Fraunhofer Institute for Production Systems and Design Technology
Enter the Cycle
From a management perspective, there are more than enough compelling reasons to become a circular company. Rising raw material prices, fragile supply chains, new regulatory requirements, and growing expectations from customers and investors are putting companies under increasing pressure. By using materials more efficiently, keeping products in use longer, and avoiding waste, companies can lower costs, reduce dependencies, or tap into entirely new business models. This sounds very convincing in theory, but in practice the question arises: where to start?
Benjamin Gellert, a researcher and sustainability expert at Fraunhofer IPK, knows these considerations all too well: »In our experience, the main challenge is that the circular economy is a very broad, essentially systemic concept. It doesn’t just concern the question of material alternatives like bio-based plastics or recycled metals. It potentially affects every part of a company.« Decisions regarding which materials to use and whether a product is repairable are made in purchasing and product development. Production influences how much waste is generated and what happens to it. And sales and after-sales operations are in direct contact with customers and can supply replacement parts or take back products.
If a company wants to level up its circularity, this transformation can hardly be achieved in a single major step. But because there are so many levers to pull, it is important not to set priorities too hastily. Decisions that make sense in the long term require specific company data as a basis, as Fraunhofer Austria’s Theresa Madreiter emphasizes: »Company data shows where circular approaches are already being implemented and where untapped potential lies dormant. It reveals whether materials are already being managed in closed loops, how much of the product design is modular, or to what extent the after-sales business supports repairs and take-backs. In short: Only once it is clear where the company stands today can a well-founded decision be made about which next step will have an impact.«
Based on these observations, a research team from Fraunhofer IPK and Fraunhofer Austria is working on the online tool »EcoBoost« (short for »Ecological Business Optimization and Sustainability Tool«). In a joint project, they are developing a data-driven decision support system that helps companies identify the circular economy approaches best suited to their needs. EcoBoost provides recommendations tailored to the company’s profile, considering the company’s individual circumstances and constraints. The project is supported by two medium-sized application partners from the mechanical engineering sector, who are testing the system in pilot applications and giving their practical feedback to help refine it.
The approach is deliberately designed to be practical. As a company, you enter selected key performance indicators into an input form. These include, for example, the proportion of materials used that are reusable, the proportion of products sold that have a modular design, or the proportion of revenue generated by upgrades and product modernizations. Since this data is not always available, estimates (ranging from very high to non-existent) can also be provided. The nearly 30 key performance indicators collectively illustrate in which areas circular economy approaches are already established and where there is still potential to improve.
A prioritized list of recommendations: This is what it might look like using the EcoBoost tool to gain
an overview of which approaches are particularly promising for a company’s specific situation.
Based on this, EcoBoost then works similarly to the »Wahl-O-Mat.« The well-known internet-based voting decision-making tool provided by the German Federal Agency for Civic Education (bpb) asks about attitudes toward political issues and compares them with various parties’ statements. In just a few steps, users can access a prioritized overview of the extent to which their views align with those of the parties.
Using and interpreting the EcoBoost online tool is just as simple. Here, after entering the requested data, users are shown the most suitable circular approaches for their respective companies. These may include, for example, the increased use of reusable materials, systematic take-back management, new service and upgrade offerings, or circular product design that incorporates reparability and reuse from the outset. A key feature of EcoBoost is its consistent consideration of the individual business context. What makes sense for one manufacturer of complex machinery may not automatically be suitable for another company. EcoBoost captures these varying conditions and incorporates them into its recommendations. In this way, the circular economy remains not an abstract set of guiding principles, but becomes a strategic development process.