Delft University of Technology
Towards a sufficiency-driven business model
Experiences and opportunities
Bocken, NMP; Short, SW
DOI
10.1016/j.eist.2015.07.010
Publication date
2016
Document Version
Final published version
Published in
Environmental Innovation and Societal Transitions
Citation (APA)
Bocken, NMP., & Short, SW. (2016). Towards a sufficiency-driven business model: Experiences and
opportunities. Environmental Innovation and Societal Transitions, 18, 41-61.
https://doi.org/10.1016/j.eist.2015.07.010
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ContentslistsavailableatScienceDirect
Environmental
Innovation
and
Societal
Transitions
j o u r n a l h o m e p a g e :w w w . e l s e v i e r . c o m / l o c a t e / e i s t
Towards
a
sufficiency-driven
business
model:
Experiences
and
opportunities
N.M.P.
Bocken
a,b,∗,
S.W.
Short
baIndustrialDesignEngineering,DelftUniversityofTechnology,Landbergstraat15,2628CEDelft,The
Netherlands
bInstituteforManufacturing,DepartmentofEngineering,UniversityofCambridge,CambridgeCB30FS,
UnitedKingdom
a
r
t
i
c
l
e
i
n
f
o
Articlehistory:
Received11February2015
Receivedinrevisedform14July2015
Accepted19July2015
Availableonline7August2015
Keywords: Sustainability Sustainableconsumption Slowconsumption Productlongevity Frugalinnovation
a
b
s
t
r
a
c
t
Businessmodelinnovationisanimportant leverforchangeto tacklepressingsustainabilityissues.Inthispaper,‘sufficiency’is proposedasadriverofbusinessmodelinnovationfor sustaina-bility.Sufficiency-drivenbusinessmodelsseektomoderateoverall resourceconsumptionbycurbingdemandthrougheducationand consumerengagement,makingproductsthatlastlongerand avoid-ingbuilt-inobsolescence,focusingonsatisfying‘needs’ratherthan promoting‘wants’andfast-fashion,conscioussalesandmarketing techniques,newrevenuemodels,orinnovativetechnology solu-tions.Thispaperusesacasestudyapproachtoinvestigatehow companiesmightusesufficiencyasadriverforinnovationand assertsthattherecanbeagoodbusinesscaseforsufficiency. Busi-nessmodelsofexemplarcasesareanalysedandinsightsaregained thatwillcontributetofutureresearch,policymakersand busi-nessesinterestedinexploringsufficiency.
©2015TheAuthors.PublishedbyElsevierB.V.Thisisanopen accessarticleundertheCCBYlicense (http://creativecommons.org/licenses/by/4.0/).
1. Background:theneedforsufficiency-drivenbusinessmodels
Pressureonnatural resourcesand agrowingglobal populationandmiddle class arecreating increasingsustainabilitychallengesforindustryandsociety.Itisincreasinglyapparentthat
business-∗ Correspondingauthorat:IndustrialDesignEngineering,DelftUniversityofTechnology,Landbergstraat15,2628CEDelft,
TheNetherlands.
E-mailaddress:n.m.p.bocken@tudelft.nl(N.M.P.Bocken).
http://dx.doi.org/10.1016/j.eist.2015.07.010
2210-4224/© 2015 The Authors. Published by Elsevier B.V. This is an open access article under the CC BY license
as-usualisnotanoptionforasustainablefuture:afundamentalshiftinthepurposeofbusinessand almosteveryaspectofhowitisconductedisrequired(Jackson,2009;EhrenfeldandHoffman,2013; Bockenetal.,2014).
Currentapproachestosustainability,focusinglargelyonefficiencyandproductivityimprovements and‘greening’supply chainsand productsareanimportantfirststep inreducingtheimpactsof productionandconsumption.However,growthindemandisfaroutpacingsuchimprovementsand innovationsandtheseinitiativescanfacilitaterebound-effectswhereefficiencygainsleadtomore consumption(Druckmanetal.,2011;Bockenetal.,2014).Morerecently,theconceptofthe‘circular economy’hasgainedwidespreadpopularity,wherebymaterialsarecontinuallyrecycledandreusedto curtaildemandfornewmaterials.However,eventhisapproachcanleadtogreaterresource consump-tioniftotalfinalconsumptionofproductsandservicesisnotmitigated(Allwood,2014).Referringto Boulding(1966),asuccessfulcirculareconomycouldonlybeachievedifglobaldemandforthe vol-umeofproductsstabilised,whichisautopianprospectinourgrowth-driveneconomicsystemand expandingglobalpopulation(inAllwood,2014).
Accordingly,agrowingnumberofacademicsarguethatcurrentindustrialsustainability initia-tivesthatfocusonthesupply-side(e.g.productdesign,production,andsupplychaininitiatives)are inadequateontheirownandthatactionisneededtodirectlytackleexcessiveconsumptionlevels (e.g.Jackson,2009;EhrenfeldandHoffman,2013).Suchinitiativesareoftenreferredtoas ‘sustain-ableconsumption’(e.g.Jackson,2009).AccordingtoTheRoyalSociety(2012)themostobviousway toreducethenegativeeffectsofhumanactivityontheplanetistodecreaseresourceconsumption ofthosewhocurrentlyconsumethemost.Whilealargepartoftheworldstillneedsfurther devel-opmentandneedstoincreaseconsumptiontoalleviatepovertyandsuffering,thedevelopedworld increasinglyexperiencesthenegativeeffectsofover-consumption,suchasworryinglyhighobesity ratesandotherrelatedhealthissues.Moreover,whereasmostconsumptiontakesplaceindeveloped countries,thepoorestaremostdirectlyaffectedbyclimatechangeimpacts(IPCC,2014)andthe envi-ronmentaldegradationcausedbymaterialsextractionandproduction.Thereforetacklingdeveloped worldconsumptionlevelsoffersbenefitstoall.
Tomanageconsumption,businesseswillneedtomovebeyondeco-efficiency(savingenergyand materials),whichisclosetotheconventionalbusinesscase,toincludemoreradicalnewapproaches suchas‘sufficiency’,whichfocusonreducingabsolutedemandbyinfluencingandmitigating con-sumptionbehaviour(DyllickandHockerts,2002;YoungandTilley,2006;Bockenetal.,2014).As Ehrenfeld(2000,p.204)observes:‘Thechallengetoindustrialsocietiesisnotsimplytoreduce con-sumption,buttotransformthenatureofwhatweconsumesothatbothhumanbeingsandnatural systemscanprosper’.‘Efficiency’inindustrialsustainabilityisgenerally‘supply-side’or production-focused,aimedatmoderatingproductioninputsofmaterials,energyandlabour.Greenproductsand supplychainsequallyfocusonmoderatingproductioninputsandimpacts:thatis,doingthesame ormorewithless.Incontrast,weconceptualise‘sufficiency’inindustrialsustainabilityasprimarily demand-sideorconsumption-focused,aimedatmoderatingend-userconsumption:encouraging con-sumerstomakedowithless.‘Sufficiency’,accordingtotheOxfordEnglishDictionary,isthe‘condition orqualityofbeingadequateorsufficient;anadequateamountofsomething,especiallyofsomething essential’.Theoppositeofsufficiencyismanifestedinourcurrentdevelopedworldconsumption pat-terns–evermorerapiddiscardingandreplacementofproductsandmaterials,andinthecaseof food,over-consumptionreachingendemicproportionsinsomecountries.Political,socialand eco-nomicsystemschampionandcelebrateconsumption-basedeconomicgrowth(Jackson,2009),which inevitablyleadstoover-consumptionafterbasicneedshavebeensatisfied.Afundamentalshiftfrom over-consumptiontowardsamoresufficiency-orientatedviewofconsumptionandproduction,or whathasbeendescribedasa‘sufficiencyeconomy’(ThailandForeignOffice,TheGovernmentPublic RelationsDepartment,2014)isthereforeessential.
Asufficiency-basedapproachtakesanalternativedirectiontodoingbusiness–directlyseekingto reduceormoderateconsumption.Thisnotionwasarticulatedin2006bytheSustainableConsumption Roundtable(2006,p.62):“Thelong-termgoalofsustainableconsumptionmustsurelybe:societal aspirationsthatarefairforeveryone;businessmodelswhichaddhumanvaluewithouttakingaway environmentalvalue;aneconomywhichisstableandyetsustainable.”Sufficiencyinthiscontextis amore‘social’principle;referringtoindividuals(andcompanies)livingonneedsratherthanwants
(YoungandTilley,2006,p.409).Sufficiency-drivenbusinessmodelsfocusoninfluencing consump-tionbehaviour,whichinvolvesforexample,afundamentalshiftinpromotionandsalestactics(e.g. noaggressiveormanipulative‘over-selling’),eschewingfastfashiontrends,providingconsumer edu-cationand‘choiceediting’toreduceaccesstosustainablyundesirableproducts,andproductdesign changestoenhancedurability,reparabilityandlongevity(Bockenetal.,2014).
Atfirstglance,suchapproachesseemverymuchatoddswithcurrentbusinesspracticesand per-hapsunviableincompetitivemarketswheresalesgrowthisakeytosuccess.Othersarguethatit isnottheplaceofbusinessorpoliticianstointerfereinconsumerdecisions,andhypothesisethat sufficiencycanonlybeeffectivelydrivenbyconsumersthemselvesthoughproductboycottsor con-sumeractivism(e.g.DyllickandHockerts,2002).Notwithstandingtheseconcerns,someexamples ofsufficiency-basedbusinessareemerging.However,despitetheinterestandgrowingawareness oftheneedforasufficiency-basedapproach,thereisstilllittleunderstandingofhowbusinessand industrialpolicymightalignwiththisneedacrossthefullrangeofindustrysectorsandthereare fewdocumentedexamplesofsuchsufficiency-basedbusinessestodate.Theliteratureidentifies suc-cessfuldemand-sidemanagementtotackleconsumptionlevelsintheenergysectorthroughESCOs (EnergyServiceCompanies),butthisislimitedtooneindustrysectorwithaveryspecificandacute setofchallengestoaddressdrivenbylegislation,inertiaandcostsassociatedwithconstructingnew powerplants.AccordingtoFORA(2010)ESCOsarebusinessmodelswheretheprovider“optimizes companiesandpublicbuildingsandinreturngetspaidbypartofthesavingsachieved.Thecustomer doesnothavetopayupfront[andis]compensatedifsavingsarelessthanguaranteed”(p.9).
Thispaperexplorestowhatextentbusinessmighttakeamoreprominentandleadingrolein movingtowardsasufficiency-driveneconomyacrossabroaderrangeofindustrysectors,andwhat businessmodelsmightbesuitabletocreateandsustainsuchaneconomy.Basedonourdefinitionof sufficiency-basedbusiness(focusingondemand-sidemoderation),thispaperidentifiesandpresents arangeofnovelemergentcasesinkeyconsumersectors.Thesebusinesscasessuggestthat profitabil-ityandconsumeracceptanceofbusiness-ledsufficiencyapproachesispossible,throughpremium pricing,generatingcustomerloyalty,and increasedmarketsharefrombetter(e.g.moredurable) products.Suchbusinessmodelscanthereforebeeconomicallyviable,whilecontributingtoreducing over-consumption,andhencematerialandenergythroughputs.Theresearchquestionis:Howcan sufficiencyserveasadriverforsustainablebusinessmodelinnovationincompanies?
Thispaperexploresthepotentialofsufficiency-drivenbusinessmodelsusingacasestudyapproach toinvestigatetheextenttowhichsuchapproachesarepossibleandhowtheymightbedesignedand maintained.Thebusinessmodelsofthecompaniesareanalysedtoidentifythekeycharacteristics anddriversofsufficiency-basedsolutions.First,theliteratureonsufficiencyinabusiness(model) contextisreviewed.Inthemethodologysection,thecasestudycompaniesandresearchapproachare introduced.Inthecasestudysection,characteristicsandtypesofsufficiency-basedbusinessmodels aredevelopedbasedonthecases.Thediscussionsectionincludesrecommendationsforbusinesses andisfollowedbyashortconclusionofthemainfindingsofthispaper.
2. Literaturereview
Theliteraturereviewexploreswhatsufficiency-drivenbusinessmodelsmightlooklike.Reference ismadetoexisting sufficiencyperspectives(e.g.DyllickandHockerts,2002;Bockenetal.,2014) andthewastehierarchy(PriceandJoseph,2000)asawell-establishedframeworktoevaluatethe environmentalpreferenceofarangeofoptions.
2.1. Perspectivesonsufficiency
Sufficiencyisnotwidespreadasadriverforbusinessmodelinnovation,perhapsbecauseofits seeminglyparadoxicalcharacteristicofseekingtomitigateconsumptioninaconsumption-driven economy.However,sufficiencyhasbeendescribedasacountryvision(UNEP,2014),acorporate sustainabilitytacticandaconsumptionissue(DyllickandHockerts,2002).
Onacountrylevel,sufficiencyhasbeenpopularisedbyThailand’sKingBhumibolAdulyadej,who inhisinhisroyaladdressesfocusedon“sufficiency,moderation,economizing,rationalization,andthe
Fig.1. SBMframework.
Source:AdaptedfromShortetal.(2014).
creationof“socialimmunity”forthemajorityofthepeoplewhoareinthefarmsector”(ThailandForeign Office,TheGovernmentPublicRelationsDepartment,2014).[TheKing]cautionedtheThaisnotto beimprudentinconductingtheirlives,buttobefullyawareofthedevelopmentprocessinaccordance withpropertheories,andwithintheframeworkofgoodmorality.Thishasbecomeknownas“Sufficiency Economy.”(ThailandForeignOffice,TheGovernmentPublicRelationsDepartment,2014).The Suffi-ciencyEconomyisincludedingovernmentprojectsandaimstoenablethecommunitytomaintain anadequatepopulationsizeandpreservethewealthofecosystems(UNEP,2014).
Sufficiencyhasbeendescribedasacorporatesustainabilitystrategy.Sufficiency,asdescribedin DyllickandHockerts(2002)andYoungandTilley(2006),referstotheactionsofindividualconsumers tomakeresponsiblechoices,rightthroughtoconsumerscollectivelyboycottingorsubverting corpo-ratebrandingandmarketingstrategiesthatarebelievedtobeenvironmentallyharmful.Thispositions sufficiencyaslargelyaconsumerissueratherthanafirm’s.However,thescopeofsufficiency,which hasclosetieswith‘sustainableconsumption’thatisaboutfulfillingourpotential,whilelivingwithin ourmeans(SustainableConsumptionRoundtable,2006),ispotentiallymuchbroader.
Thispaperhypothesisesthattherecanbeagoodbusinesscaseforsufficiencythatcanbepursued bycompanies,ratherthanmerelyrelyingonareactiveapproachthatdealswithconsumerboycottsor policyinterventiononanadhocbasis.Buildingonearlierwork(Bockenetal.,2014),‘encourage suffi-ciency’maythereforebecomeakeybusinessmodelinnovationforsustainability,where“sufficiency” canbeviewedasanopportunityratherthanahindrancetoinnovationorbusinesssuccess.Novel busi-nessmodelsbuildingonsufficiencyprinciples–limitoverconsumptionandassociatedunnecessary resourceuse–arerequired.Companies,becauseoftheirmarketingandbrandingknowledge,canuse thisknowledgepositivelyandadapttheirpromotionalstrategiestofocusonsustainableconsumption (BockenandAllwood,2012).
2.2. Threeframeworkstoassessbusinessmodelsufficiency
Threeframeworksareintroduced:thesustainablebusinessmodel(SBM)framework,thestrategies forcorporatesustainability,andthewastehierarchy.Abusinessmodellensisusedtoanalysethecases inthispapertodrawoutrecommendationsforfuturesufficiency-basedbusinesses.
2.2.1. Thesustainablebusinessmodel(SBM)framework
Businessmodelinnovationliesatthecoreofchangingthewaybusinessisdone(Magretta,2002). Businessmodelsdefinethewaya firm doesbusiness andinclude thefollowingelements:value proposition(productserviceoffering),valuecreationanddelivery(e.g.activities,resources,suppliers, partners)andvaluecapture(costandrevenuestreams)(Fig.1).Businessmodelinnovationfor sus-tainabilityseekstocreatesignificantpositivebenefitsorsignificantlyreducenegativeimpactsforthe environmentandsociety;throughchangesinthewaytheorganisationanditsvalue-networkcreate, deliverandcapturevalue(Bockenetal.,2014).Suchbusinessmodelsmaybeviewedasanimportant leverforchange(Schalteggeretal.,2012;Bockenetal.,2013).Bockenetal.(2014)haveproposeda
Fig.2.Sixstrategiesforcorporatesustainability.
Sources:ThesixstrategiesframeworkwasdevelopedbyDyllickandHockerts(2002);definitionswereincludedfromYoung
andTilley(2006).
categorisationofSBMarchetypestoassistfirmsinexpandingthescopeandunderstandingofbusiness modelinnovationsinpracticeandresearchforsustainability.Theseinclude:
1.Maximisematerialandenergyefficiency. 2.Createvaluefrom‘waste’.
3.Substitutewithrenewablesandnaturalprocesses. 4.Deliverfunctionality,ratherthanownership. 5.Adoptastewardshiprole.
6.Encouragesufficiency.
7.Re-purposethebusinessforsocietyandenvironment. 8.Developscale-upsolutions.
Thesearchetypescanbeappliedasstand-aloneinitiativesorincombinationtobuildupthebusiness model for sustainability. The archetype “Encourage sufficiency” focuses specificallyon demand-managementandmitigatingconsumption.
2.2.2. Thestrategiesforcorporatesustainability
Fewauthorshavedescribed‘sufficiency’asabusinessstrategytodate.DyllickandHockerts(2002) developedaframeworkofsixsustainabilitystrategies,specificallyincludingsufficiency(Fig.2).Dyllick andHockerts(2002)offerthehypothesisthatattheoperationallevel,eachofthesestrategieswould needtobeaccountedforseparately,whereasatthestrategiclevelthesedimensionsshouldbe con-sideredholistically.Similarly,Bockenetal.(2014)arguethatmultiplesustainablebusinessmodel archetypesmayneedtobecombinedwithinonebusinesstohavethegreatestimpactoncorporate sustainability.AccordingtoYoungandTilley(2006)moreworkneedstobedoneonhowcompanies
Fig.3.Wastehierarchyandpotentialbusinessmodelinnovations.
Source:DevelopedfromPriceandJoseph(2000)andPapargyropoulouetal.(2014).
fitintothismodel,andmoreimportantly,onthepracticesthataretransferabletoothercompanies. AsshowninFig.2,DyllickandHockerts(2002)perceiveasufficiencystrategyasprimarilyreactive, drivenbyconsumerchoicesandconsumerandsocietalpressure.Incontrast,inthispaper‘sufficiency’, amoderationinresourceconsumption,isconceivedasaneffectivecorestrategyforsustainable busi-nessmodelinnovation,initiatedanddrivenbycompaniesthemselves,ratherthanmerelyareactive strategytoanexternalinfluencingfactoronbusiness.AsDyllickandHockerts(2002)presenta some-whatdifferentconceptualisationofa‘sufficiency’strategy,itwasdecidednottousethisframework toanalysethecases.
2.2.3. Thewastehierarchyandsufficiency
Todemonstratehow‘sufficiency’mayserveasaviablecorporatestrategythatmakesbusiness (economic)senseandmitigatesenvironmentalimpact(Bockenetal.,2014),examplesof‘sufficiency’ arepresentedbasedonthewastehierarchy(Fig.3).Fig.3presentsa businessmodel orientated interpretationofthewastehierarchyandexamplesagainsteachlevelofthewastehierarchy.
Themostimpactfuloptionforcompaniestopursueis‘avoid’.Thatis,toassistorencourage con-sumerstoavoidover-consumptionthroughthewaytheydobusiness.Therearealsoopportunitiesat thelowerlevelsofthewastehierarchyaswell:forexample,atthestageoflandfilling,somecompanies havemanagedtousediscardedmaterialsasarawmaterialinputfornewproducts.
2.3. Defining‘sufficiency-basedbusinessmodels’
Buildingontheliterature,sufficiency-basedbusinessmodelsdeliversustainabilitybyreducing absolutematerialthroughputandenergyconsumptionassociatedwithprovisionofgoodsand ser-vicesbymoderatingend-userconsumption:encouragingconsumerstomakedowithless.Assuch, sufficiencyisembodiedinthethreeenvironmentallymostpreferableoptionsofthewastehierarchy: avoid,reduceandreuse.Thedefinitionofsufficiency-drivenbusinessmodelinnovationbuildson DyllickandHockerts(2002)andYoungandTilley(2006)whoemphasisetheroleoftheconsumerin makingresponsiblechoices(e.g.buyingethicalproducts)andBockenetal.(2014)whoemphasisethe business-sideofsufficiency,focusedondurabledesignandproductlifeextension(e.g.secondhand markets),frugalinnovation(backtothefundamentals),conscioussales(against‘fastfashion’),and moderatingconsumption.Sufficiency-drivenbusinessmodelinnovationisthereforeaboutcurbing consumptionaspartofthebusinessmodelbymoderatingdemandthrougheducationandconsumer engagement,makingproductsthatlastandavoidingbuilt-inobsolescence;extendingproductlivesto slowdisposalandreplacement,focusingonsatisfying‘needs’ratherthanpromotingwants’and fast-fashion,andreducingoverallresourceconsumptionthroughconsciouschangesinsalesandmarketing techniques,newrevenuemodels,andinnovativetechnologysolutions.
Asanidealsustainabilitysolutionasufficiency-drivenbusinessmodelwouldalsorequire sustain-ableproductionmethodsandsupplychains,andthatrevenuesandbenefitstobefairlydistributed
Table1
Interviewsforcasestudies.
Casecompany Waste hierarchy
Size/maturity Interviewwith Interviewson 1 Vitsœ–furniture
manufacturer
Avoid,reduce, reuse
Large MD November2011(faceto face+visittofacilities), March2012(phone),June 2014(emailexchange) 2 BrunelloCucinelli–
clothingmanufacturer
Avoid/reduce Large Personal assistantto CEO
November2012(faceto face+visittofacilities,and additionalcommunication material) 3 Patagonia–outdoor sportsgear manufacturer Avoid,reduce, reuse Large Headof Patagonia Philosophy September2013(faceto face)
June2014(phoneand email) 4 Kyocera–document managementsystem manufacturer Avoid,reduce, reuse
Large CSRDirector July2012(faceto face+visittooffices) 5 Riversimple–
automotive manufacturerandcar leaseservice
Avoid,reduce, reuse
SMEstart-up Co-founder October2012(facetoface) June2014(facetofaceand email)
6 Reduse–equipment (‘unprinter’) manufacturer
Avoid,reuse SMEstart-up Co-founder/CEO
July2014(facetofaceand email)
across(all)stakeholdersthroughoutthesupplychain,includingbenefitsfor‘society’and‘environment’ (Boonsetal.,2013;BoonsandLüdeke-Freund,2013;Bockenetal.,2013,2014).
3. Method
Tofurtherconceptualise‘sufficiency-drivenbusinessmodels’acase-basedapproachistaken,as casestudyresearchissuited toobtaina holistic,real-worldperspectiveandis suitedtoaddress ‘how’and‘why’questionsfocusingoncontemporaryevents(Yin,2014).Furthermore,thisworkis exploratorybecausetodate,littleresearchhasbeendoneinthisfield.Thecaseswereselectedbased onreviewing alargerange ofcompanycasesgatheredand reviewedinBockenetal.(2014)and investigatingwhichtypesofbusinessesexemplifiedthe‘sufficiency’theme.
Thecriteriatoselectthecasesincluded:thecompanyappearstohavetakenaleadershipviewon ‘sufficiency’aspartofthebusinessmodel,andisfocusingonthehigherlevelsofthewastehierarchy (primarilyavoid,reduceandreuse)(seeTable1).Apracticalconsiderationwasdataavailabilityand accesstotheorganisation.
Noneofthecasesisaperfectexampleof‘sufficiency’andlimitationsorevencontradictionsare evi-dent,butalldemonstratesomeimportantapproachestomoderatingconsumerdemand.Consumers alsohavearoletoplayinpursuingsufficiencyintheirdailylives,soresponsibilitycannotliesolely withcompanies(or,morebroadly,governmentalbodies).ThisisinlinewiththeThailandviewon sufficiencyurgingeverycitizentoliveamodestlife(ThailandForeignOffice,TheGovernmentPublic RelationsDepartment,2014).Nevertheless,weaimtohighlightthesufficiencythemeswithineachof thecasesandidentifyhowfirmsmightmorebroadlyadoptsuchapproaches.Itshouldalsobenoted thatthecasesaspresentedlargelyfocusonsalesandcustomerrelationsandnottheentireproduct lifecycle.
Interviewswithkeypersonnelofthebusinesseswerecomplementedwithreviewofwebsites, annualreports,andotherpublicdocumentstobuildthecasestudies.Thecasestudiesexploredthe followingthemes:
• Howthecompanyconceiveditsownbusinessmodel.
• Howthecompanyaimstogroworexpand.
• Opportunitiesandbarriersorchallengestoestablishingasufficiencydrivenbusinessmodel. • Keycharacteristicsofthefirm,enablersanddriversforsufficiencyinitiatives.
ThecasecompaniesareshowninTable1.Thecasenarrativesinthenextsectionarebasedon mate-rialobtainedduringtheinterviewsandbackgroundmaterial(websitesandcorporatedocuments).
4. Casestudies
Thissectiondescribesthesixcasestudies.
4.1. Vitsœ–extendingproductlifeandencouragingreuse
Vitsœisafurnituremanufacturersupplyingshelvingandstoragesolutionstosmallbusinessand privatecustomers.Thecompanywasfoundedin1959andcurrentlyemploysaround50people.Its visionistomanufacturefurnituretolastaslongaspossible,thatisadaptableanddiscreet,byproducing productsthataredurable,easilyextendable,reparableandavoid‘plannedobsolescence’(Adams, 2012;FablemazeWeather,2014).AkeyfeatureofVitsœ’ssufficiencystrategyconsistsofadeliberate policyofunder-selling,buildingtrustandlong-termrelationshipswithcustomers(Adams,2012). Vitsœpurposelytrainssalesstafftounder-sellratherthanover-sellonthebasisthatcustomerscan alwaysaddmoreatalaterstageifneeded.Therearenosalescommissionspaidtostaff,ordiscounts offeredtocustomers(e.g.nobulkpurchasingdiscountorendofseasonsales)andinstallationand supportservicesassociatedwithfuturerelocationoffurniture(incl.repair)areprovidedatcostprice (Adams,2012).Thesebusinessmodelfeatureshelptoensureunnecessarysalesandconsumptionand wastearekepttoaminimum.Theirsalesstrategyisfocusedonloyalcustomers–theircustomers areviewedasthemainambassadorsfortheproduct.Vitsœonlydoesdirectsalesthroughitsphysical shops,onlineorphonetokeepthepersonalcontactwiththecustomerandcontroloverhowsales aredone.Thesalesstrategyimpliesapotentialsacrificingofshort-termopportunisticgrowthfor thebusiness,whichisinstarkcontrasttomostconventionalbusinessthinking.Trustandreputation developedthroughthecustomerrelationshipcreatespositiveword-of-mouthrecommendationsthat drivefuturesalestonewcustomersandensurestheongoingbusinessviability.Althoughpublicdata onVitsœ’ssalesarenotavailable,Evansetal.(2009)foundthatsince1995,whenVitsœmovedthe companytotheUKsaleshaverisenyearonyearby20%.Hence,thebusinesshasbeenfinancially viabledespiteitsunconventionalsalesstrategy.
4.1.1. Sufficiency-relatedelementsinVitsœ’sbusinessmodel
Vitsœexemplifies‘sufficiency’byactivelystrivingtoeliminatebuilt-inobsolescencethroughits designandproductionsystems,andconsciouslyeschewingshort-livedfashioncyclesortrends.By goingagainsttheindustrynormofdesigningandmanufacturingproducts(deliberatelyintendedto havealimitedusefullife)Vitsœavoidsthecycleofreplacementandrepurchasing.Theyareconsciously under-sellingproductsbytrainingsalesstafftooffercustomerstheminimumtheyneedforthejob, andmeasuringperformanceonabroaderrangeofcustomersatisfactionratherthansalesfigures. Variousservicesareofferedatanominalcosttoencouragecustomerstoreuseratherthandiscard products.Finally,Vitsœdoesnottradesharespubliclybecausetheownerfeelsdemandsofexternal shareholderscouldcompromisethecompany’svision.
4.2. BrunelloCucinelli–timelessqualityclothing
CucinelliisanItalianfashionhouseoperatingintheluxuryapparelsector,ownedandrunbythe founder,CEOandheaddesigner,BrunelloCucinelli.Thecompanywasestablishedin1978specialising incashmeresweaters,andhasexpandedtobecomeagloballyrecognisedbrandproducing‘sport luxurychic’menswear,womenswear,andleathergoods.Cucinelliemploysabout700peopleglobally, withitsheadquartersandfactoryintheUmbriaregionofItaly.
Thebusinessmodelisbasedonpremiumpricing,offeringcustomersexclusiveproductshand-made inItaly.ThereishightangiblevalueintheproductsbasedonItaliandesignandhighestqualityfabrics, combinedwithastoryofsocialvaluecreationandethicalproductionbasedonItalianlocal manufac-turingandcommunitydevelopment.Accordingtotheinterviewee,whilenotallcustomersengage withthesocialdimension,thosethatdoperceivethisasanimportantpartofthevalueproposition.
CucinelliwasrecentlyfloatedontheItalianstockmarketin ordertoprovideliquidityforthe familymembers.TheintervieweeexplainedthattheCEOmadesocialvaluecreationakeythemein theinvestorbriefingsfortheInitialPublicOffering,alongwithissuingspecificguidancetopotential investorsthatembodiedasufficiencyethos:thecompanywouldnotpursueaggressiveleveraged growthandwouldnotentertainsuggestionstooutsourcetolower-costregionstoincreaseprofit.
4.2.1. Sufficiency-relatedelementsinCucinelli’sbusinessmodel
ThemainsufficiencythemeforCucinelliisthefocusonproductsthatareofthehighestqualityand, unlikemanyotherfashionhouses,designsaimtobetimelesswithoutbrandlogosandusenatural coloursandfabricsthatcancontinuetobe(re-)used.Aseconddistinguishingfeatureemphasised duringtheinterviewisthatfromtheoutsetthefounderconceivedthebusinesspurposeascontributing tosocietyandcreatingdignifiedworkintheregion,ratherthanseekingtomaximiseeconomicwealth creation,profitorgrowth.Cucinelli’ssocialinitiativeshavesoughttocreatelocalskilledemployment, anddemonstrateaconcernforemployeeandsupplychainwell-being.Alltheirgarmentproducers andalmostallfabricssuppliersareItalian,with80%ofthesebasedlocallyintheUmbriaregion,which contrastsstarklywiththeoutsourcingtosweatshopsinlow-costregionsthatiscommonplaceinthe industry.
Luxurygoodsmayappeartobediametricallyopposedtosufficiency,andsomeare;however,they canbethemoresustainableoptioniftheyarecherished,lastlongerandareusedmore,ratherthan quicklygoingoutoffashion,failingprematurelyandbeingdiscarded.Moreover,qualityshouldnotbe confusedwithquantity–expensive(luxury)doesnotnecessarilyimplymorematerialorenergyare embodiedintheproduct,butasinthiscase,thepremiumpricereflectsthedesignandmanufacturing choices–artisanalproduction,100%inspection,andthehighestgradenaturalmaterials–creating highsocialandcustomervaluewithrelativelylowenvironmentalimpact.
4.3. Patagonia–encouragingreuseandrepairofclothing
Patagoniaoriginallystartedasamountaineeringequipmentcompanyinthe1950s.Theoutdoor clothingbusinesswasestablishedinthe1970sasaprofitablebusinesslinetodiversifythebusiness (Chouinard&Stanley,2012).Thecompanyhasbecomerecognisedasaleadingindustryinnovator throughitsenvironmentalandsocialinitiatives,andthebrandisnowconsideredsynonymouswith consciousbusinessandhigh-qualityoutdoorwear.Patagoniahaslongsupportedactivistgroupsto pursuetheirenvironmentalcausesandhasworkedtointegratesustainabilityinitiativesthroughout theirbusiness.Advertisementsaugmenttheseinitiativestocreateenvironmentalawarenessamong theirconsumers(Chouinard,2006;ChouinardandStanley,2012).
Intheir‘CommonThreadsInitiative’initiatedbyeBayandPatagonia(eBay,2015)Patagoniapledges to‘buildusefulthingsthatlast,torepairwhatbreaksandrecyclewhatcomestotheendofitsuseful life’,whereascustomersareaskedtopledgetoonlybuywhatisneededandwilllast,makerepairs andreuseandrecycleanythingelseandconsidersecondhandproducts.WorkingwitheBaythey establishedastore-fronttosupportandencourageareusemarketforsecond-handPatagoniaclothing. Additionally,arepairwebsiteincollaborationwithiFixitteachescustomershowtorepairtheirgear (iFixit,2015).
Inaone-offadvertisementintheNewYorkTimes,Patagoniaaskeditscustomersto“NotBuy” theirjackets,tryingtocreateawarenessoftheirpurchasesandencouragingthemtomakethings last.Labelssownintoeverygarmentprovideafurtherremindertocustomerstothinktwicebefore purchasing.Conventionalmarketersmaycriticisetheapproachasagimmicktoincreasesales,and indeed,accordingtoVincentStanley(Director,PatagoniaPhilosophy),overallsalesinPatagoniadid risealittle,whereasthesalesofthisparticularjacketstayedthesame.Dumaine(2012)observedthat
Patagoniahasannualsalesofaround$400millionand“makesmoneyevenwhileencouragingits customerstoconsumeless”.
4.3.1. Sufficiency-relatedelementsinPatagonia’sbusinessmodel
Patagonia’smain‘sufficiency’strategyconsistsofencouragingconsumerstothinktwicebefore makingprematurereplacements,orover-consuming.PatagoniathroughitspartnershipswithiFixit andeBayaimstomakeiteasyforcustomerstoeitherrepairproductstoincreasetheusefullifeof products,orreselltheproductswhentheynolongerwantthemthroughanestablishedandcredible second-handmarketplace.Theseinitiativesaresupplementedthroughhigh-profilemarketing cam-paigns(“don’tbuythisjacket”),andlabelsplacedinsideeverygarmentremindingcustomerstorepair andreuseratherthanbuynew.Finally,Patagoniaisstructuredasabenefitcorporation(BLab,2015) allowingthecompanytoalignitscorporatestructurewithitsbusinessmodeltocreatesocietaland environmentalbenefitsthroughthewaybusinessisdone.
4.4. Kyocera–managingdemandforprintingandcopying
KyoceraisaJapanesetechnicalceramicscompanywithworldwideoperationsemploying60,000 employees.Kyocera’scorporatephilosophyistotrytointroduceenvironmentallypreferable solu-tionstoexistingtechnologyanddevelopnewtechnologiesthatareintrinsicallyenvironmentallyand sociallyresponsible.
Thecasestudyfocusedontheirofficecopierbusiness(UKsalesandmarketingsubsidiary).The establishedindustrybusinessmodelconsistsofsellingprintersandcopiersrelativelycheaply (some-timesbelowcost),andthenmakinghighprofitsthroughrepeatsalesofhigh-margintonercartridges. Toperpetuatethebusinessmodelthemanufacturershaveintroducedcomplexcartridgesthat incor-poratetheprintdrum,developerandfuserunit;allessentialcomponentsoftheprintengine.These cartridgesareoftentoocomplextodisassembleandinvariablyendupinlandfill.Hence,thisbusiness modelisintrinsicallyunsustainable.AccordingtotheCSRDirectoratthetime,Kyocerahas deliber-atelyadoptedadifferentroute,developingadurableprintdrum,developerandfuser,permanently sitedinthemachine,andusingconsumables,whicharesimpleplasticreservoirs,containingonly tonerandbeingeasilyrecyclable.Kyocera’smodeloffersongoingsubstantialthrough-lifereductions inoperatingcostsandwastetolandfill.
Mostprinterandcopiermanufacturersnowdesigninfeaturestohelpreducepaperandenergy consumption,suchasdouble-sidedprintingandmultiplepagespersheet.Duringtheinterview,it emergedthatKyocerahaveidentifiedbehaviouralchangeasakeytoensuringthesefeaturestranslate intoenvironmentalbenefits.Theyareworkingwiththeircustomersbyofferingaholistic product-servicesolutionincludingpapermanagementconsultation,systemredesign,andrealtimemonitoring. Tofacilitatethisnewbusinessmodel,Kyocerahavedevelopedsoftwareandservicesforwhichtheycan chargeafeetothecustomer.Theoverallsavingsareclaimedtojustifyservicecostsforthecustomer andreducedemandfornewprinters,whiletheservicesrepresentanimportantnewbusinesslinefor Kyocera.
4.4.1. Sufficiency-relatedelementsinKyocera’sbusinessmodel
ForKyocera,sufficiencyisembodiedintheirprintandcopymanagementservicesthatseekto helpthecustomerreducedemandforprintingandcopyingeventhoughthiswillultimatelyreduce demandforKyocera’sprinterandcopiermachines.Managementservicesincluderaisingawarenessof theneedtoreduceprintingthroughpresentations,print-releasefunction,monitoringusage,default settingfordouble-sidedprinting,andsoon.Thecompanyisawarethatthismightunderminetheir existingmanufacturingbusiness,butaimstooffsetthiswithincreasingservicesprovision.
4.5. Riversimple–reducingimpactsofautomotivesolutions
Riversimplehasdevelopedahydrogenfuelcellpoweredurbanvehiclesuitedfortwopeople.Oneof itsfounders,HugoSpowers,observedthatmostcarsareusedtodrivearoundoneormaybetwopeople atatimeandareusedonlyrarelyatfullcapacity.Furthermore,mostcarsareusedforshortdistances,
forexampleincitieswherethetopspeedwouldberelativelylow.Thismeansthatmostcarsatpresent areover-specifiedandover-designed.TheRiversimplecarwillbea2-seathatchbackwithatopspeed of55mphandavehiclerangeof200miles(Riversimple,2015).Itwillbelight(approximately350kg), andbycombiningfuel-celltechnologywithanenergyregenerationbrakingsystemcoulddeliverhigh levelsoffuelefficiency.
Thetechnologysolutionisaugmentedwithafull-servicesolutionforthecustomer,wherebythe customerpaysamonthlyall-inclusivefeeforusage,wheretherunningcostsincludingfueland mainte-nancearetheresponsibilityofRiversimple.Theserviceprovisionsolutionenablesconsumerstoaccess whatmightotherwiseseemexpensiveunproventechnology.Moreover,bydeliveringfunctionality, ratherthanownership,thebusinessmodelseekstoencouragetherightbehavioursbybetteraligning sustainabilityinterestsbetweentheenvironment,thecustomerandthecompanydirectlythrough thebusinessmodel.Riversimpleisastart-up,soitishardtoforecastitsfuturefinancialviabilityat thisstage.
4.5.1. Sufficiency-relatedelementsinRiversimple’sbusinessmodel
Sufficiencyisembeddedthroughtheholisticdesignofthebusinessmodelacrossallaspectsofthe businesstooptimiseforsocialandenvironmentalsustainabilityintheprovisionofpersonalmobility withtheobjective‘tosystematicallypursuetheeliminationofenvironmentalimpactofpersonal transport’.Riversimple’sbusinessmodelseekstobreakdownsomeoftheexistingconceptsofcar ownership;removingthefashionelementofnewmodels,reducingassociationsofprestigeandstatus, focusingonthecoreofprovidingpersonalmobility.Insodoing,thedemandforcontinuousupgrade andreplacementisaddressed,potentiallyradicallyreducingproductiondemandandcarusage.Finally, Riversimple’sinnovativecorporatestructureseekstoinvolverepresentativesoftheirkeystakeholder groups(including“Environment”and“Community)toensurevalueiscreatedbeyondthebusiness, itsinvestorsandcustomers(Riversimple,2015).
4.6. Reduse–unprinting
Reduse(acombinationof‘reduceandreuse’),aspin-offfromtheUniversityofCambridge,has developedatechnologytoremoveprintfrompaper,whichtheyrefertoas‘unprinting’.Itisanearly stageinnovationtoremovetonerprintfromprintedpaperusinglasers,potentiallyenablingthepaper tobereusedmanytimesover.Thecompanywantstodemonstratethat‘reuse’isthenewrecycle,and thatmerelyrecyclingisadefeat.Theprimaryfocusisonofficeswithatypicallyhighpaperuse(e.g.law firms,banks,universities).Potentialreboundeffectsofunprintingcouldbemitigated,bycombining thiswithadocumentmanagementservice(seeKyocera’scase).
Redusewantstohelpcompaniessavemoneyandprovideanenvironmentallysuperior(i.e.less waste,energy,water,chemicals,CO2)alternativetorecyclingpaper.Assuch,theunprintermaybe
viewedisapotentialeducationaltoolaswellasacostsavingandenvironmentalimpact-mitigating device.TheambitionofReduseisultimatelytosee‘anunprinterforeveryprinter’(Reduse,2015).In thelong-term,ifcollaborationwithanexistingprintermanufacturerisestablished,Redusecanembed itstechnologyintoexistingofficeequipment.Reduseisanearlystageventure,whichisstillinthe R&Dphase;soaclearviewonitsfinancialviabilityisnotyetavailable.
4.6.1. Sufficiency-relatedelementsinReduse’sbusinessmodel
Themainsufficiencydimensionofthisbusinessmodelisthatthetechnologywasdevelopedfrom theoutsettotacklepaperconsumptionthroughacombinationof‘reuseandreduce’.The‘unprinting technology’allowscustomerstoreusepaperoverandovertopotentiallyradicallyreducetotalpaper consumption.Reduseaimstotransformthewaypaperisusedbytheirnewtechnologyandthrough educatingcustomers.ItshouldbenotedthatReduse’smodelisfocusingonproductsandservicesand notatentireproduct-lifecycles(e.g.itdoesnotatthetimeofwritingfocusonimprovedformsof paper).However,ithastheambitiontosupportabsolutereductionsinpaperconsumptionthrough reuseandeducation.WhereassomemightarguethatReduseisabout‘eco-efficiency’,thecaseisadded asa‘sufficiency’examplebecauseoftheambitiontoreduceabsolutepaperconsumptionthroughthe business.
Fig.4. Businessmodeloptionsforsufficiencybuildingoncasesandwastehierarchy.
4.7. Summaryofthecasestudies
Thissectioncollatesthefindingsfromthesixcasestodevelopthefoundationsofa sufficiency-drivensustainablebusinessmodel.ThesummaryofthecasesisshowninTables2and3.Inbrackets,the sourcesforthecases(interview,publicdataandwebsitesorcorporatedocuments)areshown(Table2). Table3showsthatthecasecompaniesaretakingaholisticapproachtoindustrialsustainability,where ‘sufficiency’isoneofseveralbusinessmodelinnovationsapplied.
Thecompanyvisionsineachofthecasesgenerallyshowamatureviewon‘sustainability’; sus-tainabilityisacorepartofthewaybusinessisdoneanda sourceofcompetitiveadvantage.The casecompaniesthroughtheirbusinessmodelschallengethewayconventionalbusinessisdone.The aimsofthecompaniesmovebeyondthecompanyboundaries,tocreatingawiderunderstandingfor consumersonhowtobestliveandact.
Thevaluepropositionofthecasecompaniesfocusesontheenvironmentallypreferableoptionson thewastehierarchy–avoid,reduceandreuse(Fig.4).Durability,reparabilityandmodulardesign arekeydesigncriteriaemployedbythecasecompaniesto‘avoid’wasteandresourceuse.Whereas Reduseseekstoreducethenumberoftreesbeingcutforpaperusage,Riversimplehascreatedalight carthatreducesmaterialandenergyuse.Reuseofproductsacrossmarkets(fromfirsttosecond-hand) andgenerationsispursuedbyCucinelli,VitsœandPatagoniainparticular.Afterusebyonecustomer, itwillbepassedontoanother‘customer’forfreeoratadiscountfromtheoriginalprice(except, forinstance,collectoritems).CompaniessuchaseBaymightfacilitatethis(e.g.Patagonia’sCommon ThreadsInitiative).Finally,product-sharingplatformsareemergingtofacilitatereuseofthesame productacrossmultiplecustomers,Riversimplebeinganexampleofthis.Thisstrategy‘avoids’and ‘reduces’resourceuse.
Valuecreationanddeliveryinallcasesinvolvesacloserelationshipwiththevalue-chaintoensure quality, consistency and continuous improvement while minimising environmental impact (e.g. waste).ThisisillustratedinparticularthroughthecasesofVitsœ,Patagonia,CucinelliandKyocera. Salesandmarketingstrategiesincludeenvironmentallyconsciousselling,andthecompaniesutilise marketingandadvertisingandsometimestheproductitself(inthecaseofReduse,theUnprinter)asan educationaltool.Theemployeerecruitmentandtrainingpolicyisstronglyfocusedonmaintainingthe company’ssustainabilityethos.Finally,capturingvalueisnotaboutmaximisingeconomicwealthfor thecompanies:Patagonia,CucinelliandVitsœrestrictgrowthtoratesthatallowsthefirm’sresources andrelationshipstoscalewithoutlossofintegrity.Patagoniaisstructuredasabenefitcorporation(B Lab,2015),whereasVitsœisalimitedcompany.Thesecompanystructurescouldavoidlossofcontrol overthemissionandvision.
N.M.P. Bocken, S.W. Short / Environmental Innovation and Societal Transitions 18 (2016) 41–61 53
SummaryofthecasesbuildingonthebusinessmodelframeworkaspresentedinFig.2.Note(i)B2B,business-to-business;B2C,business-to-consumer.Note(ii)Dataretrievedfrom:1. Caseinterviews;2.Publicmaterial/companywebsites;3.Corporatedocuments.
Vitsœ Cucinelli Patagonia Kyocera Riversimple Reduse
Businessmodelstrategy forsufficiency
Premiumpricingmodel (1,2,3)
Premiumpricing model(1,2)
Premiumpricingmodel (1,2)
Technology-basedsolution, service-basedoffering(1)
Serviceprovisionwith technologicalinnovation(1, 2)
Technology-basedsolution (1,2)
Sustainablebusinessmodelelements
Valueproposition 1.Product/service/value
forcustomer
Highend,timeless, durablefurniturewith highservicelevels(1,2)
Highend,timeless, durable craftsmanshipin clothingdesign(1,2, 3)
Highend,durable, multi-functionaloutdoor gear,highservice(1,2)
Reusableinkcartridges,high qualityprintersandhigh levelsofservice,document managementservices(1)
Convenientandgreenaccess topersonaltransport(1)
Reusepaper,savecostand theenvironment.Education tool:reuseisthenewrecycle (1,2)
2.Customers/ segments/ relations/service
High-endandB2B(1,2) High-endindividual customers(1)
Highend+secondhand marketfornew segments(1) High-endand environmentallyconscious businesses(1,2) Mid-rangeconsumers. Servicingdoneby Riversimple(1)
B2B,startingwithlarge paperusers,afterwards movingtoB2C(1) 3.Value(proposition)for
environment/society
Goingagainstplanned obsolescence(1; Fablemaze Weather, 2014;Adams,2012)
Socialvaluecreation inthecommunity, ethicalsourcingand longerproductlife (1)
Creatingawarenessof, andsupportingreuse andrepair(1,2)
Innovationsforreduced resourceuse(e.g.paper, cartridges)(1)
“Green”personalmobility substitutestraditionalcars with‘greener’solution (hydrogen,smaller, optimisedusage)(1)
Reuseratherthanrecycling ofpapertoreducevirgin paperuse(1,2)
Valuecreation&delivery 4.Keyactivities(process,
R&D,salesmodel)
Under,ratherthan oversell–customerscan addmoreifneeded. Moving&installation service(1)
Localhighlyskilled employment, concernfor employeeand supplychain wellbeing(1) Conscioussales (environmentalimpact, repair)(1) Product-serviceofferingto reducepaperconsumption; remanufactureandreuse cartridges(1)
Reducenewcarsalesand increase‘green’carusage(1)
Promotion:costsavingand ‘greenfeel’.Educational element:‘reuseisthenew recycle’(1)
5.Keyresources (materials, infrastructure,human resources(mostsalient elementsarementioned forthecases)
Stricthiringpolicy focusedon‘Vitsœethos’ (1).
Sustainability=common sense(Adams,2012)
Socialvaluecreation drivenbytheowner; strongattractionfor employees(1)
Hiringpolicyfocusedon ‘PatagoniaPhilosophy’ (1)
‘Kyoceraway’corporate ethosandrecruitment
HiringbasedonRiversimple ethos.Needfordevelopment ofinfrastructureand hydrogentechnology(1)
Developacommercially viableprototypeiswhere mostresourcesarebeing allocated(1)
6.Distributionchannels Showroomsshowcasing products.Directdelivery tocustomer.Relocation andinstallationservice (1)
Exclusivecatalogues andretailstores. Limitedadvertising strategy(1,2,3)
Repairservices,second handsales.Select numberofretailers, cataloguewithadvocacy (1;Chouinardand Stanley,2012) Customereducation. Challenge:engaging distributorswith sustainability(1)
Highaccessto‘green transport’inurbanareas(1)
Existingsaleschannelsfor printerswillbeusedfor unprinters(1)
7.Suppliers/ partners/ coalitions
Closecooperationwith supplierstoimprove durability.Reusable packagingfordeliveries (1)
Garment manufacturersare paidaboveaverage. 80%regional suppliers(1)
Sourcingbasedon sustainabilityand durability(1;Chouinard andStanley,2012);eBay ispartnerinCommon ThreadsInitiative
Kyocera’scustomersarekey suppliersastheyreturn emptypackagingfor remanufacturing(1)
Suppliersselectedtofulfil newfunctions(hydrogen, lightweight).Collaborations withlocalitiestoalignwith existinginfrastructure(1)
Initially,collaborationswith largecompaniesand traditionalprinter/copier saleschannels(1)
N.M.P. Bocken, S.W. Short / Environmental Innovation and Societal Transitions 18 (2016) 41–61 Table2(Continued)
Vitsœ Cucinelli Patagonia Kyocera Riversimple Reduse
8.Key sufficiency-enabling technologiesand process/product features Simplicityin design, durability, continuous improvements without harming compatibility (1,2) Highquality materialsand manufacturing processes(1,2) Sustainabledesign: organiccotton,PET recycledpolyester, durablematerials (1,2)
Simplifiedsystem, durablerollers, tonercartridgesare easilyre-fillableor recyclable(1,3)
Hydrogenfuelcar, lightweight design,2-seater car.Focusedon fuelefficiencyand lowemissions(1, 2)
Theunprinterfocuses onresource efficiency.Theteam isexploringwhether thedesigncanbe ‘circular’(1)
Valuecapture 9.Cost&revenue
model.Product pric-ing/ownership model Premium pricedproduct sales,buthigh ongoingservice (1) Premium pricedproduct sales(1,2) Premiumpriced productsales,but highongoing service(1)
Higherpriceof initialmachines, buthighongoing service(1)
Paypermonth. Leasepricing comparableto conventional leasing(1)
Perproduct.In future:sellpaper(1)
10.Valuecapture forothers(e.g. environment, society) Slowsresource use(1) Socialvalue (e.g.skilled jobs)inUmbria region;slows resourceuse (1)
Slowsresourceuse (1,2)
Reduceswasteto landfilloverthe productlifetime(1)
Reducesthe impactof personalmobility (1)
Slowsresourceuse, savesenergy,CO2 water,chemicalsand waste(1)
11.Growthethos Accepting
slowerorganic growth;no publiclytraded shares(1) Nowtradingon thestock exchange,but restrictedto organicratesof growth(2) Growsustainably andslower(e.g. secondhand).Has experimentedwith zero-growthmodel (1;Chouinard, 2006) Kyoceraistrading onthestock exchange(2) Replacingcars witheco-friendly substitutes. Partneringto grow(1)
“Anunprinterfor everyprinter”isthe aim–stillinstart-up phase(1,2)
Table3
Applicationofthe‘sustainablebusinessmodelarchetypes’tothecases.Note.Thearchetypesare:optimiseresourceefficiency;
closingresourceloops;substitutewithrenewablesandnaturalprocesses;deliverfunctionalityratherthanownership;adopt
astewardshiprole;encouragesufficiency;createinclusivevaluecreation;re-purposethebusinessforsociety/environment.
Vitsœ Cucinelli Patagonia Kyocera Riversimple Reduse Encourage sufficiency; adopta stewardshiprole Encourage sufficiency;adopta stewardshiprole Encourage sufficiency; re-purposethe businessfor soci-ety/environment; adopta stewardshiprole Encourage sufficiency; optimiseresource efficiency;closing resourceloops; deliver functionality,not ownership Encourage sufficiency;deliver functionalityrather thanownership; substitutewith renewablesand naturalprocesses; re-purposethe businessfor soci-ety/environment; optimiseresource efficiency Encourage sufficiency; optimiseresource efficiency;closing resourceloops
Adaptedfrom:Bockenetal.(2014).
5. Discussion
Howcansufficiencyserveasadriverforbusinessmodelinnovationforsustainability?Thispaper, throughthecasespresented,showsthatsufficiencycanbeembodiedthroughmultiplemechanisms withinthebusinessmodel.
5.1. Thebusinessmodelandeconomicrationale
Thecasespresentcomprehensiveapproachestosufficiencyintegratingabroadarrayofinitiatives withintheirrespectivebusinessmodels.Table4providesanoverviewofthebusinessmodelinitiatives observedfromthecasesandotherillustrativecasesfromtheliterature.
Whichtypesofrevenuemodelsmightsufficiency-drivencompaniespursue?Companiesdrivenby sufficiencymightoftenadoptapremiumbusinessmodel(Bockenetal.,2014).Thepremiummodel iscommonacrossthecases,andappearstobejustifiedwithB2CandB2Bcustomersthroughproduct differentiation,highlevelsofservice,extendedwarranteesandbytreatingkeystakeholderswell. However,asTable4shows,premiumpricingisnottheonlysolution.Sufficiencycanalsogenerate costsavingsandenvironmentalbenefits,forexamplethroughreducedpaperuseinthecaseofReduse orlongerlifeproducts,whichneedtobereplacedlessoften.Itcanalsobecompatiblewithconvenience, forexamplethroughcarclubmodelssuchasRiversimple’smodel.Riversimpletapsintoanewmarket ofconsumersseekingaccesstocarswithoutrequiringownershipinthemostsustainableway.Hence, althoughthe‘premiummodel’seemstodominate(e.g.Cucinelli,Vitsœ,KyoceraandPatagonia)andis seeninothersustainabilityinitiativessuchasFair-Trade,thisisnottheonlyroutetobusinessand‘pay permonthoruse’(Riversimple)ormoreconventionalsalesmodels(Reduse)maydeliversufficiency. Themostobviousconcernincreatingasufficiency-basedmodelisthatifthesalescycleisreduced orcurtailed(e.g.byofferingaproductthatlastslongerorforever)thenoverallmarketdemandmust ultimatelyshrink.Thisreductioninrepeat-businessandexpansionopportunitiesmeansthatto sur-viveasufficiency-basedmodelneedstocontinuallyseekandwinnewcustomersordevelopother formsofincome(e.g.services).Thecasestudiesdemonstratethatthroughcarefulbusinessmodel design,differentiatedvaluepropositionscanbedevelopedtoappealtoconsumers,create competi-tiveadvantageandsupportsufficiency.Competitorsmaytrytomimicthesebusinesses,butiftheydo, thisisperhapsonlyapositivesustainabilitybenefit(e.g.followingPatagonia’slead,numerous com-paniesintheoutdoorapparelsectornowemphasisetheirethicalcredentialsandsomeofferrepair orreusesolutions).Eventhoughsufficiencyhasbeendemonstratedinthepresentedcasestudies,it maybemuchharderforlargemultinationalsthatalreadyhaveadominantmarketsharetojustify sufficiencyapproachesastheywouldmorelikelyexperienceanabsolutereductionintheirbusiness.
Table4
Sufficiency-basedbusinessmodelinnovationsobservedfromthecases.
Businessmodelinitiative Valuecreatinglogic Examples 1Sharing;noownership
Sharingthesameproductacrossmultiple customers.Thecustomernever‘owns’the product.Rather,aserviceissold
Thefirmispaidfortheservice(e.g.caraccess) ratherthanownership(ofcars).Forthe customerthiscancreateconvenienceand transparency(caravailabilityandfullservice)
Riversimple,other sharingmodels:Zipcar, BlaBlaCar,
Couchsurfing,Airbnb (Chase,2012) 2Demandreductionservices
Solutionsthatmitigatetheuseofenergyand
resourcesbyindividualsandbusinesses
-Provisionofadd-onservicesthatassist
consumersinreducingconsumption
-Publicsubsidiesand,orpreferentialtax
treatmentmaybeusedtostrengthenthe
businesscase
Thefirmispaidforservices,whilethe
consumermakessavingsthataregreaterthan
thefees,sobothconsumerandfirmbenefit
Itmaybenecessarytostrengthenthebusiness
caseandprovideincentivesforconsumeror
provideradoption
ESCOs(FORA,2010),
Kyocera,Riversimple
E.g.energyfeed-in
tariffs,green-deal
subsidiesforhome
insulation,etc.
3Moderatingsalesandpromotion
Consciousactiontomoderatesalesactivities–
eliminatingmanipulativeconsumermarketing
campaigns,nosalesincentives,choiceediting
Thebusinessmodelisbuiltoncustomer
long-termrelationshipsandtrustinpaybackin
termsofloyaltyandreputationalbenefits.
Revenuemodelsareoftenfocusedonpremium
pricing
Vitsœ,Patagonia
4Extendingproductlife
Provideproductsdesignedtolastalifetime
(eliminatebuilt-inobsolescence),be
repairable,upgradable,andnotsubjectto
fast-fashiontrends
Thebusinessmodelisbuiltonlong-term
customerrelationshipsandtrust,leadingto
loyaltyandreputationalbenefits,and
follow-onservices.Apremiumpriceorservice
chargescanjustifyslowersales.Customers
benefitinthrough-lifecostsavings
Cucinelli,Patagonia,
Vitsœ
5Directreuse
Creationofsecond-handmarketsforused
goodstoreducewastetolandfilloridleassets
Consumersareencouragedtopaypremium
pricebecauseastrongusedmarketcreates
re-salevalueoffsettinginitialhigherpurchase
costs
Patagoniain
partnershipwitheBay
6Fulllifecyclesufficiency
Designandproductusearefocusedon
minimisingresources,themostimportant
examplebeing‘frugalinnovations’.
Unfortunatelymostofthesesolutionshave
beenmainlyfocusedonlowincomecountries,
notdevelopedcountries
Dependingonthetypeofproduct(frugalor
premium)affordableorpremiumpricingis
adopted.Inbothcases,customersbenefitfrom
costreductionsintheusephase(e.g.energy).
Infrugalinnovation,socialenterprisemodels
withlowerprofitdrivemightbeused
Kyocera’sfulllifecycle
impactapproach;
frugalinnovations
(Bockenetal.,2014)
basedonsimple
technologyandlow
impactacrossthelife
cycle
5.2. Enablersofsufficiency-basedbusiness
Thecasestudiesconsistentlypresentanumberofenablersandpre-requisitesthatseem impor-tantforsuccessfulinnovationforsufficiency.Theseneedtobecomemainstreamconsiderationsin businesseducationandbusinesspracticeandencouragedthroughappropriatelegislationandpolicy intervention:
1.Corporategovernanceorientationtowardssufficiencydrivenfromthetop(Vitsœ,Cucinelli, Patag-onia,Riversimple,Reduse).
2.Performanceandincentivesystemsalignedwiththesustainabilityobjectivesofthefirm(e.g.do notrewardover-selling,nosalescommissions)(Vitsœ,Patagonia,Kyocera,Riversimple).
3.Strongandconsistentcommunicationofcorporatevaluesbothinternallyandexternally(allcases). 4.Commitmentandperseverancetogoagainstthebusiness-as-usualtrends(allcases).
5.Astrongfocusonqualityanddurability(mainlyVitsœ,Patagonia,Kyocera,Cucinelli).
6.Astrongfocusoncustomers–buildinglong-termrelationships,usingexistingcustomer’s word-of-mouthrecommendations asan importantmeansof promotion(Vitsœ,Cucinelli,Patagonia, Riversimple,Kyocera).
7.Radicallydifferentmarketinginitiativesandcampaignsrelativetoindustrynorms–focusedon moderatesales(Vitsœ,Cucinelli,Patagonia,Kyocera).
8.Preferencefororganicgrowthratherthanhighlyleveragedgrowthandacquisitioninordernotto diluteorlosethecorporateethosandvalues(Vitsœ,Cucinelli,Patagonia,Riversimple,Kyocera).
Expandingonthefinalpoint,rapidgrowthintuitivelyseemsincompatiblewithsufficiencyand sustainability,andassuch,Vitsœ,CucinelliandPatagoniahavepurposefullyadoptedstrategiesof organicgrowthonly.Patagoniahasinthepastgoneevenfurtherandexperimented(unsuccessfully) withazero-growthmodel,butevennowstillkeepsgrowthtolowrates(Chouinard,2006)–zero growthwasfoundtocreatemotivationalproblemsforstaffwithinthecompanyaswithoutgrowth theopportunitiesforpromotionandpersonaldevelopmentopportunitiesweregreatlydiminished. Targetinglowergrowthrateshasbothpositiveandnegativeeffectsonthebusinesses.Restraining thegrowthrateisseentobeanimportantmechanismtomaintaincorporatecultureandensure entiresupplychainsandsalesanddistributionnetworksremainalignedwiththecorevaluesofthe company(e.g.Cucinelli,Vitsœ).Ontheotherhand,constrainingthegrowthratereducesrevenues, limitsmarketpenetration,andislessattractivetoinvestors(bothVitsœandRiversimplehighlight ongoingchallengeswithfinancing),whichinacompetitivemarketoronewhereradicalchangeis neededattheindustrylevelmaybeagreatimpedimenttohavingimpactorevensurviving.Todeliver meaningfulsystem-levelchange,theremaysimplynotbetimetowaitforsmalldisruptiveplayersto groworganically.Whilesufficiencyseeminglyimpliesthatthereshouldbelittleornogrowth,onecan arguethatcompaniescanandshouldgrowrapidlyiftheyaretohaveanymeaningfulimpactonthe world:Whatmattersiswhethertheyarereducingoverallimpactsbyunderminingordisplacingthe conventionalmoreenvironmentallyharmfulbusinesses–thatis,theirgrowthislessthantheoverall declineindemandthattheyprecipitateinthemarketstheyserve.
5.3. Barrierstoadoptionofsufficiencymodels
Thequestionremainswhetherallcompaniesinallsectorscanadoptsuchstrategiesandhowthey mightengagelessconcernedmass-consumermarketswithpremiumprices.Althoughasshownin thecasessufficiencycanofferdifferentiationandcompetitiveadvantage,theremaybebarriersthat holdbackbusinessesfromtakingasufficiency-drivenapproachbasedonourcases:
• Theyarestructuredasapubliclimitedcompany(plc),characterisedbypublicsharesandfocuson short-termshareholdervaluemaximisationandsomaystruggletopersuadeanalystsandinvestors oftheneedforalonger-termapproach(Riversimple,PatagoniaandVitsœhaveexplorednewownership andgovernancemodelstoreducethisinfluence).
• Businesscontinuityinaclassicbusinessmodelformisbasedonrepeatsalesandsellingmoreunits overtimetogenerateaprofit.Built-inobsolescence(designingproductstofailprematurely)and fast-fashionarepartofbusinessmodelsintroducedtosupportindustrialmodelsofmass-production (Vitsœ,Kyocera,PatagoniaandCucinelliinparticulartrytobattlebuilt-inobsolescence).
• Competitionisfierceandoftenfocusedmoreonpricethanonqualityanddurabilityandfirmsuse sophisticatedmarketingstrategiestopromoteconsumption.Theincumbentmultinationalsthat dominateglobalproductionhaveadistinctadvantageoncosts(economiesofscale),andmarketing budgetandreach,makingitdifficult,althoughnotimpossible,forsmalldisruptivefirmstomakean impactandwincustomers.
Fromacustomerperspectivethereareotherreasonsthathinderasufficiency-drivenapproach: Consumers seek variety and novelty (driven in part by marketing, social conformance, and a disposable-societymentality);seekstatusandprestigethroughownershipanduseofthelatest gad-getsorprestigegoods;and seekperformancebenefitsthroughtechnologicalinnovations.Froma systemicperspective,aconsumerismculture,affordability(i.e.upfrontcosts)ofmoredurable prod-ucts,difficultiesindefiningappropriatelevelsofsufficiency,andconcernsabouttheeffectsofslower growthcanbebarriers.Thecharacteristicsofconsumerbehaviourandtheinfluenceofmarketingand promotionarewelldocumentedintheliteratureanditisbeyondthescopeofthispapertoexplore themingreatdepthhere.However,theyarewithoutdoubtasignificantchallengeforsufficiency initiatives,andpromotionalactivitiesmustbetackledinparallelwithbusinessmodelinnovationas
highlightedinseveralofthecases(Vitsœ,Patagonia).Foramanufacturer,makingdurableproducts generallymeanstheyaremorecostlytoproduceandnecessitatehigherprices,whichmaybe unattrac-tivetocustomers.Achallengeidentifiedbythecases(Patagonia,VitsœandKyocera)isthatalthough overthelonger-termbetterproductscanoffsettheirpremiumprices,consumersarenotgoodat consideringfuturebenefitsandcostsandoftenunder-valuefuturebenefitssignificantly.Evenwhere benefitsarerecognised,consumersmaystruggletofinancehigherupfrontcostsandcontinuetobuy cheaperlessdurableproducts.Educationisimportanttoensureconsumersarefullycognisantofthe impactsoftheirpurchasingandconsumptiondecisions.Businessmodelscanplayarolethroughthe useofproduct-serviceofferings,leasing,orotherfinancingsolutionsthatenableconsumerstoaccess amoreexpensiveproductoremergingtechnologybydeferringpartoralloftheupfrontcostandrisk. Forexample,Riversimpleusetheservicemodelinparttofacilitateadoptionoftheircars.Inthecase ofReduseandKyocera,theirearlystageadoptionstrategiesfocusonlargecorporatecustomers,as thesearemorelikelytounderstandandengagewiththethrough-lifebenefitsoffered.
Finally,oneofthebarriersatthenationalandgloballevelforsustainabilityseemstobeindefining appropriatelevelsforsufficiency.Inthedevelopedworld,perspectivesonsufficiencyandperceived essentialneedsarefarremovedfromthoseinmanydevelopingnations. Culturalnormsand val-ues,educationandawareness,relativeaffluenceandexpectations,andlocalavailabilityofnatural renewableresourcesmaygreatlychangedefinitionsofsufficiencyfromoneconsumer,companyor geographicregiontoanother.Thisintroducesalevelofsubjectivitytotheterm‘sufficiency’thatmakes itdifficulttoapplyuniformlyandmeasure(unlikeefficiencymeasures,whicharemoreeasily quan-tifiedandunderstood).Thisinturncouldmakeregulationandlegislationproblematicandinhibits experimentationanduptake,astherearefewclearlydefinedexpectations,standardsandrolemodels. Thereisalsothequestionofhowmuchshouldandcanindustryandgovernmentinterveneinprivate consumptiondecisionsandpatterns.Yet,amoreconcertedeffortisalmostcertainlyrequired par-ticularlyintherichdevelopednationstomoderatesomeoftheexcessesofconsumption.Consumer resistancetosuchchangesevenwherethereisstrongevidenceofthenegativeimpactsofexcess(e.g. smoking)illustratesthechallengesinshiftingconsumerbehaviours.
5.4. Sufficiencyasacatalystforreformingourgrowth-driveneconomicsystem
YoungandTilley(2006,p.414)ask“Canacompanyeverbesustainablewhenithasnolimiton salesandhenceconsumption?Howcanacompanybeawareofitslimitstogrowthwhenother unsus-tainablecompanieswilljustkeepgrowing,intheshortterm,takingsales?”.Morefundamentally,can sufficiency-drivenbusinessesserveasacatalystforwiderreformofourgrowth-driven consumerism-basedeconomicsystem,whichiscurrentlyarootcauseofunsustainabilityandover-consumption? Whileitisdifficulttoaddressthesefundamentalquestionsbasedonalimitednumberofemerging cases,weseektoprovideourviewbasedontheworkpresentedinthispaper.
Thepressureonresourcesisexpectedtopushsignificantlydifferentnewwaysofdoingbusinessin thefuture(WBCSD,2013),andifcurrentpredictions(e.g.Randers,2012)arecorrect,itseemsinevitable thatatsomepointfirms,industries,nations,andultimatelythevastmajorityofglobalsocietywill havetoadoptsomeformofsufficiency-basedapproachtoproductionandconsumption.Thiswillnot beoutofchoice,butoutofnecessity.Itseemsquitefeasiblethatthefuturewillseequotasandcaps imposedonconsumption,oratleastconcertedpolicyinterventionstoactivelyencouragereduction inconsumptionincertainkeysectors(similartotoday’sESCOinitiativesintheenergysector).Based onRanders(2012),energy,water,foodandprobablytextileswillbethefirstindustrysectorstobe squeezed.Sheddingnewlighton‘sufficiency’asadriverforbusinessmodelinnovationfor sustaina-bilitymighthelpstimulatemoreresearchandexperimentationinthisdirectionandprepareforthese comingchallenges.Wideradoptionandawarenessofbusinessmodelsdrivenbysufficiencymight facilitatethe‘normalisation’ofsuchmodels,createsocialacceptabilitywithconsumers,and,perhaps moreimportantly,demonstratethefinancialacceptability,or,thebusinesscasetopotentialinvestors andmanagement.Thereisalsoanimportantandcriticalroleofpolicymakerstomove‘sufficiency’ outofthenichespace,forexample,bycreatingaminimumproductlifethroughmandatorylonger productwarranties,mandatingadequateandaffordablerepairandreuseservices,creatingzero-textile
wastetolandfillpolicies,placingrestrictionsoncorporatesalesandmarketingstrategies,andindustry specificpolicies(e.g.mandatingx%ofallprintingmustbeon‘reused’paper).
Concerns(orperhapshopesofsome)thatsufficiency-basedmodelswillunderminethecurrent consumereconomyandcauseeconomiccollapse,althoughhardtopredict,areprobablyunfounded assufficiencyasabusinessdriverwillbeintroducedincrementallyandcanbethemechanismthat enablesindustryandtheworldtocontinuetodevelopfurtherandservethegrowingpopulationin amoresustainablemanner.Ineverybigtransitiontherearewinnersandlosers,and asresource constraintsbecomemoreacute(e.g.WBCSD,2013)andtheimpactsofclimatechangeworsen(IPCC, 2014),sufficiency-basedmodelsmaywellundermineordestabilisetraditionalapproachestobusiness andcauselargeincumbentfirmstofail.However,reducedmaterialconsumptionwillnotmeantheend ofbusiness.Inthelonger-termsuchanoutcomemayperhapsserveasacatalystformorefundamental changeincurrentconsumption-orientatedandgrowth-basedeconomicsystems.Whatseemslikely isthateconomieswillcontinuetobegrowth-basedatleastfortheforeseeablefuture,butgrowthwill increasinglybedrivenbyprovisionofservices(e.g.Chase,2012)andpremium-pricedgoods(Bocken etal.,2014).Thiswillemphasisedeliveryofhigherperceivedcustomervalueandcreatinghighersocial valuewithreducedmaterialconsumption,hopefullywithanincreasingfocusondeliveringwell-being andmoremeaningfulvalueratherthanconsumerismandover-consumption(seee.g.Jackson,2009).
5.5. Contributionstoexistingliterature
Theconceptofsufficiencyandreducingdemandtosatisfyneedsratherthanunlimited‘wants’is notnew.Sufficiencywasakeypartoftraditionallifestylespre-industrialrevolutionandtherelatively recentageofconsumermarketing.Manydevelopingnations,eventhoughtheyarewellbehindin manyrespectsregardingconsumptionandsustainability,bynecessitypracticemanybettersufficiency strategiesthanthedevelopedworldbecausetheirfinancialsituationforcesthemtobefrugal,avoid unnecessaryconsumption,andmake muchgreateruseofrepair andreuseineverydaylife.Such initiativeswillneedtobereinvigoratedparticularlyinthedevelopedworldunderincreasingresource andclimatepressures.However,atpresent,alargepartofthepopulationhaseasy accesstotoo manyresourcesandoftenplacesahighervalueonconvenienceoverbroaderenvironmentalorsocial considerations,whilethemajorityofindustryandgovernmentdoeverythingpossibletoencourage unfetteredconsumption.
Theframingof‘sufficiency’asadriverforbusinessmodelinnovationisseenasakeycontribution ofthispaper.Sufficiencycanbeanimportantstrategicapproachforsustainabilitywhichisintegral tothewayofdoingbusiness,ratherthanmerelyanadhocapproachofrespondingtonichecustomer demandoravoidingboycotts,aswasformerlydescribedinDyllickandHockerts(2002).Fig.1,the ‘sustainablebusinessmodel framework’wasfoundtobeusefultomapandexplainthedifferent casestudies,withthecaveatthattheroleofcorporategovernanceaslistedinSections5.2and5.3 cannotbefullycapturedinthebusinessmodel.Sufficiencyseemstoactnotonlyasabusinessmodel innovation,butalsoasanover-archingethosforthecompaniesandhencemaytranscendtheelements ofthebusinessmodel.
Thewastehierarchywasfoundtobeausefulvisualisation(Fig.4)toexplainwhatsufficiency mightmeanforacompanyandwhichsufficiencystrategiesarepreferableaspartoftheirbusiness models.Thecasesprimarilyfocusonthehigherlevelsofthewastehierarchy–avoid,reduce,and reuse.Althoughthesestrategiesarenot‘mutuallyexclusive’andthereisclearlyoverlapbetween categories,thewastehierarchydoesshowthevariousoptionsforsufficiency.
Thecasecompanieshavesuccessfullydevelopedsufficiencyintoabusinessproposition,showing thatsufficiencydoesnotnecessarilyhavetobefarawayfromthebusinesscase.Whenanalysing thecasesusingthesustainablebusinessmodelarchetypes(Table3)itbecomesapparentthatall casesfocuson‘sufficiency’,buttherearearangeofcomplimentarybusinessmodelarchetypes pur-suedbythecompanies.Additionally,itisobservedthatwhile‘sufficiency’canbeadiscretebusiness modelarchetypeinitself(asproposedbyBockenetal.,2014),sufficiencycanalsobeengendered throughvariousotherbusinessmodelarchetypes(e.g.Riversimple’sproduct-service-systemmodel). AsrecommendedbyYoungandTilley(2006),DyllickandHockerts(2002)andBockenetal.(2014)
thecompaniespursuemultiplestrategiessimultaneouslytocreateintegratedsolutionstooptimise sustainabilityoutcomes.
6. Conclusions
Thispaperhasdevelopedinsightsintosufficiencyasadriverforsustainablebusinessmodel inno-vationandfindsthattherecanbeagoodbusinesscaseforcompaniestotakeaproactiveapproach tosufficiency,ratherthanmerelyadoptingareactiveresponseonanad-hocbasistoconsumeror regulatorypressure.Assuch,thispaperoffersanimportantextensiontothelimitedextantliterature onsufficiencyasabusinessstrategy.
Sufficiencyisembodiedinthemostenvironmentallymostpreferableoptionsinthewaste hier-archyofavoiding,reducingandreusing,and,farfrombeingjustanadd-onapproachtobusiness, sufficiencyacrossthebusinessmodelcanbeseenasaholisticstrategy.Asufficiencyapproachcan affectenvironmentalbenefitsacrosstheproductlifecyclefromrawmaterialextractiontoproduction throughtoconsumerandbeyond.Moresufficiencydrivenbusinessesandbusinessmodelswillneed tobepursuedtonormalisesuchapproachesanddrivechangeinconsumptionandproduction.
Legitimatequestionsremainoverhowfarindustrycanbeexpectedtopursuesufficiencymodels independently.Whilethemodelspresentedaresuccessful,theirapplicationacrossallsectorsand regionsisnotclear.Inparticularwhilethemodelsarefeasibleforinnovativenewstart-upsandsmaller companies,thelargemulti-nationalsthatfacilitatemostoftheworld’sconsumptionwouldsufferby encouragingsufficiencyordemandreduction,andsoseemunlikelytowillinglyadoptsuchstrategies. Specificsectorpolicies(e.g.minimumproductlifetimesandwarrantees)andwiderreformofthe economicsystem(e.g.emphasisewellbeingorhappinessratherthaneconomicgrowth)aretherefore likelyrequiredtopushsufficiencyinbusinessmodelsmorewidelyandquickly.
Thesecasesareofinterestintheirownrightasexemplarsofindustrialsustainabilityintegrating arangeofinitiativesandapproachestodeliverenhancedsocialandenvironmentaloutcomes,but foremostthesecasespresentsufficiencyapproachesanddemonstratetheviabilityofsuchbusinesses. Thepaperoffersinterestingtemplatesfordisruptivebusinessmodelsthatcandrivesufficiencyand achievesuccesswithincurrenteconomicmodels,andmoreimportantlyperhapsofferablueprintfor futurebroaderbusinesswithinasufficiency-basedeconomy.
Thisresearchwaslimitedbyasmallnumberofcasesindevelopedcountries.Thismightlimit gen-eralizabilitytowidercontexts,butitprovidesapositivebaseforfurtherexplorationofthisemerging area.Itwilllikelybeincreasinglyimportanttoinvestigate‘sufficiency’acrossmultiplecontexts (com-panies,industriesandcountries)aspressuresonresourcesandtheenvironmentintensify(WBCSD, 2013).Furtherworkisnecessarytodeveloptheconceptofsufficiencyasadriverofbusinessmodel innovationforsustainability,butthispaperpresentsapositiveperspectiveonsufficiencyanda pre-liminarybasisforfurtherresearch.Futureresearchmightpursuetheinclusionofexamplesacross developingcountrieswheredifferentconsumerpriorities,regulatoryandculturalcontextsmayhave facilitatedotherinterestingapproachestosufficiency.Futureresearchcouldalsoprofitablyexplore whatspecificpolicyleversmightberequiredtoencouragefirmstomovetowardssufficiency-based modelsandbetterunderstandthepoliticalandsocialbarrierstoimplementingsuchpolicychanges.
Acknowledgements
ThisworkwassupportedbySustainValue,aEuropeanCommission’s7thFrameworkProgramme (FP7/2007-2013)and theEPSRC Centrefor Innovative Manufacturingin Industrial Sustainability (RG64858).We wouldliketothankthecasecompaniesfortheirtimeand richinsights,and the assistanceofseveralanonymousreviewersinrefiningandenrichingthispaper.
References
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