Hofmann, Florian / Marwede, Max / Nissen, Nils / Lang, Klaus-Dieter (2017): Circular added value: business model design in the circular economy

The current linear production and consumption structures, which build upon the intensive use of natural resources and cheap energy, are crucial drivers for the rapid economic development in the last sixty years. Biodiversity loss, climate change, conversion of the planet earth´s surface and resource depletion force researchers, policy-makers, business representatives, and consumers to think about alternative economic approaches and lifestyles. the circular economy concept has recently attracted increased attention from academic, political, and economic institutions. The transformation to an economy characterized by cyclical and cascading usage of natural and physical capital requires disruptive and systemic innovations. On business level, integrated strategies consisting of sufficiency, consistency, and efficiency factors are needed to implement the idea of circularity in the architecture of enterprises. Business developers have to restructure value creation processes, dematerialize value propositions, rethink and demerge global supply chains or consider ecological and social aspects in their cost-benefit analyses. Currently, the most business modeling tools and methods do not consider characteristics that are crucial for designing circular business models. This study is built upon a five-step systematic literature review methodology, which focused on circular economy, conventional as well as circular business model literature. The insights gained from the extensive literature analyses were used to redefine the logic, composition, elements, and potential element attributes of the Business Model Canvas in the context of circular economy.

This is a contribution to PLATE – Product Lifetimes And The Environment. It can be seen here.

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