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IoT-Driven Reuse Business Models: The Case of Salesianer Textile Rental Services
Abstract and Figures
Service business models such as rental, leasing, and performance contracting can contribute to a circular economy by keeping products, components, and materials longer in use and thereby preserving their value over time. These business models are, however, subject to higher complexity and information demand. Smart products and the Internet of Things facilitate the optimisation of such closed-loop value creation processes. We present an in-depth case study of a textile rental firm, in the business-to-business domain, that has recently become a front-runner in using textiles equipped with RFID chips. The firm has used smart textiles to improve the transparency of the product life cycle, raise awareness on textile losses, and improve procurement decisions. We show that combining smart textiles with a rental business model could accelerate the transition towards circularity and sustainability.
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... Therefore, smart products may bring about essential changes in the architecture of the offering of the firm. Firms may increasingly develop packages of smart products and services, that is, product-service systems (PSS) that include circular strategies (e.g., Alcayaga et al., 2021). ...
The circular economy has been proposed as an alternative to replace the current linear system of production and consumption. Internet of Things technologies could enable the operationalisation of the circular economy and related circular strategies. Smart products and their amplified capabilities could deliver valuable data about the use phase and their life cycle, creating transparency and facilitating decision-making for circularity. However, extant literature has highlighted the lack of empirical research to deepen our knowledge about this emergent phenomenon. Against this background, we conducted an expert study of business practices in the B2B domain. We interviewed 43 experts from industry, consulting, and research organisations about how smart product in the Internet of Things could enable the circular economy. We propose a framework that represents business practices and processes across the base strategy smart use and the circular strategies. Our results suggest that the IoT provides new possibilities to enable and optimise maintenance and repair, reuse, remanufacturing, and recycling. For instance, product data drives innovation by providing feedback to R&D about how to improve circular product design. We have also identified smart-cross strategy capabilities as a relevant infrastructure to support the development of circular services. Finally, higher service degrees of business models offer advantages to operationalise smart circular strategies because of higher proximity to the customer, easier access to the product and product data, and higher synergies between circular strategies.
... The quality of the items they supply are imperative to ensure the shop's fashionable aesthetic remains, as this was of key value for the target group. Poor quality items have been found in other swap shop models, with customers often using the stores as dumping grounds for their unwanted soiled clothes [65]. Further Martina & Oskam emphasize that service models such as these "should offer both functional and beautiful products" [63] (p. ...
This article seeks to contribute to the literature on circular business model innovation in fashion retail. Our research question is which ‘model’ or combination of models—would be ideal as a business case crafting multiple value creation in small fashion retail. We focus on a qualitative, single in-depth case study—pop-up store KLEER—that we operated for a duration of three months in the Autumn of 2020. The shop served as a ‘testlab’ for action research to experiment with different business models around buying, swapping, and borrowing second-hand clothing. Adopting the Business Model Template (BMT) as a conceptual lens, we undertook a sensory ethnography which led to disclose three key strategies for circular business model innovation in fashion retail: Fashion-as-a-Service (F-a-a-S) instead of Product-as-a-Service (P-a-a-S) (1), Place-based value proposition (2) and Community as co-creator (3). Drawing on these findings, we reflect on ethnography in the context of a real pop-up store as methodological approach for business model experimentation. As a practical implication, we propose a tailor-made BMT for sustainable SME fashion retailers.
... In particular, we look for ways that benefit from digital technologies to develop services that extend the value proposition and operationalise circularity, that is, activities that extend the product lifetime and close material loops. 15 Kristoffersen et al. (2020) 16 Alcayaga et al. (2019) 17 Alcayaga et al. (2021) 18 Porter and Heppelmann (2014) INTRODUCTION ...
The circular economy and the Internet of Things (IoT) are two major developments reshaping the business environment. Firms may embrace the opportunities provided by the circular economy approach to innovate their business models and offer higher value to their customers and society. In order to address circularity, firms can adopt a range of activities known as circular strategies (maintenance, repair, reuse, remanufacturing, and recycling, among others). However, there are barriers that hinder the operationalisation of circular strategies, such as the lack of knowledge by the producer firm (or service provider) about the condition, location, and status of the product. Producer firms may not know what customers actually do with their products during the use phase, which may prevent the planning and execution of take-back, reuse, or remanufacturing activities. In this sense, digital technologies within the framework of the IoT could enable the operationalisation of circular strategies. Smart products and their amplified capabilities could deliver valuable data to create transparency about their life cycle, facilitating decision-making, and streamlining the extension of their service life.
Against this background, the question arises of how firms deploy digital technologies for developing circular strategies. To answer this question, and due to the emergent nature of this field, we conducted a qualitative study of business practices of pioneering firms in the business-to-business (B2B) domain. Qualitative research is well suited to understand new phenomena due to its logic of discovery and openness. We conducted 35 expert interviews at 27 different organisations to gain viewpoints from various industries. We focused on experts from German-speaking countries (mainly from Austria), which were selected considering their experience in either developing IoT-enabled circular strategies or in diffusing their implementation.
The results of the study suggest that the implementation of IoT-enabled circular strategies in the B2B market is still at an early stage of development, with pioneering firms driving their respective industries forward. We consider these developments as “embryonic patterns”1. These patterns forecast further developments in the broader industry context in the years to come.
Our main insights are as follows:
1. The main driver of the implementation of digital technologies is the need to better understand the use phase and improve customer experience. Firms may use product and customer data to enable smart processes and services during the use phase (what we aggregate under the umbrella concept of “smart use”). These smart processes and services may include remote control, location tracking, or condition monitoring, and aim at improving the experience of the customer. Firms may create added value for their customers by extending their service portfolio with smart use services.
2. Companies are increasingly going beyond smart use and are adopting “smart circular strategies”. Smart maintenance and repair activities enable product uptime and an overall extension of the product lifetime; smart reuse, remanufacturing, and recycling enable additional use cycles of products, components, and materials.
3. Firms may also develop “smart cross-strategy capabilities” such as product passports and product life cycle management (PLM) applications. These capabilities enable and support the operationalisation of smart use and smart circular processes. For instance, firms may require a well-designed life cycle management system to manage the flow of product lifetime data between their IT systems and the product.
4. Moreover, firms may use product data and insights gained along the product’s life cycle as feedback for research and development (R&D) to improve future product design.
5. Finally, our results suggest higher servitisation levels among the firms under study. Pioneering firms are going through an intensification of their service offering to enable smart circular strategies and satisfy diverse customer needs. Such higher degrees of servitisation of the firm’s underlying business model allow for easier implementation of smart circularity due to higher proximity to the customer, better access to product data, and easier execution of closed product loops. However, not all service business models are the same. In comparison with business models based on product sales, the extended scope of rental, leasing, or sharing contracts enable an easier implementation of smart circularity.
The circular economy (CE) aims at cycling products and materials in closed technical and biological loops. Cradle to cradle (C2C) operationalizes the CE with a product design concept rooted in the circulation of “healthy” materials because contamination of materials with substances of concern hampers cycling and may pose risks to people in contact with them. Extant research shows that barriers often hinder organizations from successfully pursuing cradle-to-cradle product innovation (CPI). Innovation community theory helps to explain how to overcome barriers and further the innovation process by taking a microlevel perspective on intra- and interorganizational collaboration of individual promotors (or champions). We elaborate innovation community theory with a longitudinal embedded case study of a C2C frontrunner company with the goal to get a precise understanding of how promotors collaborate in the CPI process. Our contribution is threefold:We identify eight collaboration mechanisms used between promotors to sequentially overcome a hub firm’s individual, organizational, value chain, and institutional level barriers to circularity. Second,wedifferentiate these mechanisms according to their cooperative and coordinative facets and put emphasis on the coordinative functions of those mechanisms linked to the C2C standard. Third, we highlight the importance of promotors at the linking level who facilitate the CPI process as intermediaries.
While the enabling capabilities of the Internet of Things (IoT) in the Circular Economy (CE) have been highlighted in a number of publications, knowledge about how to leverage IoT in actual implementation of circular strategies is still lacking. This paper aims to elucidate reasons for the apparent mismatch between the ‘theoretical opportunities’ of IoT for CE as described in literature, and current implementation in practice. To this end, we present a case study in the field of LED lighting, within a company with previous experience and knowledge in both IoT and CE. The primary data source is twelve semi-structured interviews with stakeholders from the company. We identify opportunities for using IoT to support circular strategies in this specific case: IoT can support servitized business models; improve tracking and record keeping of in-use and post-use products; enable conditions monitoring and predictive maintenance; improve estimations of remaining lifetime of used products; and inform design decisions to improve durability of products. Related to these opportunities, we identify implementation challenges faced by the company. The main IoT-specific implementation challenges in the case are (1) a lack of structured data management processes to ensure high quality data collection and analysis, and (2) the difficulty of designing IoT-enabled products for interoperability, adaptability, and upgradability, especially considering that IoT technologies develop at a high pace. By elucidating these challenges, this paper contributes with IoT-specific insights to the available literature about challenges in circular business model implementation. Moreover, this paper adds an important emphasis on real-world implementation challenges to the literature about digitally-enabled circular strategies.
Smart products and digital transformation represent a complex, dynamic and challenging environment for organisations. Remote monitoring and location technologies affect almost every core function of a company and the main activities of the value chain.
Quality 4.0 does not lie in the individual production stages but in a holistic and integrated ‘end-to-end quality’ approach. Merely changing the processes is not enough. It is only by adapting the business model that the possibilities of the Internet of Things can deliver a real competitive advantage.
The intention of this whitepaper is to outline a new vision of quality for the ‘World 4.0’. It presents related concepts, business models and best practices of successful companies.
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.
The most recognized definition of the circular economy is that it is a restorative and regenerative economy. Despite the wide use and importance attributed to the concepts of “restoration” and “regeneration,” they are rarely defined or explained in the circular economy literature. In this context, this study critically examines the two terms, while providing guidance on their future utilization and development. Specifically, the study investigates the origin of the concepts, their adoption in frameworks that anticipated the idea of the circular economy, and their connotations in the circular economy literature. The examination supports the need for clear and distinct definitions, combined with precision in usage. From a review of the literature, restoration is a better‐defined concept than regeneration, although it needs conceptual re‐enforcement relative to the biological/ecological aspects of the circular economy. This study suggests looking in the direction of restoration ecology, a well‐established branch of ecological research. Conversely, regeneration is a symbolic/evocative term with little practical application in the context of circular systems except in the case of certain agricultural practices. Until new conceptual developments intervene, regeneration does not seem to be applicable to the economy as a whole and because of this, might be abandoned as a guiding principle of the circular economy. Unlike regeneration, restoration can be considered a core principle because it has widespread application and can be a point of reference for circular applications. This does not preclude the possibility that other concepts may be needed to augment restoration.
The Circular Industrial Economy in a nutshell
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Circularity is how Nature works, and a circular economy is as old as humankind. But in the beginning it was a barter economy and circular sharing society driven by necessity, and characterised by scarcity of shelter, food, materials and objects. This situation is still dominant in some world regions and regularly resurfaces after major disasters.
The industrial revolution enabled society to overcome scarcity by producing goods made of wool, timber, leather and few metals, which did not become ‘waste’ because they had a re-use value or were compatible with Nature’s circularity.
A first break point was reached in the 20th century with the invention of synthetic (man-made) materials, such as plastics, agrochemicals, pharmaceuticals and metal alloys. Manufactured products embodying these materials are mass-produced and long-lived, leading to a society of abundance. Waste has no re-use value and is not food for Nature: witness plastic in the oceans.
In a society of abundance, the circular economy is driven by motivation and legislation, not necessity. Rag-and-bone collectors can no longer make a living, so municipalities become waste managers by default to close material loops.
Policymakers have overlooked the importance of liability loops: if used manufactured objects and materials have no value for man or Nature, returning them to their producers creates a circular industrial economy, where preventing the costs of waste is in the interest of all: The circular economy is about economics! Municipalities should not have to pay for the end-of-pipe waste created by profit-making industrial producers.
My new book is about a circular industrial economy of manufactured objects and materials and identifies six major challenges:
1 CARING: motivate owner-users of objects to enjoy the use and take care of their assets and belongings as long as possible, through reuse and repair.
2 Technical innovation into processes and technologies to recover the atoms and molecules of the synthetic legacy waste by de-bonding to retain the highest economic value,
3 Policy innovation to extend the Producer Liability for used objects without value nor liable owner, return to creator.
4 Spreading the technical and economic knowledge of the circular industrial economy and its societal benefits to all classrooms, boardrooms, parliaments
5 DARING: promote scientific innovation into novel materials, components and systems solutions, such as re-useable molecules and circular metallurgy, to strengthen the circular industrial economy,
6 SHARING: a performance economy selling goods as a service demands a stewardship by producers and users – No sharing without caring.
Tackling the six challenges presented in the book is a holistic task as they have to be tackled simultaneously. This needs political vision and action combined with entrepreneurship and systems thinking in Science and industry, breaking up today’s silos.
Walter R. Stahel, 7.5.15
Profiting from the benefits of smart products connected through the Internet of Things (IoT) could disrupt business models and has the potential to foster a circular economy by embracing a performance economy. Extant literature has offered insights into circular strategies, smart products and product-service systems (PSS) in isolated ways or by considering partial overlaps, but lacks a holistic account of their interplay. By means of an integrated review, this paper synthesises literatures from various domains to describe interrelationships among these three concepts and propose a conceptual framework of smart-circular systems. This paper thereby advances research by providing a description of three binary interrelationships: smart circularity, smart PSS and circular PSS. Moreover, the review elaborates a new understanding of smart-circular (product-service) systems by articulating the base strategy smart use and extending the following circular strategies (or technical loops): maintenance, reuse, remanufacturing and recycling. Finally, the review outlines a critique of the state of the literature on this phenomenon and offers suggestions to guide future empirical and theoretical research in the domains of circular strategies, services and business models.
In recent years major companies such as Philips, H&M and Google have adopted a circular economy agenda to promote sustainability. Design consultancies such as IDEO has developed and promoted a circular design guide to help companies in this endeavour. However, designing for a circular economy often require design and reconfiguration of entire value chains-making the transition towards a circular economy rather difficult. In this paper we analyse a development project from the Danish island of Bornholm to investigate how to align diverse actors across the value chain in a process of co-creating systems for a circular economy. We combine design, value chain considerations and circular economy mindsets to shed light on how negotiations of concerns among actors in the value chain can be staged and facilitated as an infrastructuring process with the aim of designing networks rather than objects.
Product/service-systems (PSS) that focus on selling service and performance instead of products are often mentioned as means to realize a circular economy (CE), in which economic growth is decoupled from resource consumption. However, a PSS is no implicit guarantee for a CE, and CE strategies do not necessarily lead to decoupling economic growth from resource consumption in absolute terms. Absolute resource decoupling only occurs when the resource use declines, irrespective of the growth rate of the economic driver. In this forum paper, we propose a two-step framework that aims to support analyses of PSS and their potential to lead to absolute resource decoupling. In the first step, we present four PSS enablers of relative resource reduction that qualify as CE strategies. In the second step, three subsequent requirements need to be met, in order to successfully achieve absolute resource decoupling. Conditions and limitations for this accomplishment are discussed. Danish textile cases are used to exemplify the framework elements and its application. We expect that the framework will challenge the debate on the necessary conditions for CE strategies to ensure absolute resource decoupling.
The service sector has the potential to play an instrumental role in the shift towards circular economy due to its strategic position between manufacturers and end-users. However, there is a paucity of supporting methodologies and real-life applications to demonstrate how service-oriented companies can implement circular economy principles in daily business practice. This paper addresses this gap by analysing the potential of service-oriented companies in the information and communication technology (ICT) sector to build and implement circular economy business models. To this end, the Backcasting and Eco-design for the Circular Economy (BECE) framework is applied in an ICT firm. BECE, previously developed and demonstrated for product-oriented applications, has been developed further here for applications in the service sector. By shifting the focus from a product-oriented approach to a user-centred eco-design, the paper shows how ICT firms can identify, evaluate and prioritise sustainable business model innovations for circular economy. The two most promising business model innovations are explored strategically with the aim of designing circular economy models consistent with the company's priorities of customer satisfaction and profitability. The findings suggest that ICT companies may be able to support the deployment of a circular economy in the service-oriented technology sector. Importantly, micro and small organisations can play a fundamental role if provided with macro-level support to overcome company-level barriers. Finally, the BECE framework is shown to be a valuable resource to explore, analyse and guide the implementation of circular economy opportunities in service-oriented organisations. Further research to verify the application of the findings to other service-oriented organisations is recommended.
The circular economy concept has gained momentum both among scholars and practitioners. However, critics claim that it means many different things to different people. This paper provides further evidence for these critics. The aim of this paper is to create transparency regarding the current understandings of the circular economy concept. For this purpose, we have gathered 114 circular economy definitions which were coded on 17 dimensions. Our findings indicate that the circular economy is most frequently depicted as a combination of reduce, reuse and recycle activities, whereas it is oftentimes not highlighted that CE necessitates a systemic shift. We further find that the definitions show few explicit linkages of the circular economy concept to sustainable development. The main aim of the circular economy is considered to be economic prosperity, followed by environmental quality; its impact on social equity and future generations is barely mentioned. Furthermore, neither business models nor consumers are frequently outlined as enablers of the circular economy. We critically discuss the various circular economy conceptualizations throughout this paper. Overall, we hope to contribute via this study towards the coherence of the circular economy concept; we presume that significantly varying circular economy definitions may eventually result in the collapse of the concept.
Sustainable innovation requires collaboration across organizational boundaries, hence in this research, we take a boundary-spanning perspective on the business model. This perspective focuses on how value is created and captured across organizational boundaries, by investigating the value transfers between the focal organization and the external network of business model actors. We analyze the business models of 64 innovative sustainable organizations from The Netherlands in terms of how environmental and social sustainability is manifested in the content, structure, and governance of their business models. We find that environmental sustainability is mainly represented in value creation content, whereas social sustainability is achieved by serving underprivileged user groups and mainly is reflected in value capture content. We observe that social sustainability in both for-profit and non-profit organizations is often achieved by having an imbalance in value exchanges that is compensated elsewhere in the business model. In terms of business model structure we show that sustainable organizations use the same underlying business model structures as can be found in conventional firms. All in all, we demonstrate that analyzing the environmental and social sustainability of organizations using the boundary-spanning perspective on business models provides complementary insights to the traditional component-based view of the business model.
The Internet of Things and the amplified capabilities of smart products can be increasingly utilised for the development of feedback-rich systems and loops throughout the entire product life cycle. By adopting the IoT and collecting data during product utilisation, companies can replace the end-of-life concept with product life extension and circular loops. In this sense, service business models hold the greatest potential to optimise the utilisation of goods over time. These models allow a reduction of the overall life cycle costs and contribute to resource efficiency and the transition towards a circular economy. This paper introduces the concept of smart-circular systems that reflects the interplay between the Internet of Things, the circular economy and service business models, and presents a conceptual framework for further empirical analysis of this phenomenon. The framework focuses on product-service systems and more broadly on services business models that optimise the utilisation of goods over time through the amplification of circular activities by the introduction of smart enablers. It also considers three main business models types and tactics for successful implementation of service business models.
Novel ways of thinking and theorizing are needed, given the persistence and magnitude of contemporary sustainability challenges. While management scholars have approached sustainability issues from different perspectives, critical voices find the research agenda on corporate sustainability too narrow, theoretical approaches ill-suited, and the impact on practice limited, if not adverse. This article introduces the research field of 'sustainability transitions' and explores how its general approach and some of its concepts can be mobilized to address these issues. Sustainability transitions research studies fundamental and long-term changes of sectors such as energy, transportation or food toward more sustainable modes of production and consumption. It is based on systemic theorizing thereby mobilizing middle range frameworks such as the multi-level perspective or technological innovation systems. For management scholars interested in sustainability, the field of sustainability transitions offers highly relevant and potentially impactful research, empirical and conceptual challenges, novel frameworks and interdisciplinary perspectives, which altogether make it a promising terrain to explore.
This updated and revised edition outlines strategies and models for how to use technology and knowledge to improve performance, create jobs and increase income. It shows what skills will be required to produce, sell and manage performance over time, and how manual jobs can contribute to reduce the consumption of non-renewable resources.
Digital technologies have enabled the formulation of multiple Product Service-Systems (PSS) with considerable economic, environmental and societal benefits. One of the most promising paradigms, which is inspired by business models and value propositions that have already been described in the PSS literature, is the concept of Circular Economy. Circular Economy is characterized as an economy that is restorative and regenerative by design and is attracting significant attention from researchers and policy makers alike. In light of the recent proliferation of digital technologies such as Big Data and the Internet of Things, this article attempts to identify how can digital technologies support the transition to Circular Economy. This article conducted a systematic review of the literature based on a review protocol, in an effort to evaluate the application of key digital technologies in Circular Economy. The study concludes by identifying research gaps, reflecting on the application of digital technologies in the field of PSS and proposing suggestions for future research.
In this article, we use Hirsch and Levin’s notion of umbrella concepts as an analytical lens, in order to articulate the valuable catalytic function the circular economy (CE) concept could perform in the waste and resource management debate. We realize this goal by anchoring the CE concept in this broader debate through a narrative approach. This leads to the insight that whereas the various resource strategies grouped under the CE’s banner are not new individually, the concept offers a new framing of these strategies by drawing attention to their capacity of prolonging resource use as well as to the relationship between these strategies. As such, the CE offers a new perspective on waste and resource management and provides a new cognitive unit and discursive space for debate. We conclude by discussing research opportunities for the industrial ecology (IE) community relating to the concept’s theoretical development and its implementation. Specifically, we pose that reinvigorating and growing the social science aspects of IE is required for both. After all, it is in understanding and facilitating the collective implementation of any idea, also the CE concept, that the potential lies for shaping our material future.
Circular economy (CE) is a term that exists since the 1970s and has acquired greater importance in the past few years, partly due to the scarcity of natural resources available in the environment and changes in consumer behavior. Cutting-edge technologies such as big data and internet of things (IoT) have the potential to leverage the adoption of CE concepts by organizations and society, becoming more present in our daily lives. Therefore, it is fundamentally important for researchers interested in this subject to understand the status quo of studies being undertaken worldwide and to have the overall picture of it. We conducted a bibliometric literature review from the Scopus Database over the period of 2006–2015 focusing on the application of big data/IoT on the context of CE. This produced the combination of 30,557 CE documents with 32,550 unique big data/IoT studies resulting in 70 matching publications that went through content and social network analysis with the use of ‘R’ statistical tool. We then compared it to some current industry initiatives. Bibliometrics findings indicate China and USA are the most interested countries in the area and reveal a context with significant opportunities for research. In addition, large producers of greenhouse gas emissions, such as Brazil and Russia, still lack studies in the area. Also, a disconnection between important industry initiatives and scientific research seems to exist. The results can be useful for institutions and researchers worldwide to understand potential research gaps and to focus future investments/studies in the field.
A new relationship with our goods and materials would save resources and energy and create local jobs, explains Walter R. Stahel.
The fear that human consumption is causing climate change, biodiversity loss, and mineral scarcity has recently prompted interest in reuse because of the intuitive belief that it reduces new production and waste. The environmental impacts of reuse have, however, received little attention—the benefits typically assumed rather than understood—and consequently the overall effects remain unclear. In this article, we structure the current work on the topic, reviewing the potential benefits and pitfalls described in the literature and providing a framework for future research. Many products’ use-phase energy requirements are decreasing. The relative importance of the embodied impacts from initial production is therefore growing and the prominence of reuse as an abatement strategy is likely to increase in the future. Many examples are found in the literature of beneficial reuse of standardized, unpowered products and components, and repairing an item is always found to be less energy intensive than new production. However, reusing a product does not guarantee an environmental benefit. Attention must be paid to restoring and upgrading old product efficiencies, minimizing overspecification in the new application, and considering whether more efficient, new products exist that would be more suitable. Cheap, reused goods can allow many consumers access to products they would otherwise have been unable to afford. Though socially valuable, these sales, which may help minimize landfill in the short term, can represent additional consumption rather than a net environmental benefit compared to the status quo.
There have long been calls from industry for guidance in implementing strategies for sustainable development. The Circular Economy represents the most recent attempt to conceptualize the integration of economic activity and environmental wellbeing in a sustainable way. This set of ideas has been adopted by China as the basis of their economic development (included in both the 11th and the 12th ‘Five Year Plan’), escalating the concept in minds of western policymakers and NGOs. This paper traces the conceptualisations and origins of the Circular Economy, tracing its meanings, and exploring its antecedents in economics and ecology, and discusses how the Circular Economy has been operationalized in business and policy. The paper finds that while the Circular Economy places emphasis on the redesign of processes and cycling of materials, which may contribute to more sustainable business models, it also encapsulates tensions and limitations. These include an absence of the social dimension inherent in sustainable development that limits its ethical dimensions, and some unintended consequences. This leads us to propose a revised definition of the Circular Economy as “an economic model wherein planning, resourcing, procurement, production and reprocessing are designed and managed, as both process and output, to maximize ecosystem functioning and human well-being”.
Infrastructure sectors such as energy or water supply, sanitation or telecommunication provide us with services that are essential for modern life and for industrialized societies. In this article, we explore some of the sectors' key characteristics in order to better understand the conditions for far-reaching transformation processes in infrastructures. It will be argued that durable and capital intensive assets together with a high degree of systemness generate considerable inertia and rather hinder fundamental change. At the same time, capital intensity and massive investment needs as well as negative environmental impacts represent inherent sources for change. A high degree of regulation and an often large share of public utilities also play a key role for sector dynamics. Conceptual frameworks for studying infrastructures and making policy recommendations have to take into account these particularities and the close interplay of techno-economic, organizational and institutional characteristics.
Purpose ‐ This paper analyses the sustainability-oriented transformation of industries from the lens of sustainable entrepreneurship. The authors investigate the co-evolution between pioneers introducing radically more sustainable offerings and (mostly large) market leaders with their responses. While sustainability pioneers introduce new products in niche markets, incumbents advance them into the mass market, together leading to the transformation of industries, markets and consumer habits. Design/methodology/approach ‐ The authors apply the sustainable entrepreneurship perspective to a case study of the German clothing retail industry with a focus on organic cotton. The analysis covers four of the ten largest German textile retailers. Data collection is based on public available sources. Findings ‐ The late 1970s saw the foundation of Hess Natur, which pioneered organic cotton practices and supported the development of sustainability standards in the clothing industry. In the beginning this was largely a phenomenon in niche markets, but to date some organic practices have diffused amongst mainstream retailers. This is counter-intuitive, as theory suggests that incumbents only adopt practices with significantly lower sustainability standards than companies in the niche. Research limitations/implication ‐ The study suggests that more research should focus on the co-evolutionary dynamics between pioneering companies and incumbents and examine whether and how sustainability practices diffuse into the mass market. Practical implications ‐ The findings can help managers to better understand their organisation's role in the transformation of industries towards sustainability and, vice versa, how the transformation may affect them. Leading the transformation challenge by adopting organic and other sustainable supply chain practices can be an important measure for market success. Originality/value ‐ This study is one of the few pieces of research investigating sustainability-oriented industry transformation from a market-based perspective. Actual data on organic cotton diffusion in German retail are presented.
The rise and fall of organizational effectiveness, an "umbrella construct" once at the forefront of organizational theory, is traced through four life-cycle stages: emerging excitement, the validity challenge, "tidying up with typologies," and construct collapse. Although the study of effectiveness has declined, re- search on its component elements continues to thrive. Using the effectiveness story as an exemplar, we develop a more general model of this process for all umbrella constructs, defined here as broad concepts used to encompass and account for a diverse set of phenomena. This life-cycle model—driven largely by a dialectic between researchers with a broad perspective ("um- brella advocates") and those with a narrower one ("validity po- lice")—leaves open the possibility that some umbrella con- structs may ultimately be made coherent or remain permanently controversial rather than collapse, as effectiveness has done. We propose that umbrella constructs will arise most frequently in academic fields without a theoretical consensus, will inevitably have their validity seriously challenged, will have a shorter life than their constituent elements, and will be more vulnerable to validity challenges when they lack support from practitioners. This model's implications for the future direction of such cur- rent umbrella constructs as organizational learning, culture, strategy, and performance are also explored and elaborated. Ironically, some evidence suggests that studies around the con- struct of organizational "performance" have arisen to replace the nearly identical, but fallen umbrella construct of organiza- tional effectiveness. (Sociology of Organization Science ; Paradigms; Theory Development; Organization Theory; Umbrella Con- structs) The question for organizational science is whether the field can strike an appropriate balance between theoretical tyranny and an anything-goes attitude. (Pfeffer 1993, p. 616)
Research on sustainability transitions has expanded rapidly in the last ten years, diversified in terms of topics and geographical applications, and deepened with respect to theories and methods. This article provides an extensive review and an updated research agenda for the field, classified into nine main themes: understanding transitions; power, agency and politics; governing transitions; civil society, culture and social movements; businesses and industries; transitions in practice and everyday life; geography of transitions; ethical aspects; and methodologies.
The review shows that the scope of sustainability transitions research has broadened and connections to established disciplines have grown stronger. At the same time, we see that the grand challenges related to sustainability remain unsolved, calling for continued efforts and an acceleration of ongoing transitions. Transition studies can play a key role in this regard by creating new perspectives, approaches and understanding and helping to move society in the direction of sustainability.
This study covers new trends and techniques in the field of predictive maintenance, which has been superseding traditional management policies, at least in part. It also presents suggestions for how to implement a predictive maintenance programme in a factory/premise and so on. Predictive maintenance primarily involves foreseeing breakdown of the system to be maintained by detecting early signs of failure in order to make maintenance work more proactive. In addition to the aim of acting before failure, it also aims to attend to any fault, even if there is no immediate danger of failure, to ensure smooth operation and reduce energy consumption. Predictive maintenance has been adopted by various sectors in manufacturing and service industries in order to improve reliability, safety, availability, efficiency and quality as well as to protect the environment. It also has created a separate sector, which specializes in developing predictive maintenance instruments, offering dedicated predictive maintenance solutions and training predictive maintenance experts. Predictive maintenance techniques are closely associated with sensor technologies but for efficient predictive maintenance applications, a comprehensive approach, which integrates sensing with subsequent maintenance activities, is needed to be adapted in accordance with the needs of the particular organization. Recent advances in information, communication and computer technologies, such as Internet of Things and radio-frequency identifications, have been enabling predictive maintenance applications to be more efficient, applicable, affordable, and consequently more common and available for all sorts of industries. Researches on remote maintenance and e-maintenance have been supporting predictive maintenance activities especially in unsafe working environments and scattered locations.
The concept of circular economy (CE) is to an increasing extent treated as a solution to series of challenges such as waste generation, resource scarcity and sustaining economic benefits. However the concept of circularity is not of novel as such. Specific circumstances and motivations have stimulated ideas relevant to circularity in the past through activities such as reuse, remanufacturing or recycling. Main objectives of this work are: to provide a comprehensive review of research efforts encompassing aspects of resources scarcity, waste generation and economic advantages; to explore the CE landscape in the context of these three aspects especially when they are considered simultaneously; based on an idea of a comprehensive CE framework, propose an implementation strategy using top-down and bottom-up approach in a concurrent manner. To fulfill this objective a comprehensive review of state-of-the-art research is carried out to understand different ideas relevant to CE, motivation for the research and context of their recurrence. Main contributions of this paper are a comprehensive CE framework and a practical implementation strategy for a regenerative economy and natural environment. The framework emphasizes on a combined view of three main aspects i.e. environment, resources and economic benefits. It also underlines that joint support of all stakeholders is necessary in order to successfully implement the CE concept at large scale. The proposed framework and implementation strategy also identify new avenues for future research and practice in the field of CE.
RFID, complemented by other Auto-ID technologies such as Barcode, NFC and sensor technology, can unlock huge benefits for enterprises and users, creating successful businesses with the combination of technology and processes. It is important to have an understanding of all aspects and properties of the technology, in order to see its potential. This solution-orientated book contains a comprehensive overview of RFID, explaining which elements can be applied with respect to specific project environments, and how RFID systems can be integrated into existing IT systems. It includes chapters and project guidelines written by top experts in the industry, covering global privacy issues and the history of EPCglobal, as well as: a discussion on current trends and developments in the RFID market, and the process-based and technological drivers behind it; a chapter on RFID legislation with a global perspective; descriptions of practical applications and twelve application scenarios, demonstrating the possibilities that have already been discovered with RFID. RFID for the Optimization of Business Processes is a descriptive introduction to the technology for business and technical managers, IT consulting experts and business process designers, as well as marketers of RFID technologies. The text will also be of great use to technical experts interested in business processes and also students studying the subject.
Beginning with an historical background, tracing the origins of reusable healthcare textiles and their contribution to the development of the sterile field, the overview details products used in the twenty-first century. Surgical packs and their components, protective apparel and incontinence materials are discussed, among other medical textile products. Physical properties and performance characteristics of various reusable items are outlined for numerous products. Factors related to the environment and health and safety issues are also discussed. The chapter offers a broad coverage of reusable medical textiles for both experienced readers and those new to the subject.
While a consensus appears to have evolved among many sustainability researchers and practitioners that sustainable development at the societal level is not very likely without the sustainable development of organizations, the business model as a key initiating component of corporate sustainability has only recently moved into the focus of sustainability management research. Apparently, the usual approaches to sustainable development of philanthropy, corporate social responsibility, and technological process and product innovation are insufficient to create the necessary radical transformation of organizations, industries, and societies toward genuine, substantive sustainable development. More in-depth research is needed on whether both modified and completely new business models can help develop integrative and competitive solutions by either radically reducing negative and/or creating positive external effects for the natural environment and society.
Since the 1990s, Product Service Systems (PSS) have been heralded as one of the most effective instruments for moving society towards a resource-efficient, circular economy and creating a much-needed ‘resource revolution’. This paper reviews the literature on PSS in the last decade and compares the findings with those from an earlier review in this journal in 2006. Close to 300 relevant papers were identified, over 140 of which have been referenced in this review. Research in the field of PSS has become more prolific, with the output of refereed papers quadrupling since 2000, while on average scientific output has only doubled. PSS has also become embedded in a wider range of science fields (such as manufacturing, ICT, business management, and design) and geographical regions (Asia now produces more papers than Europe). The literature of the last seven years has refined insights with regard to the design of PSS, as well as their business and environmental benefits, and confirmed the definitions and PSS concepts already available in 2006. A major contribution of the recent literature is research into how firms have implemented PSS in their organization and what the key success factors and issues that require special attention are (such as a focus on product availability for clients; an emphasis on diversity in terms of services provided rather than the range of products; and the need for staff to possess both knowledge of the product and relationship management skills). The reasons why PSS have nonetheless still not been widely implemented, particularly in the B2C context, seem to have already been explained fairly well in the literature available in 2006. For consumers, having control over things, artifacts, and life itself is one of the most valued attributes. PSS are often less accessible, or have less intangible value, than the competing product, in part because PSS usually do not allow consumers as much behavioral freedom or even leave them with the impression that the PSS provider could prescribe how they should behave.
Increasingly firms develop technology-based sharing approaches where users rent, lease and share products, instead of purchasing them. Particularly, the product service system (PSS) concept has recently caught attention by scholars from different disciplines, although surprisingly little from the innovation research community. The writings from our colleagues however lead us to suspect that PSS developing firms might pursue an innovation behavior that is much more in line with recent societal demands for reducing environmental externalities. Recent examples show that adopting the PSS approach could be a way even for profit-driven firms towards a more sustainable economy, actually without too much governmental intervention.However, to our knowledge this argument has yet been hardly discussed in detail. Drawing on concepts from the innovation management literature as well as from environmental management research, we contribute a model that explains why the PSS approach can shift firm innovation behavior towards generating fewer environmental externalities. This model links firm innovation behavior to three antecedents, including two product related characteristics (ownership, product purpose) and the specifics of the PSS related profit function. We argue that these antecedents differ whether firms develop products or PSSs. In the latter case the antecedent specifications impact firms’ R&D objectives in a way that creates incentives to follow innovation trajectories that lead to a reduction of environmental externalities (i.e., eco-innovation behavior).
Sustainability oriented innovation and technology studies have received increasing attention over the past 10-15 years. In particular, a new field dealing with "sustainability transitions" has gained ground and reached an output of 60-100 academic papers per year. In this article, we aim to identify the intellectual contours of this emerging field by conducting a review of basic conceptual frameworks, together with bibliographical analysis of 540 journal articles in the field. It is against this background that we position the six papers assembled in a special section in Research Policy. These papers pave the way for new conceptual developments and serve as stepping-stones in the maturation of sustainability transition studies, by linking with the scholarly literatures of management studies, sociology, policy studies, economic geography, and modeling.
Function-oriented business models or product–service systems (PSSs) are often seen as an excellent means for achieving ‘factor 4’. SusProNet, an EU network on PSSs, showed a more complicated reality. At least eight different types of PSS exist, with quite diverging economic and environmental characteristics. The economic potential of each type was evaluated in terms of (i) tangible and intangible value for the user, (ii) tangible costs and risk premium for the provider, (iii) capital/investment needs and (iv) issues such as the providers' position in the value chain and client relations. The environmental potential was evaluated by checking the relevance of certain impact reduction mechanisms (e.g. more intensive use of capital goods, inherent incentives for sustainable user and provider behaviour etc.). Most PSS types will result in marginal environmental improvements at best. The exception is the PSS type known as functional results, but here liability and risk premium issues, amongst others, need a solution. Copyright © 2004 John Wiley & Sons, Ltd and ERP Environment.
In the last decade ‘sectoral systems of innovation’ have emerged as a new approach in innovation studies. This article makes four contributions to the approach by addressing some open issues. The first contribution is to explicitly incorporate the user side in the analysis. Hence, the unit of analysis is widened from sectoral systems of innovation to socio-technical systems. The second contribution is to suggest an analytical distinction between systems, actors involved in them, and the institutions which guide actor’s perceptions and activities. Thirdly, the article opens up the black box of institutions, making them an integral part of the analysis. Institutions should not just be used to explain inertia and stability. They can also be used to conceptualise the dynamic interplay between actors and structures. The fourth contribution is to address issues of change from one system to another. The article provides a coherent conceptual multi-level perspective, using insights from sociology, institutional theory and innovation studies. The perspective is particularly useful to analyse long-term dynamics, shifts from one socio-technical system to another and the co-evolution of technology and society.
Corporations increasingly subscribe to the principles of corporate sustainability, which is generally described as the integration of economic, environmental and social dimensions. Concerning innovation management, this emphasises the role of sustainability-oriented innovations (SOI). SOI is considered a tool both to address sustainability issues and to tap into new customer segments and markets. Yet SOI are very risky: both their market success and non-economic sustainability are uncertain. This paper presents a generic model termed the "Sustainability Innovation Cube" (SIC) for structuring innovations' sustainability effects in order to better inform corporate decision-makers about how to minimize the directional risk of SOI. The model includes the three dimensions: target, life cycle and innovation type. A qualitative expert study reveals the opportunities and challenges related to the developed model. Finally, practical implications are derived, limitations are discussed and a brief outlook is given.
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