Abstract
While the enabling capabilities of the Internet of Things (IoT) in the Circular Economy (CE) have been highlighted in a number of publications, knowledge about how to leverage IoT in actual implementation of circular strategies is still lacking. This paper aims to elucidate reasons for the apparent mismatch between the ‘theoretical opportunities’ of IoT for CE as described in literature, and current implementation in practice. To this end, we present a case study in the field of LED lighting, within a company with previous experience and knowledge in both IoT and CE. The primary data source is twelve semi-structured interviews with stakeholders from the company. We identify opportunities for using IoT to support circular strategies in this specific case: IoT can support servitized business models; improve tracking and record keeping of in-use and post-use products; enable conditions monitoring and predictive maintenance; improve estimations of remaining lifetime of used products; and inform design decisions to improve durability of products. Related to these opportunities, we identify implementation challenges faced by the company. The main IoT-specific implementation challenges in the case are (1) a lack of structured data management processes to ensure high quality data collection and analysis, and (2) the difficulty of designing IoT-enabled products for interoperability, adaptability, and upgradability, especially considering that IoT technologies develop at a high pace. By elucidating these challenges, this paper contributes with IoT-specific insights to the available literature about challenges in circular business model implementation. Moreover, this paper adds an important emphasis on real-world implementation challenges to the literature about digitally-enabled circular strategies.
Highlights
The term Circular Economy (CE) envisions an economy that simultaneously considers environmental impact, resource scarcity and economic benefits (Lieder and Rashid, 2016)
We investigate the opportunities of using Internet of Things (IoT) for CE in the specific context, and the associated implementation challenges faced by the company
The opportunities for IoT to support a circular Product Service Systems (PSS) in the food retail segment, as perceived by the interviewees, are summarised in Table 2 and explained below
Summary
The term Circular Economy (CE) envisions an economy that simultaneously considers environmental impact, resource scarcity and economic benefits (Lieder and Rashid, 2016). Research into circular and sustainable business models has shown that service-oriented value propositions have the potential to decouple profit from production volumes, and thereby reduce resource use (Bocken et al, 2014). Such business models have been studied extensively within the research field of Product Service Systems (PSS) (Tukker, 2015). In relation to the circular strategy of increased utilisation, IoT can support sharing of products between multiple users by allowing for monitoring of product condition, status, location, and usage (Bressanelli et al, 2018)
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