Circular Value Creation Architectures

Hansen and Revellio developed a typology of circular value creation architectures and their orientation in terms of circular supply chain coordination, loop configuration and ambition levels, specifically using the example of the smartphone industry. Four generic coordination mechanisms were classified: vertical integration, network, outsourcing and laissez-faire. Case studies show how coordinators co-operate with value chain actors to provide circular service operations.

The results show that companies that rely on deceleration strategies (repair, reuse, remanufacturing) tend to pursue higher degrees of vertical integration than those that only rely on closure strategies (recycling). Higher degrees of vertical integration also enable higher degrees of loop closing and make it easier to incorporate feedback into product design.

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