Does circularity or the circular economy have anything to do with our business?
As you can imagine, our answer is always Yes.
The difference between working on circularity versus producing eco-friendly products is the process. For a company to produce eco-friendly products, we may look into gaining some efficiencies in the water and energy consumption at the factory level; use biodegradable packaging; or use organically grown raw material. Nonetheless, the fundamental process of take, make, waste does not change.
To a large degree, this is the point where companies stop and find that being environmentally conscious might bring in some operational efficiencies, but ultimately most projects are still more challenging to implement as an add-on, materials are more expensive to procure, and overall, it is a hassle.
Most of the time, SMEs do not have control over the entire production cycle – and therefore achieving circularity takes several players to work together. For B2B service providers, this means helping SMEs fix waste issues from design and process optimization, and facilitating supply chain collaboration. For producers, this means looking at the input of your natural resources and finding ways to source them differently. For brands, this means thinking wider and planning better for design and production.
Moreover, each project is an independent adjustment for relevant teams and it doesn’t impact everyone. It’s a different story with circularity.
The ultimate outcome of a “circular economy” is waste reduction through achieving a “closed loop.” To achieve waste reduction, every business unit has a role to play in increasing circularity through simple principles such as 9R.
💡What is a closed loop?
A closed loop means that instead of using new resources to trigger a production cycle of a product or service, the initial input is taken from something that already exists. This can be achieved by reusing used input, or using input that has been produced through repair, remanufacturing, recycling, etc.
Shift in Decision Making Mindset
It takes a different set of management skills and decision making logic to make circularity work.
For example, the simple math of just maximizing efficiencies in one area or the other at a time doesn’t work. Circularity is a system change, and it requires decision makers to unlearn the simple patchwork or just fixing the spot that’s leaking. It is about thinking holistically and leveraging on various players in the supply chain.
Designing-out-waste
For process modelers, product designers, engineers, this is a golden opportunity to shine. How can we break status quo processes and design products and processes that aim to “close the loop” at every single intervention?
Procurement & Production Process
The most obvious approach in procurement is to swap existing materials for “recycled materials”.
For the production process, investing in processes that can recycle wastewater is also the obvious way to go. Waste reduction used to be about recycling. Yet, since the concept of circular economy became more and more popular, recycling has become less preferred.
For B2B service providers this means helping SMEs fix waste issues from design, process optimization, and facilitating supply chain collaboration. For producers, this means looking at the input of your natural resources and finding ways to source them differently. For brands, this means thinking wider and planning better for design and production.