Developing business models for a circular economy: development guided by strategy and dynamic capabilities

Abstract

The Circular Economy (CE) proposes a new way of organizing production and consumption systems by introducing a circular flow of resources, materials and products in order to create economic, environmental and social value. Business have a crucial role, as they have the ability to redesign their products, services and processes in a way that addresses current resource inefficiencies. A tool that can help businesses in conceptualizing this redesign are business models (BMs). This thesis provides understanding on how these specific BMs are created by answering the following research question: What are the key elements for developing business models for a circular economy (BMCEs)? Most research has focused on types of BMCEs or appear to assume one-shot BM- innovations, while a continuous process of reconfiguration and development is more likely. A literature review on CE, BM(CE), dynamic capabilities and strategy was conducted in order to develop a theoretical framework that elaborates on this process of developing BMCEs. The elements identified were strategy, dynamic capabilities, resources, capabilities, stakeholder collaboration and multidimensional value. The theoretical framework, therefore, adds to the current body of knowledge by offering a dynamic perspective on how to develop BMCEs and by identifying possible manifestations of the identified elements.