Product design and business model strategies for a circular economy

The transition from a linear to a circular economy requires a range of strategic and practical practical challenges for companies. What are the product design and business model strategies for companies that want to move to a circular economy model?

The following paper (open access) discusses some potential design and business model strategies to support the move to a Circular Economy. Building on the work by Walter Stahel, the strategies of slowing, closing, and narrowing resource loops are introduced.

Slowing loops is about strategies to design long-life products and extend the useful life of products, for example through reuse and repair and new service-driven business models. It is about reuse of long-life products. Closing loops is concerned with closing the loop post consumer-use through recycling, resulting in a circular flow of resources. It is about reuse of materials. Narrowing loops is about resource efficiency, using fewer resources per product. It is about using fewer resources in the product design and production process phases.

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Figure 1: Strategies of closing, slowing and narrowing resource loops. Source: Bocken, de Pauw, van der Grinten and Bakker (2016). 

 

Different business model strategies and product design strategies are formulated to help slow, close and narrow resource loops. Figure 2 gives an example of the business model strategies which have been used as a framework for the book “Circular Business – Collaborate and Circulate”. 

With these strategies in mind, companies can start looking for new options to innovate their designs and business models to start the transition to a Circular Economy.

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Figure 2. Framework to assess circular projects and businesses in the book. Source: Kraaijenhagen, van Oppen and Bocken (2016),  p. 30. 

 

 

Sources:

Bocken, N.M.P., de Pauw, I., van der Grinten, B., Bakker, C. 2016. Product design and business model strategies for a circular economy. Journal of Industrial and Production Engineering, 32 (1), 67-81.

Kraaijenhagen, C., Van Oppen, C., Bocken, N. 2016. Circular business. Collaborate & Circulate. Circular Collaboration, Amersfoort, The Netherlands. Available at www.circularcollaboration.com

http://www.product-life.org

https://www.ellenmacarthurfoundation.org

SUSTAINABLE BUSINESS MODEL AND SUPPLY CHAIN CONCEPTIONS – TOWARDS AN INTEGRATED PERSPECTIVE

The concepts of Sustainable Supply Chains and Sustainable Business Models are closely related and highly complementary. Business model innovation often requires significantly new supply chain lay-outs. For example, when shifting from product sales to product rental or leasing models, new forms of distribution and product take-back are required. The relationship with retailers also changes. Similarly, supply chain opportunities can drive business model innovation, for example, when new distribution channels give access to new customer segments desiring different value propositions.

This blog discusses the similarities and differences between Sustainable Supply Chains and Sustainable Business Models .

It is based on the book chapter on the topic written by Florian Lüdeke-Freund, Stephan Gold and Nancy Bocken in the book “Implementing Triple Bottom Line Sustainability into Global Supply Chains” edited by Lydia Bals and Wendy Tate, published in May 2016 via Greenleaf)

 

Sources: 

Bals, L. & Tate, W. (2016) (Eds.): Implementing Triple Bottom Line Sustainability into Global Supply Chains.Sheffield: Greenleaf.

Lüdeke-Freund, F.; Gold, S. & Bocken, N. (2016): Sustainable Business Model and Supply Chain Conceptions – Towards an Integrated Perspective, in: Bals, L. & Tate, W. (Eds.): Implementing Triple Bottom Line Sustainability into Global Supply Chains. Sheffield: Greenleaf, 337-363.