business models for sustainable consumption v3...iiiee - lac - daniel olbe - june 2010! 1!...

1 IIIEE - LAC - Daniel Olbe - June 2010

Innovative business models for sustainable consumption

IIIEE, LAC, June 2010 Daniel Olbe


Agenda

  Background

  About the project and the suggested assignment

  Examples for inspiration

  Discussion / Q&A


Background Green architecture

Do Well and Do Good blog

Small scale wind power

case study

Innovative business models for sustainable

consumption


Summary

  Suggestion: An assignment, which can be a part of the ECS course.

  Main purpose: To get a better understanding of, and to reflect over, how corporate business models are linked to consumption patterns and related environmental impacts.

  Outline: The students are supposed to give examples, discuss possible impacts, and rate the suggested business models according to specified criteria.


  Reflecting over the role of business in relation to consumption.   Possible impact from rethinking business models.

  Try it for yourself, a joyful introduction to a complex topic.

Why this project?

It is not about absolute answers – it is about creativity, reflection and critical discussion in order to understand mechanisms and interrelations.


Outline of assignment

1.  Suggest an innovative business model - With the potential to change patterns towards more sustainable consumption. ��- A bold new idea, adaptation of an existing model or a well known example.

2.  Describe - What & how offered, revenue model, unique features, example companies.

3.  Evaluate and discuss - How is the model linked to consumption patterns? ��- Impact - potential to lead to fundamental change? Why not? ��- Drivers for implementation?

4.  Provide feedback on the work of the other groups - Rate according to: Clearness in presentation�� Innovativeness/Creativity�� Possible impact�� Likeliness for implementation


Guiding principles

  Fulfilment of user needs.

  Resource efficiency.

  Take the entire product life cycle into account.

  Closed loop systems.

  Shift from products to services.

  Influencing choice and promote transparency.

  Decouple profits-resources; pricing & distribution.


Inspiring examples (1)

Peer-to-Peer Product Service Systems Why buy when your neighbour would happily help you out? Rather than renting from a company, an alternative model could be to facilitate rentals, loans or swaps between individuals – frenting (from “FRiend” and “RENTing”). Issues for discussion: How to make it work on a big scale? Doesn’t use without ownership risk to turn into misuse without responsibility? Revenue models? Get inspired on: http://www.frenting.com/ - http://www.swaptree.com/ - http://www.beta.neighborrow.com/

http://www.barterquest.com/ - http://neighborgoods.net/

Car sharing Zipcar - membership based car sharing/car rental company. Providing the flexibility in car ownership without its practical and economical downsides while making better use of cars over its life cycle. Issues for discussion: Are all user values fulfilled? Other values than mobility for car owners? Get inspired on: http://www.zipcar.com/

From Products to Services - sell less by making more Switching from selling products to selling services can give businesses an incentive to reduce use of materials and take life time responsibility. Examples include DuPont paint coating business (switching from selling paint to painted cars), Interface (selling floor covering rather than carpets), Xerox (remanufacturing of office machines), Dow Chemicals (chemical take-back & reuse closing the loop) and Electrolux (services for laundrettes; installation, repair, training, financial). Issues for discussion: For which type of products is this concept applicable? Wouldn’t consumers buy more or change more often making the concept counter productive? Get inspired on: http://www.youtube.com/user/ecoideasnet#p/search/0/6W5wEAbp9o8



Rethinking mobility “How would you run a whole country without oil?” By adopting business models from other sectors - “pay per distance” – Shai Agassi, founder of electric vehicle network and services company Better Place, wants to change how we use cars without increasing costs. Charging and battery-switching stations, EV driver services and new standards. Issues for discussion: It is a bold plan, but what patterns will be changed? Prerequisites for global success? Get inspired on: http://www.ted.com/talks/lang/eng/shai_agassi_on_electric_cars.html

http://www.betterplace.com/

Wind energy cooperatives Co-owning and sharing responsibility from generation to usage can promote switching to renewable energy while influencing ones’ access to and cost for electricity. Locally produced, transparent and environmental friendly. Swedish O2 is one of the providers. Issues for discussion: Can such a model challenge traditional structures and compete with large scale giants? What is curbing development? Get inspired on: http://www.o2.se/ - http://www.ecotricity.co.uk/

Do well and do good - online searches save forests The environmental slant of the search engine Ecosia makes the company stand out on a highly competitive market. 80% of the revenue is invested in forest protection initiatives in partnership with WWF. Issues for discussion: How can this model change behavioural patterns? The customer value of environmental protection in relation to other values? Get inspired on: http://ecosia.org/



Digital distribution (e-books, music, film, etc.) Decoupling of volumes sold-material used (and transports) while improving availability and transparency for customers. Issues for discussion: Instead of consuming CDs, DVDs etc., have digital distribution moved consumption to fancy, throwaway electronic devices instead (iPods, e-readers, cell phones etc.)? Have we just doubled consumption - digital AND and physical?

Chemical services PortionPac - chemical company selling concentrated detergents in resource efficient portion packs now offering cleaning services. 1. Turning from products to services: Selling clean facilities instead of detergents. 2. Reducing energy, transportation, storage etc. by distributing concentrated detergents (normally up to 90% water). Issues for discussion: Still a conflict in incentives – selling more means bigger profits. Get inspired on: http://www.portionpaccorp.com/about/

Closing the loop In 2005, US outdoor clothing company Patagonia, launched its “Common Threads Recycling Program”, aiming to transform outworn garments (fleece, Capilene®, cotton, polyester) into new clothing - in line with the company’s long-term goal of taking full responsibility of all their products. Issues for discussion: LCA aspects (e.g. customers driving to the store to return the clothes)? Get inspired on: http://www.patagonia.com/web/us/patagonia.go?assetid=1956



Comparison services empowering customer choice By providing transparency, Swedish company Elskling helps customers find lowest fare, green labelled electricity from all providers available. Issues for discussion: Business model and incentives for the service provider. Can they be trusted? Get inspired on: http://www.elskling.se/index.php

http://www.switchpower.com.au/

Virtual travel and events Distances have already been “reduced” thanks to technological solutions. Can more of our experiences be digitalized – even travel experiences? Meetings, conferences, fairs, events etc. can be held without people physically getting together – how far can this change in pattern be taken? Issues for discussion: What patters will such solutions drive – digital meetings or just more meetings? Get inspired on: http://www.inxpo.com/index.htm http://www.telegraph.co.uk/technology/news/7651663/Children-would-rather-explore-the-world-virtually-than-travel.html http://www.google.ru/intl/ru/landing/transsib/en.html

Rental of luxury goods (applying the Netflix concept) Avelle - use oriented product-service system where customers rent fashion items (hand bags, watches, jewellery etc.), while the company retains ownership of the products over its complete life time. Issues for discussion: Is this about changing behaviour or fostering a “have more” attitude and “wants”? Are these products necessary in the firs place? Get inspired on: http://www.bagborroworsteal.com/aboutus?ref=f_e8-8


Questions for discussion

  Relevant and useful?

  Suggestions?

  More interesting examples?

”Business is probably best placed to respond positively to sustainability challenges via radical innovative products and

services and related new business models.”

A. Tukker et al., Journal of Cleaner Production 16, 2008


Related reports for further reading

  Sustainable Consumption Facts & Trends From a Business Perspective ��World Business Council for Sustainable Development (2008) http://www.wbcsd.org/Plugins/DocSearch/details.asp?DocTypeId=25&ObjectId=MzI2ODI

  Redesigning Business Value: A Roadmap for Sustainable Consumption ��World Economic Forum (2010) http://www.weforum.org/en/initiatives/DrivingSustainableConsumption/sustain_con/index.htm

  The 21st Century Corporation: The Ceres Roadmap for Sustainability ��Ceres (2010) ��http://www.ceres.org/ceresroadmap

  Sustainable Consumption and Production: A Business Primer ��University of Cambridge (2007) ��http://www.cpi.cam.ac.uk/leaders_groups/collaboratories/scp_taskforce/knowledge_zone/scp_business_primer.aspx

  Partnerships for Sustainable Consumption ��German Global Compact Network (2009) ��http://www.scp-centre.org/projects/finished-projects/dgcn-publication-partnerships-for-sustainable-consumption.html


Thank you

Mail: [email protected]

Phone: +46 70 777 11 12 Skype: danielolbe

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