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    Open Innovation for Circular Business Models: Addressing the Right Challenge at the Right Time
    (Wiley, 2025-09-27) ; ;
    Manuel Ritter
    ;
    Shaun West
    ;
    ABSTRACT Academic Summary In response to escalating societal challenges, such as climate change and resource constraints, this article examines the transition from linear toward circular business models (CBMs). It explores the challenges of CBM transitions and how to tackle them through open innovation. We leverage 68 interviews with 45 firms, including 12 focal manufacturers and their open innovation partners. We identify 13 challenges and their relevant time horizons. They concern the product and service portfolio, data governance, life cycle valuation, circular strategy, and the legal environment. By iterating our inductive analysis with insights from the literature, we develop a framework that explains the link between open innovation and CBMs. We develop three mechanisms: (1) capture value by coupling internal innovation and data sharing to incentivize life cycle valuation, (2) technology co‐development with supply chain partners for an improved circular product and service portfolio aligned with data governance to create value, and (3) orchestrate complementary partners to promote circular strategies and resources for the legal environment to deliver value. Our framework contributes to the literature on CBMs and open innovation by explaining when and how different forms of open innovation can help in the transition from linear toward CBMs. Practitioner Summary In response to growing environmental pressures, this study explores how firms can transition from linear toward circular business models (CBMs) by leveraging open innovation. Drawing on 68 interviews with 45 firms, including 12 manufacturers and their innovation partners, we identify 13 key challenges grouped into five strategic themes: product and service portfolio, data governance, life cycle valuation, circular strategy, and the legal environment. Our findings emphasize that CBM transition is an iterative process, rather than a one‐time shift, that comes with many challenges. Our study proposes open innovation as a strategic option to address these challenges. Firms need to deploy varied approaches over time: internal innovation and data sharing in the short term to drive circular value capture; supply chain co‐development in the mid term to enhance circular value creation; and the orchestration of complementary partners in the long term to improve value delivery and system‐wide circularity. We offer a practical framework and a temporal innovation roadmap to help managers structure their CBM efforts. This roadmap provides clear guidance on when and how to apply open innovation strategies, enabling decision‐makers to address challenges, align internal and external partners, and transition their linear business models toward circularity.
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    Structuring Private Sustainability Governance: Combining Rule-Based and Goal-Based Mechanisms
    (2025-05-19) ;
    Niklas Letmathe
    ;
    Marin Jovanovic
    ;
    This study investigates the structuring of private sustainability governance as a critical mechanism for facilitating sustainability transitions. Drawing on 33 semi-structured interviews with manufacturing firms, regulatory bodies, policy associations, auditing firms, and management consultancies, the study examines how firms navigate increasing external governance pressures, including regulatory ambiguity, compliance demands, market expectations, and stakeholder accountability, while simultaneously managing internal governance through organizational restructuring, sustainable performance measurement, data management, human resources, and incentive structures. The findings highlight the importance of integrating rule-based and goal-based private sustainability governance through two key mechanisms: shaping external governance by aligning with and influencing regulatory standards, and adapting internal governance to embed sustainability into core business operations. This study develops a hybrid governance framework that demonstrates how firms leverage both mechanisms in parallel, revealing the tensions inherent in balancing regulatory compliance with strategic sustainability ambitions. We make a further contribution by underscoring the role of ethical change management in fostering transparency, accountability, and proactive sustainability commitments. By examining governance structures in combination with ethical considerations, the study advances the discourse on private sustainability governance, offering both theoretical insights and practical implications for firms navigating the transition toward sustainable systems.
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    Scopus© Citations 6
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    Towards circular business models in the punching industry: Leveraging smart sensor technology for sustainable manufacturing processes
    The punching industry (PI) remains largely dependent on unsustainable resource use in its manufacturing process, consuming finite materials. Evolving market needs for increased environmental sustainability in the PI cause punching companies to reevaluate their existing manufacturing processes. Considering this trend, this research explores the prerequisites for transitioning to circular business models (CBMs), a subset of sustainable business models, by using smart sensor technology (SST) supporting a sustainable manufacturing process (SMP). Prior research has shown that using different sensors pertaining punching tools and machines is prevalent. Standard parts in the punching tool itself address these challenges of an imprecise set-up of the punching tool on the punching machine resulting in process improvements and efficiency enhancements. Yet, no similar data-driven punching tool concepts have been installed highlighting the novelty. To address this gap, this study examines how data can be gathered and successfully utilized to support SMP fostering CBMs in the PI based on data-driven punching tools. Mixed methods are applied in a practice-oriented project, involving a Swiss-based manufacturer. The results demonstrate several key drivers supporting SMPs enabled by data-driven punching tools. Future research should involve a larger number of interviews and further field testing to increase maturing SST data-driven punching tools.
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    Thriving Circular Economy Actions in Public and Private Relationships: The Microfoundations of Firms’ Green Behavior
    (2024) ;
    Niklas Letmathe
    ;
    Marin Jovanovic
    ;
    The R&D Management Conference is an international event initiated in Manchester in 1980, which annually brings together academics and practitioners concerned with the study of R&D, technology management and innovation. This conference will explore how technology is disrupting and transforming established industries through innovation.
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    Paving the way towards a circular economy: Lifecycle services to make the transition towards circular business models
    This book of abstracts summarizes the proceedings of the 10th International Conference on Business Servitization (ICBS 2023). On this edition, the conference places a special emphasis on the focal theme: AI Platforms for Digital Servitization and Solution Delivery.
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    Conceptual Ecosystems to Support the Development of Sustainable Business Models for a Capital Equipment Manufacturer
    (2023) ;
    Manuel Ritter
    ;
    Shaun West
    ;
    Improving sustainability concerns many stakeholders: customers, shareholders, employees, and regulators. The manufacturing industry is a significant factor as production continually depletes finite resources. Without a shift to more sustainable business models (i.e. those based on the triple bottom line), there is a risk of continued depletion of resources. A common finding from prior work is the need to act within an ecosystem approach to support the development of a circular economy that considers the multiple interactions and dynamic recombination of resources that lead to value co-creation. This paper investigates the interplay of ecosystem actors and builds conceptual habitats to improve sustainability. It considers the strategic meso and macro levels of the ecosystem to provide detailed insights into the behaviors and motivations of different actors. Critical bilateral and multilateral interdependences among the ecosystem actors are highlighted. The presence of digitalization provides the necessary institutional arrangements for interactions between diverse actors. This builds upon the work of West et al. (Practices and tools for servitization. Springer, pp. 363–385, 2018), by creating multiple conceptual future state ecosystems, identifying gaps within the ecosystems, and providing a description of the actors. The study suggests that an extended model is considered for developing and operationalizing sustainability-based business models for capital equipment. The limitations of this study reveal the requirement to validate and cross-check the suggestions in a real case example with a broader scope for comprehensive qualitative and quantitative data collection.
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    Role of Recycling Towards a Sustainable Business Model: A Perspective on Industrial Assets
    Equipment manufacturers (EMs) exhibit unsustainable operating patterns in linear production models by depleting finite materials. In this context, future business environments in industrial markets shift fundamentally and form a new sustainability paradigm stimulated by key drivers, e.g., end customer behavior. Considering the market shift, this research explores an overview of prerequisites in the transition toward a sustainable business model in industrial markets. Prior research exhibited product life cycle extensions for industrial assets facilitated by the most common R-principles “reuse”, “remanufacture”, and “recycle”. Leaning on previous research, recycling is instrumentalized for some materials, e.g., polyethylene terephthalate (PET). For industrial assets, manufactured products, such implementation efforts for EMs fall short. Investigating the shortage, this study (1) scrutinizes the role of recycling in the transition towards a sustainable business model, (2) identifies appropriate characteristics of industrial assets facilitating recycling, and (3) evaluates parameters to operationalize a recycling value chain (RVC). In a practice-based project, involving a Swiss-based equipment manufacturing company, mixed methods are applied. The results propose key drivers and characteristics facilitating recycling efforts of industrial assets and parameters fostering an RVC. Future research should increase the number of sample EMs and scrutinize the role of various RVC actors to exceed present limitations.
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    The impact of circular strategies on the triple bottom line: An analysis of enablers and actors
    (2022) ;
    Manuel Ritter
    ;
    Shaun West
    ;
    This book of abstracts summarizes the proceedings of the 9th International Conference on Business Servitization (ICBS 2022). In this edition, the conference places a special emphasis on the focal theme: Servitization as a springboard for enhancing sustainable manufacturing.
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