Circular value creation architectures: Make, ally, buy, or laissez‐faire

Abstract

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.

Orchestrating cradle‐to‐cradle innovation across the value chain: Overcoming barriers through innovation communities, collaboration mechanisms, and intermediation

“…It has become evident that collaboration in networks is at the core of product‐level circularity (e.g., Hansen & Revellio, 2020; Konietzko, Bocken, & Hultink, 2020). As research in both product‐level circularity and broader industrial ecology shows, such interorganizational collaboration requires careful network orchestration (Boons & Baas, 1997; Korhonen, Nuur, Feldmann, & Birkie, 2018) and facilitation (Paquin & Howard‐Grenville, 2012; Patala, Salmi, & Bocken, 2020).…”

A Critical Review of the Role of Repair Cafés in a Sustainable Circular Transition

“…However, the article stresses that the service provided can, and should be, distinguished from other types of sharing platforms. Finally, repair cafés are addressed as 'third party service providers' and 'autonomous loop operators' in relation to CE [69] (p. 1263), particularly in relation to slowing and closing product and related material loops, as those require service operations, such as repair. However, due to the informal character of the relationship among actors in this laissez-faire architecture, a central coordinator fails to receive this feedback.…”

“…However, due to the informal character of the relationship among actors in this laissez-faire architecture, a central coordinator fails to receive this feedback. This is noted as a 'lost opportunity' [69], as valuable knowledge is being lost.…”

“…From an environmental and economic sustainability perspective, repair cafés are also viewed as taking on different roles, pulling them more towards being a 'third-party service provider' [27,69]. Obtaining repair data is an important resource in the CE [26].…”

Nachhaltige Entwicklungsziele – Der Beitrag der Montanuniversität zur Erstellung eines Optionenpapiers für die österreichische Bundesregierung

“…Circular Economy Packages ("Towards a circular economy: a zero waste programme for Europe") und mit dem im März 2020 neu veröffentlichten "New Circular Economy Package" wesentliche Weichen für Nachhaltige(n) Konsum und Produktion gestellt [4,5]. Hierbei wird ein breiter Ansatz vertreten, der weit über das stoffliche Recycling (so genannte "Closing"-Strategien) hinausgeht und auch die Produktlebensdauer und damit verbundene Konsumgewohnheiten (so genannte "Slowing"-Strategien) adressiert [6,7]. Im folgenden Circular Economy (CE) Framework als Bezugsrahmen werden die Abdeckung, die Systemgrenzen und der Zusammenhang der einzelnen Abb.…”