Why more manufacturers are implementing a circular business model

Increasingly, we see workers wanting to aim their careers in the direction of green pursuits and sustainability. Many careers are being chosen to align one’s environment-friendly values with their need to earn a living. Jobs ranging from LEED building inspections to ecotourism to aquatic biology and much more are under consideration. What is rarely considered by the environmentally conscious job seeker is a career in manufacturing.

Manufacturing gets a bad rap among the green crowd. Although we all heavily rely on the diverse range of products yielded by the sector, it is nevertheless often viewed as unclean and a source of resource depletion. The 20th century image of soot-stained, smoke-belching factories beside lagoons of toxic waste still clings to many minds. Choosing work between an industrial plant and a green initiative nonprofit is a no-brainer for the ecologically inclined.

But wait! There may be reasons to look at the modern manufacturing sector as harboring some initiatives that could make even the most devoted tree hugger stop and slowly nod in the affirmative. Gradually, we see evidence of manufacturers attempting what is known as a circular business model. This approach seeks to establish supply chains that involve recycling and recovery of constituent materials used in the making of products. If the circle is really tight, supply chains swirl themselves into a continuous loop, whereby new raw materials are rarely needed in the reproduction of products.

Imagine knowing that once the usefulness of a manufactured product has expired it can be returned to the industry from whence it came, rather than a landfill, and be reused or repurposed into future products. Sounds pretty green, doesn’t it? Beyond the PR-positive social responsibility and environmental gains of instituting green practices, there are other economic benefits for the manufacturer by going circular. These include reducing production waste and utilizing raw materials more efficiently, both of which are costsaving activities.

Implementing a circular business model can involve up to three strategies, according to operational experts Atalay Atasu, Céline Dumas and Luk Van Wassenhove. They identify the following as practical schemes manufacturers can apply to adopt a circular model. The first is known as “Retain Product Ownership.

Typically, this involves leasing rather than selling products. Once the product is past its usefulness, it goes back to the manufacturer for reprocessing. This approach may work best for products with a lot of components and complexity and which can be transported back to the manufacturer relatively easily.

Another direction may be in “Product Life Extension.” Here, products are made more durable and longer lasting than the competition. Gaining a consumer reputation as a quality enduring product makes premium pricing more justifiable and builds consumer loyalty. Throw in easy exchange policies for worn or defective products and people take notice.

There is also the intentional “Design for Recycling” action plan. Designing and creating products built to be fully recycled ensures the eventual reuse of products or at least their elemental parts. It’s actually surprising we do not see more of this in general manufacturing now. To have an infrastructure that efficiently captures reusable products that are made to be recycled would be a very exciting development in manufacturing.

To be sure, management may have to get creative with how to weigh these different approaches to reduce both costs and their environmental impact. What is most important is for the manufacturer to see that value can be reclaimed from their products. With value comes profits. Re-energizing product value time and time again at lower costs may make good business sense.

So, when searching for “green” lines of work consider whether or not these circular business model techniques align with your eco-consciousness. You may find manufacturing is the place where you can best express your environmental principles.

Bill Ryan writes about career, employment and economic topics from his home in North Sutton.