Skills and capabilities for a sustainable and circular economy: The changing role of design

TL;DR: In this paper, the authors present case studies from a variety of multinational enterprises that are transforming their product strategies for climate change, revealing a growing necessity for industry to employ new proficiencies that support closure of material loops.

About: This article is published in Journal of Cleaner Production.The article was published on 2017-09-01 and is currently open access. It has received 287 citations till now. The article focuses on the topics: Circular economy & Sustainable Value.

Summary

1. Introduction

• Changes are taking place worldwide in business strategy as industries face increasing pressures from economic crises, resource scarcity and pollution.
• Due to the speed at which the planet's resources have been exploited, an industrial evolution to effectively extend usable value of material assets is crucial to sustain human activities in years to come (McDonough and Braungart, 2001; Allwood et al., 2011) .
• Research has demonstrated that companies must build new capabilities to operate within sustainable industrial systems (Alix and Vallespir, 2010; Kopnina, 2014) .

1.1. The Circular Economy as a Pathway to Product Sustainability

• The Circular Economy (CE), also known as a 'closed loop' economy, is an industrial and social evolutionary concept that pursues holistic sustainability goals through a culture of no waste.
• The CE also regards industries shifting towards the use of renewable energy, the elimination of toxic chemicals and waste whilst maximising competitive advantage through the superior design of materials, products, systems and business models (Ellen MacArthur Foundation, 2012) .
• Maintain products and components in use for longer.
• Different kinds of product cycles take place within a circular economy.

Focus

• Value Flows (Ellen MacArthur Foundation, 2013) Primary Source of Revenue (Lacy et al., 2014; Bakker et al., 2014b) Economic Activities to Close Loops (Stahel, 2013) Cycling smallerusing less energy and fewer resources Profit from increased utilisation rate of products, enabling shared use/access/ownership.
• Reuse and remarket of manufactured goods Profit from selling access to a product for a specific period of time or 'uses', and retaining material ownership.

Pure or regenerative cycles

• Profit from providing renewable energy, bio based-or fully recyclable materials to replace single-lifecycle inputs.
• Categorisation of business making for CE according to value form, sources of revenue and economic activities, also known as Figure 1.

Materials

• Necessary organisational changes to foster a CE model of production and consumption primarily encourage changes in the way industries profit.
• Authors consider the biggest challenges for manufacturing enterprises are to adopt the business models that aim to profit from existing resources and reduce new resource dependency through servitisation (Roy, 2000; Tukker, 2013; Bakker et al., 2014b) .
• A significant number of publications highlight the importance of developing capabilities to support strategies for closed-loop supply chains through design (Rahimifard and Clegg, 2008; Plant et al., 2010) .
• In fact, it has been suggested that designers now have the potential to influence consumer perceptions and consumption patterns to help industry and society move away from careless resource depletion (Andrews, 2015) , but to do so, "design has to show that it does more than make superficial changes to products" (Madge, 1993, p. 161) .

1.2. Climate Change Challenging Design

• Sustainable product design strategies that respond to climate change are far from being new topic in research.
• Design guidelines aiming to improve ease of disassembly, material separation and reassembly for circular products have been a fruitful topic of research (Hatcher et al., 2011; Crul et al., 2009) .
• A more descriptive classification was needed to clarify concepts for the reader, and aid forthcoming stages of the research.
• While it has been established that a change of mind-set driven by environmental awareness is required from design practitioners (Roux, 2011; Andrews, 2015) , an investigation has not yet been made into the necessary capabilities required to execute both technical and strategic changes in design for the CE (Hatcher et al., 2011) .
• Furthermore, most of the literature is academic or with industrial examples mostly from business-to-business (B2B); this reveals a lack of evidence in the ways design could be changing within other industrial and market systems.

2. Methods

• Case study research has been considered a suitable approach to build theories on a new topic concerning contemporary events (Eisenhardt, 1989; Yin, 2009) .
• It served to the purpose of depicting successful practices implemented in industry, which Vezzoli et al. (2015) and Tukker (2013) considered of utmost importance to encourage application of the existing body of knowledge regarding systemic transformations for industrial sustainability.
• The quantity of information collected through use of this approach alongside the accuracy of inferences made, confirmed by a range of consulting experts, was deemed comparable to undertaking first hand case study research and justified the deductions made.
• The role of design within different business models should be analysed, therefore the categorisation by Lacy et al. (2014) , was used as a guide to select exemplary case studies.
• Case studies must illustrate applications of circular economy in a wide variety of products and life-spans; from long-life, costly products to 'fast moving consumer goods' (FMCG) and single-use products. .

3.1. Audi®: Sharing Platform for Automobiles

• The case of study is Audi Unite™, the car sharing service branch of Audi®, which not only represents efficiency in the use of materials for automobiles, but also advocates for reducing the amount of vehicles on the road.
• The ownership of the car and remains within the manufacturer (Audi, 2015) .
• The car then becomes a capital investment for Audi, therefore it is in their best interest to develop reliable products that can be easily maintained and re-used.
• The different levels of the approach taken by Audi® for providing a product-service for share were identified and summarised in Table 3 .

3.2. Nokia®: Products as a Service for Mobile Devices

• Leasing is a strategy under development for creating a CE in Nokia® (Accenture, 2013) , allowing Nokia® to maintain ownership and control the lifecycle of their products to comply with regulations.
• Product design strategies must drive customers to prefer leasing Nokia® mobile phones over owning the competitor's products.
• For enhancing the service experience, designers must understand the requirements and expectations from customers as well as the optimal lifespan of the product based on technology (Tukker, 2013; Bakker et al., 2014a) .
• Table 4 depicts the multilevel aspects of this climate change strategy.

Implementation of CE SOCIETAL SYSTEM Contextual landscape

• The automobile industry is particularly pressured to reduce their carbon footprint at all stages of the product lifecycle.
• But usage is normally out of the manufacturer's control.
• Reduction of carbon footprint and increment of responsible car usage.

SOCIO-TECHNICAL SYSTEM System innovations and market

• Promotion of shared ownership schemes through an attractive product-service offering.
• Development of specialised service strategies as well as relevant supply relationships to support the car sharing scheme.
• Furniture performance is linked to "fashionable" factors.
• Reduction in the environmental impact of Ikea® large volume manufacturing.
• Development of key resource chains to secure recycled materials and implementation of reverse logistics that support take-back policies.

PRODUCT-SERVICE SYSTEM Business and process innovations

• Since its origins Audi® has been a pioneer of technical innovations in the automobile market, and has one of the most flexible and efficient production systems.
• Ikea® has strived to achieve product quality by building strong supplier relationships, producing large volumes and investing in efficient production technologies.
• Ingrain the value of sustainability in Ikea® products and operations.
• Development of state-of-theart manufacturing facilities that use renewable energy and more resource efficient processes.
• The company envisions to generate as much energy as consumed and become a leader in renewable energy.

PRODUCT-TECHNOLOG Y Product innovations

• Design within Rype Office® is primarily provided as a consultancy service and products are made-to-order.
• Design of furnishings for multiple life-cycles and high customisation.
• Design for cost effective remanufacture, including ease of assembly and disassembly.
• Design and selection of a range of building blocks from available feedstock.
• Rype Office® provides customised furniture of a timeless aesthetic.

3.3. Rype Office®: Products as Services and Life Extension for Office Furniture

• The usable life of furniture is dictated by enterprise owners and not users.
• Second-hand market for furniture is widely disseminated, but generally unappealing for the high-end customers and it seldom has the ability to supply large quantities of office furniture for enterprises (Rype Office, 2015) .
• Rype Office® is a UK growing enterprise that approaches the furniture market with a different strategy; it aims to maximise economic, environmental and social value for customers by remanufacturing custom or existing furniture and offering a guaranteed buy-back price or lease option (Ellen MacArthur Foundation, 2015d) .

3.4. Philips Health™: Product Life Extension for Medical Equipment

• Medical imaging products represent high investments in and long R&D processes in companies as Philips®.
• Healthcare budgets are increasingly under pressure and care facilities seek to make use of diagnostic equipment for long periods of time, but their life-saving character demands optimal reliability (Philips, 2014) .
• Philips® proposes two forms of business for circular products: the first is pre-owned refurbished units.
• Stated by Philips® (2014), modular design approaches will be used for new products.
• The objective is achieving highly reusable subassemblies and maximise residual value of products and facilitate parts harvesting procedures (Philips, 2014) .

3.5. Steelcase®: Product Life Extension for Office Furniture

• Steelcase® continuously aims to develop products with better environmental performance and higher quality and efficiency in their operations (Steelcase, 2015) .
• Further driven by environmental issues and embracing the Cradle to Cradle© philosophy, Steelcase® currently leverages for product design and development with a materials perspective (Steelcase, 2015) .
• Table 7 depicts their current strategies for closed loops.

3.6. Splosh®: Product Life Extension for Packaging

• In short-lived Fast Moving Consumer Goods (FMCG), the functional value of the product remains in the consumable part of it, while the value of the package ends after a sale is made.
• Splosh® is a UK based enterprise that offers an alternative business model for household cleaning products, enabled by product technology, which aims for minimal environmental impacts and extended packaging lifecycles (Ellen MacArthur Foundation, 2015e) .

3.7. Ikea®: Material Recovery for Home Furniture

• Ikea® thrives to produce quality furniture at affordable prices for its customers by optimising their supply chain processes.
• Aside from their distinctive user assembled furniture, as a strategy for logistics optimisation, Ikea® is pursuing the use of waste as resources for new products, simultaneously reducing landfill by establishing take-back campaigns for recycling furniture.
• In addition to their process minimisation approach, designers will also require to wisely use recycled and biodegradable materials in a way that does not complicate recovery at EOL.

3.8. Ecovative®: Circular Supplies for Packaging

• Ecovative® is a MNE that emerged from the creation of a mushroom-based material that was discovered to have properties similar to plastic foams, but being completely renewable (Ecovative, 2015a) .
• Ecovative® uses a material-first design approach to enhance the functional and aesthetic performance of mushroom material packaging (Ecovative, 2015b) .
• Design and adaptation of products from customers must be carefully assessed to ensure process compatibility (Ecovative, 2015b) .

SOCIETAL SYSTEM Contextual landscape

• Natural resources, such as wood, are extracted in large amounts for the furniture industry and are treated or altered, which prevents its safe degradation into the environment.
• Reduction of resource depletion and landfill pollution.
• Increase of consumer awareness to reduce landfill, and regulations for use of polluting materials and waste take-back.
• Companies are increasingly addressing the reduction of resource extraction, their carbon footprint, and the elimination of hazardous chemicals from across their value chain.

PRODUCT-TECHNOLOGY Product innovations

• The Ikea® business idea is to offer "a wide range of well-designed, functional home furnishing products at affordable prices Optimisation of resource and material usage throughout the product life cycle Design for efficiency in production and logistics.
• Selection of recycled, recyclable and biomaterials and development of knowledge to aid recovery at EOL.
• Visually attractive and functional homeware and furnishings that can be sustainably produced.
• Based on the empirical evidence gathered, the requirements of 'design for' (DfX) strategies relevant to each case study were identified, and the necessary knowledge from designers derived from this.
• These deductions were validated, as suggested by Eisenhardt (1989) , by the stakeholders from the relevant MNE's and CE experts.

4. Findings

• Ten requirements for capability development were identified in this comparison as necessary to design products and services that support the many pathways to form closed loops of materials (see first column, Table 12 ).
• Thus, segmentation was judged an appropriate approach to address skill-building for circular design.
• The evidently varied combinations of tangible and intangible value across CE business models proved to play an important part in determining the nature of design contributions.
• Observed in the Y axis of Figure 2 , if the strategy is geared towards material sufficiency, the level of tangible value is reduced, which means the services gain importance to render customer value and to profit.
• Analysis of the different contexts studied demonstrated that some industrial transformations involve a barely noticeable change in the role of design, with their supply chain and operations facing the greatest challenge; while others represent increasing technical challenges for designers or extended responsibilities.

5.1.1. The design process and product canvas

• Aside from performing a primary function, designers must ensure that products are suitable for multiple lifecycles and continue to appeal to potential consumers.
• This represents a most interesting challenge for design innovation.
• Product life extension appears to signify a reduction in the frequency of physical product design, which may allow for longer lead times, ensuring new products are thoroughly planned for superior environmental performance.
• This scenario makes more relevant the suggestions of authors like Pettersen (2015) , and Atwal and Williams (2009) underlining the need to embed symbolic and meaningful ingredients in products, as a way to enthuse users and create superior use and service experience.
• According to this study, however, implementing design methods for material recovery conveys only a small shift in the design process.

5.3. Impact to audience

• Changes in the role of design to cater to a changing industry, society and environment had been explored by a number of authors that contemplated the changing definitions of the discipline of design (Joore and Brezet, 2015) and offered a retrospective of its evolution up until the 21st century's circular economy (Andrews, 2015) .
• Research concludes that designers should now be 'solution providers' and not only 'object creators' (Meroni, 2008; Roux, 2011) .
• To achieve more holistic solutions for true circularity, changes in legislation are required that go beyond reduction and efficiency.
• The validation rationale of this research was consultative, where experts participated in verifying answers, rather than to providing answers.
• Incorporating a semi-structured interview in the methodology, to build the case studies, could have aided in obtaining first hand input and more case-specific details.

6. Conclusions

• Holistic sustainability strategies imply a change in business making for MNEs, shifting focus towards dynamic, intelligent solutions.
• New designer archetypes, which are not exclusive to specific products or business models but to design roles, were modelled with skillsets to attend to the diverse requirements of the circular economy.
• Stakeholders in MNEs are encouraged to seek the development of such proficiencies in their product development teams to boost the successful execution of sustainability strategies.
• The environmental and economic frailty in the global panorama signifies an end to the age of the 'consumer' as a depleting entity (Webster, 2015) , and the beginning of the age of the 'user', as a pillar for restorative systems.

Figures

Table 4: System analysis of Nokia® leasing scheme. (Data sources: Accenture, 2013).

Table 5: System analysis of Rype Office® furniture (Data sources: Ellen MacArthur Foundation, 2015d; Rype Office, 2015).

Table 10: System analysis of Ecovative® (Data sources: Ecovative, 2015a; 2015b; Ellen MacArthur Foundation, 2015c).

Table 9: System analysis of Ikea® activities for material recovery (Data sources: Canada et al., 2007; Ellen MacArthur Foundation, 2015a; Ikea, 2015).

Table 1. Taxonomy of design approaches for a sustainable industry.

Table 3: System analysis of Audi Unite™ platform. (Data sources: Audi, 2015; Audi AG, 2015abc).

Table 8: System analysis of Splosh® cleaning products (Data sources: Ellen MacArthur Foundation, 2015e; Splosh, 2015).

Table 13. Features and applicability of the 'design personas' within CE business models and product types.

Table 7: System analysis of Steelcase® furniture (Data sources: Ellen MacArthur Foundation, 2015b; Steelcase, 2015).

Table 12: Design skills necessary to create products for closed loops.

Table 6: System analysis of Philips® refurbished systems (Data sources: Philips, 2014; 2015).

Table 2: Panel of validating experts.

Figure 2: Circular Economy business models compared to business-as-usual.

Figure 1: Categorisation of business making for CE according to value form, sources of revenue and economic activities.

Table 11: Cross-case analysis of findings.

Frequently asked questions

Q1. What have the authors contributed in "Skills and capabilities for a sustainable and circular economy: the changing role of design" ?

This paper contributes to existing literature by depicting successful practices being implemented in industry. Resulting from this research, learning goals are proposed to serve as guidance for manufacturing companies seeking to tackle climate change. 

Q2. What are the future works in "Skills and capabilities for a sustainable and circular economy: the changing role of design" ?

Findings from this research provide a summarised but complete depiction of changes influencing design within CE systems, disseminates available knowledge on product strategies for climate change and further contributes to extend skill-building by identifying areas in which to focus design education. 

Q3. What are the common approaches to design for sustainability?

Most solutions to implement and maintain a sustainable industry are inter-sectoral and interdisciplinary (Lozano, 2012), and concurrent teams are a common approach for sustainable product development and whole systems design. 

Q4. What is the useful tool to support designers?

The Circularity Indicators Methodology is perhaps the most useful tool to support designers, and companies more broadly, to assess how well a product or company performs in the context of a CE allowing companies to estimate how advanced they are on their journey from linear to circular (Ellen MacArthur Foundation, 2015). 

Q5. What is the role of design in the development of sustainable products?

The characteristics of a product directly influence the way the entire value chain will be constructed and managed (Bevilacqua et al., 2008), therefore design has a crucial role in supporting closed-loop supply chains and shared ownership models for sustainability (Nasr and Thurston, 2006; Souza, 2013). 

Q6. What is the role of the company in the development of a CE?

Leasing is a strategy under development for creating a CE in Nokia® (Accenture, 2013), allowing Nokia® to maintain ownership and control the lifecycle of their products to comply with regulations. 

Q7. What are the main reasons for the change in the way industries profit?

Necessary organisational changes to foster a CE model of production and consumption primarily encourage changes in the way industries profit. 

Q8. What are the key capabilities to design for a sustainable future?

A variety of new capabilities are key to design for a sustainable future; these range from deeper knowledge of material composition to rich understanding of social behaviour. 

Q9. What are the archetypes of the design personas?

The archetypes geared towards physical products, such as the ‘Retrofitting designer’ and the‘Block building designer’ are evidently compatible with the widely spread literature concerning design strategies for component recovery and reuse. 

Q10. What is the need for a variety of design skills to support closed loops?

The need for a variety of design skills to support closed loops has been made evident within this work; ranging from deeper knowledge of material science, engineering techniques and operational processes, through to proficiencies in service design and a deep knowledge of human behaviour. 

Q11. What is the definition of a closed loop economy?

The Circular Economy (CE), also known as a ‘closed loop’ economy, is an industrial and social evolutionary concept that pursues holistic sustainability goals through a culture of no waste. 

Q12. What is the importance of a balance between design-specific knowledge and transdisciplinary skills?

Charnley et al. (2011) pointed out the need for a balance between design-specific knowledge and transdisciplinary skills, as crucial to engage in problem solving using a wider perspective for circular economy practices. 

Q13. What are the changes in design processes?

Changes in design processes were identified, revealing a growing necessity for industry to employ new proficiencies that support closure of material loops. 

Q14. What are the different contexts of the study?

Analysis of the different contexts studied demonstrated that some industrial transformations involve a barely noticeable change in the role of design, with their supply chain and operations facing the greatest challenge; while others represent increasing technical challenges for designers or extended responsibilities. 

Q15. What are some of the loops that are used to avoid landfill?

Some loops involve companies maintaining economic value of material assets during their entire lifecycles, avoiding products to end up in landfill for as long as possible; some others involve the adoption of resources that can be reintegrated into nature, or fed into another supply chain (Ellen MacArthur Foundation, 2012). 

Q16. What are the key stages of the design process?

Shown in the X axis of Figure 2, resource extraction, manufacturing and sales are key stages for traditional product-based businesses.