Circular disruption: Digitalisation as a driver of circular economy business models

Abstract

Abstract: New circular business models can evolve at all stages of the life cycle of a product. Digitalisation can drive disruptive innovations, new business models and novel ways of collaboration and thus can accelerate the economic transition to more resource‐efficient and circular production systems. Yet, there is little empirical research on the enabling role of digitalisation for a circular economy. To address this gap, this paper investigates the role of digitalisation in facilitating circular business models, based on the empirical analysis of a data set of 599 German manufacturing firms and 296 industrial service providers. While relatively few German firms rely on new business models to foster their resource efficiency strategy, we find this share higher for companies with a strong digital focus in the manufacturing sector. This suggests that digitalisation can indeed be a driving force for the implementation of circular business models.