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Article
Publication date: 2 August 2024

Xiaoling Chen, Caiyun Shen and Wenying Zheng

Circular economy firms, unlike those in a linear economy, encounter significant challenges due to the nature of nonstandardized products, such as asymmetric information on product…

Abstract

Purpose

Circular economy firms, unlike those in a linear economy, encounter significant challenges due to the nature of nonstandardized products, such as asymmetric information on product specifications and highly dispersed supply and demand. Consequently, achieving large-scale operations becomes inherently difficult for them. However, when digital platform-based circular firms adopt diversified business models, their value creation has the potential to achieve significant scale. This study aims to answer “How do digital platform-based circular firms scale up value creation through business model diversification?”.

Design/methodology/approach

The authors use a qualitative case study design with a longitudinal (2011–2023) analysis of the various business models developed by ATRenew, a leading firm in the Chinese preowned electronics industry.

Findings

The authors find that the recycling business model can act as a “cornerstone” business model for a circular firm to integrate the business model portfolio by leveraging the most synergies (or complementarities) with other business models. Besides, digital platform-based circular firms can effectively scale up value creation by leveraging capability complementary on the supply side, through establishing industrial infrastructure shared with the platform ecosystem; and by leveraging customer complementary on the demand side, through activating the dual role played by platform users as suppliers and consumers.

Originality/value

The authors contribute to the circular business models literature with three mechanisms to scale up circular value creation through business model diversification and advance a set of propositions to be tested in future research. This also has important practical implications for circular economy platform businesses.

Details

Chinese Management Studies, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1750-614X

Keywords

Book part
Publication date: 19 April 2022

Katharina Spraul and Stephanie Stumpf

In research on the circular economy, business models are often taken as a focal point since their essential functions are both to create value and to capture part of that value…

Abstract

In research on the circular economy, business models are often taken as a focal point since their essential functions are both to create value and to capture part of that value. This chapter investigates whether and how circular business models can be “opened up” to creating and capturing value by utilizing a firm’s main asset not only in its own operation but also in other firms’ businesses. We hereby take the perspective of producing companies which face various challenges over the entire product life cycle and empirically analyze a case of five companies which are part of a joint innovation toward circularity in the plastics industry. Building on a grounded theory approach, we propose a new framework for companies which combines insights about open business models with circularity. When moving toward circularity, producing companies are advised to expand their dyadic perspective of suppliers, on the one hand, and customers, on the other hand, to a network perspective and open their business models.

Details

Circular Economy Supply Chains: From Chains to Systems
Type: Book
ISBN: 978-1-83982-545-3

Keywords

Book part
Publication date: 5 September 2022

Della-Maria M. Marinova and Svetla T. Marinova

This chapter explores the role of diversity in the emergence of circular business models by focusing on circular economy innovative born-global start-ups. Diversity refers to a…

Abstract

This chapter explores the role of diversity in the emergence of circular business models by focusing on circular economy innovative born-global start-ups. Diversity refers to a wide range of characteristics that differentiate an individual or group. These include legally protected and/or demographic characteristics, such as age, as well as identity-shaping characteristics, such as cognitive traits and experience. Diversity in organizations has been mostly explored in terms of the former, i.e., culture, age or ethnicity as a key factor in organizational innovation and enhanced performance. This chapter offers a more holistic view on the role of diversity in relation to emerging circular business models. It shows how diversity of previous knowledge, experience, ethnicity and the shared ideation of the organization's founders can be used as compatible and complementary inputs, which can lead to the emergence of a global circular business model by using integration, coordination and fast scaling up. The analysis is on the level of firm micro-foundations. Using data from three circular born-global companies from a single country context, the study identifies different types of diversity as contributing to the emergence of these business model and their configuration. We conclude that circular born-global business models are nurtured by the shared ideation and values of the business model founders, while the design of the business model is enabled by the diversity of competences and capabilities stemming from the founders' knowledge, past experience and diaspora networks. Such a perspective suggests that managers need to adopt a holistic approach in employing diversity in business model configuration in relation to common drivers and ideation, and organizational purpose.

Article
Publication date: 8 June 2021

Phuc Hong Huynh

Digital innovation and circular business model innovation are two critical enablers of a circular economy. A wide variety of digital technologies such as blockchain, 3D printing…

11387

Abstract

Purpose

Digital innovation and circular business model innovation are two critical enablers of a circular economy. A wide variety of digital technologies such as blockchain, 3D printing, cyber-physical systems, or big data also diverges the applications of digital technologies in circular business models. Given heterogeneous attributes of circular business models and digital technologies, the selections of digital technologies and circular business models might be highly distinctive within and between sectorial contexts. This paper examines digital circular business models in the context of the fashion industry and its multiple actors. This industry as the world’s second polluting industry requires an urgent circular economy (CE) transition with less resource consumption, lower waste emissions and a more stable economy.

Design/methodology/approach

An inductive, exploratory multiple-case study method is employed to investigate the ten cases of different sized fashion companies (i.e. large, small medium-sized firm (SME) and startup firms). The comparison across cases is conducted to understand fashion firms' distinct behaviours in adopting various digital circular economy strategies.

Findings

The paper presents three archetypes of digital-based circular business models in the fashion industry: the blockchain-based supply chain model, the service-based model and the pull demand-driven model. Besides incremental innovations, the radical business model and digital innovations as presented in the pull demand-driven model may be crucial to the fashion circular economy transition. The pull demand–driven model may shift the economy from scales to scopes, change the whole process of how the fashion items are forecasted, produced, and used, and reform consumer behaviours. The paths of adopting digital fashion circular business models are also different among large, SMEs and startup fashion firms.

Practical implications

The study provides business managers with empirical insights on how circular business models (CBMs) should be chosen according to intrinsic business capacities, technological competences and CE strategies. The emerging trends of new fashion markets (e.g. rental, subscription) and consumers' sustainable awareness should be not be neglected. Moreover, besides adopting recycling and reuse strategies, large fashion incumbents consider collaborating with other technology suppliers and startup companies to incubate more radical innovations.

Social implications

Appropriate policies and regulations should be enacted to enable the digital CE transition. Market patterns and consumer acceptances are considered highly challenging to these digital fashion models. A balanced policy on both the demand and supply sides are suggested. The one-side policy may fail CBMs that entail an upside-down collaboration of both producers and consumers. Moreover, it is perhaps time to rethink how to reduce unnecessary new demand rather than repeatedly producing and recycling.

Originality/value

The pace of CE research is lagging far behind the accelerating environmental contamination by the fashion industry. The study aims to narrow the gap between theory and practice to harmonise fashion firms' orchestration and accelerate the transition of the fashion industry towards the CE. This study examines diverse types of digital technologies in different circular business models in a homogeneous context of the fashion industry with heterogeneous firm types.

Details

International Journal of Productivity and Performance Management, vol. 71 no. 3
Type: Research Article
ISSN: 1741-0401

Keywords

Article
Publication date: 25 September 2018

Enes Ünal, Andrea Urbinati and Davide Chiaroni

The purpose of this paper is to investigate the managerial practices that companies can implement in order to design a circular economy business model and how companies can create…

5073

Abstract

Purpose

The purpose of this paper is to investigate the managerial practices that companies can implement in order to design a circular economy business model and how companies can create and capture value from a circular economy business model.

Design/methodology/approach

The paper adopts a single case study methodology with semi-structured interviews and company, supplier, and manufacturing site visits, conducted in a small-to-medium-size Italian company operating in the office supply industry.

Findings

The theoretical setting maps a set of managerial practices for a circular economy business model and sets the research gaps and questions in a research framework designed along three main dimensions: value network, customer value proposition and interface, and managerial commitment. Then, through an empirical analysis, the findings reveal that the proposed dimensions are interdependent and reinforce each other. Moreover, the managerial commitment as moderating factor between the value network and the customer value proposition and interface dimensions is identified as essential for reaching the intended goals of circular economy business models.

Research limitations/implications

This study maximizes the depth of the phenomenon under investigation by leveraging a single case study methodology, which ideally helps in a theory-testing approach as in the present case. Future research opportunities could be found in qualitative and quantitative studies to increase the generalizability of the findings of this paper.

Practical implications

The paper presents a set of relevant managerial practices for circular economy business models that can be used by managers who have the will to embrace in practice circular economy principles to support the design, change, or upgrade of the business model of companies within which they operate.

Originality/value

An interdisciplinary approach that integrates the research streams of circular economy, social psychology, organizational behavior, and business model design has been pursued to test the theoretical setting and the research framework for circular economy business models in a real-world context.

Details

Journal of Manufacturing Technology Management, vol. 30 no. 3
Type: Research Article
ISSN: 1741-038X

Keywords

Article
Publication date: 11 November 2020

Boleslaw Rok and Monika Kulik

The purpose of this paper is to explore how circular start-ups design and implement innovation into their business models to increase their positive impact.

1368

Abstract

Purpose

The purpose of this paper is to explore how circular start-ups design and implement innovation into their business models to increase their positive impact.

Design/methodology/approach

This qualitative study is based on an exploratory multiple-case study involving six circular start-ups with positive impact in Poland. Data gathering took place via in-depth interviews with start-up founders.

Findings

The analysis demonstrates that three factors, which are strongly interconnected, can significantly influence the development of a circular start-up. The first is the purpose-led motivation for circularity as a solution, mostly concentrated on the environmental education of different market actors. The second factor is built on the aim to increase the positive impact by addressing the most pressing social and environmental problems. It determines the impact on society as well as on the environment and the extent to which its model can be scaled up. The third factor is driven by the understanding of the purpose of the innovation, concentrated on the business model innovation regarding circularity.

Practical implications

This paper demonstrates the benefits for diverse stakeholders and the importance of using circular business models in start-up development. Circularity can be perceived as a main part of the new approach to improve sustainability.

Originality/value

Circular start-ups represent a new phenomenon in the entrepreneurial market. While the structure and logic of the circular business model in start-ups are significantly unexplored in the management literature, this model is viewed as a crucial step in the direction of increasing the positive impact of start-ups. From a theoretical and practical perspective, it is important to understand the differences and similarities in this area within different markets.

Details

Corporate Governance: The International Journal of Business in Society, vol. 21 no. 2
Type: Research Article
ISSN: 1472-0701

Keywords

Article
Publication date: 11 June 2019

Esben Rahbek Gjerdrum Pedersen, Rebecca Earley and Kirsti Reitan Andersen

The purpose of this paper is to discuss how organisational complexities influence the design of circular business models, which have recently been introduced as a new panacea for…

3067

Abstract

Purpose

The purpose of this paper is to discuss how organisational complexities influence the design of circular business models, which have recently been introduced as a new panacea for aligning the interests of business with the needs of the environment.

Design/methodology/approach

The Service Shirt, a new garment concept, is used as an illustrative case example for demonstrating some of the organisational complexities of making circular business models operable. The shirt was developed through a series of design workshops for the fashion brand Fashion Alpha.

Findings

The analysis highlights multiple challenges emerging when a fashion product with a significantly extended lifecycle passes through different users, organisations and business models. It is concluded that it is difficult to talk about a circular business model (singular) as circular economy solutions depend on the contributions of multiple stakeholders with business models.

Practical implications

The findings illustrate how fashion companies interested in the circular economy fundamentally have to rethink conventional approaches to value, organisational boundaries and temporality.

Originality/value

Drawing on a case example from the fashion industry, the paper demonstrates the organisational complexities linked to the design of new business models based on circular economy thinking, as these require the coordination of actions between autonomous actors driven by different logics regarding value creation, value delivery and value capture.

Details

Journal of Fashion Marketing and Management: An International Journal, vol. 23 no. 3
Type: Research Article
ISSN: 1361-2026

Keywords

Article
Publication date: 8 February 2021

Nancy Bocken and Paavo Ritala

Circular business models can improve resource use in a financially and environmentally feasible way. However, companies struggle to choose among the vast variety of ways to…

3789

Abstract

Purpose

Circular business models can improve resource use in a financially and environmentally feasible way. However, companies struggle to choose among the vast variety of ways to achieve circularity within a business model. The purpose of this paper is to offer a pragmatic guide for making strategic decisions on circular business models.

Design/methodology/approach

This paper develops a conceptual model of six different strategic approaches to circular business models and provides examples to business cases and practice to illustrate these.

Findings

This study identifies two critical strategy choices companies should make. First, an innovation strategy addresses the extent to which circularity is achieved with internal or external stakeholders. Second, a resource strategy addresses how companies achieve circularity by narrowing, slowing or closing resource loops. Using examples from business practice, this study illustrates how the combinations of these two strategies can be used to design competitive circular business models. Key managerial questions are also identified to help decide upon a feasible strategy for circular business model innovation.

Originality/value

While different types of circular business models have been described, it is less clear what the strategic choices are that companies need to make to find feasible business cases for circularity in terms of value proposition, value creation and delivery and value capture. This study outlines these through a “circular business model strategy framework”.

Details

Journal of Business Strategy, vol. 43 no. 3
Type: Research Article
ISSN: 0275-6668

Keywords

Article
Publication date: 23 August 2022

Sonia Mehrotra and Santosh Rupa Jaladi

The purpose of this paper is to investigate the practices that start-ups in emerging economies can implement to design circular economy business models and how they can create and…

1221

Abstract

Purpose

The purpose of this paper is to investigate the practices that start-ups in emerging economies can implement to design circular economy business models and how they can create and capture value from a circular economy business model.

Design/methodology/approach

The paper adopts a qualitative case method approach with semi-structured interviews with start-up founder promoters, its employees, its beneficiaries and its customers, conducted in two local Indian start-ups engaged in the manufacture of products and providing services that promote adoption of circular economy principles.

Findings

Analysis of the two business models reveals common patterns in building value proposition. The findings suggest that start-up ventures adopt an iterative approach to produce reusable and interlinked products and co-create with customers, vendors and local communities. They adopt mechanisms that can create, deliver and capture value while maintaining economic viability, and thus contribute towards micro- and macro-level benefits.

Research limitations/implications

This study maximizes the depth of the phenomenon under investigation by leveraging case study methodology. Future research opportunities could be found in quantitative studies to increase the generalizability of the findings of this paper.

Practical implications

The paper presents a theoretical model linking the circular business model design and deployment mechanisms that can be used by start-up entrepreneurs desirous of embracing circular economy principles and thus contribute towards environmental, economic and developmental goals in emerging economies.

Social implications

To accelerate the transition of adoption of circularity principles in emerging markets, start-up ventures could adopt circular business models that contribute towards achieving positive behavioural change. This can be achieved by integrating with different stakeholders in the value network such that they play a vital role in the process of value creation and delivery and benefit from the value captured.

Originality/value

An interdisciplinary approach that integrates the research streams of circular economy, and business model design has been pursued to identify the design and deployment mechanisms adopted in the circular business models of start-ups in real-world emerging economies’ context.

Details

Journal of Entrepreneurship in Emerging Economies, vol. 14 no. 5
Type: Research Article
ISSN: 2053-4604

Keywords

Open Access
Article
Publication date: 11 July 2024

Francis Kamewor Tetteh, Gabriel Atiki, Andrews Kyeremeh, Francisca Delali Degbe and Prosper Apanye

Though business analytics capability continues to attract considerable industrial and scholarly attention, its holistic performance implications, especially in the post-COVID-19…

Abstract

Purpose

Though business analytics capability continues to attract considerable industrial and scholarly attention, its holistic performance implications, especially in the post-COVID-19 period, have not been fully understood. Thus, there have been calls for a full understanding of the implications of BAC for achieving holistic, sustainable outcomes among firms. This study therefore examines the influence of BAC on the three dimensions of sustainable performance. We also proposed the mediating role of circular economy implementation.

Design/methodology/approach

We tested the proposed model using survey data from 246 managers of manufacturing firms in Ghana. Partial least squares structural equation modelling was employed to validate the model.

Findings

Our findings showed that BAC significantly enhances both sustainable performance and circular economy implementation. We also found a significant association between CEI and sustainable performance. We further found significant partial mediation of CEI in the BAC sustainable performance nexus.

Practical implications

Our study offers thoughtful insights for managers, policymakers and the academic community that firms should simultaneously implement circular models alongside building analytics competencies in the quest to achieve balanced performance outcomes.

Originality/value

To the best of our knowledge, our study is among the very few attempts to understand the mechanism that channels the benefits of BAC for a holistic, sustainable outcome.

Details

Modern Supply Chain Research and Applications, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 2631-3871

Keywords

1 – 10 of over 11000