The Seven C’s of Circular Business Models
November 7, 2017 | By Mark Hodgson |
Welcome to QSA’s blog page on circular business models. In these posts we will share our learning from implementing new business models with a range of clients, and we will also add our thoughts on latest developments and news on circular economy. Over time we’ll build this up into a library of information and we welcome your contributions and comments here, too!
The QSA team are experts in developing the case for business models that deliver “inner circle” activities – such as repair, reuse and remanufacture. These all create more value than “outer circle” activities such as recycling, because they usually reduce the amount of processing required to get products to customers.
There’s a wide range of information already available on circular economy. In this blog, we’ll use a “Seven C’s” approach to helping you find useful information. These aren’t hard & fast categories – more a guideline to help you think about how you can lead business model change in your organisation.
Here are the Seven C’s we like to use:
• Who is the customer, what are their needs and how can you best meet them with a different business model?
• What will the customer journey look like? What will they see, hear and feel?
• How can you validate the market need?
• What is the best proposition to meet the market need and customer journey requirements?
• What operating model is necessary to deliver the proposition?
• What is the detailed financial business case for the new model? What assumptions are underpinning this and where are the biggest sensitivities?
• What are competitors and new entrants doing in this space?
• How does this business model align with your company’s core business strategy?
• Which board member will sponsor/support your project and why?
• What resource can you secure from people who are focused on “business as usual”?
• What budget can you secure for this work?
• How can it fit with traditional business development projects in your organisation?
• Is there an innovation or “lab” programme you can use to develop the idea?
• What capabilities do you need to deliver the operating model?
• Who can help with gaps and how can you work in partnership with suppliers?
• How can you develop trusting long-term relationships with those partners?
• Change management is an essential of this process – have a planned & structured (yet flexible) process
• Who can support change in your organisation and how can you network and influence them?
• Change needs champions! You need to be tenacious to drive change.
• Are you targeting a reasonable amount of change? Be careful of impacts of large changes on the organisation (and resistance to it!)
• Is your new business model genuinely reducing resource consumption?
• Does it realise the business and environmental benefits you need?
• Is it a useful step on the path to a fully circular business model?
Remember – you may be taking small steps towards circularity rather than trying to go “fully circular” in one go. This can help others understand the benefits in a way that prevents rejection of ideas that are perceived as “too far”.
We will return to these themes in future blogs – and hope that you can contribute too! Get in touch if you’d like to find out more information.