Defining value creation in the context of circular PSS
Open accessAbstract
The concept of a circular economy (CE) can be regarded as a way to operationalise the aim of accomplishing sustainable development (SD) on a macro level. Product-Service Sytems (PSS), business models (BM) that combine tangible products with intangible services to jointly satisfy a customer’s needs, are well suited to align with CE principles. Whether applying CE principles leads to value creation for a broader group of stakeholders, however, is not yet sufficiently proven. The study presents CE principles, elements that govern the decision-making process of a firm and uses the example of PSS to demonstrate how these principles are applied in the design of the supply chain network. A definition of value creation for multiple stakeholders is presented, and the example of mobility as a service used to highlight the importance of system and life cycle (LC) thinking to prevent rebound-effects and fully understand the trade-offs of a circular PSS.
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PSS creates a financial incentive for more diligent material stewardship.
“By doing so PSS creates a financial incentive for more diligent material stewardship (Widmer et al., 2018).”
From Facades-as-a-Service: Systemic managerial, financial, and governance innovation to enable a circular economy for buildings. Lessons learnt from a full-scale pilot project in the Netherlands (2023) · cites this paper as Widmer et al., 2018
Section 3 (The rationale for circular PSS; page unavailable) says that providers of use- and result-oriented PSS may retain ownership and take responsibility for recovery and other end-of-life strategies. Section 4 (Value creation in circular PSS; page unavailable) links the choice of recovery strategy to value creation. The paper does not explicitly establish that PSS creates a financial incentive for more diligent material stewardship, and its account applies to particular PSS arrangements rather than PSS generally. (LLM, conf=0.78)
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- Authors
- Widmer, T., Tjahjono, B., & Bourlakis, M.
- Affiliations
- Cranfield University (GB)
- Corresponding author
- Widmer, Tobias
- Venue
- Procedia CIRP
- Publisher
- Elsevier BV
- Published
- 2018
- Volume
- 73
- Pages
- 142-147
- ISSN
- 2212-8271 (ISSN-L)
- OpenAlex
- W2810722430
- Cited by
- 35
- References
- 30
- Citations by year
- 2026: 5 · 2025: 3 · 2024: 5 · 2023: 5 · 2022: 7 · 2021: 4 · 2020: 4 · 2019: 2
- FWCI
- 4.18
- Type
- journal article
- Language
- en
- Open access
- diamond
- doi.org
- Licence
- Locations
- Procedia CIRP (publishedVersion, cc-by-nc-nd)
- Pure (Coventry University) (submittedVersion, cc-by-nc-nd)
- Funders
- European Commission (721909, HORIZON2020)
- Topics
- Social Sciences › Business, Management and Accounting › Strategy and Management › Sustainable Supply Chain Management
- Social Sciences › Business, Management and Accounting › Marketing › Service and Product Innovation
- Physical Sciences › Engineering › Building and Construction › Sustainable Design and Development
- Keywords
- circular economy, product-service systems, value creation, stakeholder value, business models, supply chain network design, Mobility as a Service, life cycle thinking, rebound effect, sustainable development
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