Written for FutureEnterprise by Panagiotis Kokkinakos.
The sustainability of existing linear economic systems is nowadays questioned, since all stakeholders understand that supply of resources is not infinite. The current circumstances ask for shifting to new kinds of economies and to new ways of doing business:
- The concept of the circular economy and closed loop production, opens up novel ways to reconcile the quest for growth and business value with the environmental prudence perspective: “doing more with less”.
- The principles of a network-enabled sharing economy build on connecting people for shared creation, production, distribution, trade and consumption of products and services.
In this context, the evolution of circular business models is expected to capture new business value across supply chains and drive digital business innovation to undiscovered pathways in product design, development of product-to-service approaches, customer engagement and internal workforce performance. While examples of such new ways of business are emerging today with collaboration, reverse supply chains and connectivity as their key drivers, achieving circular and collective business innovation in a systematic and lean way is still in its infancy.
In addition, the agile philosophy of thinking fast, moving fast, failing fast, learning fast and succeeding fast has been embraced as the holy grail of web entrepreneurs across the world; yet it has not been fully encompassed and realized by more traditional enterprises at any size (SMEs or large corporations). Persisting on business models that have successfully worked in the past neither allows new forms of enterprises to emerge and flourish nor guarantees that imminent opportunities will be timely tapped or that unexpected market and business risks will be efficiently handled. An enterprise at any stage of its evolution needs to be able to continuously tune in and translate the flows of incoming ideas from within and beyond its boundaries to appropriately proceed in potential adaptations of its business model.
The last years have also marked the proliferation of multi-sided platforms that have redefined the boundaries among enterprises and their clients and infused a win-win collaboration mentality. With consumers “buying” solutions to their differentiated, personalized problems, each business offering needs to be validated in market-simulating environments. Despite the indisputable power of user engagement thanks to social networking and crowdsourcing techniques, user-centric design is still lagging behind. Open Innovation played also a key role in this growth, however the current approaches and the definition of “openness”, as perceived by enterprises who are constantly troubled with intellectual property issues, are crippling factors to the real innovations that could arise.
Disruptive and creative technologies, like the Internet of Things, Big Data, Social Media, Mobile and Cloud Computing, have to be exploited as a means towards generating value from more efficient resource use and conduct business in a sustainable manner that benefits all stakeholders and the overall society. The design of products and services, as well as the overall business operation, shall abide by the principles of flexibility, durability, restoration and prosumption.
Thus, novel business models that challenge traditional operating models, follow the paradigms of the Sharing Economy (that, according to a survey from PWC, around 80% of stakeholders perceive as highly valuable) and the Circular Economy (that Accenture claims will be worth $4.5 trillion in the next 15 years), and capitalize on novel technologies and Future Internet assets in business environments are necessary. These new business models target to introduce unique innovation propositions at multiple levels, ranging from the innermost configuration and the core offerings of an enterprise, to the customer-facing, networking elements of its business system (user experience).
There are specific smaller-scale challenges that should be addressed in the upcoming years in order to facilitate the envisioned developments:
- Circular Supply Chain Management.
- Boundless Open Innovation Ecosystems.
- Collaborative Prosumption Models.
- Collective Ideas Flow on ever-evolving and interactive Business Plan Lifecycles.
- Crowd market validation of Business Innovations.
- Reverse engineering of innovation.
- Innovation Diffusion & Adaptation Techniques.
