Over the last decade, the concept of a circular economy, an industrial economy that is restorative or regenerative by intention and design, has gained increased attention of policy makers, industry and academics. Recently the number of innovation projects, set up by local governments, communities, non-governmental organizations and businesses, to experiment with new sustainable technologies for a circular city, has increased substantially. This paper aims to explore how in this emerging field different stakeholders collaboratively create value and develop a viable sustainable business model. We do so by building on business model literature and literature on innovation networks and combining these with insights on value outcomes and learning from strategic management. For this study we take a qualitative research approach, building on four innovation projects for a circular city, characterized by collaboration of a wide variety of stakeholders, each being initiated and coordinated by a different stakeholder type. The findings show an emphasis on technical and organizational learning, influencing expected and unexpected value outcomes. The main contribution of this paper is a conceptual framework to analyse value creation and capture within the context of open partnerships through different learning types. Learning proves to be an effective mechanism in innovation networks to create and capture more economic, environmental and social value then initially aimed for.
This article aims to uncover the processes of developing sustainable business models in innovation ecosystems. Innovation ecosystems with sustainability goals often consist of cross-sector partners and need to manage three tensions: the tension of value creation versus value capture, the tension of mutual value versus individual value, and the tension of gaining value versus losing value. The fact that these tensions affect all actors differently makes the process of developing a sustainable business model challenging. Based on a study of four sustainably innovative cross-sector collaborations, we propose that innovation ecosystems that develop a sustainable business model engage in a process of valuing value in which they search for a result that satisfies all actors. We find two different patterns of valuing value: collective orchestration and continuous search. We describe these patterns and the conditions that give rise to them. The identification of the two patterns opens up a research agenda that can shed further light on the conditions that need to be in place in order for an innovation ecosystem to develop effective sustainable business models. For practice, our findings show how cross-sector actors in innovation ecosystems may collaborate when developing a business model around emerging sustainability-oriented innovations.
Both research and practice acknowledge that an increasing number of business models are realized by multiple organizations in innovation ecosystems. Little research addresses how organizations develop these business models jointly over time and balance the tensions that occur from the divergent goals and interests of each actor. We propose that the concept of value valuation may be helpful in understanding this process. Value valuation is a balancing process that takes place between actors in an innovation ecosystem when collaborating around a business model for sustainability, making sure that the benefits of ecosystem membership outweighs its costs, leading to continuing support of the initiative. Based on four smart city projects for a circular economy we find that value is valuated along two dimensions: economic, environmental and social value; and mutual and individual value. Value valuation takes place in iterative cycles and is characterized by a number of mechanisms, including action-based experimenting. These findings open up a research agenda to study the dynamics of ecosystem-based business model development.
