Sustainable Innovation Business and System Level Flashcards
The Generic Manufacturing Business Model
Attributes of a Sustainable Business Model
- Focus on life cycle resource minimisation
- Closed loop
- Multi-functional products
- Distributed manufacture
- Meets needs, not wants
- Reusable or upgradable products
- Avoids ‘split incentives’ such as built in redundancy
Product Service Systems (PSS)
An innovation strategy, shifting the business focus from designing (and selling) physical products only, to designing (and selling) a system of products and services which are jointly capable of fulfilling specific client demands
Advantages of Product Service Systems
- The fulfilment of client needs in an integrated and customized way, hence allowing clients to concentrate on core activities – e.g. outsourcing of catering or recycling
- The construction of unique relationships with clients, which can enhance customer loyalty – long term relationship to develop mutual understanding
- Allow the ability to innovate faster since they follow their client’s needs better – companies know what their customers want
Eight Types of Product Service Systems?
(name the three groups)
Drivers for Change
- Distributed energy systems
– Increasing share of renewables,
– Increasing competition and digitalization - Opportunities
– Digitization offers the potential to develop new business models beyond the traditional generation, selling and transportation business of energy utilities. - Response – New companies
– Combine regulated network ownership, investment in renewable generation with consumer-centric retail business.
– Both strategies focus on the end consumer market and renewables with the networks as a back-bone for their business.
Sharing Economy
Collaborative consumption,
The sharing economy is an economic model often defined as a peer-to-peer (P2P) based activity of acquiring, providing or sharing access to goods and services that are facilitated by a community based on-line platform
E.g. Airbnb doesn’t own a single hotel, but is the world’s largest accommodation provider – its business model based on a platform enabling people to share their own spaces.
* This has had huge social as well as economic benefits as well as impacting the traditional economy
* As with other ‘trust’ based systems it is open to abuse
Examples of Sharing Economy
- Peer-to-Peer Lending - e.g. unsecured personal loan, offered on such platforms as Lending Club
- Crowdfunding
- Ridesharing and Carsharing
- Coworking - e.g. Share the cost of office rent, utilities, storage, mail
Advantages of a sharing economy
- Cheaper Goods and Services
- Extra Income for Providers
- New and Better Opportunities
- Stronger Communities
Disadvantages of a sharing economy
- Privacy/Safety Concerns
- No or Few Guarantees
- Cooperation With Others
- Market Distortions
Future of a sharing economy
– More Flexibility in Work and Life
– More Ways to Earn and Save Money
– Less Worry about Valuable Possessions and Obligations
– More Adaptable Businesses
What is system level Sustainable innovation?
System innovation can be defined as a set of actions that shift a system – a city, a sector, an economy – onto a more sustainable path.
- Why do we need SI (sustainable innovation) at the system level?
– We need global solutions to global problems (CO2)
– Many major systems are under stress – food, water, housing
– The whole system has to be sustainable not just part of it
– Many of the biggest polluting products are part of larger system/network – cars/fuel/transport, housing/heating/supply
Six Steps to Significant (system level) Change?
- Experience the need for change
- Diagnose the system
- Create pioneering practices
- Enabling the tipping
- Sustain the transition
- Set the rules of the new mainstream
Examples of system level innovation?
- Cats eyes
- Shipping container
The Circular Economy Definition?
A Circular Economy is one where the value of products, materials and resources is maintained in the economy for as long as possible, the generation of waste minimized, and resources are kept within the economy when a product has reached the end of its life, to be used again and again to create further value.
