content •Sustainable and sustainability concepts •Business model (BM) definitions •BM and servitisation •Digitalisationa and servitisation…sustainability of BM •Digital servitisation •BM and sustainability and sustainable BM (SBM) •Product Service Systems •Cicular BM and SBM •Digital services and Cicrular economy (CE) • Sustainable and sustainability Business model •help understand how a firm does business and can be used for analysis, comparison and performance assessment, management, communication, and innovation •concerned with how the firm defines its competitive strategy through the design of the product or service it offers to its market, how it charges for it, what it costs to produce, how it differentiates itself from other firms by the value proposition, and how the firm integrates its own value chain with those of other firm’s in a value network •a holistic description on ‘how a firm does business’ and how the company will convert resources and capabilities into economic value. •the organisational and financial ‘architecture’ of a business and includes implicit assumptions about customers, their needs, and the behaviour of revenues, costs and competitors •a business model CANVAS = a series of elements: the value proposition (product/service offering, customer segments, customer relationships), activities, resources, partners, distribution channels (i.e. value creation and delivery) and cost structure, and revenue model (i.e. value capture). •a consolidated view of the components of a business models as: the value proposition (i.e. the offer and the target customer segment), the value creation and delivery system, and the value capture system. •an activity-based perspective, including the selection of activities (‘what’), the activity system structure (‘how’), and who performs the activities (‘who’). Business model and servitisation Digitalisation and servitisation of business model – dig. also enabler of sustainable b.m. Digital servitisation Business model and sustainability Sustainable business models Example of the environemntal SBM Example of the social SBM Example of the economic SBM Sustainable business model archetypes •describe groupings of mechanisms and solutions that may contribute to building up the business model for sustainability. •The aim of these archetypes is to develop a common language that can be used to accelerate the development of sustainable business models in research and practice. •The archetypes are: •Maximise material and energy efficiency; •Create value from ‘waste’; •Substitute with renewables and natural processes; •Deliver functionality rather than ownership; •Adopt a stewardship role; •Encourage sufficiency; •Re-purpose the business for society/environment; and •Develop scale-up solutions Focus = addressing resource constraints ‘limits to growth’ associated with non-renewable resources and current production systems •Substitution with renewable (non-finite) resources •Local renewable energy solutions •Environmentally benign materials and production processes Product Service Systems •Some explanations: •Product related – e.g.: a maintenance contract, a financing scheme or the supply of consumables, but also a take-back agreement when the product reaches its end of life. •Product renting/sharing) - the main difference to product leasing is that the user does not have unlimited and individual access; others can use the product at other times. The same product is sequentially used by different users. •Product pooling. This greatly resembles product renting or sharing. However, here there is a simultaneous use of the product. •Functional result. Here, the provider agrees with the client the delivery of a result - a functional result is meant in rather abstract terms, which is not directly related to a specific technological system. The provider is, in principle, completely free as to how to deliver the result. Typical examples of this form of PSS are companies who offer to deliver a specified ‘pleasant climate’ in offices rather than gas or cooling equipment, or companies who promise farmers a maximum harvest loss rather than selling pesticides. Tukker, A. (2004). Eight types of product–service system: eight ways to sustainability? Experiences from SusProNet. Business strategy and the environment, 13(4), 246-260. (Yang, M., & Evans, S. (2019). Product-service system business model archetypes and sustainability. Journal of Cleaner Production, 220, 1156-1166). (Yang, M., & Evans, S. (2019). Product-service system business model archetypes and sustainability. Journal of Cleaner Production, 220, 1156-1166). Business model and circular economy •CE = generic term for an industrial economy that is, by design or intention, restorative and in which •material flows are of two types, biological nutrients, designed to re-enter the biosphere safely, and technical nutrients, which are designed to circulate at high quality without entering the biosphere RESOLVE framework and CBM • The Ellen MacArthur Foundation, 2015 - ReSOLVE proposes six CE-based business model development strategies: •Regenerate – This model focuses on a shift to renewable energy and material. Biological cycles circulate flows of energy and materials and convert organic waste into sources of energy and raw material for other chains. ••Share – This model has a shared economy perspective in which individuals share goods and assets; and ownership loses importance. Products are designed to last longer, and maintenance focuses on reuse of products and extending their life. Coordination between individuals is necessary for model viability. The “internet of things” can facilitate asset sharing (The Ellen MacArthur Foundation, 2015). ••Optimise – This model is technologically centred. Organisations use digital manufacturing technologies, such as sensors, automation, radio-frequency identification (RFID), big data, and remote steering to reduce waste in production systems and supply chains. Organisations benefit through a performance improvements; for instance, predictive maintenance schemes can be planned using real-time data (The Ellen MacArthur Foundation, 2015). ••Loop – This model uses biological and technical cycles. Biological cycles, for example, anaerobic digestion, can recapture the value of organic waste. Technical cycles can restore the value of post-consumption products and packaging through repair, reuse, remanufacturing, and recycling activities. Collaboration and coordination in supply chains is essential to close the loop and convert waste into useful resources. The use of intelligent devices, physical objects that are able to sense, record and communicate information about themselves and their surroundings for instance, provide information on location, condition, and availability of post-consumption products; supporting the loop strategy (The Ellen MacArthur Foundation, 2015). ••Virtualise – This model is a service-focused strategy. This model replaces physical products with virtual and dematerialised products implying the enhancement of customers' satisfaction. Smart connected products, linking with the internet of things, enable data gathering for the technical cycle (Spring and Araujo, 2017). ••Exchange – This model encompasses transferring old and non-renewable goods into advanced and renewable ones. Additive manufacturing using 3D printers can shift traditional mass production systems. Traditional mass production may produce more than the necessary to satisfy actual and potential demand; 3D printing may produce only when and what is needed at the source of demand. 3D printers are also be used for product parts repair implying a reduction of consumption of materials and of inventory (Despeisse et al., 2017). Circular business model canvas Circular business model Bocken, N.M.P., Schuit, C.S.C., Kraaijenhagen, C., 2018. Experimenting with a circular business model: lessons from eight cases. Environ. Innovat. Soc. Transit. 28, 79e95 https://www.threebility.com/_files/ugd/b67836_7bd275b345cf4f20bc560590113a8f47.pdf Digital services and CE