Author Archives: Michele Miller

About Michele Miller

Michele Miller is the Executive Education Manager at the University of Bradford School of Management. Before that she was the Circular Economy Projects Manager at the University.

How the Circular Economy will change what we buy, how we own and the relationship between manufacturer and client

The circular economy

The circular economy

At a recent conference I attended, Joe McGee from Jabil – the $18bn manufacturing company, which you will probably never have heard of, said: “If you are not disrupting you will be disrupted”… and so it is, in today’s market place.

The pace of change is rapid and organisations across the globe are grappling with how they continue to sell products and make margins. Governments too are struggling to comprehend how they maintain, grow and prosper with dwindling resources and increasing populations. It is not surprising therefore that the world’s largest companies (such as Jabil) and the world’s most forward-thinking governments (such as Japan) are looking more closely at how the Circular Economy can help them maintain and grow for the sake of their stakeholders – and almost coincidentally, do ‘the right thing’ in terms the preservation of our planet.

The Circular Economy is a regenerative process, which focuses on systems thinking – considering things at scale and taking a holistic view of materials, products and processes. In doing this we can look beyond our current linear processes – the ‘take, make and dispose’ methodology, which currently exists as the dominant model in both business and society and consider how things could be different?

Could we for example, design for:

multiple use?

for disassembly?

for remanufacturing?

Could we make things with less composite materials, which don’t have toxins so they could go back into the materials stream for re-use?

Do we always need to buy things, houses, cars, washing machines, and drills? Do we want the object or is it the utility value we need – and if it is the latter then why do we need to own the item at all?

At another event, I listened to George Ell from Tesla talking about the driverless vehicles of the future – and without the thrill of driving the car – would you be bothered about owning it? What does this mean for the future of the car industry, the taxi industry and Uber? If car manufacturers leased their vehicles they would maintain ownership of the materials (for re-use) and would have a continual dialogue and potential longevity of relationship with their customers.

At yet another conference, Gregory Hodkinson from Arup, reminded the audience that 70% of the world’s population will live in cities by 2050 – and the global population will then be at 9bn. But our urban fabric changes at only 2.5% p.a. Cities are currently neither resilient nor regenerative and this generation will need to absorb huge infrastructural changes for cities to meet the needs of their inhabitants. Royal BAM, Turn-too, Eco-Res and others are currently looking at how they can design buildings which are dynamic – can be changed and adapted; and for disassembly, with components, which can be re-used and made with materials which are non toxic.

The Circular Economy offers some new perspectives on these issues. The emergence of new innovative models leads to collaborative dynamics across industries and communities, which reveal new sources of value creation and new opportunities.

An emerging global business model: An introduction to circular economy

We have limited resources – and yet we have continued to utilise our global assets as if they were endless. We freely discard items which we regard as no longer relevant to us with barely a second thought and ‘throw them away’ – as if there is an ‘away’ to throw them (think about it); and we fail to maximise our business revenues by not being smarter about the business models we adopt and the way we use finite resources.

The circular economy is a compelling alternative to the linear ‘take, make and dispose’ business model which has prevailed over the last 200 years and which, if uncontested will lead to increasing scarcity, volatility and disparity across world markets and indeed the global population. Challenging the status quo and offering some different business models, which could completely revolutionise our thinking about the products and services we offer and indeed the way we live, the circular economy offers an opportunity to build a roadmap for greater resilience in both business and the broader society.

In short, the circular economy is a truly restorative and regenerative economic model which looks to recover and maximise all our resources whilst applying different parameters and business models within our supply/value chains. This supports greater resistance to market volatility and disruption and offers the potential for business to access new market segments via new types of client relationships. It also offers governments the opportunity to look at broader flows within society and how we manage these to best effect.

This is not a sustainability agenda, nor is this about cutting our cloth accordingly… this is the way society will work in the future. It offers new windows into innovative ways of considering current business and societal challenges not only to gain short term cost benefits today, but to take advantage of some striking longer term strategic opportunities too.

Some of the world’s most impressive companies are beginning to adopt circular models, such as Veolia, Philips, Ikea, Nike and Renault… to mention just a few. Equally impressive is the interest of regional and national governments, including Taiwan, Scotland, Denmark, Catalonia, Phoenix and London.

A model of the circular economy model

A model of the circular economy model

The idea is not new, until relatively recently, the laws of life have demanded that we use our resources wisely, nature’s own designs are restorative – we have had serious global amnesia over the last 200 years about the laws of life and nature. Design for the end at the beginning, design models of flow, which allow you to take back your resources when they no longer have a use for the consumer and re-use the resources contained within rather than virgin resources wherever possible.

Consider the opportunities and benefits:

  • To have greater dialogue with consumers
  • To sell and sell again… perhaps to different market segments
  • To lease rather than sell at all (think about your mobile phone)
  • Design to re-use components of your products/service

The University of Bradford offers the world’s first PG Certificate and online MBA in Circular Economy which currently has more 100 participating students from across the world.

More information on the Circular Economy – Distance Learning MBA is available on the website.

See the Ellen MacArthur Foundation for more details on the circular economy.