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Businesses operating in the circular economy have developed a particular mindset that allows them to operate differently than in conventional approaches.

This circular mindset is based on a set of principles that can support your successful transition towards a circular business model. Thinking in systems, applying technological and non-technological innovation, becoming a steward, collaborating with different stakeholders, communicating progress transparently and putting circular value creation at the core of your processes are key principles that will frame your transition.

Take time to get acquainted with the following principles as they will lay a strong foundation to your transition journey.

• Circular mindset principle 1: Organisations take a holistic approach to understand how individual decisions and activities interact within the wider system.
• Circular mindset Principle 2: Organisations continually innovate to create business value through the sustainable management of natural resources by designing processes, products and/or services and business models.
• Circular mindset Principle 3: Organisations manage the direct and indirect impacts of their decisions and activities across their system.
• Circular mindset Principle 4: Organisations collaborate internally and externally through formal and/ or informal arrangements to create mutual business value.
• Circular mindset Principle 5: Organisations are open about decisions and activities that affect their ability to transition to a more sustainable and circular mode of operation and are willing to communicate these in a clear, accurate, timely, honest and complete manner.
• Circular mindset Principle 6: Organisations keep all products, components and materials at their highest value and utility at all times.

Changes in your business environment can create great opportunities for your organization – and cause significant threats. For example, opportunities can come from new technologies that help you reach new customers, from new funding streams that allow you to invest in better equipment, and from changed government policies that open up new markets. Threats can include deregulation that exposes you to intensified competition; a shrinking market; or increases to interest rates, which can cause problems if your company is burdened by debt.

PEST Analysis is a simple and widely used tool that helps you analyse the Political, Economic, Socio-Cultural, and Technological changes in your business environment. This helps you understand the “big picture” forces of change that you’re exposed to, and, from this, take advantage of the opportunities that they present.

PEST Analysis is useful for several reasons:

• It helps you to spot business opportunities, and it gives you advanced warning of significant threats.
• It reveals the direction of change within your business environment. This helps you shape what you’re doing, so that you work with change, rather than against it.
• It helps you avoid starting projects that are likely to fail, for reasons beyond your control.

Download this worksheet  to develop your own analysis.

Stakeholder mapping is the visual process of laying out all the stakeholders of an organisation, or project, in one map. The main benefit of a stakeholder map is to get a visual representation of all the people who can influence your transition project and how they are connected. It’s good to have a detailed stakeholder map and know how to involve the right people when you plan to launch a new product or service or revisit your overall organization’s strategy.

Whether you are planning a new circular project or kicking off an internal program that mostly affects your team, it’s important to understand the different types of stakeholders to involve. Each project has internal and external stakeholders, and drawing a clear line between the two will help you set the right priorities and find the approach that works for your specific situation

Source: unsplash.com

Stakeholder mapping allows you to identify key players that will influence your circular project and its success:

✔Find out who has the most influence: When you build a stakeholder map, you can easily see who will have the highest-level influence over a project.

✔Focus on those who benefit most: Stakeholder maps help you see who will benefit most from the end-product, so you can focus on marketing to that person for either sales or resources.

✔See where resources are most plentiful: Often when you build a stakeholder map, you’ll see who has restraints on the project and who has more resources, so internally you can put the right people on your team. 

✔Have a game plan: Overall, a stakeholder map gives you a good idea of who you’re trying to satisfy when building this project. 

You should focus on identifying and characterising two sets of stakeholders: internal and external stakeholders.

• Internal stakeholders: Internal stakeholders are people on your team who are participating in delivering a project. Their level of engagement may vary but they all have an influence because they are a part of your organization.
• External stakeholders: External stakeholders are those who will be impacted by your project and product, though they don’t directly participate in working on it. It might obviously be your customers/users, competitors or other actors in the markets (local governments, NGOs, etc.), suppliers, federations, etc.

Source: CEnTOUR-Circular Economy in Tourism (2020).

Download  this template to kick off this activity.

Use this matrix to classify your stakeholders. For instance, you may place a key partner in the manage closely box as they have strong power and high interest in collaborating with you. Download the matrix here.

Do you want to know more about how to use this matrix? Check this Video.