How to create a circular business model?
The world is 8.6% circular
That’s what the 2022 Circularity Gap Report measured. What does it mean? We are at the start of a massive revolution. Circular business models represent an enormous opportunity. A circular economy could greatly benefit the environment and boost competitiveness and resilience. McKinsey highlights how moving to a circular economy requires a considerable initial transition investment. But the positive outcomes for the European economy and the annual benefits of up to €1.8 trillion by 2030 outweigh them far more.
Moving from theory into practice is a challenge for most businesses. But not an insurmountable one.
If you are a designer or a business curious to learn more about the circular economy and what a circular business model is. I have the following gift for you.
Together with Tom Prior from Designers in Business, we recorded an episode where we spoke about the circular economy. I share some concrete examples and experiences from how I supported companies in their exploration of circular business models. We also talk about:
What the Circular Economy is and why it matters
The recognisable brands already starting their Circular journey
Practical processes and tools for sustainable design
Mindset and communication strategies when working in Climate change
If you are a bit further along the journey, I recommend the recently published study by Nancy Bocken and Jan Konietzko. Together they analysed more than 20 interviews with innovators from companies like H&M, IKEA and Philips. Identifying common practices and tools used to create new circular business models. Three key aspects Jan highlights in his recent post are:
The transition phase from a linear to a circular model is the most uncertain and underdeveloped. It requires constantly evaluating what capabilities to keep, change or source from others.
The transition requires continuous and detailed environmental and social impact assessment to measure whether the business circular model performs as intended.
It’s hard to predict the impact of a circular business model as it is hard to predict consumer behaviour and uncertain operational requirements. Understanding customers’ behaviour or what drives them is key to achieving the highest impact.
Sounds like a complex challenge? Yes, it is but not one we can’t design our way out. Let’s get moving.
This interview is available in video, audio, or transcription formats.
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