Circular supply chains as complex adaptive ecosystems: A simulation-based approach

Abstract

Circular Supply Chains (CSCs) are self-sustained ecosystems designed to pursue Circular Economy principles. Compared to linear supply chains, they involve new classes of stakeholders performing circular activities and multiple resource streams (e.g. virgin materials, by-products, end-of-life products, waste) moving forward and back the original and different supply chains. Therefore, CSCs are characterized by increasing complexity that call for proper coordination mechanisms. In this regard, we propose a theoretical framework, based on the theory of Complex Adaptive Systems, capturing the static and dynamic dimensions of CSC complexity which characterize the archetype of a CSC and then we develop a novel agent-based model to simulate the effect of competition and collaboration mechanisms on CSC performance across different CSC archetypes. The results of numerical simulations suggest which mechanism to adopt for the coordination of certain CSC archetypes: while competition is always detrimental, local collaboration is effective for CSCs with closed loop structures, and global collaboration is instead required in presence of open and hybrid loop structures.