1/3 Configuration Strategies: Organize to Create and Capture Circular Value

Configuration strategies focus on the core of how organizations create and capture value. By rethinking business models, supply chains, and internal processes, companies can embed circularity into the very structure of their operations. These shifts not only reduce environmental impact but also unlock resilience, efficiency, and new revenue streams.

Below are four key approaches organizations can adopt to reconfigure themselves for circular value.

1. Circular Supply Chains

A circular supply chain sources renewable, recycled, or upcycled materials while ensuring products return into the cycle through reverse logistics systems. The aim is to design materials and flows that minimize waste, reduce dependency on virgin resources, and prepare for a future where sustainability is not optional but expected.

• IKEA has committed to using only renewable or recycled materials in its products by 2030. The company invests heavily in closed-loop sourcing and product take-back programs, building resilience against raw material shortages while strengthening its sustainability leadership.

• UBQ Materials transforms household waste, including food scraps and unrecyclable plastics, into a bio-based thermoplastic substitute. This material can replace conventional plastics in supply chains, giving manufacturers a low-carbon, circular alternative.

2. New Business Models

Circularity often requires reimagining the relationship between company and customer. Instead of relying on ownership-based models, businesses can create offerings that prioritize access, longevity, and reuse. These models extend product lifecycles, generate recurring revenue, and deepen customer relationships.

• Access over ownership: Philips offers lighting-as-a-service, where clients pay for light instead of buying bulbs. Philips retains ownership, manages maintenance, and ensures end-of-life recycling.

• Secondary markets: Patagonia launched the Worn Wear program, reselling refurbished clothing to extend product lifespans while creating an authentic connection with customers who value sustainability.

• Subscription and rental models: Grover provides electronics as a subscription service, enabling customers to rent phones, laptops, or tablets. Products are refurbished and recirculated multiple times, keeping them in use and out of landfills.

• Repair and maintenance services: Fairphone designs modular smartphones with replaceable parts, supported by a repair marketplace and guided tools. This approach makes devices easy to maintain, extends their lifespan, and creates a secondary revenue stream through spare parts.

3. Cross-Sector Partnerships

Circular innovation rarely happens in isolation. It demands collaboration between suppliers, recyclers, governments, nonprofits, and even competitors. These partnerships unlock synergies, pool resources, and reduce systemic waste.

• TerraCycle’s Loop works with global brands like Nestlé, Unilever, and Procter & Gamble to develop reusable packaging systems. These circulate across industries, reducing single-use waste while creating a scalable model for collaboration.

4. Operational Efficiency

Circularity also lives in the day-to-day operations of organizations. By redesigning processes to minimize energy use, emissions, and waste, companies create efficiencies that benefit both the bottom line and the environment.

• Interface, a global carpet manufacturer, reengineered its production system to incorporate recycled nylon while slashing carbon emissions. Its commitment to closed-loop manufacturing sets a benchmark for how efficiency and sustainability can reinforce each other.

A key concept here is industrial symbiosis — where the by-products of one industry become valuable inputs for another. For example, heat, water, or material waste from one facility can be repurposed by another, creating efficiencies across entire ecosystems.

• The Plant, a repurposed meatpacking facility in Chicago, demonstrates industrial symbiosis by converting organic waste into energy and integrating aquaponics, creating a closed-loop system that powers a collaborative community of food-producing businesses committed to sustainable practices.

Operational efficiency is often the fastest path to measurable impact — lowering costs, reducing risks, and signaling progress to stakeholders.

Looking Ahead

Configuration strategies lay the foundation for circular innovation. By rethinking supply chains, experimenting with new business models, forging cross-sector partnerships, and optimizing operations, organizations build structures capable of sustaining value in the climate age.

In the next article of this series, we will explore the second group of strategies: Offerings — how organizations can design products that embody circularity through reuse, repair, and recycling.