Three lenses on circular business model innovation

Circular business models help businesses to create and capture value in ways that are in line with circular economy strategies, while, at the same time, making feasible business cases. Identifying circular business cases is not simple, however, and calls for major innovation efforts in different aspects of the firm's business model. In this chapter, we identify and demonstrate three lenses to circular business model innovation. First, we explicate how firms innovate circular value propositions, that is, customer-facing promises of value creation that draw from circularity principles. Second, we focus on the firm-level business models, that is, on how firms innovate their value creation, delivery, capture schemes to operatjonalise circular strategies. Third, we adopt the ecosystem lens, by examining how firms can involve a variety of complementary actors, governed via coordination mechanisms such as contractual frameworks, digital platforms and around a shared value proposition. The three lenses are complementary and constitute an overarching view of circular business model innovation. We use examples to show how these lenses help companies implement the circular strategies of narrowing, slowing, closing and regenerating the loop. We also suggest directions for future research in this area.