Let’s (not) get (too) physical, physical • 7
While the shift from products to services – often referred to as servitization – is far from new, it remains a powerful framework for manufacturing companies and digital-first startups looking to embrace customer-centric, service-dominant business models. This blog post wraps up my seven-part series on thinking services instead of products, with a look at the Circularity Over Linearity principle.
7. Circularity > Linearity
The Circularity Over Linearity principle is about adopting circular business models and practices within business and experience ecosystems to reduce environmental impact and drive systemic change. Circularity refers to an economic system designed to eliminate waste and pollution, keep products and materials in use, and regenerate nature (Ellen MacArthur Foundation, n.d.). This approach contrasts sharply with linear take-make-dispose models.
Innovating and designing for circularity includes, but is not limited to:
Fostering a culture of circularity among employees and ecosystem partners
Designing and operationalizing circular business models
Embedding circular principles and practices in portfolio management, lifecycle management, and end-to-end NPD
Designing products with circular properties
Closing the loops
Creating platforms for access and sharing
Cultivating circular mindsets & behaviors in daily life
In the context of servitization and value co-creation, organisations can design supplementary services that enable individuals and groups to integrate circular mindsets, practices, and behaviors into their personal and professional lives (loosely based on Bau 2006, 2010, 2011, 2015). See my blog post about the Solutions Over Products principle for an introduction to supplementary services and service packages.
For this discussion, I highlight what servitization might mean for closed-loop systems, sharing platforms, and circular mindsets & behaviors (adapted from my blog posts Going for gold • 5 and Let’s (not) get (too) physical, physical • 1).
Note: Unlike a product-centric approach, a genuine service design mindset embeds platform thinking, product-service systems, value co-creation, end-to-end experiences, user/local communities, and a multi-actor perspective into conversations about circularity and sustainability.
Closing the loops
Closing the loops is key to reducing waste, extending product lifecycles, promoting reuse, and retaining the value of materials.
In the context of servitization, organizations can develop desirable and effective systems, services, and experiences for:
Providing or ensuring care and maintenance to extend product lifespans and optimize performance
Facilitating refurbishment and repair to restore functionality and value
Upgrading products and solutions to enhance utility and relevance
Repurposing and upcycling products or components to unlock new uses and applications
Extracting maximum value from resources by repurposing them in stages across various uses (a process known as cascading)
Connecting disused products or components with new markets or users (a process known as redistribution)
Restoring and reselling products or components at scale (a process known as remanufacturing)
Supporting recycling initiatives to recover valuable materials and components effectively
Encouraging responsible disposal as a last-resort option in circular systems
Note: Products with circular properties enable closed-loop systems; for example, designs that are modular or simple to disassemble make maintenance and repair loops more efficient and effective. In turn, circular loops reinforce circular design by delivering valuable insights into the performance of products and components, driving continuous feedback and adaptation even after market launch.
Examples: Caterpillar's remanufacturing program restores used equipment and components to like-new condition, extending product lifespans, reducing waste, and offering cost-effective solutions to customers (1973–present). Desso takes back used carpets and recycles them into new products, creating a closed-loop system that conserves resources, reduces landfill waste, and minimises environmental impact (2008–present). Loop, TerraCycle's reusable packaging initiative, partners with major brands to provide durable containers for everyday products; these containers are collected, cleaned, and refilled, creating a closed-loop system that reduces single-use packaging waste and promotes sustainable consumption (2019–present).
- Eco Robin Hood. Redistributing excess or unused resources, such as materials, energy, or products, to those who can repurpose them effectively. Donating a share of revenue to support sustainable or social projects. Providing affordable services or refurbished products to underserved communities.
- Incentivized Take-Back. Encouraging customers to return used products or materials to the organization for reuse, refurbishment, remanufacturing, or recycling. This is achieved by offering incentives such as discounts, loyalty points, cash, or other rewards.
- Maintenance & Repair. Extending the lifecycle of products by keeping them in optimal working condition through regular upkeep and repairs.
- Part-Reuse. Salvaging and reusing functional components from end-of-life products or systems to create new products or restore existing ones.
- Product-Reuse. Extending the lifecycle of products by enabling them to be reused multiple times, either by the same user or by transferring them to new users.
- Recycling. Maintaining or recovering material value by mechanically or chemically converting ‘waste’ products or materials into new materials or products.
- Reverse Logistics. Creating systems and processes to move products, materials, or packaging back from the end-user to the producer or another point in the supply chain.
- Waste as Input. Searching for and developing ecologically and socially reasonable applications for used resources, by-products, and post-consumer waste.
Creating platforms for access and sharing
Creating platforms for access and sharing empowers customers to experience, utilise, and benefit from assets and resources without the burdens and costs associated with ownership. Common service models include peer-to-peer sharing platforms, subscription-based services, and performance-based contracting. For a deeper dive, see my blog post on the Access > Ownership principle.
Examples: Turo allows car owners to rent out their personal vehicles to others through a peer-to-peer car-sharing marketplace (2010–present). Floow2 enables businesses to share equipment, office space, and even staff with other companies to maximize resource efficiency (2012–present). Cohealo helps healthcare facilities share medical equipment with other institutions, optimizing the utilization of costly resources (2013–present).
- Dynamic Pricing. Adjusting prices based on real-time demand, availability, or usage patterns, helping to optimize resource allocation and reduce waste.
- Fractionalized Ownership. Enabling multiple users to share ownership of a single product or asset.
- Pay-per-Use. Offering access to products or services on a usage basis, enabling customers to pay only for what they use.
- Performance-Based Contracting. Providing access to high-value solutions without the burden of ownership, with payment tied to measurable outcomes such as engine uptime, energy savings, or system availability.
- Rent Instead of Buy. Facilitating short-term access to products or assets through rental agreements.
- Sharing. Optimizing resource, asset, and product usage by facilitating shared access among multiple users instead of limiting to individual ownership.
- Subscription. Offering access to products or services over a set period in exchange for a recurring fee.
Cultivating circular mindsets & behaviors
Cultivating circular mindsets & behaviors lays the foundation for sustainable living, resilient communities, and regenerative economies.
In the context of servitization, organizations can develop desirable and effective platforms, services, and experiences for:
Building awareness and knowledge (through supply chain transparency, interactive tutorials, content recommendations, learning paths, etc.)
Sharing practical tools for action (such as adaptive checklists, carbon footprint calculators, resource trackers, and self-repair kits)
Delivering actionable insights (through real-time feedback, personalized dashboards, predictive analytics, simulations, etc.)
Incentivizing sustainable behavior (through gamification, tangible rewards, tiered loyalty programs, take-back programs, etc.)
Building communities and fostering engagement (around causes like climate action or biodiversity conservation)
Supporting and scaling community-based micro-services (such as bicycle self-repair workshops or local refill stations)
Encouraging customers to participate in sustainable or circular initiatives (such as donation programs or community recycling projects)
Examples: Patagonia’s Worn Wear program encourages customers to repair, reuse, and recycle their outdoor gear through trade-in options, repair guides, online resale shop, and events that promote sustainable living (2012–present). Too Good To Go connects consumers with surplus food from restaurants and stores, helping reduce food waste while educating users about sustainable consumption (2015–present). OLIO fosters local sharing of surplus food and household items, enabling communities to reduce waste and embrace circular behaviors in daily life (2015–present).
- Crowdfunding and public funding. Engaging individuals or institutions to fund circular economy projects or initiatives, leveraging collective support to drive sustainable innovation and impact.
- Eco Robin Hood. Redistributing excess or unused resources, such as materials, energy, or products, to those who can repurpose them effectively. Donating a share of revenue to support sustainable or social projects. Providing affordable services or refurbished products to underserved communities.
- Incentivized Take-Back. Encouraging customers to return used products or materials to the organization for reuse, refurbishment, remanufacturing, or recycling. This is achieved by offering incentives such as discounts, loyalty points, cash, or other rewards.
- Maintenance & Repair. Extending the lifecycle of products by keeping them in optimal working condition through regular upkeep and repairs.
- Product-Reuse. Extending the lifecycle of products by enabling them to be reused multiple times, either by the same user or by transferring them to new users.
- Recycling. Maintaining or recovering material value by mechanically or chemically converting ‘waste’ products or materials into new materials or products.
- Revenue sharing. Collaborating with partners, stakeholders, or communities to share profits generated from circular economy initiatives, aligning incentives and fostering mutual value creation.
- Reverse Logistics. Creating systems and processes to move products, materials, or packaging back from the end-user to the producer or another point in the supply chain.
- Signalling & Transparency. Providing clear, accessible, and reliable information about a product’s sustainability credentials, lifespan, and end-of-life options.
- Sharing. Optimizing resource, asset, and product usage by facilitating shared access among multiple users instead of limiting to individual ownership.
Benefits
Empowers end-users to adopt sustainable behaviors and circular practices
Reduces environmental impact by minimizing waste, optimizing resource usage, and lowering emissions
Cuts production costs by improving resource efficiency and reducing material waste
Improves operational efficiency through streamlined processes and waste reduction
Ensures compliance with evolving ESG standards and regulatory requirements
Unlocks new revenue streams through circular business models and offerings (such as performance-based contracting)
Drives innovation and differentiation
Enhances brand reputation by demonstrating leadership in sustainability and circularity
Fosters a culture of circularity and sustainability
Encourages continuous feedback, learning, and adaptation
References
Bau, R. (2006). Design av tjänster och upplevelser [Design for services and experiences]. Part of Executive education in Design Management [unpublished training material]. Berghs School of Communication.
Bau, R. (2010, December). Ten strategy paradoxes in service Innovation and design. Paper presented at ServDes 2010 (Service Design and Innovation Conference), Linköping, Sweden.
Bau, R. (2011, December). Strategy paradoxes in service innovation and design. In: Cai et al. (Eds.), Design Management: Toward a new era of innovation. Proceedings from the 2011 Tsinghua-DMI International Design Management Symposium, Hong Kong, China. IDMA.
Bau, R. (2015). Thinking services instead of products. In: Service Design Boot Camp, Day 1 [unpublished training material]. Veryday.
Ellen MacArthur Foundation (n.d.). What is a circular economy?
Takacs, F., Stechow, R. & Frankenberger, K. (2020). 40 circular economy pattern cards. BMI Lab.
