Short answer

Designers should proactively incorporate principles of openness and collaboration into their design processes, anticipating how products will be integrated into broader, circular value chains.

Field: Innovation & Design
Source: 'University of California Press' (2016)
Method: Conceptual framework development and case study analysis.
Evidence: Strong effect

Manufacturing firms are shifting towards more collaborative and open business models to manage the entire product lifecycle, integrating consumers and stakeholders into new value chain structures. This innovation & design research insight is drawn from a 2016 study published in 'University of California Press'. Using Conceptual framework development and case study analysis., researchers explored how this design variable affects real-world outcomes. The key design takeaway: Designers should proactively incorporate principles of openness and collaboration into their design processes, anticipating how products will be integrated into broader, circular value chains.

Study

Innovation & DesignHigh ImpactStrong effect

Open Business Models Foster Closed-Loop Value Chains

Manufacturing firms are shifting towards more collaborative and open business models to manage the entire product lifecycle, integrating consumers and stakeholders into new value chain structures.

'University of California Press' · 2016

Key Findings

01Firms are moving beyond vertical integration to horizontal collaborations with stakeholders.
02Open business models are crucial for establishing closed-loop value chains.
03Consumer communities play a significant role in new product development and model sustainability.
04Nine distinct business model archetypes emerge from this shift.

Application

Design takeaway

Designers should proactively incorporate principles of openness and collaboration into their design processes, anticipating how products will be integrated into broader, circular value chains.

How to apply

When developing new products or services, consider how consumers and other stakeholders can be involved in the design, production, use, and end-of-life phases. Explore opportunities for horizontal partnerships to create more integrated value chains.

Project actions

01Consider how your design project can involve users or other stakeholders in its lifecycle.
02Think about the end-of-life of your product and how it can be reused or recycled.
03Research different business models that encourage collaboration and circularity.

Method & Evidence

AimHow can manufacturing firms redefine their business models to incorporate open strategies and closed-loop value chains, thereby transforming the firm-consumer relationship?

MethodConceptual framework development and case study analysis.

ProcedureThe research identifies and categorizes nine business model archetypes that represent varying degrees of openness and integration within closed-loop value chains. These archetypes are then illustrated with examples from various industries to demonstrate their practical application and implications.

ContextManufacturing industry, business strategy, product lifecycle management.

Variables

IVDegree of business model openness, stakeholder collaboration.

DVFirm-consumer relationship, product lifecycle management, sustainability of business models.

CVIndustry sector, market conditions.

Strengths & Limitations

Strengths

+Provides a comprehensive framework for understanding evolving business models.
+Connects business strategy directly to product lifecycle and consumer interaction.

Limitations

The specific archetypes might not perfectly fit every business scenario, and some may be more challenging to implement than others.

Reliability & validity

The framework's validity is supported by illustrative examples, but further empirical testing across diverse industries would strengthen its generalizability. Reliability is based on the conceptual coherence of the archetypes.

Think critically

To what extent do these 'open' business models truly empower consumers, or do they represent new forms of strategic engagement by firms?

Design Principles

"Design for collaboration and circularity."

This evolution challenges traditional linear product development and consumption patterns. By embracing openness, companies can unlock new avenues for innovation, enhance customer engagement, and build more resilient and sustainable business models.

What This Means for Your Design

Companies are changing how they make and sell things by working more with customers and other businesses, creating a cycle where products are reused and recycled.

How to use in your project

1.Use this research to justify a design approach that emphasizes user co-creation or a product designed for disassembly and reuse.

Add to My Project

Quick Cite

Paragraph starter

The research by Kortmann and Piller (2016) highlights a significant shift in manufacturing towards open business models and closed-loop value chains. This evolution necessitates a re-evaluation of the firm-consumer relationship, emphasizing collaboration and stakeholder integration throughout the product lifecycle. Designers must consider how their work can facilitate these new models, incorporating principles of co-creation and circularity to ensure product relevance and sustainability.

Source

'University of California Press'

Open Business Models and Closed-Loop Value Chains: Redefining the Firm-Consumer Relationship

journal · 2016

View source

Questions About This Research

What does the research say about open business models foster closed-loop value chains?: Designers should proactively incorporate principles of openness and collaboration into their design processes, anticipating how products will be integrated into broader, circular value chains. Evidence: 'University of California Press' (2016).
Why does "Open Business Models Foster Closed-Loop Value Chains" matter for design?: This evolution challenges traditional linear product development and consumption patterns. By embracing openness, companies can unlock new avenues for innovation, enhance customer engagement, and build more resilient and sustainable business models.
How can designers apply this research?: Designers should proactively incorporate principles of openness and collaboration into their design processes, anticipating how products will be integrated into broader, circular value chains.
What were the main findings?: Firms are moving beyond vertical integration to horizontal collaborations with stakeholders.. Open business models are crucial for establishing closed-loop value chains.. Consumer communities play a significant role in new product development and model sustainability.. Nine distinct business model archetypes emerge from this shift.
What research method was used?: Conceptual framework development and case study analysis..
How strong is the evidence?: Evidence strength is rated Strong effect, based on a 2016 journal from 'University of California Press'.
What should I do differently in my next project?: When developing new products or services, consider how consumers and other stakeholders can be involved in the design, production, use, and end-of-life phases. Explore opportunities for horizontal partnerships to create more integrated value chains.
What are the limitations?: The framework's applicability may vary across different industry sectors and regulatory environments. The long-term economic viability of all nine archetypes requires further empirical investigation.