always embedded within sociotechnical contexts through which, for example, public policies, private financing, or stakeholder interests influence whether and how business models can be developed. The agency and systems perspectives are integrated in the so‐called business model mediation space. This theoretical notion embraces the decisions and activities pursued by sustainable entrepreneurs as they align their business models with sustainability innovations on the one hand and the influence of environmental contingencies, barriers, and stakeholders from the sociotechnical context on the other hand. The paper concludes with propositions for future research derived from the BMfSI framework.
  • ... Recent studies on value chain configurations identify another hybrid form of value chain configuration in industrial markets: package logic, based on offering customization projects (Johansson & Jonsson, 2012). In fact, in the sharing and circular economy, the conventional forward value chain turns into a closed-loop value chain, comprising activities related not only to the production stage, but also consumption and circulation stages (Kortmann & Piller, 2016;Lüdeke-Freund, Gold, & Bocken, 2019). ...
    Article
    Full-text available
    Value is the unit of analysis for a business model, and also the main goal of strategy. From both an academic and a practical point of view, the question that guides the definition of a business model is: how to create, configure and appropriate value? Strategic management and business model theories have already progressed significantly in some aspects of value, but present major misunderstandings to answering this question, especially because they still work from a static view of value, based only in the content or result. The paper aims to develop a theoretical articulation of business model and strategy through a dynamic perspective of value, based on the combination of strategy content and strategy process. In order to accomplish this task, it tooks contributions from several fields of knowledge underpinning value, such as economics, marketing, strategic management and organizational configuration. The main proposition is that a business model is an emergent structure, defined through the interplay of strategic decisions for discovering and recognizing opportunities (value creation) but also for implementing (value configuration) and profiting from them (value appropriation).
  • ... Research on "what"questions focus on the constitution of circular BMs, the description of properties and features of individual circular BM elements or circular BM design strategies that can be summarized as conceptual debates (e.g. Bressanelli et al., 2018;Lewandowski, 2016;Lüdeke-Freund et al., 2018;Manninen et al., 2018;Planing, 2018;Urbinati et al., 2017). Despite, and in part because of, the discourses on the definitional ("what"), motivational ("why"), and risks ("why-not") issues, there is still missing a significant investment in scientific knowledge production, apart from a few exceptions (e.g. ...
    Conference Paper
    Full-text available
    Practitioners from politics, economics, and the civil society, but also scholars increasingly recognize that business contributions to a circular oriented transition of the society are founded in new business models. However, most research in this field remains theoretically conceptual and offers a rather static view of a complex and constantly changing reality. This study strives to contribute to the shift in the circular business model debate from its definitional and motivational aspects to the understanding of organizational dynamics connected to the efforts of firms that experimenting with circular oriented business configurations. Based on eight problem-centered expert interviews with business consultants, the study provides a set of propositions on how they are framing corporate transitions towards value creation systems to slow down resource flows. It reveals starting points for understanding patterns of circular change in firms, which may simultaneously serve as impulses for future research investigations.
  • ... Business model innovation is the bottom-up engine towards a Circular Economy (CE). Circular business models (CBMs) provide the rationale so that companies and individuals can consistently operate and benefit from value retained in products and materials (Bocken et al., 2016;Lüdeke-Freund et al., 2018). Increased complexity is commonly linked to CBM innovation. ...
    Preprint
    Full-text available
    Static approaches for business modelling cannot cope with the increased complexity commonly linked to Circular Business Model (CBM) innovation. In this research, we aim to investigate whether System Dynamics (SD) modelling is suitable to verify the long-term behaviour and impacts of CBMs by applying it to a particular case study. The dynamics of a closed sharing platform for healthcare institutions are modelled and simulated. The dynamics of sharing durables and consumables is represented through (1.) a causal explanation of the behaviour, (2.) the structure of stock and flows and (3.) verification through simulation. Results indicate substantial potential impacts for durable products. Products lifecycle time and the number of use cycles determine this behaviour. The use of SD enables experimenting with CBM in this case by connecting the dynamics of sharing to the use of resources and its impacts. Further research should verify the possibilities to design enhanced CBMs from interventions evidenced by modelling.
  • ... Bocken et al. (2014) developed eight archetypes of sustainable business models to categorize business innovations that deliver sustainability. More detailed typology with a focus on the circular economy concept by Lüdeke-Freund and Bocken, (2018) identified 26 circular economy business model patterns. While these categorizations provide mechanisms and design strategies to embed sustainability in business models, a systematic comparison of business options is hampered by the detachment between the strategy and specific products and services. ...
    Article
    Consumer products are increasingly offered through renting and sharing, which are emerging as alternative business models to purchasing. These business models have the potential to environmentally benefit society through fulfilling consumer demands using fewer artifacts. Past studies performed qualitative and quantitative analysis on the extent of the benefits, but they are predominantly paired comparative studies of a traditional model with one or two alternative models. Rather than a paired comparative study, a one-to-many comparative study would be more appropriate to reveal the condition that makes a provision system more environmentally advantageous among available opportunities. To systematically compare the environmental impact of diverse provision models of consumer durables, a typology was developed based on three environmentally decisive features of business models: value capture mechanism, product provider, and the combination of associated services. When the operating business models of automobiles and books were examined using the typology, 15 and 11 models were identified, respectively. The greenhouse gas emission analysis identified decisive factors in the environmental impact of provision models among all available business options. This study presents the typology that can position current business practices, quantitatively analyze their performance, and generate alternatives for environmentally-driven business expansion.
  • ... Educating potential customers especially in B2B or B2G sectors on the quality and functionally of tyre-recycled rubber products may open additional opportunities to diversify customer segments and expand the market share in Latvia. Xpo -company does not obtain, but has a strong potential to acquire this opportunity with comparatively minimal efforts Source: created by the authors adapting from Ludeke-Freund and co-authors [6] From the perspective of new CMB, the use of pyrolysis for production of fuel from pyrolysis oil has not been successfully introduced in Latvia. The lack of proper certification to be used and sold this fuel in the market is one of the issues to be solved in order to maximise new CBM opportunities provided. ...
  • ... The past few years has witnessed a boom in literature on circular business models (Lüdeke-Freund et al., 2019). In this context, the dynamic between the private sector and the state is often framed as "led by business for a profit within the 'rules of the game'" (Webster, 2013). ...
    Chapter
    Full-text available
    The Handbook of the Circular Economy covers the issue to which it is dedicated in a manner as comprehensive as possible within the scope of a handbook. This final chapter identifies and addresses some key issues related to circular economy: how it can be implemented sustainably taking into account its limitations, the role of analytical tools, barriers and how to overcome them, and concluding remarks. The circular economy is a viable alternative to the linear economy. By maximising the value of resources along the life cycles of the products that contain them, resources can be used more efficiently and effectively, and negative environmental, economic and social impacts associated with the life cycle of products can be minimised. Hence, the circular economy offers a clear solution that meets current policy goals. There is tremendous scope for increasing the share of the circular economy in the global economy.
  • ... Toffel (2004) identified strategic motives for a central actor's decision to coordinate reverse operations. Addressing circularity strategically requires a redefinition of "how companies create and capture value" (Lüdeke-Freund et al., 2018, p. 3), often leading to new business models and the design of new "value creation systems" (p. 6). ...
    Article
    Full-text available
    Slowing and closing product and related material loops in a circular economy (CE) requires circular service operations such as take-back, repair, and recycling. However, it remains open whether these are coordinated by OEMs, retailers, or third-party loop operators (e.g., refurbishers). Literature rooted in the classic make-or-buy concept proposes four generic coordination mechanisms and related value creation architectures: vertical integration, network, outsourcing, or doing nothing (laissez-faire). For each of these existing architectures, we conducted an embedded case study in the domain of smartphones with the aim to better understand how central coordinators align with actors in the value chain to offer voluntary circular service operations. Based on the above coordination mechanisms, our central contribution is the development of a typology of circular value creation architectures (CVCAs) and its elaboration regarding circular coordination, loop configuration, and ambition levels. We find that firms following slowing strategies (i.e., repair, reuse, and remanufacturing) pursue higher degrees of vertical integration than those following closing strategies (i.e., recycling) because of the specificity of the assets involved and their greater strategic relevance. The typology also shows that higher degrees of vertical integration enable higher degrees of loop closure (i.e., from open to closed loops) and better feedbacks into product design. Furthermore, we differentiate the understanding on third-party actors by distinguishing between independent and autonomous loop operators. Overall, we strengthen the actor perspective in product circularity literature by clarifying the actor set, their interrelationships, and how they form value creation architectures.
  • ... Business models can range from strictly firm-centric models to more network-embedded types (Bankvall, Dubois and Lind, 2017). Their scope can even be as broad as circular economy business model considerations (Lüdeke-Freund, Gold and Bocken, 2019). This study perceives BMs as firm centric. ...
  • ... More recently, Urbinati et al. [61] proposed a taxonomy of business models based on CE and its impact on efficiency levels, identifying two dimensions to define indicators: (i) the customer value proposition and interface and (ii) the value network. Lüdeke-Freund et al. [62] conducted a review and analysis of 26 CE businesses, identifying six major dimensions: (i) repair and maintenance; (ii) reuse and redistribution; (iii) refurbishment and remanufacturing; (iv) level of recycling; (v) level of reuse; and (vi) organic raw material business model patterns. ...
    Article
    Full-text available
    In this paper, a number of indicators are shown to measure economic efficiency in terms of circular economy (CE). The European Union affirms the need for a comprehensive model of indicators relating to CE in order to meet the needs of all participants (individual companies and industry, society, and the nation), to be based on three perspectives: environmental impact, economic benefit, and resource scarcity. Therefore, the objective of this work is to define these indicators and establish models for measuring the efficiency of processes and products of CE (through Data Envelopment Analysis, (DEA)) in its different manifestations. The models will be useful for both organizations and external users in relation to CE in order to facilitate the search for indicators for all users. Following the bibliographic review of official reports and different high impact works, our results demonstrate the ability to obtain information concerning the main indicators of CE and how the efficiency of CE models has been measured through the most frequently used inputs and outputs.
  • ... The concept of circular economy (CE) has been proposed to replace the unsustainable takemake-dispose approach of linear manufacturing [1]. The sensu stricto definition of CE [2] concerns the technological cycle of resources mainly through the slowing and closing of resource loops, and is the subject of extensive research [3,4]. ...
    Article
    Full-text available
    Circular economy has gained momentum since the 1970s as a regenerative alternative to the traditional linear economy. However, as the circular economy has gone mainstream, circularity claims have become fragmented and remote, consisting of indirect contributions, such as the life extension of other products and the use of waste as feedstock, without addressing the actual cause of waste. The present study aims to identify the strategic motivations of manufacturers participating in the circular economy and the corresponding relationship to ecological embeddedness. This paper explores the circular economy in manufacturing through existing products on the market and their relationship to eco-design by considering the product, packaging, and its production. Legitimacy is found to be a decisive factor in whether the type of circular economy strategy manufacturers adopt yields ecological benefits. The results from the case study of products clearly indicate the superiority of ecological embeddedness, as a form of circularity supporting strong sustainability. Finally, a novel template is proposed to support the implementation of ecological embeddedness in manufacturing.
  • ... BMs are representations of how businesses create economic value for a company through the creation of value for its customers [11]. The incorporation of CE principles [12] to the business gives rise to CBM, where the value is created through the interrelation of activities [13]. ...
    Article
    Full-text available
    The purpose of this paper is to conceptualize a circular business model based on an Eco-Holonic Architecture, through the integration of circular economy and holonic principles. A conceptual model is developed to manage the complexity of integrating circular economy principles, digital transformation, and tools and frameworks for sustainability into business models. The proposed architecture is multilevel and multiscale in order to achieve the instantiation of the sustainable value chain in any territory. The architecture promotes the incorporation of circular economy and holonic principles into new circular business models. This integrated perspective of business model can support the design and upgrade of the manufacturing companies in their respective industrial sectors. The conceptual model proposed is based on activity theory that considers the interactions between technical and social systems and allows the mitigation of the metabolic rift that exists between natural and social metabolism. This study contributes to the existing literature on circular economy, circular business models and activity theory by considering holonic paradigm concerns, which have not been explored yet. This research also offers a unique holonic architecture of circular business model by considering different levels, relationships, dynamism and contextualization (territory) aspects.
  • ... We are inspired by the previous work of Plewnia and Guenther (2018), T€ auscher and Laudien (2018), and Lüdeke-Freund et al. (2019), using morphological analysis to model sharing economy business models, platform business models, and circular economy business models, respectively. Morphological analysis is a qualitative modelling method to structure and analyse multidimensional objects such as business models (Eriksson and Ritchey, 2002;Lüdeke-Freund et al., 2019;Plewnia and Guenther, 2018). As a method, it is a structured and comprehensive procedure to develop and describe all relevant business model attributes in a given context (Kwon et al., 2019). ...
    Article
    Full-text available
    Background The predominant focus of academic research on the sharing economy has been on Airbnb and Uber; to this extent, the diversity of business models ascribed to the sharing economy has not yet been sufficiently explored. Greater conceptual and empirical research is needed to increase understanding of business models in the sharing economy, particularly attributes that deliver on its purported sustainability potential. Objective We aimed to elaborate an improved sharing economy business modelling tool intended to support the design and implementation of sharing economy business models (SEBMs) with improved sustainability performance. Methods We used a structured approach to business modelling, morphological analysis, to articulate relevant business model attributes. Our analysis was informed by a narrative literature review of business and platform models in the sharing economy. We also iteratively tested, refined, and evaluated our analysis through three structured opportunities for feedback. Results The output of the morphological analysis was a sharing economy business modelling tool for sustainability, with stipulated preconditions and descriptions of all business model attributes. Conclusion The sharing economy is not sustainable by default, so we must be strategic and deliberate in how we design and implement SEBMs. The sharing economy business modelling tool should be of interest not only to researchers and practitioners, but also to advocacy organisations and policymakers who are concerned about the sustainability performance of sharing platforms.
  • ... Demand for innovation, policy related to environmental sustainability and the demand for green alternatives can drive economic performance within this economy (Cainelli et al., 2020). A fundamental concept within this industrial system is to redesign the supply chain and create value for the organisation as well as the wider environment (Lüdeke-Freund et al., 2019). Organisations may face some barriers to adopting this change, such as institutional, behavioural and market barriers, however, the type and magnitude of the barriers are heavily dependent on the individual characteristics of the organisation (Diaz Lopez et al., 2019). ...
    Article
    Treated waste-water sludge (biosolids) are frequently recycled in agricultural lands; however, this practice has polluted soils with microplastics (MPs), nanoplastics (NPs), synthetics, heavy metals, pharmaceuticals and engineered nanoparticles. This study analyses many of the significant research outcomes in this area and proposes the urgent reduction of biosolids recycling in farmlands, aiming to eliminate their use altogether as soon as practicable, and instead, to utilise this material as a source of brick firing energy in the manufacturing of fired clay bricks and as a replacement for virgin brick soil. Based on a comprehensive data analysis, this study has calculated that in the European Union, the United States, China, Canada and Australia, approximately 26,042, 21,249, 13,660, 1,518 and 1,241 tonnes of microplastics, respectively, are added to farmlands annually as a result of biosolids application. The accumulation of microplastics produces detrimental effects on soil organisms and increases the accumulation of other micropollutants, such as heavy metals. The degradation of MPs over time is a source for the creation of nanoplastics, which pose a greater threat to ecosystems and human and animal health, as their size allows for their absorption into plant cells. On the other hand, the results of a comprehensive study at RMIT, including a comprehensive Life-Cycle Assessment, confirm that recycling biosolids in fired clay bricks (Bio-Bricks) is a promising sustainable alternative. This study proposes the mandatory addition of 7% biosolids in all brick manufacturing worldwide to utilize all biosolids production in fired clay bricks. This will reduce brick firing energy by over 12.5%.
  • ... The "circular" says more about the "cycle applicability" than about a self-contained circular business model. It is therefore helpful to place the innovation of 20 "circular" business models in the larger context and to see it as a bundle of business models along the closed-loop supply chain which enable a CE Van Wassenhove, 2006, 2009;Lüdeke-Freund et al., 2019). It is important, consequently, that the considerations of the boundary conditions are carried out over the entire closed-loop supply chain. ...
    Article
    Circular Economy (CE) is the buzzword of today, promising an economy able to prosper on limited resources by closing material cycles. However, there is no guarantee that simple strategies of material cycling, as propagated by the various definitions of this concept, will indeed lead to an economy able to manage the world's resources, pollution and societal demand within environmentally sustainable levels. Based on the shortcomings of the present mainstream definitions of CE, this paper proposes an integrative, cascading, resource-based approach aimed at an environmentally sustainable and socially beneficial economy. The international community agrees on the necessity to maintain the current environmental equilibrium to ensure equity for future generations and to allow human well-being and dignity already in the present. Accordingly, physical and environmental limitations are identified, that are to be observed to make CE sustainable. This paper then suggests that a transition towards a sustainable resource-based CE goes hand in hand with a paradigm shift in the way environmental considerations are perceived by individuals, codified in different normative frameworks and dealt with by private companies. It therefore opens the discussion by underlying some challenges that could appear in the view of transitioning to CE.
  • ... It must therefore consider temporal aspects that would be related to the technical life of the product and the duration of the cycle of use of the same one [72]. The value chains can be mapped to visualize the linkages and interactions between the different stages and chain actors to understand the complexities of such multi-actor systems and make informed decisions regarding the coordination and balance among stakeholders of a supply chain [74,75]. For this reason, [45] consider that greater intensity is required in the relationships established in the supply chain and with customers. ...
    Article
    Full-text available
    Circular economy is an alternative to the traditional production model and has therefore attracted a great deal of attention from researchers. The change in the production system is accompanied by new logistical needs related both to resources and waste and to the distribution and recovery of products. The circular supply chain involves return processes and the manufacturer intends to capture additional value in the supply chain. In this paper, value chains have been mapped to visualize the links and interactions between the different stages and actors to understand the complexities of these systems and to make informed decisions. For this reason, and based on thorough literature review, the final objective of this work is to achieve a conceptual framework to study circular supply chain, which uses the main theoretical perspectives in strategic management literature. Four dimensions have been identified to support the development of these new supply chains-greater intensity in the relationships established in the supply chain, adaptation of logistics and organizational, disruptive and smart technologies, and a functioning environment. It can be concluded that to develop a new relationship capacity will allow for reaching more frequent, closer relationships with more actors. These relationships will be developed within an adapted organizational and logistical framework that is framed in new business model archetypes. However, dimensions related to the business environment such as sectoral, legislative, and fiscal frameworks must be incorporated.
  • ... The problem is that our economy carries out a linear transformation, while that of nature is cyclical. To try to prevent the current economic system from persisting in the linear model, the Circular Economy advocates a circular system based on the following three key principles: preserve and improve natural capital, controlling finite stocks and balancing the flows of renewable resources; optimise the use of resources; and reveal and eliminating negative externalities [32,33]. ...
    Article
    Full-text available
    Since the end of the last century, different approaches for corporate management have been appearing that try to incorporate the social advances that are being produced and disseminated thanks to the greater capacity of communication available through social networks and other traditional avenues. Among the best known are Corporate Social Responsibility, Sustainability, the Circular Economy, and Collaborative Economics. All of them add value to organisations, and all of them have a common characteristic: they are anthropocentric approaches. Our proposal goes a step further: we need a worldview that is capable of placing organisations in a position of continuous learning looking at nature, because it is the best way to integrate into it as a more ecosystem and thus achieve its flowering respecting the once to all the other subsystems that make up the planet: Organizational Biomimicry. This work compares the anthropocentric vision with the worldview at the same time that it offers a guide of the essential steps so that Organizational Biomimicry is the new model of corporate management.
  • ... While providing new opportunities for companies to create and capture value Bakker et al. 2014b;Moreno et al. 2016), adopting CE strategies also requires holistic and radical changes in companies' offers and value chains (Urbinati et al. 2017;Lüdeke-Freund et al. 2019a;Rosa et al. 2019;Wells and Seitz 2005). This can be changes downstream in a companies' value chain processes (e.g. ...
    Thesis
    Full-text available
    Today our economy is largely based on linear material flows, and many products, such as electronics, furniture, building materials and textiles, are discarded even when they could still be used. Without urgent action, global waste is expected to increase by 70% by 2060 and global materials use is expected to more than double. We are starting to realise that linear material flows are not only a loss of valuable products and materials, but are also inconsistent with ‘planetary boundaries’ and are a main cause of sustainability challenges. More than 50% of all greenhouse gas emissions are estimated to derive from materials management in our economy. One proposed solution is a shift towards a circular economy, in which products are not discarded; instead, their embedded economic and environmental value is retained for as long as possible in a closed-loop system. This is achieved through, for example, reuse, repair and remanufacturing of products, or recycling. Many suggest that a circular economy also offers new business opportunities for companies. This thesis focuses on how companies can devise ‘circular’ business models (CBM) to capitalise on such opportunities, focusing on CBMs that retain value embedded in products and materials. Based on pioneering companies that have devised CBMs for value retention, the thesis examines what value their business model creates for the environment, business, society, and customers, and how value is created. The thesis also explores how tools to help practitioners integrate circularity in their business model can be developed and improved. A key finding is that CBMs for value retention have significant potential to reduce environmental impact, may have a promising business case, could generate employment, and could produce additional customer value. However, value is not created by default. Recommendations to secure value creation along the various value dimensions are provided. To help practitioners integrate circularity in their business models, a structured overview of CBM innovation tools is presented and a CBM canvas for value retention proposed. A guideline shows how CBM tools can be developed to more effectively support practitioners. Future research is needed to improve methodology for comparing financial and societal value creation by circular versus linear business models. Implications for value creation if CBM were upscaled need further investigation. Whether the financial value alone will be sufficient to incentivise businesses to shift towards CBMs within the short time window we have to address climate collapse remains doubtful, so research is needed on policy interventions that can help accelerate the transition.
  • ... The adoption of IS can create economic benefits for companies, as well as environmental and social benefits for the society (e.g., Jacobsen, 2006;Taddeo et al., 2017b). Nowadays, IS is considered a key strategy supporting the transition towards the circular economy, so that the attention received in the literature by the topic is grown a lot (e.g., Baldassarre et al., 2019;Domenech et al., 2019;European Commission, 2015;Lüdeke-Freund et al., 2019;Taddeo et al., 2017a). In fact, according to Scopus, since the late 90 s around 1000 scientific papers have been published ( Fig. 1) by more than 1900 scholars, who are part of a large scientific community with several research groups spread across the world (Fig. 2). ...
    Article
    Full-text available
    During the last two decades, the literature devoted great attention to industrial symbiosis (IS) as an effective strategy to achieve environmental, economic, and social benefits. Accordingly, a wide range of numerical indicators – highly different among them for scope, definition, purpose, and applications – have been developed, to characterize and measure IS. The paper proposes a taxonomy of these indicators with the aim of facilitating their adoption and proper usage in practice. The taxonomy is developed on the basis of a literature review and is addressed to answer three main questions: (1) what to measure, (2) where to measure, and (3) how to measure. This offers a clear picture of available relevant IS indicators in terms of purpose, context, and methodology.
  • Article
    The purpose of this study is to analyze how the maturity stages of the adoption of circular economy practices are related to the circular economy business models. The study highlights a case study in which original datasets were collected through an in-depth interview within 10 analysis units and secondary sources. The case study examines the Santa Catarina Association of Fine Wine Producers of Height (ACAVITIS), a group that includes 28 associates. The relationship identified between the maturity stages and the practices of circular economy provides evidence that will fulfil the premises of the ReSOLVE Model and the 5Rs. Contributions/value: These evidences contribute to highlight the following contributions of the study: (i) circular economy has relation with stages of maturity of the analysed business models; (ii) advanced stages of maturity, that is, between 3 and 5 are interfaced with a variety of practices of circular economy; (iii) duration of the enterprise, level of education and portfolio of manufactured products do not have a strong direct relationship with the engagement with the circular economy; (iv) the practices of circular economy are already established in the analysed units of analysis, but they demand optimisation and management to make them more efficient and that can impact even more positively in the family wine production model. It is suggested that new studies be carried out to confirm and generalize the findings of this research, especially those that test hypotheses evidencing the relationship between circular economy practices and maturity stages of business models.
  • Article
    Waste generation, especially hazardous waste, can strongly affect the environment and human lives. There is an urgent need to implement sustainable hazardous waste management tools to reduce their harmful impact on the environment stemming from incorrect waste management. However, there is still a lack of business model concepts combining sustainable development and risk management in reverse logistic value chains for hazardous waste. Therefore, the authors develop a novel sustainable business model canvas for both an entity and the logistics system using the Osterwalder’s Business Model Canvas integrated with the concept of sustainable development in economic, social and environmental areas (Triple Bottom Line, TBL) and risk-related elements. Then, using the developed sustainable business model canvas, the model for the logistics system for the treatment of hazardous waste containing asbestos was successfully created. The model was implemented in the prototype of computer software in the form of electronic network services.
  • Article
    Full-text available
    The concept of circular economy (CE) has recently gained momentum in the political, scientific, and economic debate, especially in China and Europe. As a result, organizations and scholars have started to establish different sets of principles for its adoption. For this reason, it is important to identify and assess the differences and similarities among existing sets of CE principles, and how organizations and individuals understand and translate them into practice. In this paper, we firstly present a brief review and analysis of the coherence among six existing sets of principles. Our analysis finds that, despite the mixed degree of coherence, all sets describe the necessity to implement CE principles at all levels of a company. We then present the results of an in-depth qualitative survey that investigates how 19 key informants representing small, medium, and multinational companies based in China understand and carry out the CE principles laid out by the BSI standard BS 8001:2017; how these principles can transform the culture and processes of these companies; and what are the opportunities and threats that such transformation can bring. Results describe a good awareness and knowledge of the CE principles and an optimistic outlook concerning their adoption. At the same time, numerous barriers and threats that the implementation of these principles might entail are presented. Overall, respondents confirm the complexity of implementing the principles of the CE in an integrated and consistent way in the management and strategies of Chinese companies and highlight the challenges that might arise during their implementation.
  • Research
    Full-text available
    Das Verpackungsaufkommen steigt stetig an. Dies betrifft gleichermaßen die Produktverpackungen in den Regalen als auch die Transportverpackungen entlang der Lieferkette und Versandverpackungen. Plastikverpackungen tragen mit ihrer kurzen Lebensdauer und geringen globalen Recyclingraten zur Anhäufung von Makro- und Mikroplastik in der Umwelt bei – mit unklaren Auswirkungen auf Mensch und Natur. Und Plastik durch Papier und Glas zu ersetzen, ist nicht immer umweltfreundlicher. Stattdessen gilt es, vorbeugend Angebot und Nachfrage kurzlebiger Verpackungen aktiv und systematisch zu verringern. Unternehmen befinden sich in einer strategisch wichtigen Position, um wirksame Änderungen herbeizuführen. Der Einzelhandel setzt bereits einzelne Maßnahmen für weniger Verpackungen um. Dabei fehlt jedoch eine umfassende Strategie. Das Forschungsvorhaben Innoredux will Entscheidungsträger/innen deshalb zeigen, wie die Integration von verpackungsreduzierenden Maßnahmen auf Geschäftsmodellebene den Weg für ein proaktives und langfristig nachhaltiges unternehmerisches Handeln ebnen kann. Erstes Zwischenergebnis ist eine Taxonomie der nachhaltigkeitsorientierten Verpackungsreduktion (novo-Taxonomie). Die dort identifizierten Ansätze beschreiben sechs Herangehensweisen, um eine umweltfreundlichere Verpackungsalternative zu etablieren. Diese reichen von Verpackungsverzicht und -reduktion über Mehrweg und Substitution hin zu komplexeren Verfahren wie ein Re-Design von Verpackungen oder das Angebot weiterer Serviceleistungen. Mögliche Konsequenzen einer Einführung neuer Verpackungslösungen beschreiben wir differenziert auf Geschäftsmodellebene mithilfe des Business Model Canvas von Osterwalder und Pigneur und entwickeln darüber Typen verpackungsreduzierender Geschäftsmodelle im Einzelhandel. Unternehmensverantwortliche können anhand der Typen sondieren, welche Verpackungsinnovationen zu ihrem Unternehmen passen, und abschätzen, welche Änderungen damit einhergehen würden. Dies sorgt für weniger Unsicherheiten und bessere Steuerbarkeit in den ansonsten komplexen Innovationsprozessen.
  • Article
    Full-text available
    Kiertotalouden edistäminen on 2010-luvun lopulla nostettu Suomessa keskeiseksi politiikkatavoitteeksi. Materiaalivirtojen sulkeutumista yleisellä tasolla kuvaavat kiertotalousmallit eivät kuitenkaan tarjoa selkeitä ohjenuoria siihen, millä tavoin ja kenen toimesta kiertotaloussiirtymä tapahtuu. Me kysymme tässä artikkelissa, mitä kiertotalouspilottien tutkimuksella voi oppia kiertotalouden edistämiseen liittyvistä laajemmista yhteiskunnallisista jännitteistä. Analyysimme kohteena on yhden kiertotalouden pioneeriyrityksen kamppailu lannan muuntamiseksi sikatalouden tuottamasta haitallisesta ylijäämästä hyödyntämiskelpoiseksi ravinnetuotteeksi ja energiantuotannon raaka-aineeksi. Tutkimme, millaisiin aineellisiin järjestyksiin toimijat törmäävät etsiessään ratkaisuja kiertotalouden peruskysymykseen, ylijäämäisten materiaalien muuntamiseen resurssiksi. Tarkastelemme kokeiltuja kiertotalousratkaisuja metabolisia suhteita uudelleen järjestelevinä teknologioina, jotka ovat poliittisia siinä mielessä, että ne pyrkivät avaamaan uusia tulevaisuuspolkuja intensiiviselle eläintuotannolle. Samalla ne törmäävät erilaisiin olemassa olevaa yhteiskunnallista järjestystä ylläpitäviin hallinnan teknologioihin ja kategorisointeihin, kuten ympäristötukijärjestelmään. Näiden törmäysten kautta paljastuu sellaisia kiertotaloussiirtymään liittyviä yhteiskunnallisia jännitteitä, jotka eivät artikuloidu poliittisilla areenoilla määrittelykamppailuina tai konflikteina. Väitämme, että konkreettisten kiertotalouspyrkimysten analyysi nostaa esille sen intressien, solidaarisuuksien ja historiallisten polkuriippuvuuksien kirjon, joka yleisen tason poliittisissa kiertotalousohjelmissa peittyy markkinointipuheen taakse.
  • Article
    Purpose This paper aims to investigate overlaps, complementarities and divergences between the literature on circular economy (CE) models and related literature in non-linear production models and frameworks, including CE, reverse logistics, closed-loop, industrial symbiosis and industrial ecology. Design/methodology/approach A systematic literature review was conducted focussing on the benefits of non-linear modes adoption. Findings The results show a high degree of convergence in findings, gaps and weaknesses of these literatures. Negative environmental, economic and operational impacts are understudied. There is a scarcity of studies identifying practices resulting in empirically tested benefits. The business and society case for non-linear production is still largely built upon conceptual studies, modelling and a few case studies. Despite a normative focus, there is very little use of theory, in particular, management theories. Research limitations/implications First, the authors use only one, albeit highly recognized database, Scopus. This database may have omitted some relevant research, journals such as the Journal of Cleaner Production and Resources Conservation & Recycling that are more likely to publish such research and also have a more interdisciplinary approach. This is an important gap and interesting result to claim for more interdisciplinary research. Second, the filtering process used and the focus on Association of Business Schools top journals may have also omitted some relevant research, such as a large stream of literature in specialist journals such as Resources Conservation and Recycling and the Journal of Cleaner Production . Practical implications There are contradictions, tensions and epistemological ambiguity that needs to be critically addressed. Such tensions may be associated with the knowledge field that gave rise to these different non-linear production approaches. Many of them appeared at the same time, but from different sciences and disciplines with their own perspectives. Then in doing so, they create confusion in the definitions of CE, assumptions underlying modelling and business choices arising from this complexity. This can be minimized through the critical interpretation of knowledge to elucidate epistemological quandaries to improve the understanding of the economic, social and environmental impacts of practices. Social implications In some way, this result makes sense, as the authors have limited the search to management, business and accounts journals, especially talking about Operations Management journals. This is an important gap and interesting result to claim for more interdisciplinary research. Originality/value In addition to gaps previously described, the authors identified areas of tensions where the literature offers inconclusive – often contradictory – findings requiring further exploration. A better understanding of these tensions is required to understand the impacts of non-linear production and develop policy guidelines for industry and policymakers to scale-up CE.
  • Purpose The purpose of this paper is to test the link between servitisation and circular economy by synthesising the effect of product-service systems (PSS) on supply chain circularity (SCC). Design/methodology/approach Following a systematic literature review methodology, the study identified 67 studies and synthesised them using content analysis. Findings A conceptual model is developed illustrating how PSS business models impact SCC through increased product longevity, closure of resource loops and resource efficiency. It also identifies six contextual factors affecting the implementation of SCC including: economic attractiveness of SCC; firm sustainability strategy; policy and societal environment; product category; supply chain relationships; and technology. Research limitations/implications The conceptual model proposes that SCC increases with servitisation. It also proposes that the main circularity effect stems from increased product longevity, followed by closed resource loops and finally resource efficiency. The model is deduced from the literature by using secondary data. Practical implications The review provides practitioners with a framework to increase SCC through PSS business models. It also gives insight into the various contextual factors that may affect how a manufacturer’s servitisation strategy contributes to SCC. Originality/value This review contributes to the understanding of the relationship between servitisation and SCC by synthesising the different effects that exist. Moreover, it creates new knowledge by identifying a range of contextual factors affecting the relationship between PSS and SCC.
  • Article
    Purpose This study aims to identify the legitimacy issues raised during a sustainable business model innovation, deployed by an Italian company, which was analyzed through the lens of the legitimation theory and the business model innovation theory. Design/methodology/approach A single case study methodology is employed for empirical research. Semistructured interviews, with top and middle management, were conducted together with the analysis of several internal and external documents, to corroborate the case analysis. Findings Results show how the potentiality of digital technologies allows the development of new sustainable business models, which, though, still need to gain legitimation to be accepted. The study findings allow drawing both on the business model innovation theory and on the legitimation theory, as they show how legitimation is a dynamic concept that involves internal as well as external stakeholders to support business model innovation. Originality/value The paper is novel, since it addresses the topic of sustainable business models development, showing how companies can get legitimation. The paper builds on existing theories and provides a practical example.
  • Article
    Today production industry has increasing incentives to be resource efficient and sustainable. Many residual material streams from production processes are therefore recycled internally; however, some streams might be of better use in another industry. In this study, factors seen as encouraging and/or barriers in the work towards an industrial symbiosis with residual materials, between two or more industries, were identified. The factors were divided into five categories: physical/technical, regulatory, business, motivation and society, on three organisational levels. Based on the key factors, the time aspect for establishing an industrial symbiosis was studied and criteria that need to be met in order to carry on with a business idea for a residual material were divided into three work phases. The study shows that an industrial symbiosis based on residual materials on many levels differs from a business with main products, for example when it comes to laws and policies. With residual materials it is also extra important to have good understanding of the material properties and the customer’s material requirements. It was concluded that the establishment of industrial symbioses would be facilitated if all materials had the same conditions regardless of origin provided that the final product gets the same properties.
  • Article
    Cascading use of biomass is a recognized strategy contributing to an efficient development of the bioeconomy and for mitigating climate change. This study aims at assessing the potential of cascading use of woody biomass for reducing GHG (greenhouse gas) emissions and increasing the overall wood flow efficiency in the European Union’s forest and bioeconomy sectors. A life cycle approach was followed to quantify the potential benefits of cascading use of woody biomass. Different supply chain stages of production were analyzed: forgone fossil-fuels substitution, optimization at manufacturing level and forest regrowth. We started with the current waste wood and paper recycling practices (scenario S1). Then we compared this current scenario with two divergent options: a scenario in which all post-consumer wood and paper waste is fully re-utilized for energy (S0) and a scenario with optimized future product cascading (S2).  Through maximized product recovery and zero waste strategy (optimized cascading), the wood use efficiency ratio (cascade factor) in the European wood sector would be increased by 9% (S2 vs S1). The optimal cascading leads to more GHG savings (-7 MtCO2-eq/year) in the wood production sector, less GHG emissions in the energy sector (-1 MtCO2-eq/year) and less GHG emissions in the waste sector (-6 MtCO2-eq/year), when compared with current practices.  The wood use efficiency ratio in the European wood sector strongly decreases with direct energy use of all paper and wood waste (no product cascading), total by about 25% (S0 vs S1). The full energy scenario leads to additional GHG emissions in the waste sector (7 MtCO2-eq/year), in comparison with current practices. Although the GHG reduction effect is quite substantial for using all wood waste directly for energy in SO (-43 MtCO2-eq/year), that effect is largely counteracted by additional GHG emissions (28 MtCO2-eq/year) through the need of fresh fibers (instead of waste fibers) for the production of wood and paper products in SO. Overall, the optimal cascading S2 scores considerably better (-14 MtCO2-eq/year, equivalent with 8.3% GHG emission reduction) than the full energy scenario SO (-8 MtCO2eq/year or 4.7% GHG emission reduction), in comparison with current practices in the EU. This explorative study highlights the potential of cascading use of woody biomass in the wood production chains to contribute to a reduction of environmental impacts related to wood resource and energy use, relevant especially in meeting short-term (2020-2030) renewable energy targets.
  • Chapter
    Business models—the underlying structures of how companies create, deliver and capture value—form the engine of our economy. They determine the speed at which economies grow, and the intensity at which our resources are consumed. They determine the number and type of jobs in our cities, the provenance of the products we buy, and the price of the food we eat. They contribute to the quality of our communities and our lives.
  • Article
    In recent years in Sweden, interest has grown concerning the possibilities of biogas production from organic waste. This interest reflects a general concern over environmental sustainability in society. However, given the lack of financial backing and the competition of other energy producers, few Swedish biogas plants have been profitable. This is particularly the situation with farm-based biogas producers. One response to this problem in the farm-based biogas industry is to engage in business model innovation that can lead to new ways of organizing business structures and activities. This qualitative study, which takes an action research approach, explores the early phases (initiation and ideation) of the business model innovation process for sustainability at a biogas-producing farm cooperative in southern Sweden. The main activities and the actors who are central to the execution of these activities are identified in six sub-phases. The paper describes two Flourishing Business Canvas workshops in which the participants were the researchers, members of the farm cooperative, external consultants, and university students. This study contributes theoretically to the literature with its detailed examination of the early phases of the business model innovation process for sustainability. It also contributes to practice with its conceptual model that demonstrates how biogas producers and farm managers can innovate and transform their current business models towards sustainability in order to improve competitiveness and long-term profitability.
  • Article
    Full-text available
    The effort to build an EPR system for waste electrical and electronic equipment (WEEE) in China has created unexpected niches for innovation in business models for post-consumer recycling of e-waste as well as other recyclables in recent years. This study used action research to evaluate the performance of emerging business models for post-consumer recycling in urban China in recent years. We identified three categories of emerging models: (1) community-based programs targeting the garbage sorting behavior of consumers for all household waste, (2) reverse logistic systems with automatic vending machines attached to traditional commercial chains, and (3) pure internet solutions to bridge the transactions between the consumers and recyclers. All these business models share the common characteristic that they use internet technology, which is aggressively promoted in China as “Internet +” by both government policies and venture capital investment. The various business models serve as the link between the firm and the system level and reflect the diverse possibilities for the future evolution of the recycling system in China. We developed a qualitative evaluation framework with five elements including convenience for consumers, traceability for producers, profitability for recyclers, hybridity for collection, and reliability of the information used by the public to address the various values pursued by different actors involved in the recycling chains. The results reveal the dilemmas facing each business model in balancing among all the elements and highlight the governance challenge of integrating the EPR scheme with the municipal waste management system.
  • Article
    Full-text available
    This article reflects on the current state of the dynamically growing research and practice related to sustainable business models (SBMs), motivated by the question of whether dealing with SBMs is just a passing fancy or an emerging field, maybe even a field in its own right. We follow Ehrenfeld (2004), who asked a similar question for the field of industrial ecology in this journal, and reflect on the major beliefs and concepts underpinning SBM research and practice, tools and resources, authorities and the related community of actors. These elements are considered characteristics of a field and must be institutionalised in academia, industry and government for a field to emerge and progress. We therefore also identify some institutionalisation tendencies. As a result, we conclude that SBM research and practice show traits of an emerging field. It is however too early to foresee if it will develop as a sub-field within already established domains (“sub-field hypothesis”) or as a stand-alone field (“stand-alone hypothesis”). We argue that the sub-field and the stand-alone positioning may hamper the unfolding of the field's full potential. Instead, we propose that the SBM field needs to assume the role of an integrative field to break existing academic niches and silos and maximise practical impact (“integration hypothesis”). Our observations indicate that the SBM field is indeed developing into an integrative field and force. But we need to better understand and strengthen this development, for example by crafting a dedicated SBM research programme. A series of critical reviews could be a starting point for such an endeavour.
  • Presentation
    Full-text available
    The purpose of this research project is to consolidate the currently available knowledge about business model patterns that have the potential to support solutions to ecological and social problems, such as greener products, new mobility systems, or social enterprises. This consolidation will lead to a new pattern taxonomy that can be used to support sustainable business model innovation and sustainability innovations. In recent years, the value of using patterns to support business model development has been increasingly recognized and discussed in both research and practice. Already in Business Model Generation, Osterwalder and Pigneur describe five business model patterns using the Business Model Canvas in an attempt to create a shared language similar to Alexander’s pattern language. The use of patterns for sustainable business models is yet to be explored. This project intends to help close this gap. To identify such patterns the first step was to review 14 studies proposing a total of 102 potential SBM patterns. By deleting doublets and candidates that did not fully qualify as patterns in the sense of contextualised problem-solution combinations, we systematically identified a reduced set of 45 patterns ranging from eco-designed products and processes to social freemium models. In the second step, we used Alexander’s pattern template to describe these business model patterns in a consistent way. The third step involved a Delphi survey combined with a physical card-sorting method to arrange the 45 patterns in consistent and meaningful groups. Based on this expert consensus, we will set up the final SBM pattern taxonomy.
  • Article
    Full-text available
    Eco-efficient Value Creation is a method to analyse innovative product and service design together with circular business strategies. The method is based on combined analyses of the costs, market value (perceived customer value) and eco-costs. This provides a prevention-based single indicator for ‘external environmental costs’ in LCA. The remanufacturing of products is an environmental and sustainable approach, in the circular economy, and can deliver lower eco-costs of materials depletion and pollution. From a business point of view, however, remanufacturing seems to be viable in B2B niche markets only. In consumer markets, remanufacturing is less common. The question is how can remanufacturing become a viable business solution for mainstream consumer markets. Traditional ‘green’ marketing approaches are not enough: green has a positive, but also negative connotations, so marketing approaches are complex. By using the Eco-efficient Value Creation method, marketing strategies for the roll-out of remanufacturing in mainstream consumer markets, can be revealed. This approach has led to the development of five aspects, which are key to innovative circular business models, for remanufacturing: (1) buyers differ from the buyers of the ‘new product’ (2) quality must be emphasised in all communications (3) risk must be taken away from the buyer (4) top level service is required to convince the buyer (5) a ‘green’ brand may support the remanufactured product image.
  • Conference Paper
    Full-text available
    The purpose of this research project is to consolidate the currently available knowledge about business model patterns that have the potential to support solutions to ecological and social problems, such as greener products, new mobility systems, or social enterprises. This consolidation will lead to a new pattern taxonomy that can be used to support sustainable business model innovation and sustainability innovations. In recent years, the value of using patterns to support business model development has been increasingly recognized and discussed in both research and practice. Already in Business Model Generation, Osterwalder and Pigneur describe five business model patterns using the Business Model Canvas in an attempt to create a shared language similar to Alexander’s pattern language. The use of patterns for sustainable business models is yet to be explored. This project intends to help close this gap. To identify such patterns the first step was to review 14 studies proposing a total of 102 potential SBM patterns. By deleting doublets and candidates that did not fully qualify as patterns in the sense of contextualised problem-solution combinations, we systematically identified a reduced set of 45 patterns ranging from eco-designed products and processes to social freemium models. In the second step, we used Alexander’s pattern template to describe these business model patterns in a consistent way. The third step involved a Delphi survey combined with a physical card-sorting method to arrange the 45 patterns in consistent and meaningful groups. Based on this expert consensus, we will set up the final SBM pattern taxonomy.
  • Article
    Full-text available
    The population extinction pulse we describe here shows, from a quantitative viewpoint, that Earth’s sixth mass extinction is more severe than perceived when looking exclusively at species extinctions. Therefore, humanity needs to address anthropogenic population extirpation and decimation immediately. That conclusion is based on analyses of the numbers and degrees of range contraction (indicative of population shrinkage and/or population extinctions according to the International Union for Conservation of Nature) using a sample of 27,600 vertebrate species, and on a more detailed analysis documenting the population extinctions between 1900 and 2015 in 177 mammal species. We find that the rate of population loss in terrestrial vertebrates is extremely high—even in “species of low concern.” In our sample, comprising nearly half of known vertebrate species, 32% (8,851/27,600) are decreasing; that is, they have decreased in population size and range. In the 177 mammals for which we have detailed data, all have lost 30% or more of their geographic ranges and more than 40% of the species have experienced severe population declines (>80% range shrinkage). Our data indicate that beyond global species extinctions Earth is experiencing a huge episode of population declines and extirpations, which will have negative cascading consequences on ecosystem functioning and services vital to sustaining civilization. We describe this as a “biological annihilation” to highlight the current magnitude of Earth’s ongoing sixth major extinction event.
  • Article
    Additive manufacturing is a technology that makes it possible to directly produce parts from digital design models using additive production processes. The introduction of AM in manufacturing supply chains can be approached as an evolutionary design problem: How AM is initially introduced in operations affects requirements for the future development of AM technology, as well as the opportunities that open up for designing and managing supply chains in new ways. In this situation, when both the manufacturing technology and supply chain application side of the equation are undergoing change it is challenging to evaluate potential effects on sustainability. Nevertheless, we make an attempt to identify key problems for improving sustainability outcomes. In this column we focus on the problems that AM-enabled practices potentially may address and the impact of introducing AM on those problems, considering the current state of AM technology. DOI: 10.1111/jiec.12580
  • Article
    Full-text available
    There are two axioms that have shaped the degrowth discussion, namely one on the reduction of production and consumption and one on the necessity of value and attitude change in society to respect environmental limits. Surprisingly little research has focused on the role of technology in connection to value change, consumption behavior and degrowth. This gap is linked to a widely held assumption of technological innovation acting opposed to degrowth. In contrast, this paper suggests that technological innovation needs to be connected to degrowth. The fast evolution of information and communication technologies in recent years mirrors their growing importance for the global civil society, yet without adequately accounting for the scope of sustainability challenges connected to these technologies, and smartphones in particular. This paper argues that a degrowth movement going hand in hand with technological development is only possible if sustainable alternatives for highly demanded communication technology products are offered. Specifically, this study draws on lifestyle movements as the nexus between consumption, degrowth and technology. Three core concepts are found to influence the attendance to degrowth-related consumer movements: a sustainable lifestyle, alternative forms of consumption and social commitment, all of which are assumed to have a positive effect. Empirically, this paper draws on the case of Fairphone, a company that applies sustainable characteristics to a smartphone. Data were collected in a survey via online fora of Fairphone from November 4-29, 2015 and analyzed using a structural equation modeling with partial least squares. Results point to a sustainable lifestyle as the dominant factor explaining the involvement with the Fairphone. Surprisingly, the findings show that alternative consumption seems to negatively influence the involvement with Fairphone and social commitment seems to play only a minor role in the model. In other words, findings suggest that Fairphone represents a technical artifact, centered on a choice for a sustainable lifestyle, but has not become a symbol of alternative consumption and the degrowth movement. Future research needs to clarify the relationship of alternative consumption and degrowth related movements beyond this specific case. Furthermore, future studies need to delve deeper into lifestyle decisions as a leverage point towards degrowth and the potential of lifestyles understood as a from of activism to change contemporary society.
  • Article
    A circular economy (CE)-inspired waste management hierarchy was proposed for end-of-life (EOL) lithium-ion batteries (LIBs) from electric vehicles (EVs). Life cycle eco-efficiency metrics were then applied to evaluate potential environmental and economic trade-offs that may result from managing 1,000 end-of-life EV battery packs in the United States according to this CE hierarchy. Results indicate that if technology and markets support reuse of LIBs in used EVs, the net benefit would be 200,000 megajoules of recouped cumulative energy demand, which is equivalent to avoiding the production of 11 new EV battery packs (18 kilowatt-hours each). However, these benefits are magnified almost tenfold when retired EV LIBs are cascaded in a second use for stationary energy storage, thereby replacing the need to produce and use less-efficient lead-acid batteries. Reuse and cascaded use can also provide EV owners and the utility sector with cost savings, although the magnitude of future economic benefits is uncertain, given that future prices of battery systems are still unknown. In spite of these benefits, waste policies do not currently emphasize CE strategies like reuse and cascaded use for batteries. Though loop-closing LIB recycling provides valuable metal recovery, it can prove nonprofitable if high recycling costs persist. Although much attention has been placed on landfill disposal bans for batteries, results actually indicate that direct and cascaded reuse, followed by recycling, can together reduce eco-toxicity burdens to a much greater degree than landfill bans alone. Findings underscore the importance of life cycle and eco-efficiency analysis to understand at what point in a CE hierarchy the greatest environmental benefits are accrued and identify policies and mechanisms to increase feasibility of the proposed system.
  • Article
    Full-text available
    The idea of a circular economy (CE) has become prominent in both European and Chinese policy making. Chinese and European perspectives on a CE share a common conceptual basis and exhibit many similar concerns in seeking to enhance resource efficiency. Yet they also differ, and this article explores differences in the focus of CE policy in China and Europe. We present evidence on the differing understandings of the CE concept in Chinese and European policy discourse, drawing on qualitative and quantitative analysis of policy documents, media articles, and academic publications. We show that the Chinese perspective on the CE is broad, incorporating pollution and other issues alongside waste and resource concerns, and it is framed as a response to the environmental challenges created by rapid growth and industrialization. In contrast, Europe's conception of the CE has a narrower environmental scope, focusing more narrowly on waste and resources and opportunities for business. We then examine similarities and differences in the focus of policy activity in the two regions and in the indicators used to measure progress. We show differences in the treatment of issues of scale and place and different priorities across value chains (from design to manufacture, consumption, and waste management). We suggest some reasons for the divergent policy articulation of the CE concept and suggest lessons that each region can learn from the other.
  • Article
    Full-text available
    The sudden rise of the sharing economy has sparked an intense public debate about its definition, its effects and its future regulation. Here, I attempt to provide analytical guidance by defining the sharing economy as the practice that consumers grant each other temporary access to their under-utilized physical assets. Using this definition, the rise of the sharing economy can be understood as occurring at the intersection of three salient economic trends: peer-to-peer exchange, access over ownership and circular business models. I shortly discuss some of the environmental impacts of online sharing platforms and then articulate three possible futures of the sharing economy: a capitalist future cumulating in monopolistic super-platforms allowing for seamless services, a state-led future that shifts taxation from labour to capital and redistributes the gains of sharing from winners to losers, and a citizen-led future based on cooperatively owned platforms under democratic control. The nature and size of the social and environmental impacts are expected to differ greatly in each of the three scenarios. This article is part of the themed issue ‘Material demand reduction’.
  • Article
    There is ambivalence and uncertainty surrounding the stakeholder value impacts of increasingly influential collaborative consumption (CC) business models. While we observe such models expanding from developed to emerging economies we lack an understanding of the role played by the local context in which they are embedded. It can be assumed that stakeholder value impacts, both positive and negative, are particularly pronounced in emerging economies. We thus ask, what are the stakeholder value impacts of CC business models and how are they influenced by an emerging economy context? Based on case studies in transport and cleaning services in South Africa, we develop a model of the three-way interactions between local context, CC business model, and stakeholder value impacts. Further, we define CC business models as manifestations of two-sided markets, which allows us to better understand their positive and negative impacts on their key stakeholders. Our analysis shows that both new and established CC business models must be carefully adapted to local contexts to make best use of their potential to create stakeholder value and to avoid unintended negative impacts on vulnerable social groups.
  • Article
    Full-text available
    Contamination poses a significant problem to the circular economy, which derives much of its value from maintaining pure material flows. The aim of this paper is to frame contaminated interaction among other forms of contamination and investigate its effects on the circular economy. The research is based on a review of the contamination literature and case studies. We differentiate between three types of contamination influencing circular material flows: technical, which deals with fitness for use; systemic, which deals with efficiency in processing; and interaction, which deals with user-object interaction and decision making. Our focus is on developing a foundational understanding of contaminated interaction and how it influences circular processes. Through multiple examples, contaminated interaction is shown to create three barriers to the circular economy: downcycling, disposal and hindered circulation. Among other proposals to address contaminated interaction, the research calls for the development of experientially transferrable design—products that can move between users and uses without negative consequences.
  • Article
    Ever since the Internet boom of the mid-1990s, firms have been experimenting with new ways of doing business and achieving their goals, which has led to a branching of the scholarly literature on business models. Three interpretations of the meaning and function of “business models” have emerged from the management literature: (1) business models as attributes of real firms, (2) business models as cognitive/linguistic schemas, and (3) business models as formal conceptual representations of how a business functions. Relatedly, a provocative debate about the relationship between business models and strategy has fascinated many scholars. We offer a critical review of this now vast business model literature with the goal of organizing the literature and achieving greater understanding of the larger picture in this increasingly important research area. In addition to complementing and extending prior reviews, we also aim at a second and more important contribution: We aim at identifying the reasons behind the apparent lack of agreement in the interpretation of business models, and the relationship between business models and strategy. Whether strategy scholars consider business model research a new field may be due to the fact that the business model perspective may be challenging the assumptions of traditional theories of value creation and capture by focusing on value creation on the demand side and supply side, rather than focusing on value creation on the supply side only as these theories have done. We conclude by discussing how the business model perspective can contribute to research in different fields, offering future research directions.
  • Article
    Detailed and comprehensive accounts of waste generation and treatment form the quantitative basis of designing and assessing policy instruments for a circular economy (CE). We present a harmonized multiregional solid waste account, covering 48 world regions, 11 types of solid waste, and 12 waste treatment processes for the year 2007. The account is part of the physical layer of EXIOBASE v2, a multiregional supply and use table. EXIOBASE v2 was used to build a waste-input-output model of the world economy to quantify the solid waste footprint of national consumption. The global amount of recorded solid waste generated in 2007 was approximately 3.2 Gt (gigatonnes1), of which 1 Gt was recycled or reused, 0.7 Gt was incinerated, gasified, composted, or used as aggregates, and 1.5 Gt was landfilled. Patterns of waste generation differ across countries, but a significant potential for closing material cycles exists in both high- and low-income countries. The European Union (EU), for example, needs to increase recycling by approximately 100 megatonnes per year (Mt/yr) and reduce landfilling by approximately 35 Mt/yr by 2030 to meet the targets set by the Action Plan for the Circular Economy. Solid waste footprints are strongly coupled with affluence, with income elasticities of around 1.3 for recycled waste, 2.2 for recovery waste, and 1.5 for landfilled waste, respectively. The EXIOBASE v2 solid waste account is based on statistics of recorded waste flows and therefore likely to underestimate actual waste flows.
  • Article
    Mobile phones offer many potential social benefits throughout their lifetime, but this life is often much shorter than design intent. Reuse of the phone in a developing country allows these social benefits to be fully realized. Unfortunately, under the current state of development of recycling infrastructure, recovery rates of phones after reuse are very low in those markets, which may lead to an environmental burden attributed to loss of materials to landfill. In order to recover those materials most effectively, recycling in developed countries may be the best option, but at a cost of the ability to reuse the phones. The issues facing integration of social and environmental concerns into a single life cycle assessment (LCA) and resulting challenges of identifying the disposal option with the most sustainable outcome are explored using mobile phones as a case study. These include obtaining sufficient geographical and temporal detail of the end-of-life options, collation and analysis of the large amounts of data generated, and weighting of the disparate environmental and social impact categories. The numerous challenges may mount up to make performing LCA of mobile phones unwieldy. Instead of trying to encompass every aspect in full, it is proposed that focus is given to answering a question that takes into account the resources available: It is important to ask the question that has the best chance of being answered.
  • Article
    Full-text available
    Companies are more frequently seen shifting their focus from technological innovation towards business model innovation. One efficient option for business model innovation is to learn from existing solutions, i.e., business model patterns. However, the various understandings of the business model pattern concept are often confusing and contradictory, with the available collections incomplete, overlapping, and inconsistently structured. Therefore, the rich body of literature on business model patterns has not yet reached its full potential for both practical application as well as theoretic advancement. To help remedy this, we conduct an exhaustive review, filter for duplicates, and structure the patterns along several dimensions by applying a rigorous taxonomy-building approach. The resulting business model pattern database allows for navigation to the relevant set of patterns for a specific impact on a company's business model. It can be used for systematic business model innovation, which we illustrate via a simplified case study.
  • Article
    Full-text available
    The so-called circular economy—the concept of closing material loops to preserve products, parts, and materials in the industrial system and extract their maximum utility—has recently started gaining momentum. The idea of substituting lower-impact secondary production for environmentally intensive primary production gives the circular economy a strong intuitive environmental appeal. However, proponents of the circular economy have tended to look at the world purely as an engineering system and have overlooked the economic part of the circular economy. Recent research has started to question the core of the circular economy—namely, whether closing material and product loops does, in fact, prevent primary production. In this article, we argue that circular economy activities can increase overall production, which can partially or fully offset their benefits. Because there is a strong parallel in this respect to energy efficiency rebound, we have termed this effect “circular economy rebound.” Circular economy rebound occurs when circular economy activities, which have lower per-unit-production impacts, also cause increased levels of production, reducing their benefit. We describe the mechanisms that cause circular economy rebound, which include the limited ability of secondary products to substitute for primary products, and price effects. We then offer some potential strategies for avoiding circular economy rebound. However, these strategies are unlikely to be attractive to for-profit firms, so we caution that simply encouraging private firms to find profitable opportunities in the circular economy is likely to cause rebound and lower or eliminate the potential environmental benefits.
  • Chapter
    Full-text available
    New business models can make an important contribution to the transition to green growth. While some new business models involve large firms, others are small start-up firms that seek to exploit technological or commercial opportunities that have been neglected or not yet explored by more established firms. New firms tend to engage in more radical innovation than existing firms, and scaling up new business models can therefore help reduce environmental pollution, optimise the use of natural resources, increase productivity and energy efficiency, and provide a new source of economic growth. Although the market for green goods and services is growing, the development of new business models is affected by a range of barriers, many of which can be addressed by well-designed policies. Key areas for policy action include:  Strengthening market demand for green products and services by providing long-term and stable incentives for firms to internalise the environment and natural resources in their decision making, including through a well-designed regulatory framework and supportive demand-side policies.  Enhancing access to financing, including risk capital, by supporting market development for risk financing and the development of entrepreneurial skills.  Removing perverse subsidies support for existing business models and incumbent firms, such as energy subsidies; reducing the barriers to entry, exit and growth of new firms and business models; and improving the regulatory environment for start-up firms and new business models.  Reducing the costs of intellectual property rights, in particular for small and start-up firms.  Supporting skills development, including for existing workers.  Supporting R&D and innovation, including testing, demonstration and verification.  Improving governance, to ensure that national and regional policies for green growth are well aligned.
  • Article
    Full-text available
    While the terms Circular Economy and sustainability are increasingly gaining traction with academia, industry, and policymakers, the similarities and differences between both concepts remain ambiguous. The relationship between the concepts is not made explicit in literature, which is blurring their conceptual contours and constrains the efficacy of using the approaches in research and practice. This research addresses this gap and aims to provide conceptual clarity by distinguishing the terms and synthesising the different types of relationships between them. We conducted an extensive literature review, employing bibliometric analysis and snowballing techniques to investigate the state of the art in the field and synthesise the similarities, differences and relationships between both terms. We identified eight different relationship types in the literature and illustrated the most evident similarities and differences between both concepts.
  • Article
    Environmental soundness of wood cascading, known as the efficient utilization of resources by using residues and recycled materials for material use, is still to be proved since it strongly depends on which impact categories are considered and which methodological choices are made. To summarize and systemize the literature concerned about the environmental soundness of wood cascading we answer the question: what is the current state of research in measuring environmental impacts of wood cascading? In order to answer this question, we executed a systematic literature review and found 15 relevant publications to identify the environmental impacts of wood cascading with their respective measurement methods. By classifying the publications into the categories research methodology, functional unit, system boundaries and environmental impact categories, we observed that life cycle assessment (LCA) is the most-used evaluation method and there is a broad variety of different functional units for measuring environmental impacts. The relevant literature focuses on single-stage combined with multi-stage cascading systems and global warming (GW), Primary energy consumption of fossil sources (PENR), Land use (LU), eutrophication (ET), and acidification (AC). As most of the studies focus merely on the aforementioned environmental impacts, a holistic assessment, especially with a focus on resource efficiency, which is at the core of cascading, is missing.
  • Article
    Full-text available
    A material flow analysis of the 2012 Swiss waste management system is presented, highlighting the material content available from waste. Half of municipal solid waste (MSW) is materially recycled and the other half thermally treated with energy recovery. A key component of an industrial ecosystem is increasing the resource efficiency through circulating materials. Recycling rates (RRs), an indicator for the circulating behavior of materials, are often used as measure for the degree of circularity of an economy. This study provides an in-depth analysis of the recycling of paper, cardboard, aluminum, tinplate, glass, and polyethylene terephthalate (PET) from MSW in Switzerland by splitting the RRs into closed- and open-loop collection rate (CR) and RRs. Whereas CR refers to collected material that enters the recycling process, RRs measure the available secondary resources produced from recycling processes. For PET, the closed-loop CR of 45% and the open-loop CR of 40% compare to an RR of 31% and 37%, respectively (including exports and recycling of polyethylene and metals from collection). Official collection rates for paper and cardboard are very high (97%), whereas CR of 74% and 89% and RR of 59% and 81% for paper and cardboard, respectively, were found in the present study (including export). For a majority of the separately collected materials investigated, the rates that are determined are substantially lower than those that are officially communicated. Furthermore, given that official rates often do not provide information on the availability of secondary materials, the improvement potential for increased resource recovery is hidden.
  • Article
    Since sustainable consumption (SC) research focuses primarily on consumer purchasing behaviors there is a gap regarding how firms attempt to shape sustainable consumption in practice. Utilizing nine case studies, this gap is addressed by exploring the use of value propositions entailing Product-Service Systems among Swedish fashion firms. The value propositions in use by the firms suggest that sustainable consumption may be extending beyond purchase to also include aspects of use and disposal, suggesting new reciprocal responsibilities for firms and consumers. Similarities are found in what elements firms incorporate in their value propositions (i.e., more sustainable textiles, repair, and take-back systems), but differences in how these are elaborated, testifying to the inter-organizational dynamics that embed practices. The paper ends with the specific cautioning that take-back systems may send illusionary signals regarding recycling that legitimize increased consumption and further accelerate material throughput which would be at odds with notions of strong sustainable consumption.
  • Article
    Full-text available
    The transition within business from a linear to a circular economy brings with it a range of practical challenges for companies. The following question is addressed: What are the product design and business model strategies for companies that want to move to a circular economy model? This paper develops a framework of strategies to guide designers and business strategists in the move from a linear to a circular economy. Building on Stahel, the terminology of slowing, closing, and narrowing resource loops is introduced. A list of product design strategies, business model strategies, and examples for key decision-makers in businesses is introduced, to facilitate the move to a circular economy. This framework also opens up a future research agenda for the circular economy.
  • Article
    Innovation management falls short in solving urgent societal problems, if it neglects the power of networks and the values of their constituent actors. Even though network and business model innovation have been acknowledged as innovation categories in their own right, their problem-solving potential remains unexplored. In this article, we argue that purposeful innovation requires considering the shared values of those engaging in innovation processes, where values are understood as subjective notions of the desirable. Values-based innovation can motivate the development of new networks and business models that address complex societal problems, such as the unsustainability of current forms of energy supply. We present a theoretical framework and facilitation methods for values-based network and business model innovation. Both have been applied in an exemplary workshop on regional energy networks in Germany. Reflecting upon the lessons learned from theory and practice, we conclude that crucial starting points for systemic sustainability innovations can be found in values-based networks and business models.
  • Book
    Waste to Wealth proves that ‘green’ and ‘growth’ need not be binary alternatives. The book examines five new business models that provide circular growth from deploying sustainable resources to the sharing economy before setting out what business leaders need to do to implement the models successfully. © 2015 The Editor(s) (if applicable) and The Author(s). All rights reserved.
  • Article
    Full-text available
    The aim of this paper is to investigate consumer behavior regarding the environment and the adoption of new patterns of behavior and responsible consumption in the promotion of a Circular Economy (CE) in Romania. With this goal in mind, a questionnaire survey was performed on-line on a nationwide scale to explore consumers’ behaviors and attitudes, which was distributed in all four of Romania’s macro-regions and interviewing 642 respondents. The results indicate that the consumers have a positive attitude towards the importance of the environmental protection, in general and it also measures the frequency of adopting eco-friendly behaviors by the consumers, showing that the consumption behavior is not very consistent with the general attitude regarding environment. As a parallel, consumers are aware of the importance of CE business models, in general, both for the economy and for the environment, but the adoption of consumption patterns specific to CE business models, necessary for the development and the success of the CE business models, has a low probability in the absence of direct or indirect incentives and benefits fostering the adoption of these consumption patterns. In conclusion, the development of CE business models in Romania requires a national strategy, which includes means to sustain the adoption of necessary new consumption behaviors, besides awareness raising and educational campaigns for explaining to consumers the liaison and the impact of their behavior to the environment and to the economy.
  • Chapter
    In the 1970s, the first wave of environmental regulation targeted specific sources of pollutants. In the 1990s, concern is focused not on the ends of pipes or the tops of smokestacks but on sweeping regional and global issues.This landmark volume explores the new industrial ecology, an emerging framework for making environmental factors an integral part of economic and business decision making. Experts on this new frontier explore concepts and applications, including Bringing international law up to par with many national laws to encourage industrial ecology principles.Integrating environmental costs into accounting systems.Understanding design for environment, industrial metabolism, and sustainable development and how these concepts will affect the behavior of industrial and service firms. The volume looks at negative and positive aspects of technology and addresses treatment of waste as a raw material.This volume will be important to domestic and international policymakers, leaders in business and
  • Book
    Full-text available
    Available at circularcollaboration.com
  • Article
    The design of reverse logistics and remanufacturing processes and the recovery of end-of-life products have been well-studied in the literature. Quality, reliability, maintenance and warranty for recovered products and the remanufacturing activities that extend their life are integral issues in reverse logistics. This paper reviews recent and relevant literature on these issues in closed-loop supply chains, with a focus on remanufactured or secondhand products. The published literature is first classified into domain areas of research and practice. The wide array of mathematical tools and techniques used in the literature are then identified and mapped. Finally, the findings are summarised and the main research gaps are highlighted.
  • Article
    The design of reverse logistics and remanufacturing processes and the recovery of end-of-life products have been well-studied in the literature. Quality, reliability, maintenance and warranty for recovered products and the remanufacturing activities that extend their life are integral issues in reverse logistics. This paper reviews recent and relevant literature on these issues in closed-loop supply chains, with a focus on remanufactured or second-hand products. The published literature is first classified into domain areas of research and practice. The wide array of mathematical tools and techniques used in the literature are then identified and mapped. Finally, the findings are summarised and the main research gaps are highlighted.
  • Article
    Full-text available
    Companies are more frequently seen shifting their focus from technological innovation towards business model innovation. One efficient option for business model innovation is to learn from existing solutions, i.e., business model patterns. However, the various understandings of the business model pattern concept are often confusing and contradictory, with the available collections incomplete, overlapping, and inconsistently structured. Therefore, the rich body of literature on business model patterns has not yet reached its full potential for both practical application as well as theoretic advancement. To help remedy this, we conduct an exhaustive review, filter for duplicates, and structure the patterns along several dimensions by applying a rigorous taxonomy-building approach. The resulting business model pattern database allows for navigation to the relevant set of patterns for a specific impact on a company’s business model. It can be used for systematic business model innovation, which we illustrate via a simplified case study.
  • Article
    The transition within business from a linear to a circular economy brings with it a range of practical challenges for companies. The following question is addressed: What are the product design and business model strategies for companies that want to move to a circular economy model? This paper develops a framework of strategies to guide designers and business strategists in the move from a linear to a circular economy. Building on Stahel, the terminology of slowing, closing, and narrowing resource loops is introduced. A list of product design strategies, business model strategies, and examples for key decision-makers in businesses is introduced, to facilitate the move to a circular economy. This framework also opens up a future research agenda for the circular economy.