Digital technologies catalyzing business model innovation for circular economy—Multiple case study

Abstract

Digital technologies have been increasingly argued to enable circular economy business models. However, the extant research is based on conceptual and review studies, leading to a lack of understanding of how digital technologies enable individual firms in real-life settings to improve their resource flows and value creation and capture and thereby enable business model innovation to emerge. In this study, we conducted a multiple case study with interviews and document data from four Northern Europe-based forerunner firms with circular economy business models enabled by digital technologies, providing two key contributions to the extant literature. First, we generate an empirical evidence -based synthesis of improvements of resource flows and value creation and capture in firms’ businesses across industries, highlighting the critical role of knowledge generation. Second, we develop a model of four key types of business model innovation for circular economy catalyzed by digital technologies, varying on incremental and radical improvement to both the resource flows and value creation and capture, providing theoretical insights to both business model innovation and digital technologies in circular economy. For managers, we suggest suitable digital technologies for the key types, highlighting the importance of radical business model innovation catalyzed by data integration and analysis technologies.