Business Model Innovation for the Circular Economy in pandemic times: Development and insights of a series online Design Thinking workshops

The Circular Economy (CE) is commonly promoted as a contributor to Sustainable Development, however, the implementation of Circular Business Models (CBM) in the market has been low, due in part to the complexity of operationalizing CE-based ideas and the lack of guidelines for firms. Design Thinking has been identified as an innovative problem-solving approach, capable of addressing complex challenges through multidisciplinary collaboration, such us CBM development. The COVID-19 crisis has imposed mobility restrictions and social distancing, which has accelerated organizations digital transformation and has pushed them to develop virtual collaboration capabilities. Accordingly, the present research aims to explore the application of Design Thinking to guide and facilitate the early-stage development of CBMs in a n online collaboration context. Following a literature review and expert feedback rounds, the original Design Sprint process was combined with best practices from the Business Model Innovation (BMI) and CE-oriented innovation literature, modifying it to (i) embed a focus on sustainability/circularity, (ii) aim for outputs at the business model level -beyond the specific product or service-, and (iii) adapt to a digital environment. The adapted process and exercises were tested and refined in different scenarios, including two workshops with master level students, one workshop with a CE-academic consortium, three workshops with a start-up and three workshops with a corporate multistakeholder innovation project. Data was collected in the format of feedback surveys, workshop output documentation and researcher/facilitator notes. The proposed Circular Sprint -or Design Thinking Sprint for Circular Business Model Innovation- considers twelve consecutive exercises to be done in three half-day workshops, going through seven distinctive phases i.e. inspire, understand, define, ideate, decide, prototype and test, plus a pre-workshop problem framing session and a CBM introduction, all of it supported through an online visual collaboration platform. Results suggest the adapted design thinking process was effective in creating a common understanding of an issue from a life cycle perspective, allowed to ideate possible solutions in a constrained time, facilitated the decision-making process and supported the design of novel business models. However, the quality of outcomes depended on organizational settings, project maturity level and expert facilitation. Findings indicate that propositions were biased to previous knowledge and interests of participants, highlighting the relevance of idea cross-pollination mechanisms and the importance of a clear problem framing phase at the beginning of workshops. Embedding sustainability/circularity and a business model perspective from the onset has proven to be a challenging aspect, to be improved in future workshop iterations. Results also suggest online collaboration is positive for effective time management and homogenous contribution from participants, though limiting engagement. This research contributes to the development of the emergent Circular BMI field, integrating developments of the conventional BMI literature and design research fields; and will provide practitioners with an actionable framework to support the complex Circular BMI process, including a set of tools that could be flexibly adapted to different organizational contexts.