Circularity Canvas: Methodology to Outline Circular Business Models
13 March 2017

First Step to Circularity

Sustainn helps you to outline a Circular Business Model from scratch through the Circularity Canvas Methodology.

It helps to take the first step to circularity and to conceive economical, social and environmentally sustainable business models. It aims to reduce the waste generation integrating Circular Economy and Cradle to Cradle ® principles from the early business model conception stages.

Circularity Canvas Methodology Overview

The Circularity Canvas Methodology is based on the well-known Business Model Canvas (BMC) tool, customizing business model blocks towards Circular Business Models.

It is conceived as a circular path, starting from an initial BMC oriented to Circular Economy, and finishing with its adjustment after identification of value propositions among the different stakeholders involved in a complete Circular Business Model framework.

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6 Steps to Outline a Circular Business Model

Step 1: Definition of Main Value Proposition

We start defining the value proposition (VP) for the main customer focused on a “Product as a Service” models (use or result-oriented), following predefined tips and clues based on the Circular Economy principles.

Step 2: Customer Segments & Revenue Streams

Later on, we have to define the specific target customer and market segment and estimate the revenues streams from the main customer in the complete Circular Business Model framework, considering pay per use or pay per result revenues models.

Customer Relationships and Channels are to be outlined to ensure the service quality, paying special attention to user experience, utilization patterns and reverse logistics.

Step 3: Key Activities & Partnerships & Cost Structure

Then, we focus on the identification of Key Activities, paying special attention in those areas affecting more to Quality, Cost and Delivery of the service.

Regarding Key Partnerships, next concepts are to be considered having in mind the complete Circular Model Framework:

  • Nutrients Management Strategy, where the product, components, materials and waste streams are to be analyzed.
  • Circularity Hierarchy criterion (Repair-Reuse-Refurbishment-Remanufacturing-Recycle) is to be followed, analyzing all the potential recirculations of materials and valorization of waste, whether in-company (such as repair or internal waste valorization) or with the collaboration with external stakeholders (refurbish, downcycling, recycling, etc).

Key resources are to be estimated outlining cost structure with most relevant LCC (Life Cycle Cost) batches.

Step 4: Identification of Additional Value Propositions

Next step is oriented to the identification of additional value propositions among the different stakeholders within the complete Circular Business Model framework, derived from any potential recirculation.

Remarkably, it has to be carried out in a collaborative way integrating knowledge and expertise from the different stakeholders (multi-stakeholders approach).

Step 5: Particular Canvas for Additional Value Propositions

Then, a particular Circularity Canvas have to be run to detail the previously defined additional value propositions, with the same approach used for the complete Circular Business Model (fractal approach).

Feasibility of the whole Circular Business Model will depend on the adequate integration and synchronisation of additional VP’s, because it will affect to service cost and revenues structures.

Step 6: Global Canvas Integration

Finally, the initial BMC is to integrate the modifications from additional VP’s in the different blocks, especially key activities, partnerships, paying attention to:

  • Cost structure: Life Cycle Cost approach is to be followed, considering all the potential recirculations and exchange of components, materials and waste valorizations.
  • Revenue Streams: diversification of incomes and additional revenue streams coming from materials and waste valorization should be estimated at this point (such as waste valorization, downcycling, upcycling, industrial symbiosis).

Competitiveness of the business idea and main value proposition is to be revisited then, based on Quality – Cost – Delivery terms (QCD Assessment).

Circularity Canvas Methodology Added Value

Circularity Canvas Methodology is a structured methodology that helps your company to outline a Circular Business Model, oriented to:

  • – identify value propositions derived from all potential recirculations of materials and components with a multi-stakeholders approach,
  • minimize waste generation and environmental impact from the business model conception (oriented to zero-waste models), and,
  • competitiveness, through LCC and QCD assessment.

You can find more information in Open Mic Session “Circularity Canvas: First Step to Circularity” of 2016 Disruptive Innovation Festival.

Follow our future posts where we will give more details about every step of the methodology.

Do not hesitate to share your doubts and thoughts and contact us !!

¡¡ Think circular for a true sustainability !! #BeCircular

“It is the road that teaches us the best way to get there, and the road enriches us as we walk its length”. Paulo Coelho

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Comentarios

  1. Julio Salazar says:

    I like the method and it looks feasible and aplicable in a start-up. It would be interesting to find out how to apply this model to on going companies with traditional business and structures, and showing up reluctant to changes because the are living some successful times (or the think so, based just on the last quarter finantial resuts).

    Is regulations the answer?

    Building a ‘real’ Lcc, would be a must to start with in any case.

    • Carlos León says:

      Thanks a lot for your comment Julio!! In my opinion, for traditional business and structures, the method should be integrated within Requirements Definition and Conceptual Design phases and to be carried out by a multidisciplinary team. Regulations from European Commission are pushing forward, although slowly, towards Extended Producer Responsibility concept. So, the producer of the product is to be committed to be involved in its prevention and management at the end of its useful life. Anyway, I agree, always having a “real” LCC could be innovation in many cases.

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