Abstract Summary
Sustainable business model innovation is gaining interest among researchers and practitioners. However, the conceptualization of how sustainable business model innovation can contribute to system-wide transitions remains weak (Aagaard et al., 2021). Our paper addresses this gap, through a study of circular business model innovation linked to water and wastewater management. Our work is grounded in a four-year innovation action funded by Horizon 2020, and discusses the interaction between business model innovation, inter-sectoral linkages, and wider system change in six cases, in Norway, Netherlands, Czech Republic, Sicily, and Ghana. Data was collected through interviews and workshops, where the Triple-Layered Business Model Canvas (TLBMC), and Ecologies of Business Model Experimentation (EBME) (Bocken et al., 2018) were applied. The key questions we explore are: 1) To what extent do the emerging business models implicate novel value chains, and change at a wider system level? 2) What are the main factors influencing these dynamics? All the studied cases involve new interactions across at least two sectors, however, the scope of business model innovation varied. In the Dutch case, biocomposite production utilising resources from water and wastewater treatment was in focus, involving experimentation with new products, with multiple suppliers and customers, on a commercial, short-term basis. The is radical innovation in business model content, but also structurally, through a changed role for water utilities, and new connections with the building and construction sector. In two Norwegian cases, focused on energy and nutrient recovery, new companies and couplings between actors and sectors were established. Thus, there was innovation along the three axes of the activity system, at a meso-level. In Ghana, where sludge-based biochar for energy is promising, national policymakers were engaged, to ensure that the product is legally recognized. Reuse of treated wastewater, in Sicily and the Czech Republic, requires new relations between utilities and the user sectors. While the value propositions are clear, regulatory barriers have been overriding. By addressing these challenges in dialogue with relevant authorities, the business model innovation here related to a strategic, macro level, with potential impacts on a wider scale. Our study further highlights the dynamic nature of multi-system interactions. We discuss how relations have been changing over time and exhibit both symbiotic and competitive aspects. Following Aagard et al. (2021), we are concerned with how the duality of system structures and (current and planned) patterns of action shape transitions. We argue, however, that impacts of business model innovations do not necessarily evolve from micro to macro level. Fluctuations in scope and scale are linked to changing policy developments, regulatory frameworks, and market conditions. They are also strongly influenced by the positions and resources of leading actors. In the studied cases, the available volumes and qualities of the key resources and their interaction with the resource systems and requirements in the user sectors is another crucial factor, needing more research attention. References: Aagaard, A., et al. (2021). Business Models for Sustainability Transitions – How Organisations Contribute to Societal Transformation. Palgrave Macmillan. Bocken, N., et al. (2019). Sustainable business model experimentation by understanding ecologies of business models. Journal of Cleaner Production, 208, 1498-1512.
