Journeying towards sustainable business models (PhD Thesis M.G.E. Velter, 2022) by MVelter

Journeying towards sustainable business models On the collaborative shaping, shifting and redesign of organizational boundaries for sustainable business model innovation Myrthe G.E. Velter

Cover photo credits: Private collection. Photographer: Brad Daniels. Copyright: George Rickey Estate, LLC. Design, layout, graphics: Elki Penris-Sorée, Tijs Duel © Myrthe Velter, Maastricht 2022 Printing: De Digitale Drukker, Eindhoven ISBN: 9789464239850 All rights reserved. No part of this publication may be reproduced or utilized in any form or by any means, electronic or mechanical, including photocopying, recording, or by any information storage and retrieval system, without prior written permission of the author.

The cover photo contains the work ‘Crucifera III’ (1964) by George Rickey. Born in 1907, Rickey dedicated his work to precisely-calibrated kinetic sculptures that he referred to as ‘useless machines’. Crucifera III immediately caught my eye; its tree shape illustrating the landscape of our natural environment, embodied by the various independent yet interconnected elements which I depict as societal actors. Activated by the wind, the actors start moving, and in this interplay between the actors and the landscape, they affect not just each other, but also rebalance their landscape, making it fit perfectly with the content of this PhD thesis.

Journeying towards sustainable business models On the collaborative shaping, shifting and redesign of organizational boundaries for sustainable business model innovation DISSERTATION to obtain the degree of Doctor at Maastricht University, on the authority of the Rector Magnificus, Prof. Dr. Pamela Habibović in accordance with the decision of the Board of Deans, to be defended in public on Monday, the 3rd of October, 2022, at 13.00 hours by Myrthe Gertruda Elisabeth Velter born on 17 June 1987 in Weert, The Netherlands

Dr. Myriam Cloodt (Eindhoven University of Technology)

Prof. dr. René Kemp Prof. dr. Nancy Bocken Co-supervisor Dr. Verena Bitzer Assessment Committee

This PhD research was funded by the Maastricht Sustainability Institute.

Prof. Dr. Ir. Bart Vos, chair (Maastricht University)

Promotors

Prof. Dr. Yvonne van der Meer (Maastricht University)

Dr. Julia Planko (Leiden University of Applied Sciences)

Table of Summary/Samenvattingcontents 4 List of publications 6 Chapter 1 Introduction 7 Chapter 2 Philosophical grounding and research methodology 18 Chapter 3 Sustainable business model innovation: the role of boundary work for multi-stakeholder alignment 28 Chapter 4 B oundary work for collaborative sustainable business model innovation: t he journey of a Dutch SME 5 8 Chapter 5 Contributions and limitations of intermediary-led boundary work for circular business model innovation 86 Chapter 6 A boundary tool for multi-stakeholder sustainable business model innovation 106 Chapter 7 Discussion & conclusion 132 Impact paragraph 152 Acknowledgements 15 8 References 16 0 Appendices Appendix A: Review of interlinkage between sustainable business models and value creation 179 A ppendix B: Main collaboration partners, partner novelty and targeted value creation A ppendix C: T imeline of the SBMI process A ppendix D: Interview protocols A ppendix E: Data collection and analysis A ppendix F: Digital tool assessment form initial tool design A ppendix G: Digital tool assessment form improved tool design A ppendix H: Populated example of the boundary tool A ppendix I: C ollaboration pitch format List of abbreviations, figures and tables 195 Curriculum Vitae 198

This PhD thesis investigates the role of businesses in addressing grand societal challenges such as climate change, environmental degradation and social inequality. Businesses can address such challenges through innovating new, sustainable business models, but in practice, their contribution has been extremely modest regarding the challenges at hand.

To provide a sharper view on the potential of sustainable business models, this thesis explores the processes that businesses and their stakeholders go through in pursuit of sustainable business model innovation (SBMI). Through empirical and theoretical research, this thesis shows that SBMI requires the crossing, redesign and re-alignment of multiple types of organizational boundaries between the business and its multiple stakeholders that affect the desirability, feasibility and sustainability of the innovation. Such a process of stakeholder engagement and alignment can be better understood through boundary work, which involves a journey of exploring, negotiating, disrupting and realigning organizational boundaries based on multiple value creation, and requires brokering to re-align critical boundary dissonances in multi-stakeholder networks.

Summary

This thesis develops a framework and actionable tool to illustrate how boundary work helps researchers to understand complex stakeholder interactions in SBMI, how businesses can engage in the first steps of collaborative SBMI, and how intermediaries can better support businesses in their boundary work for SBMI.

Dit proefschrift onderzoekt de rol van bedrijven in het aanpakken van complexe maatschappelijke uitdagingen, zoals klimaatverandering, aantasting van het milieu en sociale ongelijkheid. Het innoveren van nieuwe businessmodellen wordt gezien als essentieel voor deze rol, maar in de praktijk zijn er weinig voorbeelden, en is de bijdrage van bestaande initiatieven uiterst bescheiden in verhouding tot de maatschappelijke uitdagingen voorhanden.

Samenvatting

Om een scherper beeld te bieden op het potentieel van nieuwe businessmodellen exploreert dit proefschrift de processen die bedrijven en hun stakeholders doorlopen in hun zoektocht naar nieuwe business modellen voor duurzaamheid. Het empirisch en theoretisch onderzoek van dit proefschrift legt bloot dat business model innovatie voor duurzaamheid vraagt om het verkennen en herdefiniëren van meerdere typen organisatiegrenzen, zowel van bedrijven als van haar veelvoud aan externe stakeholders welke de wenselijkheid, haalbaarheid en duurzaamheid van de innovatie beïnvloeden. Dit proces van stakeholder betrokkenheid en afstemming kan beter worden begrepen middels ’grenzenwerk’. Grenzenwerk gaat over het exploreren, herontwerpen en verschuiven van organisatiegrenzen op basis van meervoudige waardecreatie, en behoeft onderhandeling in multistakeholder settings om kritische dissonanties tussen stakeholders te overbruggen.

Dit proefschrift ontwikkelt een framework en tool om te illustreren hoe grenzenwerk onderzoekers helpt om complexe interacties tussen stakeholders te begrijpen, hoe het bedrijven helpt om de eerste stappen van collaboratieve, duurzame businessmodel innovaties te zetten en meervoudige waardecreatie te vergroten, en hoe het intermediairs helpt om gestructureerd bedrijven in hun grenzenwerk te ondersteunen.

Prelude Chapter 3. Velter, M., Kemp, R., Bocken, N., & Bitzer, V. (2017). Creating Shared Value through Business Model Innovation for Sustainability: the role of Boundary Work. Paper presented at the 18th European Roundtable for Sustainable Consumption and Production, Skiathos Island, Greece.

Chapter 3. Velter, M., Bitzer, V., Bocken, N., & Kemp, R. (2020). Sustainable business model innovation: The role of boundary work for multi-stakeholder alignment. Journal of Cleaner Production, 247, 119497. doi: 10.1016/j.jclepro.2019.119497

List of Chapterpublications1.Introduction

Chapter 5. Velter, M., Bitzer, V., Bocken, N., & Gerritsen, M. Contributions and limitations of intermediaryled Boundary Work for Circular Business Model Innovation. Manuscript in preparation of journal submission. Chapter 6. Velter, M. G. E., Bitzer, V., & Bocken, N. M. P. (2021). A Boundary Tool for Multi-stakeholder Sustainable Business Model Innovation. Circular Economy and Sustainability. doi: 10.1007/s43615-021-00103-3

Chapter 4. Velter, M., Bitzer, V., Bocken, N., & Kemp, R. (2021). Boundary work for collaborative sustainable business model innovation: the journey of a Dutch SME. Journal of Business Models, 9 (4), 36-66. doi: 10.5278/jbm.v9i4.6267

Prelude Chapter 4. Velter, M., Bitzer, V., Diepenmaat, H., Bocken, N., & Kemp, R. (2018). C ollaborative Business Models in the Circular Economy: managing Boundaries of Value. Paper presented at the 6th biennial International Symposium on Cross-Sector Social Interactions (CSSI 2018), Copenhagen.

Based on Diepenmaat, H., Kemp, R., & Velter, M. (2020). Why Sustainable Development needs Societal Innovation and cannot be achieved without this Sustainability, 12 (3), 1270. doi: 10.3390/su12031270

The need to tackle sustainability challenges of climate change, biodiversity loss, environmental degradation and economic and social inequalities is reaching broad awareness amongst public, private and civil society actors. As the consequences become more discernible and inescapable, calls for urgent action to transform dominant economic systems are mounting (Sachs et al., 2021; United Nations Global Compact, 2021). Since business activities are the main contributors to many of the challenges mentioned above, the discussion on the role of business in society has become more prominent than ever. The developing role of business in society For a long time, the societal role of business was primarily seen as driver of economic profit, centered on meeting the needs of consumers, shareholders and the creation of jobs (Friedman, 1970; Levitt, 1958). Over time, consciousness on the interconnections between the environment, economy and social well-being grew. This was driven by publications from Rachel Carson’s ‘Silent Spring’ (1962), the ‘Limits to Growth’ report from the Club of Rome (1972) and ‘Our Common Future’ from the United Nations World Commission on Environment and Development (1987). The latter was the first report to link society, economy and environment as equally important and coined the term ‘sustainable development’ as “development that meets the need of the present without compromising the ability of future generations to meet their own needs” (p. 43). Through this, businesses were also identified as driver for unsustainable production and consumption, stating that the narrow focus on consumers and profit neglects the negative consequences for the natural environment and society (Banerjee, 2010; Bocken and Short, 2021; World Commission on Environment and Development, 1987). In response, the societal responsibility of business was primarily discussed under the terms of eco-efficiency and corporate social responsibility. Ecoefficiency focused on compliance with environmental legislation and the generation of economic benefits, for example through improving resource efficiency and minimizing waste (Loorbach et al., 2009). Gradually, eco-efficiency was used as a means for corporate social responsibility by meeting customer demands for ethical and greener products (Bowen, 1953; Carroll, 1999). Although traces of social responsibility were already found in the 1930s, it was only in the 1950s that it was coupled with the business domain, once the recognition of businesses as powerful and impactful actors surfaced. Since then, the concept has been developed regarding the personalization of responsibilities, to whom the business is responsible, leading to the popularization of stakeholder theory in the late 1980s (Freeman, 1984, 2017). While some environmental and social benefits were created, eco-efficiency and corporate social responsibility did not bring about the necessary changes to company behavior (Senge et al., 2008; SOER, 2015).

7 Chapter 1. Introduction

In recent years, the perspective of businesses as a positive force for sustainable development has gained ground amongst researchers and managers (Bocken et al., 2015; Crane et al., 2014). This perspective challenges businesses to take wider responsibility for the impacts of their activities on external stakeholders and promotes more systemic forms of innovation and the socialization of the business. Central to this perspective is the question of what value is created by the business, for whom, and through which activities. Environmental and societal value is considered equally or even forefronted to economic value, and a wide perspective of stakeholders as well as negative and missed forms of value are integrated into innovation processes. This perspective led to the emergence of new types of businesses, such as social enterprises and green startups, which seek to create synergies between business opportunities and addressing societal and environmental challenges through new, sustainable business models (Bocken, 2019). Existing businesses too are increasingly experimenting with new ways of creating and capturing multiple forms and dimensions of value to develop sustainable business models (Boons and Lüdeke-Freund, 2013; Evans et al., 2017b; Geissdoerfer et al., 2018b). Such models are developed through a process of sustainable business model innovation (SBMI), being “innovations that create significant positive and/or significantly reduced negative impacts for the environment and/or society, through changes in the way the organization creates, delivers and captures value” (Bocken et al., 2014, p. 44). The resulting sustainable business models represent novel ways of meeting stakeholder needs through changes in processes and products of the business and its wider value chain partners (Kline and Rosenberg, 1986; Massa and Tucci, 2014; Pieroni et al., 2019). For example, by promoting sufficiency, enhancing the access for low-income customers, and/or reusing, repairing, refurbishing and remanufacturing products (Bocken et al., 2014; Kropfeld and Reichel, 2021; Lüdeke-Freund et al., 2018a). Despite the potential of sustainable business models, current development and their effects lag far behind to what is needed for businesses to function as a positive force for sustainable development (McKinsey & Company, 2020; Schaltegger et al., 2016b). Shifting boundaries, shifting perspectives As powerful actors with far-reaching societal and environmental impacts, businesses have a key-role to play in fostering the sustainable development of societies. The exploration of this role essentially concerns the boundary-setting of a businesses’ responsibility to its plethora of stakeholders. The boundaries of the business determine what is considered ‘valuable’, as the foundational logic for proposing, delivering and capturing value. Studies have indicated that a shift in the domain of a businesses’ responsibility might lead to a redefinition of value and novel ways of identifying and combining value creation opportunities (Bocken et al., 2013; Bovens, 1998; Evans et al., 2017a). Imagine if nature or social equity are valued as the most profitable on the long-term, how will this open opportunities for businesses to create new, more sustainable business models?

The focus of this thesis This thesis builds on the perspective of businesses as a positive force for sustainable development, by focusing on how multiple organizational actors continuously and intentionally explore, revise and draw their boundaries in search for SBMI. It is a thesis about boundary work for SBMI, as a new research field that potentially addresses issues of responsibility, power and identity to foster sustainable development.

It is exactly this perspective on boundaries and value creation of a business that provides fruitful ground for research and innovation on sustainable business models. While businesses position themselves based on their own experiential worlds, the operations resulting from their business models affect and are affected by their external environment, which indicates their reciprocity towards external actors (Brehmer et al., 2018; Diepenmaat, 2018). Each actor, including companies, policy-makers, civil society organizations, financial institutions, knowledge institutes, consumers, and others, affects the feasibility and legitimacy of a business’ operations, and thus has a role to play in creating an environment in which business’ success can be de-linked from negative environmental and social impacts (Diepenmaat et al., 2020; Nigel Roome and Louche, 2016). To illustrate, a sustainable service model would require consumers to request sustainable services, service-companies to take-back and repair broken products, manufacturers to make sustainable products, financial institutions to invest based on long-term returns, and policymakers to reward sustainable behavior. Multi-stakeholder interaction therefore seems imperative to span the boundaries of individual actors and tie complementary resources and benefits as a means to address sustainability challenges (Konietzko et al., 2020; Pedersen et al., 2021). Businesses who think and act solely within their own boundaries are becoming vastly outdated in a society that is increasingly holding them accountable for the effects of their operations. There is a pressing need for new perspectives to understand boundary-shifting processes of businesses and their stakeholders, but the avenues towards reconfiguring these boundaries remain critically unexplored.

The business model A business model can be understood as a conceptual tool that helps to understand ‘how a firm does business’ (Diepenmaat et al., 2020; Teece, 2010; Zott and Amit, 2013). It is generally composed what and how a firm proposes, creates and captures value. The value proposition describes the product/service offering to a firm’s customers, the value creation and delivery describes the arranged key-activities, resources and partners, and value capture relates to the cost- and revenue structures

1.1 Conceptual landscape: sustainable business model innovation as a multi-stakeholder process

10 of the firm (Osterwalder and Pigneur, 2010; Richardson, 2008). Through its connections with suppliers, partners and customers, business models span the boundaries between the focal firm and its stakeholders (Zott and Amit, 2010). It is this boundary-spanning perspective that makes a business model fruitful for innovation, stakeholder governance, and strategic decision-making (Osterwalder et al., 2005; Zott and Amit, 2010). The business model concept builds on disparate perspectives such as the theory of the firm (Holmstrom and Tirole, 1989), strategy theory (Porter, 1980, 1991) and industrial organization (Porter, 1985). More recently, it is linked with stakeholder theory (Freeman, 1984; Freudenreich et al., 2019) and transition theory (Sarasini and Linder, 2017) to allow for a more systemic perspective on the concept. Despite its wide use by researchers and practitioners, a comprehensive business model theory remains absent (Gerard and Bock, 2011; Hedman and Kalling, 2003).

Sustainable business models

Conventionally, business model components are linked through the logic of economic benefits related to economic costs (Teece, 2010). Environmental and social value may be created too, but often as a non-critical add-on to the functioning of the business model (Porter and Kramer, 2011).

Sustainable business models extend the value orientation as they propose, create and capture value as a multi-relational (for a broad range of stakeholders), multi-dimensional (created, missed, destroyed value) and multi-level (economic, environmental and social) concept. They prioritize environmental and social goals to create a business model that more adequately balances economic, social and environmental value (Dyllick and Muff, 2016). This makes an SBM fundamentally different from corporate social responsibility, in which benefits to society and environment are valued as ‘doing good’, but leaving the business model and its negative environmental and social impacts intact (Visser and Kymal, 2015). Examples of sustainable business models are circular business models (Bocken et al., 2016a), social enterprises (Defourny and Nyssens, 2010), bottom-of-thepyramid solutions (Prahalad, 2009), and product-service systems such as lease or performance models (Tukker, 2004). In recent years, studies have outlined principles, archetypes and components of sustainable business models, which offers inspiration to businesses and researchers that engage with the topic (Bocken et al., 2014; Rosa et al., 2019).

Sustainability scholars increasingly use the business model concept to leverage business contributions to sustainable development and modify it to sustainable business models (Stubbs and Cocklin, 2008). Sustainable business models are defined as “business models that incorporate pro-active multi-stakeholder management, the creation of monetary and non-monetary value for a broad range of stakeholders and hold a long-term perspective” (Geissdoerfer et al., 2018b, p. 409).

Sustainable business model innovation

1 defensively, focusing on prolonging business as usual through reducing risks and/ or costs for the business 2 accommodative, focusing on ameliorating components of the existing business model to reduce negative external impacts 3 pro-actively, focusing on completely new designs of the value logic to create new business opportunities that align the firm-focus with societal improvements. This is often seen in new start-ups who integrated sustainability into the core of their business from start, but can also be a new, diversified or acquired sustainable business model in other type of organizations (Geissdoerfer et al., 2018b).

The dominant perspective found in the literature is that pro-active SBMI with radical forms of innovation is needed to address the urge and scale of social en environmental problems, rather than incremental changes to the business model (Ahmed et al., 2020; Geissdoerfer et al., 2018b).

Challenges of sustainable business model innovation

While academics are increasingly studying the innovation of sustainable business models, the practical innovation, implementation and upscaling of sustainable business models lags behind (Geissdoerfer et al., 2018b; Pieroni et al., 2019). One of the reasons for this is that many businesses lack the capabilities that enable them to identify sustainability challenges, interlink their performance with societal results and reconfigure their organizational design (e.g., vision, strategy, structure, processes) (Bocken and Geradts, 2020; Teece, 2010, 2018). In contrast to conventional business model innovation, SBMI is associated with larger uncertainties about the financial value created, and due to the complex character sustainability challenges typically involves lengthy experimentation to find business models that create value for all relevant stakeholders (Bocken and Geradts, 2020; Schaltegger et al., 2016a; Schaltegger et al., 2012). Particularly in circular business model innovation (CBMI), which is about the narrowing, slowing, closing and regenerating of resource loops between the business and its stakeholders, the acceptance of new dependencies is critical, next to the predominantly considered material aspects of the innovation (Kwiecień, 2020; Nußholz, 2017).

A prominent concept to transform value creation is SBMI, which changes the way a business and its stakeholders define, propose, deliver and capture multiple forms and dimensions of value. Any change in a company’s business model is a form of business model innovation, however, SBMI is equipped with principles of multi-stakeholder integration, systemic thinking, extended value creation and sustainability orientation to guide the business model innovation (Breuer et al., 2018). Businesses can engage in SBMI in three ways, each of which affect the business model’s contribution to sustainable development (Diepenmaat et al., 2020; Schaltegger et al., 2012):

The challenges of SBMI on the organizational level are further amplified as SBMI not only requires changes in the value orientation of the focal business, but also of the external stakeholders with whom the business evolves, which might have to adjust their business models too (Iansiti and Levien, 2004; Konietzko et al., 2020). This leads the business into “a complex network of systems interlinkages, difficult trade-offs, and powerful feedback loops within the political, business, and natural environments” that should somehow be navigated and dealt with (Ahmed et al., 2020; Krantz, 2010, p. 7). In addition, stakeholders might have a disinterest or incapability to engage and align their organization for the SBMI. This is the case, for example, when sustainability is not a priority, when there is insufficient capability for radical forms of innovation, or when value creation and capture are diffused amongst stakeholders (Daddi et al., 2019; van Bommel, 2018; van Hille et al., 2019). Rather than a static point of view, SBMI thus involves a process of external alignment of the envisioned sustainable business model. While management literature is expanding its scope to a systems perspective, it remains critically ambiguous on how to approach such a complex process.

The need for multi-stakeholder alignment

1.2 Problem definition and research aim Despite the potential of SBMI for sustainable development, a number of theoretical and practical questions remain critically unexplored. These questions have been consolidated into three main knowledge gaps that this thesis aims to address.

Knowledge gap 1: understanding processes, opportunities and limitations of stakeholder alignment in SBMI

The challenge to tackle sustainability issues cannot be addressed without leveraging the innovation potential of businesses. Although processes of traditional business model innovation are generally well understood in both literature and practice, processes of SBMI are much less explored (Kolk and van Tulder, 2010; Krantz, 2010; Lüdeke-Freund, 2010). SBMI is associated with processes of change under a high degree of uncertainty, wherein a search for mutual value creation opportunities and impactful partnerships influence the scale of value creation and transition to sustainable development. Interaction and collaboration is a principle of SBMI, and key to create, deliver and capture value (Breuer et al., 2018; Stubbs and Cocklin, 2008). Yet, more should be known about the processes of developing sustainable value propositions, creation and capture strategies through stakeholder collaboration and alignment (Pedersen et al., 2021). It remains unclear to which extent businesses can innovate sustainable business models themselves, and whether and how interaction and collaborative innovation with multiple stakeholders affects SBMI, and if so,

Knowledge gap 3: tools to improve uptake and stakeholder alignment for SBMI

Despite the potential of SBMI for sustainable development, practical implementation lags behind (Brown et al., 2020; Chen et al., 2017; Shrivastava and Guimaraes-Costa, 2016). Previous studies have addressed this gap by developing archetypes and tools for businesses to design sustainable business models (e.g. Baldassarre. et al., 2020b; Bocken et al., 2013; Joyce and Paquin, 2016). However, existing research and tools approach SBMI rather ‘inside-out’; placing the customers, the value creation and delivery network as well as the revenue streams around the core of a businesses’ own logic, needs and offering. They do not address how companies can open up new opportunities by shifting their own boundaries and reach out, interact with, and re-align multiple stakeholders for their SBMI. In addition, existing tools that support parts of SBMI have often not been tested empirically with users (Bocken et al., 2019b). This lack of relevant tools contribute to the scarce adoption and support of SBMI, in particular its collaborative forms (Bocken and Ritala, 2021). This thesis aims to address this gap by developing actionable, empirically tested tools that businesses and their multiple stakeholders can use as guidance in developing new, sustainable business models.

how such stakeholder alignment process, which is known to be full of tensions, can be approached by researchers and practitioners (Attanasio et al., 2021; Evans et al., 2017a; Stål et al., 2021). Through exploratory research that adopts a collaborative, multi-stakeholder perspective on processes of SBMI, this thesis aims to elicit new lines of inquiry regarding the manifestation, potential and limitations of the concept for sustainable development.

Currently, there is no robust explanation of processes of multi-stakeholder alignment in SBMI, while collaborative, cross-sectoral business model innovation is a key enabler for the transition towards sustainability (Aagaard et al., 2021; Sarasini and Linder, 2017). As a result, processes of stakeholder alignment for SBMI remain poorly understood, which makes it difficult to describe and explain them, and making them actionable in practice. There is a need to go beyond exploration, by providing frameworks, requirements and pathways that guide further research as well as practical sense-making of the complex realities involved in the innovation, decision-making and adoption of sustainable business models (Charmaz, 2014; Moore, 1991).

Knowledge gap 2: theorizing processes of stakeholder alignment for SBMI

2: Which theoretical perspectives help explain processes of stakeholder alignment for SBMI?

The purpose of thesis is to advance SBMI by exploring the concept from a multi-stakeholder process perspective. It asks the following research questions:

Table 1: Structure of this thesis, research articles and their contributions

4: How can intermediaries assist businesses in their boundary work for CBMI?

How can businesses innovate sustainable business models through aligning stakeholders in their multi-stakeholder network? Research questions:

5: How can the practical uptake of SBMI be enhanced through boundary work tools that support alignment within the organization’s multi-stakeholder network?

1: How can processes of multi-stakeholder alignment for SBMI be better understood?

2: Which theoretical perspectives help explain processes of stakeholder alignment for SBMI?

1.3 Research questions and structure of this thesis

The research questions are systematically addressed in three parts that together consist of three peer-reviewed research articles as a chapter in this thesis. Table 1 lists the structure of this thesis.

Chapter Publication Contribution to research questionsContribution to knowledge gap PART I: CONCEPTUALISATION AND THEORY DEVELOPMENT

Chapter 3: New directions SBMIunderstandingfor Velter, M., Bitzer, V., Bocken, N., & Kemp, R. (2020). SBMI: The role of boundary work for multistakeholder alignment. Journal of ProductionCleaner , 247. jclepro.2019.119497doi:10.1016/j.

1: alignmentstakeholderprocesses2:limitationsopportunitiesprocesses,understandingandofSBMItheorizingofforSBMI

1: How can processes of multistakeholder alignment for SBMI be better understood?

3: How do businesses engage in boundary work to create, maintain, bridge, or dissolve boundaries that interfere with their envisioned sustainable business model?

1: alignmentstakeholderprocesses2:limitationsopportunitiesprocesses,understandingandofSBMItheorizingofforSBMI

5: How can the practical uptake of SBMI be enhanced through boundary work tools that support alignment within the organization’s multi-stakeholder network? 3: tools alignmentandimprovetouptakestakeholderforSBMI PART 1: CONCEPTUALISATION AND THEORY DEVELOPMENT The first part of the thesis, Chapter 3, is concerned with developing an approach through which processes of stakeholder alignment for SBMI can be better understood. A literature review on value creation, sustainable business models, stakeholder collaboration and stakeholder alignment informed two iterations of exploratory empirical research to understand how these concepts manifest, interact and evolve in practice. Empirical research of different SBMI cases initiated by for-profit and for-benefit organizations provided useful lessons about the processes, opportunities and limitations of multi-stakeholder engagement and alignment in SBMI. The findings formed the basis for theory development and the presentation of a boundary work framework as a novel perspective to inquire and improve processes and elements of stakeholder alignment for SBMI.

Chapter ledIntermediary-5:SBMI Contribution and limitations of ofManuscriptbusinessboundaryintermediary-ledworkforcircularmodelinnovation.inpreparationjournalsubmission.

1: alignmentstakeholderprocesses2:limitationsopportunitiesprocesses,understandingandofSBMItheorizingofforSBMI

4: How can intermediaries assist businesses in their boundary work for CBMI?

2: Which theoretical perspectives help explain processes of stakeholder alignment for SBMI?

PART II: THEORY TESTING Chapter ledBusiness-4:SBMI Velter, M., Bitzer, V., Bocken, N. & Kemp, R. (2021). Boundary work for collaborative sustainable business model innovation: the journey of a Dutch SME. Journal of Business Models, 9 (4), doi:10.5278/jbm.v9i4.626736-66.

3: How do businesses engage in boundary work to create, maintain, bridge, or dissolve boundaries that interfere with their envisioned sustainable business model?

PART III: TOOL DEVELOPMENT

Chapter 6: The boundary tool Velter, M. G. E., Bitzer, V., & Bocken, N. (2021). A boundary tool multi-stakeholderforSBMI Circular Economy and Sustainability. s43615-021-00103-3doi:10.1007/

PART 3: TOOL DEVELOPMENT

The second part of the thesis, Chapter 4 and 5, consists of testing the boundary work framework. Two rich empirical studies helped to further understand the co-evolutionary processes of SBMI in terms of boundary work phases, boundary arrangements and types of boundaries from different stakeholder perspectives (Hermanowicz, 2013; R. Thomson and McLeod, 2015; Vogl et al., 2017). The studies used rich qualitative description as a method for scientific analysis of empirical processes. Despite its great potential for investigating processes in experimental environments (Breuer et al., 2018; Geertz, 1973; Ven and Poole, 2005), rich qualitative description has been scarce so far (Berends et al., 2016; Sosna et al., 2010), and even absent in SBMI (Gibson-Graham, 2014; Rauschmayer et al., 2015; Remig, 2015), Chapter 4 explores the boundary work efforts of a small-medium enterprise (SME) that engaged in SBMI over a timespan of two years. It showed the pivotal role of addressing boundaries of identity and power in addition to competences and processes, and showed critical limitations in the ability of the SME to align external stakeholders. This directed the focus to studying actors that are experts in boundary spanning and brokering and potentially have much to offer to enrich the boundary work framework and help businesses in their boundary work. Hence, Chapter 5 explores the boundary work efforts of an intermediary actor that engages external businesses in circular-oriented SBMI. Both studies further theory building and practical work by operationalizing the different boundary work phases in activities and organizational boundaries, by eliciting boundary arrangements such as organizations, agents and objects, and by the need for multiple boundary workers simultaneously, which all enhance the chances of successful stakeholder alignment.

PART 2: THEORY TESTING

The third part of the thesis, presented as Chapter 6, is concerned with enhancing stakeholder alignment for SBMI in practice. The chapter first reviews existing tools on their strategic relevance, objectives, stakeholder inclusion, stakeholder relevance, and whether the tool implicitly or explicitly addresses the respective stakeholders. It then discusses the findings in reference to the potential of boundary work to clarify the theoretical and practical gap and formulate the objectives of the tool. Subsequent tool development took place following the principles of Design Science Research (DSR) as a forward-looking, discovery-driven research methodology that has been emerging in the management sciences (Romme and Reymen, 2018; van Aken and Romme, 2009). The result is a tested process tool that offers guidance to businesses for engaging multiple stakeholders in SBMI, but also helps the businesses to re-assess their own organizational boundaries vis-à-vis the envisioned innovation and the boundaries of their stakeholders. Specifically, the tool helps to spark discussion on delicate and transformative topics such as power reconfigurations, mutual and societal responsibilities, and organizational identity shifts.

The innovation of sustainable business models can be studied from various perspectives and on various levels. Prominent perspectives are changes in products, processes and business model components such as the value proposition, creation & delivery network (Geissdoerfer et al., 2018b). These changes can be situated on the company, industry and value chain level, but a more transformative view on SBMI that crosses industries and types of stakeholders is lacking (Wirtz et al., 2016; Zott and Amit, 2010). This research is therefore positioned at the nexus between the initiating business and its multi-stakeholder environment and studies SBMI through changes in the tangible and intangible boundaries of organizations and the processes of how they come about. Although internal boundaries may exist, for example, between individuals and departments, emphasis is placed on boundaries on the organizational level. This perspective and scope is expected to create insights that enable more transformative and impactful forms of SBMI.

1.4

Research phenomenon and scope

Chapter 2. Philosophical grounding and research methodology

“Underlying any form of research is a philosophy of science that informs a scholar’s approach to the nature of the phenomenon examined (ontology) and methods for understanding it (epistemology)” Van de Ven (2007, p. 14)

2.1 Philosophical grounding

This dissertation focuses on the interaction processes between organizations and their external stakeholders. By doing so, it starts with the premise that social reality cannot be fully understood by just its observable events, but also requires the integration of underlying and unobservable processes as a means to provide a rich understanding of this reality. Such a view on reality and knowledge is grounded in the philosophy of critical realism. Critical realism is a midcourse between positivism (or empiricism) and constructionism (or postmodernism), and emerged in the 1970s through the work of Bhaskar (1979). Positivism is concerned with regularities, laws, explanation, quantitative verification and replication, but underdeveloped in determining the nature of generative mechanisms that might lead to empirical manifestations (Alvesson and Gergen, 2010; Sayer, 2004). Constructionism presumes that knowledge is always contextual and needs to be interpreted rather than explained, but denies the reality of structures and generative mechanisms (Alvesson and Gergen, 2010; Sayer, 2004). Critical realism sees reality as relational but emergent from structures, mechanisms and patterns that lie beneath the surface of manifested phenomena. This multi-levelled view of reality distinguishes the empirical, the actual and the real domain (Figure 1) (Bhaskar, 1979; Danermark et al., 2002; Fletcher, 2017). The empirical domain concerns observable happenings, such as actions or events. The actual domain relates to happenings regardless of whether they are observed, such as perceptions, relations and interpretations. The real domain consists of invisible, underlying, mind-independent generative mechanisms and contextual constraints that ‘are’ (Ritz, 2020). Generative mechanisms are “stable patterns of thinking and

20 Chapter 2. Philosophical grounding and research methodology

A scholar’s work is never independent of their own understanding of reality. What kind of entities are perceived to exist in the social world and what are they like? How close can we get to know this reality? It goes without saying that this understanding has implications for the research at hand: the phenomenon that is studied and the methodologies for doing so. This chapter provides the philosophical grounding of this research, explains the methodological choices made, and describes and visualizes the research process.

Figure 1: The three-layered reality of critical realism. Building on Bhaskar (1979); Danermark et al. (2002)

21 acting, triggered by intervention or by system, and producing outcomes” (van Aken and Romme, 2009, p. 8). For this study, observable stakeholder actions could be driven by their perceptions of what is valuable or feasible, which can be different for every stakeholder and every context, but which are embedded in structures such as supplier-customer or policy-practice relationships.

2.2 Overarching research methodology

A critical realism approach allows for incorporation of these generative mechanisms and can provide useful lessons about the sources of organizational rigidities. The critical realist’s search for causation (through generative mechanism that stem from structures and conditions) helps in developing practical recommendations to address social problems (Archer et al., 2013; Collier, 1994).

Critical realism does not have a developed set of methodologies and methods (Oliver, 2011; Yeung, 1997). To support the overarching goal of advancing processes of SBMI, this dissertation comprises 4 independent studies, which complementarily provide the basis for a middle-range theory (MRT) on processes of SBMI and the development of actionable tools. Each separate study describes the methods used, but overarching to these methods lie theory-development (Chapter 3, 4, 5) and design science methodologies (Chapter 6), which are supported by extensive empirical work, listed in Table 2.

22 Table 2: Overview of empirical research Chapter Research type # Cases Method # 3 Exploratory case study 9 Semi-structured interviews 10 Document analysis 26 Validating case study 2 Site visits 3 Expert consultations 6 Participant observations 2 Semi-structured interviews 7 Document analysis 31 4 Single case study 1 Expert consultations 9 Participatory observations 4 Participant observations 3 Semi-structured interviews 6 Document analysis 46 5 Embedded case study 1-3* Participant observations 7 Informal conversations 15 Semi-structured interviews 8 Document analysis 82 6 Multiple case study 11 Expert panels 4-28** Workshops 14-83** Reflections (discussions and write-ups) 14 Impact Assessments 8 Questionnaire 64** * Three initiatives within one case study ** Number of participants of responses For theory development, this research followed the MRT-building approach. MRT theorizes for the purpose of action: it envisions a resulting theory that is usable by both practitioners and researchers (Boudon, 1991; Merton, 1949). The aim of MRT is to “explain an observed phenomenon by referring to the social mechanism by which such a phenomenon is regularly brought about” (Hedström and Udehn, 2017, p. 35), referring to the generative mechanisms as part of the critical realism philosophy. It requires intensive iteration between theory development and empirical inquiry to discover and theorize these mechanisms. In this research, the deep immersion in empirical research allowed

23 for understanding the perceptions, ways of thinking, emotions and evaluative schemes of those involved in the SBMI activities, and by implication the boundary work activities, both in theoretical terms and from the point of view of those involved: how boundary work is experienced in real time, by real actors, in real situations. Empirical engagement is constructed using multiple methods, such as semi-structured interviews, ethnographic observations and action research, from a wide variety of cases and along different timeframes (Marshall and Rossman, 2006). To provide space for deeper analysis and more accurate theory development, critical realism uses theories at the start of empirical inquiry as ‘initial theories’, which can be developed as the research proceeds (Fletcher, 2017). Along these lines, this research is theory-oriented rather than theory-based, using the framework of ‘boundary work’ that is adapted for the study of SBMI. Due to the absence of substantive theories for SBMI, this work employs sensitizing concepts to guide empirical inquiry, but maintains flexibility to allow for the emergence of new ideas, as exemplified by other critical realists that developed theory (e.g. Maxwell, 2012; Oliver, 2011). Sensitizing concepts are particularly useful in explorative contexts, where active empirical engagement is the starting point for the analytical process (Glaser and Strauss, 1967). This gives the research a grounded theory element, which seeks to develop theoretical explanation of human behavior through collecting data from those exhibiting that behavior (Glaser and Strauss, 1967). Concepts and frameworks of SBMI (as the process of developing alternative value propositions which necessitates engagement with external stakeholders), stakeholder theory (which says that companies have moral responsibilities towards their stakeholders), the theory of the firm (in the form of habits, internal institutions, capabilities and revenue models of a company) and boundary work (a framework for bridging the science/ policy interface) were used as sensitizing concepts. This led to the identification of boundary work phases, arrangements and organizational boundaries as a potential framework that helps to explain the phenomenon under study. Part III of this study, being ‘tool development’ used design science as a methodology. While grounded theory and critical realism emphasize knowledge production by understanding and reflecting on social practices, design science methodology is solution-oriented in a non-universalist way. The mission of design science is “to develop general knowledge to support the design of solutions to field problems” (van Aken and Romme, 2009, p. 7). Design science links an intervention or artefact to an expected outcome in an empirical setting. It therefore provides a general solution for a particular type of field problem, which fits the envisioned MRT whose validity lies in a certain field of application (Peffers et al., 2007; van Aken and Romme, 2009).

The adoption of critical realism and the approaches of MRT and design science were not part of the initial research plan. In fact, the research constituted a generative process, drawing on the literature and on the empirical research, which was initially explorative and later on more theorybased, and ultimately resulted in the creation of a multi-stakeholder tool for SBMI exploration which can be applied in a two-hour timeframe. Figure 2 visualizes this research process, which will be detailed below.

24 2.3

The first phase of the MRT process was concerned with discovering the interrelation between the ‘real’ world and the sensitizing concepts (Danermark et al., 2002). Over 3 years’ time, wide (inquiring key-informants from multiple cases) and deep (inquiring multiple informants from two cases) phases of empirical investigation were iterated with theory building activities. Abductive and retroductive inference was used for refining and building a social theory. Abduction differs from induction in that it goes beyond empirical generalization, through explicit attempts at generating and theorizing new ideas, and differs from deduction in that the conclusion is not logically given in the initial theoretical premise (Danermark et al., 2002; Meyer and Lunnay, 2013). Abduction is a form of inference that consists of redescription or recontextualization, being “to observe, describe, interpret and explain something within the frame of a new context” (Danermark et al., 2002, p. 91). This required creativity and the ability to form associations. Particularly in critical realist philosophy, abduction is often combined with retroduction, being the search for identifying “the circumstances without which something (the concept) cannot exist” (Ritz, 2020, p. 1). Any good analysis would pay attention to such circumstances and use these for theoretical refinements, helping the research to move from abstract to concrete and back. In this first phase of the research, it became clear that organizational boundaries are integral elements of the process of creating novel, sustainable business models in new multi-stakeholder networks. The wide empirical investigation led to the prototype-framework of boundary work, consisting of external stakeholders, topics of alignment, and activities for alignment. This framework received feedback from journal reviewers and supervisors in three rounds of the submission process. The reviewers requested a clearer understanding of the processes and components of alignment. The following deep empirical investigations resulted into a refined boundary work framework, with phases, boundaries and arrangements, published as the first article. In the next research phase, the elements of the boundary work framework were further empirically ascertained and theorized. This phase particularly contributed to discovering the manifestations and interrelations between the concepts of the framework, and the conditions and steps for developing an SBMI process with external stakeholders. This further developed the ability to

The research process

In the last research phase, the boundary work framework was operationalized into an empirically tested process tool that helps to start a multi-stakeholder SBMI process. Based on the previous research and expert panel discussions, five steps were defined to guide participants through the process tool: 1. defining a collective ambition, 2 . mapping and negotiating the changing organizational boundaries, 3 . exploring opportunities and tensions for aligning stakeholders, 4 . defining first interventions, and 5 . developing a collaboration pitch. All steps were supported by templates. At this point, this author’s role as researcher was shifting, too. Participants regularly seized the workshop as an opportunity to connect to unfamiliar stakeholders and speak about sensitive topics in a secure environment. This even led to the need for an exit plan after the workshop. The need to organize a follow-up was even more relevant in cases that were catalyzed by this research. I decided to organize digital and physical meetings as an attempt to enhance the feeling of ownership between the participants by letting them discuss the progress on the first interventions and the collaboration pitch themselves, as well as create a future collaboration structure in which my role was excluded. Reflecting on the process, operationalization proved of great value to enhance the relevance to practitioners, but more work is needed in discovering strategies and roles to translate action-based scientific work into processes of practical implementation.

25 make sense of SBMI as a co-evolutionary boundary work process, which goes beyond the pooling of resources and requires adjustments in identity, roles, distribution of power and location of activities across a novel value network. This study created a better understanding of the interaction processes between stakeholders, the typical issues of nonalignment, and the cruciality of shifting power boundaries, which proved particularly challenging when the initiating business has a limited power position with regard to other organizations. This led to the idea to inquire the work of an intermediary organization as an expected expert in boundary work as a means to enhance the practical relevance and further refine the boundary work framework. Refinement took place through illustrating the contributions and limitations of intermediary-led boundary work in the different boundary work phases, the relevance of developing a boundary work capability (both for the intermediary as well as for businesses), and the rigidity of power as a barrier to SBMI.

26 Figure 2: The research process

Chapter 3. Sustainable business model innovation: the role of boundary work for multi-stakeholder alignment

This study focuses on the boundary-spanning nature of sustainable business model innovation, studying multi-stakeholder engagement and alignment. Drawing on the concept of boundary work, we explore the different types of organizational boundary changes between focal companies and their external stakeholders, investigating specifically the process of exploring, negotiating, disrupting and realigning organizational boundaries. Based on an exploratory study of nine different sustainable business model initiatives from for-profit and non-profit organizations, our analysis shows how actors involved need to find alignment at normative, instrumental and strategic dimensions in order to achieve sustainable value creation. However, complexity for alignment emerges through different understandings of value, diverging interests, division of risks and responsibilities, and existing processes and activities that limits actors’ openness to align. Mutual boundary changes are thus necessary in the process of multistakeholder engagement in order to enhance organizations’ understanding of value and to capture the envisioned value. This paper functions as an agenda-setting paper, presenting first insights on how the boundary work lens can advance our understanding of alignment processes between focal organizations and their external stakeholders, required for sustainable business model innovation. Published as: Velter, M., Bitzer, V., Bocken, N. M. P., & Kemp, R. (2020). Sustainable business model innovation: The role of boundary work for multi-stakeholder alignment. Journal of Cleaner Production, 247, 119497. doi:10.1016/j.jclepro.2019.119497

Chapter 3. Sustainable business model innovation: the role of boundary work for multi-stakeholder alignment

“The real voyage of discovery consists not in seeking new landscapes, but in having new eyes” – Marcel Proust, La Prisonnière (1923, p. 69) [translated from the original French language]

While conventional business models focus on “satisfying customer needs, economic return and compliance” (Bocken, 2015, p. 70), sustainable business models (SBMs) have a much broader scope in their ambition to generate positive or eliminate negative societal impacts. They integrate multiple dimensions of economic, social and environmental value, and they exceed the customer orientation of conventional business models by considering value creation to a broad scope of stakeholders, society and the natural environment (Bocken, 2015; Schaltegger et al., 2015). Studies have therefore argued that the required fundamental changes in the purpose of business and in many aspects of how it is conducted necessitate sustainable business model innovation (SBMI) (Bocken et al., 2014; Schaltegger et al., 2012; Stubbs and Cocklin, 2008). This innovation process concerns, among others, the development of new value propositions, value creation and delivery networks, and value capture mechanisms (Teece, 2010). Such an encompassing process of SBMI calls for a broader network perspective and entails that companies engage with a wider set of actors, including customers, suppliers and partners, non-governmental organizations (NGOs) and the government (Bocken et al., 2014; Boons and Lüdeke-Freund, 2013). Thus, what was already pronounced in ‘conventional’ business model innovation, becomes even more apparent in sustainable business model innovation: it exceeds the organizational boundaries of the focal firm. The call for engaging with stakeholders is grounded in the expectation that not only are they potentially affected by SBMI, they also have something to contribute. Bocken et al. (2016b) discuss stakeholders’ roles in supporting ‘extending resource value’ and ‘extending product value’. Other studies emphasize that processes of experimentation and learning between firms and stakeholders are required to combine sustainability solutions at the level of firms’ business models with system-wide change (Quist and Tukker, 2013; Rohrbeck et al., 2013; Stubbs and Cocklin, 2008). Similarly, studies on circular business models echo the need for multi-stakeholder engagement to find innovative solutions for closed loop supply chains (Leising et al., 2018). At the same time, engaging in extensive interaction with external stakeholders requires extra efforts and is recognized as one of the key challenges in SBMI (Evans et al., 2017b; Geissdoerfer et al., 2018b). Most importantly, stakeholders may possess different perceptions of value, they may have different and conflicting objectives and material interests, and they may be characterized by

31 3.1

Introduction Companies are increasingly challenged to make the pursuit of social and environmental objectives part of their fundamental logic of ‘doing business’. It seems undeniable that this would involve radical forms of reorganizing the business model on a firm and systems’ level, questioning both what and how value is created and captured (Evans et al., 2017a; Stubbs and Cocklin, 2008).

This chapter functions as an agenda-setting chapter, presenting first insights on the ways in which boundary work advances our understanding of the processes of alignment between focal organizations and external stakeholders in SBMI. This serves to contribute to the pending question of how organizations can innovate their business models towards greater levels of sustainability (Foss and Saebi, 2017). Specifically, the paper responds to recent calls for further research on the processes by which organizations innovate SBMs in a multi-stakeholder setting (Bocken et al., 2019a; Dentchev et al., 2018; Nigel Roome and Louche, 2016). Focusing on the multi-stakeholder aspect of SBMI, where actors’ visions and interests for sustainability meet and potentially conflict, may also provide a way forward to promote stronger forms of SBMs (Upward and Jones, 2016). By approaching multi-stakeholder alignment as boundary work, we aim to add a practice-based perspective that helps organizations to address the challenges of stakeholder relations during the process of SBMI (Geissdoerfer et al., 2018b). The outline of this chapter is as follows: section 2 describes the literature on sustainable business models, multi-stakeholder alignment and its complexities, resulting in the relevance of a boundary work lens for SBMI. The methods are described in section 3. Section 4 presents the results of the exploratory and validating interviews, which are being discussed and concluded in section 5.

All organizations are incomplete and depend on exchanges with other systems to survive (Scott, 1998).

32 fundamental power imbalances (Bolton and Landells, 2015; Di Domenico et al., 2009; Powell et al., 2018). SBMI thus requires alignment of stakeholders’ interests and demands. Yet, while the literature has highlighted the need to further explore companies’ relations with external stakeholders in SBMI (Boons and Lüdeke-Freund, 2013; Stubbs and Cocklin, 2008) how this happens in practice is still relatively underexplored (Pieroni et al., 2019).

3.2 Literature review 3.2.1 From business models to sustainable business models

To contribute to this discussion on how organizations engage with external stakeholders for SBMI, we draw on the concept of boundary work, which is about finding ways to accommodate such differences between stakeholders (Bocken et al., 2019a). Boundary work can be broadly understood as actors’ efforts to explore, create, maintain and challenge existing organizational boundaries through concrete efforts, including the use of boundary spanners (e.g. organizations, people, objects) and boundary management (e.g. communication practices) (Zietsma and Lawrence, 2010). Specifically, we frame boundary work in SBMI as a process of exploring, negotiating, disrupting and realigning organizational boundaries. This will be further explained in the following section.

The boundary-spanning nature of business models is even more pronounced in sustainable business models, which can be defined as “business models that incorporate pro-active multistakeholder management, the creation of monetary and non-monetary value for a broad range of stakeholders, and hold a long-term perspective” (Geissdoerfer et al., 2018b, p. 404). At the centerpiece of this definition lies the notion of a sustainable value proposition – economic, social and environmental value, consisting of value captured, missed, destroyed, wasted and new value opportunities on both short- and long term for a broad range of stakeholders, including society and environment (Bocken et al., 2013). Sustainable business models therefore comprise a value proposition to customers, delivered by a wide value creation and delivery network, and a value capture mechanism that captures economic value for the business while simultaneously regenerating natural, social and economic value beyond organizational boundaries (Schaltegger et al., 2016a) (see also Table 3). In addition to considerations of efficiency and competence boundaries, sustainable business models implicitly relate to identity boundaries, drawing on organizations’ shared values and norms in a particular social context (Santos and Eisenhardt, 2005).

conceptualized a firm’s business model as a “system of interdependent activities that transcends the focal firm and spans its boundaries” (p. 216). This indicates that business models go beyond organizational boundaries as the socially constructed “demarcation between the organization and its environment” (Santos and Eisenhardt, 2005, p. 491). While organizational boundaries are rarely explicit, they can be conceptualized as boundaries of ‘efficiency’ (denoting which transactions an organization conducts internally and which ones are conducted externally), boundaries of ‘power’ (focusing on how organisations can control their exchange relations), boundaries of ‘competence’ (delineating an organisation’s resources, capabilities and knowledge), and boundaries of ‘identity’ (pertaining to understandings of ‘who we are’ as an organization) (Santos and Eisenhardt, 2005). Such boundaries are not static, but emerge and change through interactions with other actors (Abbott, 1995; Schreyögg and Sydow, 2010).

Business models extend organizational boundaries in that they link the focal firms’ resources, capabilities and activities through value creation outside the firm, in particular with partners, suppliers, shareholders and customers (Barney et al., 2001; Eisenhardt and Martin, 2000; Teece, 2010). Thus, while often not explicitly defined, a firms’ activities to relate to third parties to organize transactions and minimise costs or to harness their knowledge, ideas and technologies , touch upon different organizational boundaries, such as efficiency and competence (Berglund and Sandström, 2013; Santos and Eisenhardt, 2005).

The interactions of companies and their external environment, including stakeholders, are key to the discussion on business models and sustainable business models. Zott and Amit (2010) have

Table 3: Value as a multi-dimensional, multi-relational and multi-level concept

Value horizon Direct, short- or medium- term Direct, short- or medium- term plus indirect, long-term Madden (2017); Stubbs and Cocklin (2008)

Transforming the logic by which business generate and distribute value requires a process of innovation, either to develop entirely new business models, diversify into additional business models, or transform from one business model to another (Geissdoerfer et al., 2018b). In such a process of SBMI, firms need to not only conduct changes in their own organization, but depend on (re-)alignment with stakeholders. Firstly, any changes to the business model of a firm require changes in the business model of other actors – otherwise it will not work (Hellström et al., 2015).

Business, value chain, networkrelevantpartners Business and interlinked value chains plus value network including new and possibly non-traditional partners Chesbrough and Schwartz (2007); Evans et al. (2017b) Value capture Economic business value (monetary & non-monetary) Societal, environmental and economic value

* Full development of Table 3 can be found in Appendix A

network&creationValuedelivery

Secondly, sustainable business models extend the emphasis on stakeholder relationships, moving from value creation for customers, suppliers or other business partners, to value creation with and for stakeholders (Freudenreich et al., 2019), including customers, suppliers, business partners, NGOs, government actors and local communities (Boons and Lüdeke-Freund, 2013; Joyce and Paquin, 2016). As noted by Bocken et al. (2019b), this engagement takes place in a ‘value network’ to denote the possibility of mutual value exchanges, where focal organizations explore and assess together with stakeholders issues such as value created, fairness, efficiency and effectiveness. Focal organizations and stakeholders in their value network need to align on three distinct dimensions: normative, strategic and instrumental (Breuer and Lüdeke-Freund, 2017).

Boons and Lüdeke-Freund (2013); Madden (2017); Schaltegger et al. (2016b)

Value priority Economic first Societal & environmental value first or equal to economic value

3.2.2 Different dimensions of stakeholder alignment in sustainable business model innovation

Business ModelSustainable Business Model Key sources

Value form Value created and captured Value created and captured plus value absence, destroyed, missed or surplus, new value opportunities

Bocken et al. (2013); Evans et al. (2017b)

Schaltegger et al. (2016a); Stubbs and Cocklin (2008)

propositionValue Customer value Sustainable customer value and co-benefits through value for society & environment

Bocken and Allwood (2012); Boons and Lüdeke-Freund (2013); Patala. et al. (2016)

While alignment between focal companies and stakeholders is deemed critical (Bocken et al., 2019b; Freudenreich et al., 2019), its importance also explains why SBMI is so tremendously difficult (Evans et al., 2017b). Stakeholder engagement in itself requires extra efforts in SBMI compared to conventional business model innovation (Geissdoerfer et al., 2018b), much less to speak about successful alignment on normative, strategic and instrumental dimensions (Breuer and LüdekeFreund, 2017).

At the strategic dimension, SBMI affects organizational boundaries as externalities formerly outside the business model, such as emissions or waste, are to be internalized (Bocken et al., 2015; Brehmer et al., 2018; Breuer and Lüdeke-Freund, 2017). This involves a discussion about which externalities can and should be internalized and how stakeholders can help in this; for instance by adjusting their own activities. These shifting transactions need to be embedded in novel value propositions to create and capture mutual value. Decisions made at the strategic dimension direct implementation and execution at the instrumental dimension (Al-Debei and Avison, 2010; Breuer and Lüdeke-Freund, 2017; Solaimani and Bouwman, 2012).

3.2.3 The challenges of stakeholder alignment

At the normative dimension, sustainable business model innovation requires a redefinition of the purpose of the firm based on sustainable value (Stubbs and Cocklin, 2008). This involves a discussion between focal organizations and stakeholders on value propositions and how value is understood. Organizational boundaries are challenged, as value can only be created and captured when crossing them (Brehmer et al., 2018). Alignment at the normative dimension forms a foundation for decision-making and alignment at the strategic dimension (Bleicher, 1994; Breuer and Lüdeke-Freund, 2017).

At the instrumental dimension, SBMI necessitates a change of organizational activities and processes, such as novel product and service designs, distribution channels, and pricing schemes (Boons et al., 2016; Breuer et al., 2018). Although innovation always entails a change in activities, the rationale, magnitude of novelty and change is larger and more long-term in SBMI compared to conventional business model innovation. This is, for example, because activities involve longer returns on investments and higher uncertainty.

All three dimensions where stakeholder alignment is required thus affect organizational boundaries, both of the focal organization and its stakeholders. This includes changes in efficiency boundaries (e.g. new organizational activities), competence boundaries (e.g. new knowledge and skills) and identity boundaries (e.g. new purpose of an organization).

The literature on cross-sector innovation helps to shed light on the inherent complexities of bringing together organizations with potentially dissimilar organizational interests and practices. Here scholars have pointed out that multi-stakeholder engagement often struggles with seemingly irreconcilable differences in the goals of partner organizations (Huxham and Vangen, 2000), dissimilar institutional logics (Vurro et al., 2010), differing value frames, norms and expectations (Dyer and Sing, 1998; Le Ber and Branzei, 2010b; Stark, 2009), unfamiliarity and mutual suspicion (Rondinelli and London, 2003) or cultural differences and misunderstandings (Berger et al., 2004b). Organizations may possess competing material interests that influence their willingness and capability to align (Powell et al., 2018). Boundary dissonance, implying a lack of alignment of organizational boundaries between stakeholders for SBMI – for instance, with regard to definitions of value or configuration of activities – is therefore likely to emerge (Stubbs & Cocklin, 2008). This is where tensions can arise between normative aspirations and capturing (at least some) financial value to secure economic sustainability and create opportunities for scaling-up (Bitzer and Hamann, 2015). Where the multi-stakeholder context creates boundary dissonance, SBMI can be impeded. This makes the question of how to deal with boundary dissonance increasingly relevant. One assumption in the cross-sector innovation literature seems to be that conflict and tensions should be reduced or avoided to lessen their destructive forces (e.g., Crosby and Bryson, 2010; Googins and Rochlin, 2000). Others consider competing forces and value frames as vital ingredients for successful multistakeholder collaboration and innovation (Le Ber and Branzei, 2010b). Koschmann et al. (2012, p. 340) argue for the need for “surfacing and reclaiming – rather than ignoring and suppressing –relevant conflicts as a route to legitimate consent generation and ultimately, to broader support for collective decisions”. Similarly, the business model literature mentions the traditional focus on control and gatekeeping, although this seems to be shifting towards a more dynamic approach. “It is precisely the alignment of control and value parameters that is of most relevance to business modelling” (Ballon, 2007, p. 7).

As the business model innovation literature has long recognised, there is no executive control by the focal organization as to how stakeholders should behave to make business models successful (Berglund and Sandström, 2013). “A main source of complexity in business model innovation is given by the uncertainty of impacts and behaviors of network members regarding the three sustainability dimensions” (Evans et al., 2017b, p. 605). However, beyond acknowledging the challenges of stakeholder relations during the business model innovation process (Geissdoerfer et al., 2018b), this component seems to be under-researched in the literature on SBMI (Pieroni et al., 2019).

Originating from the science literature, the boundary work perspective aims to make sense of complex interactions between scientists and non-scientists in which roles of understanding and decision-making get blurred and re-asserted (Gieryn, 1983; Halffman, 2003; Hoppe, 2010). Strategic management literature mentions boundary spanning and brokerage to overcome differences and a lack of trust within an innovation community (Fleming and Waguespack, 2007). The concepts of boundary work, spanning and brokerage offer an interesting theoretical lens for understanding the interactions between prospective collaborators in a value network, i.e. between a focal organization and its external stakeholders, over relevant values, strategies and concrete actions for a new, sustainable business model. These interactions must suit the needs and interests of interdependent parties through multiple value creation, delivery and capture. Boundary work theory therefore investigates the concrete practices that enable conversation, interaction and coordinated action between the focal organziation and other stakeholders, while accommodating stakeholders to have their specific own value perspective, consideration and interests (Carlile, 2002; Halffman, 2003; Hoppe, 2010). Strategies to negotiate boundaries involve the use of boundary objects, such as texts, concepts and tools, and boundary spanners that help actors to have a shared reference. Such a shared reference, in turn, can serve to bridge differences discursively and materially through mutually aligned activities (Halffman, 2003; Hoppe, 2010). Boundary work for SBMI is about the coordination of mutually dependent activities without the use of external Boundarycontrol.

work has also been applied in organizational theory (O’Mahony and Bechky, 2008; Smink et al., 2015; Zietsma and Lawrence, 2010), focusing not only on boundary bridging but also on boundary manipulation. Challenging the state of boundaries is particularly apparent in SBMI, e.g. by different NGOs or consumer groups, legislation, public opinion or competitor strategies (Boons et al., 2016; Haaker et al., 2017; Smink et al., 2015). As boundaries have material consequences closely

3.2.4 Research gap: a boundary work perspective on SBMI Interactions across organizational boundaries and alignment of stakeholders are thus recognized as important for SBMI (Boons et al., 2016; Brehmer et al., 2018; Heracleous, 2004). However, there is still little knowledge on how focal organizations engage in processes of aligning with multiple stakeholders, specifically at normative, strategic and instrumental dimensions – all of which have implications for organizational boundaries. We approach such a process of exploring, establishing, reinforcing, disrupting and redesigning organizational boundaries between organizations and their stakeholders for SBMI from the perspective of ‘boundary work’ (Gieryn, 1983). We argue that framing SBMI as a boundary work process helps understanding these processes of alignment in multi-stakeholder engagement.

3.3.1 Case studies and case selection

To analyze the role of boundary work in SBMI, we used an exploratory comparative case study approach whereby the unit of analysis is the company (Eisenhardt, 1989; Yin, 1994). This paper presents and compares nine cases of Dutch companies that engaged in SBMI (Table 4). The chosen companies do not constitute a representative sample. Instead, given the emerging knowledge on SBMI (Lüdeke-Freund and Dembek, 2017), purposive sampling took place to identify informationrich cases that can contribute to theory building (Eisenhardt, 1989; Patton, 1990). Both for-profit and non-profit companies were selected as they represent different purposes and are expected to take different approaches to SBMI.

3.3

38 related to processes of status and monopolization, they are object of strategic consideration in which actors “struggle over and come to agree upon definitions of reality” and “maintain or disrupt systems of privilege” (Lamont and Molnar, 2002, p. 168). Zietsma and Lawrence (2010) therefore understand boundary work as “the attempts of actors to create, shape, and disrupt boundaries” (p. 190). Different practices of boundary work have been highlighted in the literature, including creating, redefining, disrupting or breaching, and bridging or crossing organizational boundaries (Carlile, 2002; O’Mahony & Bechky, 2008; Santos & Eisenhardt, 2005).

Our expectation is that the ways in which boundary work takes place, for example, the extent to which multilevel value creation is considered, influence the alignment of stakeholders’ organizational boundaries important for SBMI. This makes boundary work relevant as practice work and as a theoretical lens to explore how organizations deal with boundaries. Methods

39 enquiryempiricalfromemergedasdescription,Case4:Table OrganizationOrganizationCase type Innovation phase pursuedmodelsbusinessSustainableaim*Sustainability 1. andspacesurbanemptyfillToSMEFor-profitHeijmansOneMarket forhousingaffordableprovide throughprofessionalsyoung homemobilemodular,a moveintermediaries,toSell resourcesrenewableto 2 ventureJointDSM-NiagaNiaga MNEfor-profit, Start-upand mono-materialadevelopToMarket enablingtechnologycarpet flowscarpetcircular manufacturing,loopclosedCE manufacturing,carbonlow chemistrygreenlicensing, 3. replacingbyasbestoseliminateToMNEFor-profit,KingspanFutureproofMarket farmersDutchofroofsasbestos insulationroofs,Kingspanwith cost-neutralainpanelssolarand financerassolarusingway, moveservice,aasProduct resourcesrenewableto 4. CircularEcor Friesland Noble Environmental mono-non-toxicEcorapplyToDiscoveryMNEFor-profit, productionfibercellulosematerial andstreamswaste(local)using ProvenceFrieslandinapplications symbiosis,IndustrialCE chemistrygreenlicensing, 5 Food-for- Feed-for- Food moreandcircularacreateToDiscoverySMEFor-profitNijsen-Granico byconceptfoodsustainable wastefoodretailers’collecting feedpigintoitturnand manufacturing,loopclosedCE choicesymbiosis,industrial responsibleretailers,byediting promotionproduct

40 6 For-profit,KipsterKipster start-up mostworld’sproduceToMarket andsocial,environmental, egg‘sustainable’animal-friendly low-carbonretailer,toSell renewabletomovemanufacturing, retailers,byeditingchoiceresources, promotionproductresponsible 7 NewPhilips Karolinska healthcaretoaccessincreaseToMNEFor-profit,PhilipsRoyalMarket Newwithpartnershipin SwedenHospital,Karolinska extendedPSS,Performance-based responsibilityproducer 8 BeeBankingStroomThe Hague awarenesscitizenincreaseToSMENon-profit,Market securingofimportancetheof thespecificallybiodiversity, cycles,naturalinbeesofrole bee-banksurbanplacing bee-bankingusingand crowdapproaches,Collaborative protectionbiodiversitysourcing, (‘netinitiativeregenerationand andeducationconsumerpositive’), bankingalternativeawareness, 9 ThuisbaasUrgendaUrgenda:Non- SMEprofit, Thuisbaas: SMEFor-profit, residentialaccelerateToMarket energy-towardsretrofitting cost-neutralainhousesneutral financer)as(solarway movePSS,Performance-based resourcesrenewableto creationvaluetargeteddetailedforBAppendixSee*

Table

41 3.3.2 Data collection Empirical data was primarily collected through semi-structured interviews with key informants involved in the innovation process (Table 5). Data collection was divided into two rounds of empirical inquiry: firstly, exploratory interviews on the role of boundary work in SBMI from which the framework emerged, and secondly, validating interviews on the tentative boundary work framework. During the first round of interviews, topics of discussion included the envisioned value creation, the innovated business model and its novelty, role of collaboration and non-business stakeholders, challenges and tensions in the innovation process, critical turning points, conducted boundary work activities, and obstacles for enhancing value creation. Interviews were triangulated with a review of published documents such as annual reports, presentations, websites and Thebrochures.second

Case Organization Role Interviewees Interview round Context Duration 1 (exploration) 2 (validation) One Heijmans Initiator Director Strategy & Innovation x FTF 60 min Niaga DSM-Niaga Initiator General Manager x FTF 20 min Niaga Initiator Chief OfficerTechnology x FTF 75 min Futureproof Kingspan Initiator Commercial Director x FTF 75 min Kingspan Initiator Bus. KingspanManagerEnergy x FTF 60 min

round of data collection aimed to get a clearer understanding of how individual firms conduct boundary work in SBMI and to validate insights gained through the initial interviews. We applied focused sampling in grounded theory (Breckenridge, 2009; Charmaz, 2014; Glaser, 1978), which resulted in the selection of two cases wherein stakeholder alignment in the value network was particularly critical. Taking the firm’s perspective of the network as the starting point, additional data was collected directly from collaboration partners in the network through site visits, expert consultations, participatory observation, and interviews. The questions focused on stakeholder alignment at normative, instrumental and strategic dimensions, and how alignment was facilitated through exploring, brokering and implementing boundary changes in the value network. 5: Semi-structured case

interviews per

42 FrieslandCircularEcor Ecor Initiator CEO EconomyCircularBenelux x FTF 75 min Ecor Initiator Strategy Corporate&Affairs x FTF 15 min Reg. Inv. & Devt. Agency Investor networking& Foreign InvestmentDirectAgri & Food x FTF 60 min Waste coll. & processor &Applicationsupply CE Bus. Development x FTF 60 min Builder Application General Director x Phone 60 min FoodFeed-for-Food-for- Nijsen-Granico Initiator General Director x FTF 75 min Env. NGO Certification Project Employee x Phone 45 min Municipality Networking Policy SustainabilityOfficer x FTF 60 min Kipster Kipster Initiator Founding Partner x FTF 60 min Philips KarolinskaNew HealthcarePhilips Supplier Program Manager x Skype 30 min BankingBee- Stroom The Hague Initiator Head Project Office x FTF 60 min Thuisbaas Thuisbaas Initiator Director x Phone 60 min 3.3.3 Data analysis In the first empirical inquiry, discovery memos were written per data source. They reflected on emerging issues and explored the dimensions and linkages between SBMI, value creation, collaboration and boundary work. Subsequently data was inductively and descriptively coded line-by-line, using open coding. The multitude of codes (e.g. changing role, responsibilities, new process) were allocated to themes such as innovation type, value definition, value proposition, values-based innovation, partners and partner selection, aim of collaboration, innovation phases, critical moments, success and failure factors, novelty of business model, boundary conditions, and learnings. We found central themes related to boundary work, such as the content of boundary work (e.g. understandings of value, envisioned roles and activities) and the process of boundary work (e.g. the challenges to facilitate this process), as well as different types of boundaries, presented in section 3.4. Additional literature review and discussions amongst the authors led to a more detailed boundary work framework, showing that SBMI involves alignment on three dimensions, with boundary work consisting of exploring boundaries & boundary dissonance, brokering boundaries and implementing boundary change. This resulted in improved themes and related interview questions for the second empirical inquiry.

3.4 Results

3.4.1

Exploratory interviews

This section describes the results of the exploratory interviews on the role of organizational boundary changes, multi-stakeholder collaboration and boundary work in SBMI.

Organizational boundary changes

Empirical observations of this section aimed to explore how, if at all, organizations change boundaries in SBMI, and, subsequently, what these boundaries could exactly entail. We found possible boundary changes of initiating organizations as well as by actors in the value network, the latter being promoted during the innovation process.

Boundary changes in the initiating organization were observed in all cases, referring to extended understandings of value, novel value propositions, business models and roles as, for example, a system integrator or sustainability steward (see Appendix B for a more elaborate overview). The cases particularly show that SBMI required actors to take up new roles, for instance, from being a building company to acting as system integrator (Heijmans One) or from being a waste collector to delivering waste (Ecor Circular Friesland). This suggests organizational changes with regard to efficiency (new tasks) and competence (new resources required for new task). Our nine cases confirm that companies attempt to innovate sustainable business models by engaging in novel collaborations. However, the inclusivity of actors from diverse domains differs between the cases. Cases initiated by governmental organizations and NGOs include civil society and/or sustainability funds in multiple roles (such as financers, customers, ambassadors) next to public partners (as financers and ambassadors) and private partners (as suppliers). Companies tend to focus on actors in the private domain in roles as financers, suppliers and customers. In cases 2 and 3, new partners were intentionally searched for in different sectors to bypass industrial lockin after failing to collaborate with partners in conventional sectors. The interviewees mentioned

In the second empirical inquiry, we focused on data collection and coding (Breckenridge, 2009; Charmaz, 2014; Glaser, 1978) and deductively coded the field recordings and interview transcripts to validate the boundary work framework. This highly iterative process between data collection, data analysis and theoretical categorization fits theory building from case studies as defined by Eisenhardt (1989) and Eisenhardt and Graebner (2007). Quotes presented in this paper are in English, yet it must be noted that they have been translated from the original Dutch, except for Philips New Karolinska.

44 required boundary change from customers, competitors, suppliers, financers, governmental and indirect stakeholders, although implementation of boundary change in the value network was not self-evident. Organizational boundary changes were most apparent in cases with circular business models (case 2, 4, 5), as illustrated in Nijsen/Granico: “Previously, our customer was the pig farmer [...] we simply sold, as a value chain idea, we received raw materials, made a product out of it, and put it in a subsequent chain link, the pig farmer […] Now, my customer is the retailer, the end-consumer, and my current customer becomes my strategic partner” (General Director Nijsen/ Granico, interview 19-05-2017). As will be explored in Table 6, not all value propositions were sufficient to implement boundary change. An extended overview of the main collaboration partners, partner novelty and reasons for collaborating can be found in Appendix B.

45 intervieweesthebymentionednetwork,valuetheinactorsandorganizationinitiatingtheofchangeboundary(Promoted)6:Table changeboundary(Promoted)boundaryOriginalCaseActorInterpretationof organizational typeboundary Promoted boundary implemented?* Heijmans One throughvalueaddingintegrator,SystemcompanyBuildingHeijmans sustainabilityinnovation,technology, competence,Identity, efficiency Yes pre-financerTemporary Niaga forresponsiblesteward,ResourceDSM-Niagan.a. withoutmaterialstransforming responsibilityextendedownership, end-consumertowards competence,Identity, efficiency Yes Carpet producer productlicense,Purchase retailtocarpetselland carpetsremanufactureandRetainCompetence, efficiency No Kingspan Futureproof improvementstableIntegratedKingspanSalesofroofandfacadepanelsCompetence, efficiency Yes upscaletopre-financerTemporary productservice/RequestsFarmer contract-basison commitmentLong-term subcontractoras OccasionallyEfficiency andcustomerasEmergingserviceforrequesttoRespondsSubcontractor salesorganizing competence,Identity, efficiency Yes theofcompetitorasEmergingfarmertoloansBankBanks companyenergyfinancing unintendedYes,Efficiency OccasionallyEfficiencygroupsbankingoffinancingIntegrativegroupsbankingSeparate Energy company receivescompanyEnergy electricitysolar solarusingPre-financer paymentaselectricity competence,Identity, efficiency Occasionally

46 Kingspan Futureproof Farmer elationsr professionalAccountant, focusfriendsfamily,associations, aversionriskvalue,economicon ofunderstandingEnhance viewlong-termvalue, OccasionallyCompetence separately,solarandAsbestosGovernment financedtemporarily themescoupleandfinancingMaintainCompetence, efficiency No Ecor Circular Friesland extendedsteward,ResourceEcorn.a. end-consumertowardsresponsibility competence,Identity, efficiency Yes takingcompanyGardeningGardener greeneryofcare pre-financerTemporaryCompetenceNo novelusestreams,wastewasteDeliverpublicandprivateCollectingcollectorWaste gardeningtonextapplications competence,Identity, efficiency No streamswastedeliverandFunnel Building companies installingandProducing materialsbuilding applicationsandmaterialsnovelUseCompetence, efficiency No Housing corporation materialssustainableonFocusmaterialsefficientonFocusCompetenceNo Food-for- Feed-for- Food rawProducer materials competence,Identity,materialsrawSourcingRedundant efficiency Envisioned Nijsen/GranicoPigfeedproducersourcing andstreamswastefoodfrom materialsraw(global) fromonlysourcingproducerfeedPig sustainableofferingstreams,wastefood integratorsystemconcepts,food competence,Identity, efficiency Envisioned Pig entrepreneur feedanimalPurchases businessfocalfrom keepingpigsustainableinpartnerStrategic redundantentrepreneursofpart& Competence, efficiency No butcher,frommeatpurchasesRetailRetail transactional,price-focused, relationshort-term directandpartnerstrategicasEmerging sustainabilityfeed,animalforsupplier long-termfocus,pricetonextfocus Competence, efficiency No

47 retailersagainstCampaigningNGO andwelfareanimalincreaseto impactenvironmentalchange toretailwithCollaborating foodsustainableenhance customerinfluenceand competence,Identity, efficiency Yes EfficiencybulkinmanufacturesButcherButchererButcherseparatesfocalmeatNo throughvaluessocietalPromotingMunicipality controlandlegislation promotionandfacilitationEarly valuessocietalof EfficiencyYes Kipster producer,eggsustainableMostKipstern.a. thinkingreversed Yes short-term,Transactional,Retail contractprice-based value-long-term,Relational, contractbased competenceIdentity,Yes NewPhilips Karolinska ofserviceandSellPhilips equipmenthealthcare forresponsibilityfullExtended, performanceequipment(competitor) Competence, efficiency Yes EfficiencyPhilipstoSub-supplierhospitalstohealthcareDeliversCompetitorYes BeeBanking conventional,withinstituteArtStroom financingpublic civilwithCollaborate financingforsociety EfficiencyYes Thuisbaas forresponsibilityExtendedThuisbaasn.a. reversedcost-neutrality, based(possibilitiesthinking costs)energyaverageon Yes approach,IntegrativeequipmentsellandInstallSupplier responsibilityextended Competence, efficiency Occasionally integratedforCommitmentisolationpanels,solare.g.ofPurchaseHouse-owners retrofittinghouse Competence, efficiency Occasionally interviewoftimeAt*

Selection of materials is mainly about the fractional price differences / advantages (e.g. polypropylene vs. polyester) and not about product take back Most clients are driven by a direct solution to their specific problem(s) instead of long-term benefits

Table

1 FutureproofKingspan Actors, in particular customers, lack a sense of urgency for sustainability related issues

Circular Economy seems to focus mostly on the economy now, while it is also about different consciousness and behavior

Value approachchain 2 Feed-for-FoodFood-for- Key-partners focus on value chain instead of ecosystems, imposing responsibility on the wrong actors in the value network

FrieslandEcorFutureproofKingspanNiagaCircular

One Long-term focus (30 year) of lease companies is required for long product lifetimes, while they focus on short term investments (10 year)

Boundary dissonance in the firm’s value network was perceived in 7 cases and on multiple boundary dimensions (Table 7). The main boundary dissonance mentioned were misaligned business model elements, narrow understandings of value and responsibilities, and legal boundaries. Boundary dissonance was not in all cases critical for business model innovation. However, it did influence the value created. For example, the Niaga business model could be implemented with a mere economic understanding of value, as the technology reduces costs throughout the value chain through increased production and installation efficiency. However, alignment around the importance of sustainability was required to close the loop and internalize the envisioned externality of carpet waste. 7: Boundary dissonance mentioned by interviewees codesdissonanceBoundary Number intervieweesof Case Examples focusShort-term

Multi-stakeholder boundary exploration

2 Heijmans

considerationLimited andenvironmentalofsocialvalue

Limited feeling of urgency

We found that exploration of boundaries occurs throughout the innovation process: with increasing complexity of the value network, more time was required for boundary exploration. For the initiating companies, it was not always clear whether actor boundaries were aligned. In cases where initially shared understandings of value were perceived, dissonance emerged in later innovation stages, when commitment for changing activities was requested from collaboration partners. This happened, for example, in Kingspan Futureproof: “We learned that initially the story always sounds good, as the marketing is organized so well that it always sounds good, and that real stumbling blocks come later, at the farmer’s table” (Commercial director Kingspan FutureProof, interview 02-05-2017).

Lack approachintegratedof 1 FutureproofKingspan Separate actors focus on their own propositions (solar financing, asbestos removal financing) instead of coupling themes and finances Business model 5 Heijmans One Multiple innovations are required from external partners, particularly financing models

Legislation is not fit for the purpose of shared ownership (of roofs) and material take back Legislation approves deviation from pure materials, which obstructs remanufacturing

responsibilityLimited 3 Food for Feed for ThuisbaasFood

Key-partners refuse to take responsibility for their role in the SBMI process

However, the energy company narrowed its boundary after being disappointed in piloting, causing a pause to the SBMI process: “The same party has now also become an inhibiting factor, because now suddenly it realizes ‘hmm, I have to do more than I thought and the financing is still quite risky, and is the target group financially enough, are they creditworthy enough? So, that is now again an inhibiting factor. So actually the second success factor, the second accelerator, which I now mention, is actually the first real big brake again” (Commercial director Kingspan FutureProof, interview 02-05-2017). The initiating business responded to this boundary dissonance through pre-financing, while searching for new partners and trying to find alternative business model options. Temporary boundary change happened in response to limited boundary alignment, taking up a novel role as pre-financer (cases 1, 2, 3, 4) or compromising on value creation (e.g. a less circular business model, as shown in DSM-Niaga). This suggests that boundary maintenance or change affects value creation and might lead to terminating the collaboration.

The previous section showed that boundaries were not always clear and were explored during the innovation process. We found that simultaneously, boundaries themselves were subject to evolvement through extension, narrowing and redesign, as organizations learned about the implications of the innovation for their business model. An example is Kingspan Futureproof, in which energy companies enhanced their activities on the instrumental boundary dimension twice by pre-financing farmer projects: “The project accelerated when the energy company said ‘I would like to buy a part of the investment’. Well, that is very interesting, […] we made a framework agreement, no signed contract at all [...], but we agreed to make this happen in a pilot sphere. Then, they said ‘we will buy these parts’, until their tone even changed to, ‘we want to buy the project as a whole’ ” (Commercial director Kingspan FutureProof, interview 02-05-2017).

A lack of responsibility for the results ended several collaborations Legal 3 NiagaFutureproofKingspan

Empirical inquiry aimed to explore in what ways boundary work activities took place. We found that a boundary organization external to the actors was absent in all cases. Instead, the initiating organizations themselves conducted boundary brokering, except for New Karolinska. Boundary brokering happened rather ad-hoc, and in the majority of cases, organizations met bilaterally instead of in a joint boundary space. Only Ecor and New Karolinska took a more systematic approach by facilitating joint meetings. In New Karolinska, boundary brokering started from a joint boundary space initiated by the Stockholm County Council: “Stockholm County Council ran this process as a competitive dialogue, where they invited Philips, Siemens and GE, to many many different meetings, where we discussed different kind of matters, issues, where also a lot of proposals and thinking were done” (Program Manager Philips New Karolinska, interview 22-06-2017).

Boundary spaces, objects and spanners

Boundary objects were used to test commitment, support interaction and negotiate tensions. For example, DSM-Niaga mentioned that the joint creation of the total value model (including value beyond the traditional partners and return value) helped to enhance the importance of establishing take-back processes. The concreteness of the objects and its scope of interacting actors differed. Typically boundary objects transformed from abstract and open for adaption in early innovation phases (such as sketches, drawings, mockups) to concrete, rather fixed objects in later innovation phases (such as place making, piloting and calculation sheets). The use and development of boundary text was mentioned by eight cases (Table 8).

Table 8: Boundary objects mentioned by the interviewees Case Boundary text Boundary objects and examples

FoodFeed-for-Food-for- circular food concept, front-door, backdoor, circular pig, Pikster, ambition, sustainable,integrally Project blockchainproposal, Using a project proposal as object of discussion in the explorative phase. Blockchain is considered a possible virtual trust object in implementation phase

Coupling limited responsibility for value of the ‘old world’ with extended responsibility of the ‘new world’, and collectively create the value model to convince partner’s managers and create trust

Heijmans One paused landscape, put paused landscapes on play, generation Y, movable, mobile single home, movable singleperson home, design placemakingpictures, Coupling paused landscapes with generation Y problem of affordable housing, and placing mobile homes as objects at paused landscapes to attract attention and pilot the envisioned benefits

DSM-Niaga old world, new world, turning point, responsibility, mono-materialcircularity, blacksketches,box as mockup, calculationsharedsheets

Kipster animal sustainability,welfare,partnership sketches Using a 3D sketch in early phases to convince retail Philips KarolinskaNew not mentioned room drawings, site visits Collective meetings, discussion and site visits based on every room, using drawings to cover the full room equipment

Thuisbaas reliable, energyneutral, affordable piloting Piloting affordable, reliable and energy-neutral housing, leading to ending of collaborations as these expectations were not met

Future-proofKingspan sustainability, integrated, financing sustainability infographic Using words such as ‘integrated financing’ to couple asbestos to renewable energy. An infographic was used to illustrate potential environmental impact to high-level stakeholders

Ecor FrieslandCircular equity, economy, ecologytruemodellingcost Adopt collective True Cost Modelling based on equity, economy and ecology concepts

Bee-Banking pollination, life, bees, creating value saving booklets, art object Using saving booklets for financers (mostly civil society) conveying the message of the project and amplifying partners’ contribution to life. Spreading the message through a physical art objects (Honey Banks) in urban spaces

Discussion on exploratory findings

This section presents the results of the interviews with a wider set of stakeholders involved in the boundary work activities for the cases of Food for Feed for Food and Ecor Circular Friesland. We examine the topics for discussion and negotiation in relation to boundary change amongst business actors and non-business actors.

Resulting from this exploratory study on boundary work practices, we understand the role of boundary work in SBMI as the practices to create, shape and disrupt organizational boundaries in three highly iterative boundary work activities: (i) exploring boundaries and boundary dissonance, (ii) brokering boundaries and (iii) implementing boundary change

Finally, the nature and dimension of implementing boundary change is expected to evolve during the process, as the different parties gain knowledge about (the feasibility of) required boundary change and about value creation and appropriation. Any required boundary change thus relates to how it is perceived as ‘fair’ or ‘effective’ and ‘efficient’ (Bocken et al., 2019a) and how stakeholder interests and expectations are being met. This can have wider implications when boundary changes lead to a fundamental change in the operation of sectors.

3.4.2 Deeper analysis of boundary work

Secondly, boundary brokering activities are relevant to challenge, negotiate and reconcile critical boundary dissonance. Boundary brokering involves discussions on where organizational boundaries are to be established, while accommodating individual value frames and interests through boundary texts, objects and people (Carlile, 2002; O’Mahony and Bechky, 2008).

Firstly, exploring the current state of boundaries in the value network aims for a better understanding of the external context and illuminates (critical) boundary dissonance between focal organizations and their stakeholders (Matos and Silvestre, 2013). Freudenreich et al. (2019) suggest that organizational transformation processes may be unlocked when the focal company and its stakeholders purposefully explore similarities and differences for joint value creation by examining what each stakeholder group considers to be valuable in relation to sustainability.

Exploring boundaries and boundary dissonance

In the case of Nijsen/Granico the external actors are the owner of Kipster (case 6), an environmental NGO, and a municipality, of which the last two are new to Nijsen/Granico. The respondents agreed on the general idea (vision) of using food waste to feed pigs. They also agreed on the principles of 1) using circular and regionally sourced feed, 2) improving animal welfare and an environmentally

Nijsen/Granico is in the lead for orchestrating the network of food waste for pigs. In principle, meetings are in groups, which the interviewees considered important in the early stages, but there are also informal, bilateral meetings between partners (for example between Nijsen/Granico and Kipster). All interviewees mentioned that they feel this way of collaborating is sufficient to express their interests and perspectives. However, the absence of farmers, traders, butchers, retailers and end-consumers means that their interests are being considered only through the eyes of the other actors. The boundary arrangement is incomplete, something which may jeopardize the SBMI process.

Ecor is in charge of this. NOM and Circular Friesland Foundation agreed to play role in searching for potential collaboration partners. Brokering boundaries

53 friendly stable, and 3) use of sustainable logistics based on electric vehicles. Discussed value capture elements included the elimination of uncertainties regarding price, volume and timespan of production, but achieving this will require changes outside the present partnership. From retailers, it requires a partnership that extends the traditional transactional focus towards a relational, longer-term contract. It also requires cooperation from framers and acceptance by consumers, actors who are currently not part of the partnership (incomplete value network).

In the case of ECOR Friesland, a broad vision of a circular Friesland was agreed to by a wide group of actors, Roles and responsibilities were discussed together with complexities in the form of technical requirements for waste streams and applications, potential material flows, applications and markets, potential customer value propositions, appropriate business models (cooperation and community-building or individual business model development). Direct and indirect value using True Cost Modeling surfaced as a model for evaluating options and coordinating decisions.

Implementing boundary change Nijsen/Granico moved from a value chain to a value network focus, it considers societal and environmental values next to economic values and plays a strategic role as system coordinator, developing sustainable meat concepts. Novel activities on the instrumental dimension are to be implemented in concert with partners’ boundary changes. To date, boundary change of key partners, several of which who show critical boundary dissonance, is absent. In the Ecor Friesland case, Ecor and NOM are actively engaged in activities in networking, facilitating and promoting. Supply and application partners are presently exploring value propositions and business model opportunities, as well as technical requirements. Both cases attest to the difficulty of achieving boundary change on multiple dimensions for a wide set of actors.

pointed at three phases of boundary work; exploring boundaries and boundary dissonances, brokering boundaries, and implementing boundary changes. The cases showed that these activities happen in collaboration with non-market actors, such as municipalities, NGOs and policy-makers. This confirms that SBMI requires alignment beyond the value chain, which is

3) t he role of boundary spanners and boundary arrangements.

1) different types of organizational boundaries and boundary changes within and across organizations.

This study explores the role of boundary work as a novel perspective on SBMI, consisting of

54 3.5 Discussion & conclusion

2) t hree iterative boundary work phases as processes for multi-stakeholder alignment; exploring boundaries and boundary dissonances, brokering boundaries in spaces, texts, objects and people, and implementing boundary changes.

As an agenda-setting paper, we make three contributions. First, we specify the different types of organizational boundaries and boundary changes relevant for SBMI. The literature falls short in a concrete definition of organizational boundaries for SBMI, or what these boundaries look like in practice. This study complements previous studies on the role of boundary spanning in SBMI (e.g. Brehmer et al, 2018) by demonstrating that organizations change boundaries of identity, power, competence and efficiency through normative, strategic and instrumental alignment, relating to dimensions known in SBMI literature (Breuer & Lüdeke-Freund, 2016; Stubbs & Cocklin, 2008). This is relevant as we found that boundary changes of network actors provides the opportunity to leverage or impede value creation as actors maintain, create and adapt organizational boundaries along the process. This was illustrated in DSM-Niaga, which requires boundary changes of producers and retailers in order to be able to return carpet streams and capture the envisioned value. The iterative character of boundary changes was illustrated in Kingspan’s collaboration with their investor, whose boundaries changed multiple times, thereby affecting the implementation of the business model. Hence we contributed to the SBMI literature by exploring value propositions for a broad range of actors, consisting of immediate values such as cost reduction, unburdening and convenience (core-benefits) as well as rather diffuse benefits such as long-term health, local production or environmental improvements (co-benefits) (Baldassarre. et al., 2017; Patala. et al., 2016). While this study is a first attempt to identify organizational boundaries and boundary changes in SBMI, further research could improve our understanding of organizational boundaries and search for patterns of boundary changes, as well as the impact of boundary changes on the SBMI Second,process.thecases

3.5.1 Discussion

Third, a boundary work perspective led to the identification of boundary spanners, using objects and tools to learn about value creation, value appropriation and expectations of the actors involved, in order to ultimately align boundaries in their external network. This corresponds with the partnership literature on value frame fusion (Le Ber & Branzei, 2010a, 2010b) and value appropriation (Covey, 2006; Garcia-Castro and Aguilera, 2015) in cross-sector interactions. The boundary spanner seems important because “people are bad at taking experiential worlds and other people’s incentives seriously and learning about them” (Diepenmaat, 2018, p. 954). Assumptions about needs and interests need to be checked and collectively ascertained, as related boundaries have been found to be diffuse, ambiguous, and changing along the innovation process, based on expectations and experiences. Boundary texts and tools helped to keep the actors committed but in the end all network actors need to obtain material gains fitting with their mandate (government), missions (NGOs) and commercial interests. The literature on cross-sector collaboration emphasizes the complexity of partnerships between businesses, NGOs and public actors; among others due to

55 known from literature on innovation networks (Bouwman et al., 2008; Ojasalo, 2008) and networked enterprises (Solaimani and Bouwman, 2012). A boundary work perspective adds that non-market actors are sometimes involved only during the process of innovation, e.g. for brokering, accelerating or value enhancing purposes. The boundary work activities led to novel multi-stakeholder networks, based on a shared understanding of value rather than traditional sectors, as illustrated in DSMNiaga bypassing carpet manufacturers, and Kingspan Futureproof bypassing asbestos removers. These findings contribute to the cross-sectoral collaboration literature by eliciting the (novel) positioning of partners, as well as the intersection of domains (Austin and Seitanidi, 2012a; Harrington and Srai, 2016). Particularly in the circular economy cases, the slowing and closing of resource loops requires a high dimension of value network reconfiguration. The literature confirms that in these processes, understandings of retained and destroyed value along the product lifespan should be transformed into new value opportunities, and reversed logistics and take-back systems should be incorporated as activities (Achterberg et al., 2016; Witjes and Lozano, 2016). As a result, collaboration with partners at the end of the value chain, such as retailers and consumers, becomes increasingly important (Fischer and Pascucci, 2017), as was visible in DSM-Niaga, Nijsen/Granico, Ecor and Philips New Karolinska. Circular economy models tend to focus on materials and resources (Geissdoerfer et al., 2017), while requiring boundary change throughout the value network including novel, roles, forms of partner contracting, legislation and knowledge generation (Kraaijenhagen et al., 2016). Additionally, further research is needed to investigate patterns of collaboration in the different boundary work phases, as well as the roles of different actors in these multi-stakeholder collaborations. Additionally, further research could inquire whether the boundary work perspective holds its relevance in circular business model innovation, as our research did not focus on circular economy specifically.

56 conflicting institutional logics, interests and values (Ashraf et al., 2017; Jay, 2013). This makes it pertinent to explore partners’ divergent interests, resources, motives and missions (Austin and Seitanidi, 2012b) and to fuse value frames to co-create value (Le Ber and Branzei, 2010b; S. M. Lee et al., 2012; Oskam et al., 2018). Most cases show that the focal business takes the initiative for boundary work and conducts boundary brokering activities to capture envisioned value. In Philips New Karolinska, external actors facilitated boundary work, which corresponds to the findings of Boons et al. (2016), who describe third-party brokering and collective learning as strategies for knowledge production in industrial symbiosis, as well as Smink et al. (2015), who point at the importance of boundary spanners to increase mutual understanding in renewable energy production. We found that boundary brokering may be present in the transfer of knowledge (e.g. for exchange of materials and applications), but may also be needed on higher dimensions (e.g. to discuss interests and understandings of value). This corresponds with knowledge transformation and translation processes mentioned by Carlile (2002, 2004), who recognize the importance of negotiating actor interests and trade-offs with a prominent role for shared artifacts and methods as boundary objects of knowledge transformation, such as drawings and prototypes, to create willingness for boundary change. SBMI literature mentions participatory backcasting (Vergragt and Quist, 2011), joint visioning (Leising et al., 2018) and experimentation (Bocken et al., 2019a; Bocken et al., 2018; H. Brown and Vergragt, 2008) as strategies for knowledge production. This points at future research avenues to investigate the governance and brokering processes of boundary spanners in the different boundary work phases of SBMI, as well as the relations between boundary brokering practices and organizational boundary change.

Based on the exploratory findings, we consider boundary work in SBMI a valuable perspective to understand organizational boundaries and the process of boundary alignment in multistakeholder collaborations. As this is an exploratory study, a deeper analysis is needed to analyse all elements of the framework in-depth (visualized in Figure 3). Wider applicability of the boundary work perspective could be useful in contexts where firm- and industry boundaries are increasingly blurred and boundary realignment is required, such as BMI for digital transformation. Finally, to make it useful for practice, further operationalization and instrumentation is needed in the form of new tools and methods for boundary work in SBMI to assist organizations in the creation and management of value networks for a sustainable or circular economy. We also want to note that system change cannot be organized in an entirely bottom-up way, but requires actions from governments, citizen groups and knowledge intermediaries. New value networks and experiments involving different actors play an important role in better understanding system barriers, as the basis for coordinated action. Tools and methods can support this process of multi-stakeholder experimentation.

Boundary Work PromotingBoundarychange spaces, texts, objects and people collaboration with

Figure 3: Conceptual framework for Boundary Work in SBMI

Acknowledgements

BoundariesIdentifyingandBoundarydissonance BoundariesBridging in

3.5.2 Conclusion This paper explored the role of organizational boundaries and boundary work in SBMI. We have found that SBMI involves organizational boundary changes related to normative, strategic and instrumental alignment. Boundary alignment in the value network is required, however difficult, due to collaboration with unfamiliar actors, interaction between the different organizational boundaries as well as external boundary changes. Three phases of boundary work activities are relevant for multi-stakeholder alignment: exploring boundaries and boundary dissonances; brokering boundaries; and implementing boundary change. This study provides avenues for future research on boundary work for SBMI.

untraditional stakeholders Sustainable Business Model Innovation Sustainable Business Model Implementation LeadsRequiresInvolvestoLearning sustainableaboutvaluecreation,valueappropriationandbusinessmodelstrategies

Multi-actor

We would like to thank the interviewees for their support and time made available for interviews. We also want to thank Henk Diepenmaat for providing valuable insights on the multi-stakeholder perspective and Aimée Kyffin for her language expertise.

Chapter 4. Boundary work for collaborative sustainable business model innovation: the journey of a Dutch SME

4.1 Introduction SBMI involves changes in how a company does business to address societal and environmental challenges and has gained increasing attention in the last two decades as a means for sustainable

“Language is action. Whenever people say something, they create rather than describe a situation” Weick (1995, p. 44) How does a small business engage in boundary work to innovate its business model towards sustainability? In this chapter, we employ a boundary work lens to trace the endeavors of a small company to explore, negotiate and (re)align organizational boundaries in its multistakeholder network around new, sustainable value propositions. We engaged in longitudinal research of a company’s endeavors for multi-stakeholder alignment in SBMI. By means of thick description, this paper offers rich empirical insights on the processes of interaction between a small company and its stakeholders in the Dutch pork sector, with special attention to boundary spanners, boundary objects and the mutual organizational boundary changes. We find that the shaping and shifting of organizational boundaries highly influences the process and content of the business model innovation. During the phases of boundary exploration, brokering and boundary changes, there is a pivotal role for boundary objects to deal with uncertainties, to facilitate strategic discussions and to find solutions to different valuation frames, power tensions and role divisions between stakeholders. SBMI can benefit from boundary work, as it helps companies to find value opportunities in the organizational boundaries of their external stakeholders, addressing challenges that emerge from existing organizational boundaries, and establishing boundary arrangements to facilitate this process. Boundary work interlinks concepts of identity, power, competences and efficiency in entrepreneurial processes of collaborative SBMI. The framework and methods of this study further our understanding of the co-evolutionary processes of SBMI. Published as: Velter, M., Bitzer, V., Bocken, N., & Kemp, R. (2021). Boundary work for collaborative sustainable business model innovation: the journey of a Dutch SME. Journal of Business Models, 9 (4), 36-66. doi: 10.5278/jbm.v9i4.6267

Chapter 4. Boundary work for collaborative sustainable business model innovation: the journey of a Dutch SME

Recent studies propose that boundary work theory offers an apt lens to further deconstruct boundary alignment processes in SBMI (Velter et al., 2020). Traditionally, boundary work addresses the interdependencies and interactions between stakeholders of different institutional contexts (Gieryn, 1983; Hoppe, 2010). In the context of SBMI, Velter et al. (2020) frame boundary work as the activity of exploring, negotiating, and re-aligning organizational boundaries around new value propositions. This offers a promising starting point to shed light on how businesses engage in boundary alignment processes in pursuit of SBMI (Breuer et al., 2018; Geissdoerfer et al., 2018; Pieroni et al., 2019). We therefore employ a boundary work lens to empirically trace and analyze the endeavors of a company to align organizational boundaries in its multi-stakeholder network. We pose the following research question: How can boundary work theory help explain SBMI?

61 development. To reach its sustainability potential, SBMI necessitates engagement with external stakeholders to develop multi-stakeholder value propositions and value capture mechanisms, making these external stakeholders fundamentally part of a (future) functioning business model (Bocken, 2019; Bocken and Ritala, 2021; Powell et al., 2018). SBMI therefore structurally transcends the organizational boundaries of the firm, and requires a redesign and re-alignment of the organizational boundaries of the respective organizations involved (Paulsen and Hernes, 2003; Velter et al., 2020). For example, to address environmental and societal challenges, businesses and their partner organizations may need to develop new competences and activities; constrain or shift their position in the value chain; or even adjust their organizational purpose (Gauthier and Gilomen, 2016; Hahn et al., 2018; Tykkyläinen and Ritala, 2020). All these alterations are changes to what is inside (or part) of an organization – and what is outside (or not part) of an organization. This is subsumed under the concept of organizational boundaries, operationalized in the activities, competences, external relations and identity of an organization (Keränen et al., 2020; Santos and Eisenhardt, 2005). Research to understand the processes of organizational boundary alignment in SBMI is only in its infancy (Boons and Lüdeke-Freund, 2013; Geissdoerfer et al., 2018b; Schaltegger et al., 2016b). It is generally recognized that these processes are highly challenging for businesses: not only do they need to navigate organizational boundary alignment with relevant external stakeholders, but they also need to find new value creation opportunities by actively working on these boundaries (Keränen et al., 2020; Santos and Eisenhardt, 2005). Yet, beyond these insights, it remains unclear how companies engage in such a challenging process that requires openness, interaction, and resolving of conflicts.

To answer this question, we engaged in longitudinal research over a timespan of two years. Our case study is a small Dutch enterprise that seeks to establish a sustainable business model in the Dutch pork sector. This sector, as many industrialized livestock sectors worldwide, has come

Theoretical framework

62 under intense legal, economic, and public pressure to transform into a more sustainable sector.

4.2

Our case study shows how boundary work is crucial for developing and implementing multistakeholder SBMI, with a pivotal role for boundary objects to deal with uncertainties, to facilitate strategic discussions and to find solutions to different valuation frames, power tensions and role divisions between stakeholders. We conclude that SBMI can benefit from boundary work by its ability to find value creation opportunities in the organizational boundaries of their external stakeholders, by addressing challenges that emerge from existing organizational boundaries, and by offering a frame for boundary arrangements to facilitate this process.

Our case study portrays a company’s idea for innovation, which is dependent on a collaborative reconfiguration of stakeholders in the value network. In contrast to retrospective case studies, we observed the unfolding of the innovation process initiated by the SME, while its outcomes were still unknown at the time of research and publication.

4.2.1 SBMI as a multi-stakeholder process SBMI fosters the creation of significant positive, and significantly reduced negative impacts for the environment and society, through changes in the way the organization and its external stakeholders create, deliver and capture value (Bocken and Geradts, 2020; Bocken et al., 2014; Geissdoerfer et al., 2018b). In contrast to conventional business model innovation, which focuses on economic value creation for customers and direct stakeholders, SBMI ties the concerns of a broad spectrum of stakeholders and multiple forms of value together in reorganizing their business models (Chesbrough, 2010; Pedersen et al., 2021; Pieroni et al., 2019). As the adoption of long-term strategies that create value for all key stakeholders is fundamental for the success of SBMI, knowledge, resources and capabilities need to be shared across organizational boundaries (Bocken et al., 2019a; Boons and Lüdeke-Freund, 2013; Breuer et al., 2018). Not only the initiating business, but also external stakeholders may be forced to structurally change their business model (Boldrini and Antheaume, 2021; Velter et al., 2020). This necessitates a collaborative, multistakeholder business modelling process to structurally align normative, strategic and instrumental dimensions of the various stakeholders. For example, alignment is required on organizations’ understanding and prioritization of the envisioned value creation, and with regard to the activities, competences, resources between interdependent stakeholders (Breuer and Lüdeke-Freund, 2017; Velter et al., 2020). This multi-stakeholder process for SBMI poses significant challenges for the engaged business(es), as the process is full of tensions and clashes with existing business model configurations which should somehow be dealt with (Bocken et al., 2019a; Gorissen et al., 2016;

The boundary of identity concerns the mind-set and culture of the organization. It emerges from organizational members’ work values, attitudes, behaviors and actions, and is typically formalized in the mission, vision and expressed values of an organization (Mdletye et al., 2014; Santos and Eisenhardt, 2005). Boundary setting on identity deals with issues of coherence between the organizational identity, its business model strategy and the activities it conducts (Bojovic et al., 2019; Mdletye et al., 2014; Santos and Eisenhardt, 2005). The boundary of identity can develop ‘grounded’ through experimentation with novel activities and business models, but also through ‘releasing’, where the boundary of identity sets the scope for strategic and instrumental decisions (Berends et al., 2016; Bojovic et al., 2019; Breuer and Lüdeke-Freund, 2017). In SBMI, the boundary of identity should be based on sustainable value creation and multi-stakeholder responsiveness (Breuer et al., 2018; Geissdoerfer et al., 2018b). An organizational identity which is set on a narrow perception of value and stakeholders leads to a constrained framing of the problem and its subsequent

63 Meijer et al., 2019; Sarasini and Linder, 2017). As a result, businesses often seek to collaborate with well-known business partners to reduce complexity, which, however, constrains the potential value creation and radical forms of innovation (Bocken and Ritala, 2021; Brown et al., 2020). Studies have identified the failure of successful stakeholder collaboration as an important barrier to SBMI (Geissdoerfer et al., 2018). Ultimately, this contributes to the dearth of theoretical and empirical examples of successful, collaborative SBMI processes (Pedersen et al., 2021; Pieroni et al., 2019). There is thus a need to improve our understanding of components and processes of stakeholder alignment for SBMI.

In management theory, organizational boundaries are often studied in the context of make-orbuy decisions and alliances, merges and acquisitions (Araujo et al., 2003; Poppo and Zenger, 1998).

In innovation management specifically, organizational boundaries are the intersections where knowledge is shared and crossed, (e.g. Brown and Duguid, 2001; Douglas Miller et al., 2007) and value exchanges take place (e.g. Brehmer et al., 2018; Keränen et al., 2020). Santos and Eisenhardt (2005) offer a comprehensive conception of organizational boundaries by distinguishing organizational boundaries of identity, power, competence and efficiency. These boundary conceptions address alignment on normative, strategic and instrumental levels as needed for SBMI (Breuer and LüdekeFreund, 2017; Stubbs and Cocklin, 2008; Velter et al., 2020).

4.2.2 SBMI as a process of reconfiguring organizational boundaries

Organizational boundaries denote who or what is inside, and who or what is outside the organization (Dumez and Jeunemaître, 2010; Gieryn, 1983; Santos and Eisenhardt, 2005). Boundaries have been dominantly studied in social sciences, where they are symbolic distinctions which actors “agree upon and use to define reality” (Dumez and Jeunemaître, 2010, p. 153; Lamont and Molnar, 2002).

The boundary of power deals with issues of autonomy and is set at the point where the organization can maximize strategic control over its crucial stakeholders. SBMI typically requires a focus on network performance instead of power accumulation of individual organizations and sharing or retaining ownership of materials to enable service-based business models (Curtis and Mont, 2020; Yang and Evans, 2019). This might result in the need to constrain the influence of one organization towards empowering other organizations that are crucial to the sustainability of the innovation (Avelino and Wittmayer, 2016; Bolton and Landells, 2015; Köhler et al., 2019).

Finally, the boundary of efficiency deals with the distribution of activities in the value network as a means to create, deliver and capture value (Tykkyläinen and Ritala, 2020; Zott and Amit, 2010). Choices of efficiency are typically in ‘make or buy decisions’, in the extent to which the value of an offering can be measured, and in differences in knowledge that create coordination costs despite best intentions of the different actors (Nickerson and Silverman, 2002; Poppo and Zenger, 1998; Santos and Eisenhardt, 2005; Williamson, 1975, 1981). While SBMI does not take a stance on where efficiency boundaries ought to be set by individual organizations, it does require the adoption and alignment of novel activities such as reversed logistics, repair and remanufacture, and the tracing of materials in the value network (Bocken et al., 2014; Brown et al., 2019; Evans et al., 2017b).

64 strategic opportunities, which may result in shifting negative externalities to other stakeholders in the value chain or the societal context (Diepenmaat et al., 2020). This coherence between a boundary of identity set for SBMI with its strategic and instrumental practices potentially avoids issues as ‘green washing’ (Delmas and Burbano, 2011; Tinne, 2013).

The boundary of competence deals with the optimizing of an organizations’ resource portfolio vis-àvis market opportunities. Resources consist of intangible knowledge, skills and network relationships, but also of tangible materials and machinery that can be possessed or deployed by an organization (Barney et al., 2001). The boundary of competence can be managed through dynamic capabilities, defined as the ability to “integrate, build, and reconfigure internal and external competences to address rapidly changing environments” (Eisenhardt and Martin, 2000; Teece et al., 1997, p. 516). SBMI requires deployment of resources such as sustainable product design (Bocken et al., 2016a; Whalen and Peck, 2014), cross-sectoral collaboration (Luzzini et al., 2015; Patala et al., 2018), remanufacturing and repair skills and facilities (Jensen et al., 2019; Lüdeke-Freund et al., 2018b), the installation of take-back systems (Bocken et al., 2014; Ranta et al., 2018) and the ability to measure environmental and social performance (Bradley et al., 2020; Luzzini et al., 2015). SBMI studies point at the need to strengthen dynamic capabilities as a way to integrate societal and environmental opportunities into processes of SBMI (Antikainen and Bocken, 2019; Bocken and Geradts, 2020; Inigo et al., 2017).

Table 9: Interlinkage between organizational boundary theory and sustainable business model innovation.

theory Sustainable business model innovation Demarcation of settingBoundary inreconfigurationsTypicalSBMI tensionsTypical inreconfigurationforSBMI thisdefinedindicatorsBoundaryforstudy ofBoundaryIdentity The “whomind-setdominantofweare” At the point that activitiesorganizationalcoherencemaintainswith Based for-benefittofor-profitvaluesustainableoncreation,inclusion businessExisting logics, diverging value frames, mindsets, differencescultural Values, mind-setmission,vision,purpose, ofBoundaryPower Sphere influenceof of the organization At the point that relationshipsoverstrategicmaximizescontrolcrucial (Re)alignment in network particularempowermentcontext,ofactors competitivenessdivision,currentCompromisingpower (Access contractingownershipmaterialrelationships,externalresources,to)and

Based on Berger et al. (2004a); Bocken and Geradts (2020); Breuer et al. (2018); Breuer and Lüdeke-Freund (2017); Evans et al. (2017b); Geissdoerfer et al. (2018b); Gieryn (1983); Hörisch et al. (2014); Powell et al. (2018); Santos and EisenhardtOrganizational(2005)boundary

Empirical examples of SBMI have shown that organizational boundary alignment leverages or impedes value creation (Velter et al., 2020). SBMI thus requires actors to engage in processes to destabilize and re-stabilize organizational boundaries (Depeyre and Dumez, 2009), but organizational boundaries are ambiguous, hard to specify, and subject to change as a result of interaction of the firm with its external environment (Abbott, 1995). In addition, organizational boundary change is accompanied by high uncertainties about the potential captured value, and conflicts with existing configurations of assets, processes and activities (Amit and Zott, 2012; Chesbrough, 2010; Linder and Williander, 2015). This complicates organizational boundary alignment between stakeholders (Bocken et al., 2019a; Schaltegger et al., 2012; Velter et al., 2020). When aiming for multi-stakeholder engagement, this complexity enhances synchronically (Powell et al., 2018). We therefore expect that boundary work in SBMI helps to investigate and address the challenges for stakeholder alignment (Table 9).

costsandandinformationresourceinterests,materialdivision,flowstransaction-coordination flowsinformationactivities,Processes,

Boundary Competenceof possessedResources by the organization At the point that maximizes the value of resourcesorganization’sthe

2. Brokering boundaries. This phase is about negotiating and reconciling critical boundaries through the creation of incentives for critical stakeholders. Boundary

relationsandcompetenciesofDevelopmentnovelexternal Lack innovationtechnologyexperimentation,offs,financialcapabilities,oftrade-lengthy Capabilities (e.g. patching, rolesrelationships,networkmachinery,development),product

Boundary of Efficiency fordistributionActivityefficiency At the point that minimizes the governing cost of activities Adoption of novel processes and activities Division of 4.2.3 Boundary work for SBMI Boundary work approaches SBMI as a highly iterative and continuous process full of tensions among stakeholders rather than a linear, consensus model of collaboration (Hargrave and Ven, 2009). Destabilizing and re-stabilizing strategies occur intertwined as some actors challenge existing boundaries while others defend existing boundaries (Depeyre and Dumez, 2009; Dumez and Jeunemaître, 2010). Previous research has identified boundary work as an analytical lens to understand processes of organizational boundary reconfigurations in pursuit of SBMI, and has specified three iterative phases (Velter et al., 2020; Aka, 2019): 1 E xploring boundaries and boundary changes. This phase includes the first activities an organization undertakes in response to a triggering event or problem (Nigel Roome and Louche, 2016). In this phase, the organization attempts to define the problem(s) at hand, and explores potential opportunities to respond to this problem. This includes initial stakeholder engagement. Rather than searching for the solutions closest at hand, the challenge lies in creating ambitions for fundamental and systemic change in both the boundaries of the organization and its external stakeholders based on novel conceptions of value creation (Bresman and Zellmer-Bruhn, 2013; Evans et al., 2017a; Nigel Roome and Louche, 2016). Such a process draws on experiences from within as well as from outside the organization (Nigel Roome and Louche, 2016).

4.2.4 Research gap SBMI faces the challenge of exploring, brokering and re-aligning organizational boundaries of different stakeholders. However, the processes through which businesses navigate such boundary work for SBMI remains little explored. We address this gap by providing an empirical, detailed description of the boundary work processes for SBMI as a basis for further theoretical and practical work.

Boundary work can be conducted by individuals or organizations that take an active role in reaching out to stakeholders and help attain a common understanding of specific problems or solutions as a basis for boundary reconfigurations. These individuals or organizations can be seen as ‘boundary spanners’ who often use ‘boundary objects’ (Fleming and Waguespack, 2007; C. Lee, 2007). Boundary objects are working arrangements that facilitate (inter-)action, reflection, tailoring and ‘backstage work’ as a means for collaboration, knowledge production and creative congruence across multiple stakeholders (Benn and Rusinko, 2013; Carlile, 2002; Leigh Star, 2010; Parker and Crona, 2012). Boundary objects do not necessarily have a material character – they can also be concepts (ill-structured or well-structured) depending on the required knowledge production. Well-structured objects shape knowledge production according to the elements of the object, such as quality standards, whilst ill-structured objects invite users to contribute to the knowledge production in a more open way. Whether or not a phenomenon functions as a boundary object depends on its scope and scale of analysis. A boundary object comprises a certain functionality for guided action on a certain level (e.g., organizational), but could also spark controversies (Aka, 2009; Stark, 2010).

3. Implementing boundary changes. This phase involves the agreement on, experimentation with and embedding of boundary reconfigurations (Velter et al, 2020). Formal and informal agreement might lead to the formulation of experiments, an innovation strategy that is increasingly adopted in SBMI (Baldassarre. et al., 2020b; Bocken and Antikainen, 2019). Experimentation might lead to the actual implementation of boundary changes in SBMI; for example, by adopting a novel organizational purpose, contracting with external partners, developing novel competences, and implementing novel actions and material flows (Nigel Roome and Louche, 2016; Salvador et al., 2019).

67 brokering can adjust the understanding of the innovation, such as rhetorical closure, use and functionality adjustments (Bijker et al., 2012), but it can also comprise a shared effort to strengthen the value proposition for critical stakeholders. Brokering activities can be conducted by companies themselves, but often this is done by intermediary actors (Aspeteg and Bergek, 2019).

4.3.1 Approach The aim of this study is to further the theoretical understanding on boundary work processes for SBMI through a rich description of a qualitative case study (Eisenhardt, 1989; Geertz, 1973; Stake, 1995). We analyze the actions and perceptions of a Dutch small-sized enterprise (SME) engaging in SBMI over a timespan of two years. Following phenomenological inquiry, we explore and describe the activities of boundary exploration, brokering and change in multi-stakeholder collaboration for SBMI. We observed the unfolding of the innovation process while its outcomes were still unknown at the time of research. This approach avoids post hoc rationalization through a rich description based on the stories of the stakeholders involved, offering a more detailed understanding of the activities and influences of boundary work for SBMI (Geertz, 1973; Ven and Poole, 1990).

4.3.2 Data collection

Nijsen/Granico – a Dutch SME in the pork sector – was chosen as our case study because the company’s innovation is dependent on a collaborative reconfiguration of stakeholders in its value network. Despite many organized attempts to reconcile stakeholders in the past, the Dutch pork sector is still highly fragmented and under great legal, economic and public pressure to move towards sustainable practices. This led Nijsen/Granico to conduct boundary work with different stakeholders. Due to this particular character, a single case study design is considered appropriate (Yin, 1994). We attended and recorded meetings and strategic sessions between the company and its stakeholders, and we interviewed the stakeholders involved in the innovation process to collect data (Table 10). We also drew on personal correspondences shared with us, internal documents concerning the company and its sector, web sites, annual reports and other publicly available reports. The interviews were semi-structured and aimed to elicit the participants’ perspectives on the business model, the required boundary shifts and the collaboration process, including topics of negotiations, and whether and how they found some kind of common ground. We used these a priori concepts (of business model innovation, boundary work, boundary objects and organizational boundaries) to write discovery memos, and included ‘in vivo’ codes of related quotes and terms used by the participants to enhance and detail their grounding (Corbin and Strauss, 2013; Creswell, 1998). We subsequently applied axial coding to categorize the codes into subcategories of theory-related concepts, for example, the idea of ‘boundary challengers’ (Corbin and Strauss, 2013; Creswell, 1998; Glaser and Strauss, 1967).

4.3 Methods

69 Table 10: Overview of empirical data-collection and analysis Data sources Amount Length Collection method and data preparation Data analysis Semi-structured interviews: Recorded transcribedand Discovery memos, coding exercises NG1 Nijsen/Granico – General Director 1 75 minFace to face 19-05-2017 NG2bNG2a Nijsen/Granico – Business Development Manager 2 110 min Face to face 6-5-2019 Face to face 20-9-2019 MPM Municipality Peel & Maas – Policymaker Strategy & Development 1 61 minFace to face 3-5-2018 NGO NGO Nature & Environment –Project employee 1 45 minPhone 3-5-2018 KI Kipster – General director 1 60 minFace to face 19-05-2017 Bilateral meetings, including multiactor modelling sessions 4 550 min Recording, field notes, observationparticipatory Multi-actor model, discovery memos, coding exercises Multi-lateral project meetings 3 300 min Recordings, field notes, observation discovery memos, coding exercises Phone calls 9 165 min Notes discovery memos, coding exercises E-mail correspondences 20 n.a. Notes discovery memos, coding exercises Case study reports 14 n.a. Notes discovery memos, coding exercises Partner websites 12 n.a. Notes discovery memos 4.3.3 Data analysis Following Ven and Poole (1990), we started with developing track codes as sensitizing codes based on the literature. As this study aims to deepen our understanding of the manifestation of the track codes in the process of SBMI, we empirically derived indicators of the three different boundary work phases using inductive coding (Table 11). The manifestations of these indicators are called ‘incidents’ and functioned as coding elements for the phases.

Table 11: Phases and examples of their indicators Exploring boundaries and boundary reconfigurations

Brokering boundaries Implementing boundary changes inventing, drawing,discovering,conversing,investigating,exploring,sketching

4.3.4 Case study: SME-driven SBMI in the Dutch pork sector

Per phase we discerned topics relating to the boundary work activities. We subsequently coded and classified the data descriptively as incidents, e.g. ‘inventing’ and its elements of information, e.g. ‘value creation’. Afterwards, we interpreted the data according to its theoretical event from boundary work, e.g., ‘future boundary setting’, its organizational boundary, e.g., ‘power’, and its business model elements, e.g. ‘value creation and delivery’. This led to a ‘qualitative datum’, i.e., a string of words capturing the basic information about an occurrence and integrated these as a unique record into the data file. All data strings have related quotes, such as “We are in a process of collaboratively inventing the highest possible creation of value”. In the next step, we integrated the inductive qualitative datum into the different phases to be able to find patterns of incidents. Finally, we returned to the track codes framework and redesigned the framework according to the findings of the data. As a result, we did not just include the manifesting organizational boundaries, but also integrated the drivers and tensions for boundary reconfigurations from within the organization, between organizations and from wider contextual factors such as consumer demands as perceived by the case study companies. To enhance the rigor of the study, we returned the description of the paper to the participants of the case study. This helped to empirically assess whether our classifications and constructed meaning corresponded to the focal case study’s perceptions of the process.

The Dutch pork sector produces over 1.38 million tons of meat annually, of which 60% are exported (Berger, 2016). This makes it the fourth biggest livestock producer in the European Union. The pork sector is organized as follows: suppliers of raw materials (e.g., soy scrap, cereals, wheat middling, rape seed meal, and additives such as vitamins and minerals) deliver to pig feed producers such as Nijsen/Granico, who sell the produced pig feed to pig farmers. The farmers sell their pigs for processing and distribution to wholesale and retail businesses (the latter are often governed by (conglomerates of) supermarkets, such as SuperUnie in the Netherlands). Surrounding this chain there are several NGOs, public institutions, banks and knowledge institutes (Figure 4).

creation of choices, discussion, distribution, setting priorities, confronting, proposing agreeing on, experimenting with, determining, changing, shifting, embedding

Consumers&Buyerstraders

The pork sector is known for its efficiency, but the associated economic gains come with downsides and the sector faces major challenges in maintaining its ‘license to produce’. The main pressures are an increasing human demand for food and protein, standards for food safety, public demand for animal welfare, sustainable production, a circular bioeconomy and less pollution of water sources, soil, and air, as well as land use competition between humans and animals (Nijsen/Granico, 2017).

Nijsen/Granico

WholesaleRetailersandDistributorsProcessors Meat packers

Figure 4: Configuration of the Dutch pork sector

71 Banks, stabling, legislation, knowledge institutes, NGOs, citizen (groups), manure processing, use of by-products, public institutions Rawprovidersmaterial developersGeneticsFeedproducers Pig farmers

As a result, calls for transformation are mounting. However, large sector stakeholders in particular, such as supermarkets and meat processors, have been rather unresponsive and have attempted to keep prices low while posing higher demands on pig farmers and feeding companies.

is a regional SME which collects residual products (from bakeries, food production factories, and primary sources such as cereals and co-products from the food and biofuel industry) to produce pig feed, which they then sell pig farmers. Annually, Nijsen/Granico brings over 100,000 tons of residual products back into the food cycle (Nijsen/Granico, 2019). This strategy has recently gained attention as a means for improving the sustainability and ‘license to produce’ of the pork sector. At the same time, residual products are increasingly popular for biomass, and Nijsen/ Granico’s customers - the pig farmers - are facing increased public and legislative pressure on animal welfare, environmental restrictions, food safety, and intense pricing competition from retailers. It is within this context that Nijsen/Granico realized that further scale-up of production and efficiency was insufficient to provide a long-term outlook for the pork sector, and that there was a dire need for novel approaches to pork production. A direction for this novel approach emerged in 2014, when a sustainable poultry company called ‘Kipster’ approached Nijsen/Granico with the request to produce ‘circular’ chicken feed. Nijsen/ Granico had not made chicken feed for over thirty years, and they wondered why Kipster approached specifically them. Kipster answered that that they could only imagine Nijsen/Granico as a potential

Nijsen/Granico’s trajectory for a circular pork model began with an emphasis on exploration. Together with Kipster, Nijsen/Granico’s managing director and business development manager started with

Exploring reconfigurationsstakeholders,andtensions Exploration phase Exploring value propositions and potentialSetting-uppartnershipsfirstpartnerships Agreeing reconfigurationson Implementation phase Experimentation with newreconfigurationsreconfigurationsEmbedding reconfigurationsNegotiating Brokering phase Negotiating Setting-uppropositionsvaluecriticalpartnerships

Figure 5: Synthesis of the boundary work processes

4.4.1 Exploration phase

72 partner to deliver sustainable feed, as Nijsen/Granico collects residual waste. This brought Nijsen/ Granico to the idea for a similar business model in the pork sector, which they called ‘Food for Feed for Food’ (FFF). In this model, the firm aimed to collect residual products from retailers, process this to pig feed for Nijsen/Granico’s customers, from which the meat would be sold in the same retail stores that delivered the residual products. As a small actor in a large value chain, Nijsen/ Granico has realized that they are dependent on external stakeholders to co-create FFF, making it necessary for them to engage in collaboration in the early stages of the innovation.

4.4 Results

This section describes and elaborates on the boundary work processes by which Nijsen/Granico’s FFF business model was innovated over six years (2014-2020). The boundary work processes were characterized by phases of exploration, brokering and implementation, based on indicators from Table 11. For each phase, we describe the dominating boundary work processes, organizational boundary changes and the boundary spanners and objects used in interactions between Nijsen/ Granico and their external stakeholders. The different phases were not fully sequential, as some implementation and brokering activities interacted with exploration activities and vice versa. We therefore included a visualized timeline of the full SBMI process in Appendix C and synthesized the boundary work processes in Figure 5. Boundary work processes in the Nijsen/Granico case

Boundary work processes

With this as a basis, Nijsen/Granico’s managing director started to think about potential value propositions for the different stakeholders. “I offer a solution to a retailer’s problem. The retailer wants to be circular, he feels the heat of NGOs, that is my interpretation for the moment, he is tired of those advertisements of cut-price meat and the lame pig. Well, I can solve that problem, and I can do it circular. [...] I can tell the retailer, if you supply certain raw materials, then I can ensure that they are made into Feed, which in turn comes to you as Food. Then, we have a circular food concept” (NG1). Initial success in finding value propositions spurred further conversations with their external stakeholders: “Through conversations, we increasingly discover the design of the value chain, which seems to be more rigid than we thought it was, and should be” (NG2b). Nijsen/Granico realized they were not in the position to align all stakeholders by themselves, and that they needed to explore potential partnerships to develop FFF. Such network building activities were new to them, so they asked Kipster for assistance.

The identification of potential partners was a search process. Nijsen/Granico scanned many actors on their position in the value chain and their ambitions for sustainability: “It is very important to investigate the position of actors in the chain. Who is really interchangeable? Who shows some sort of ambition for sustainability?” (NG2b). Around that time, a business partner introduced Nijsen/ Granico to SuperUnie, a large-scale purchasing conglomeration for retail in the Netherlands. Nijsen/ Granico tried to convince SuperUnie to join the collaboration. While SuperUnie supported the idea, they wanted Nijsen/Granico to organize the process. As Nijsen/Granico had hoped and expected that SuperUnie would use its powerful position in the market to align other stakeholders, they were disappointed by the rather passive support that they received: “That [the value] was seen by SuperUnie, but the reproach I have for retail is that eventually, they don’t take any responsibility. SuperUnie said ‘fine, just take care of it’. But I told him, ‘you should take responsibility because you must

73 an initial value proposition idea from which they sketched their current multi-stakeholder network, changes required and points of tension that could help or impede the idea. On the one hand, pressure on the pork sector was high and NGOs were campaigning against the scale and ways of pork production. On the other hand, the pork sector was characterized by price-focused actors, such as retailers and processors. “The meat price is a very sensitive item in the sector, and also an important element for retailers. If Aldi changes the meat price, Lidl will follow within 4 hours” (NG2b). Simultaneously, Nijsen/ Granico expected others to be searching for added value to strengthen their position. Particularly pig farmers were producing a non-distinguishable product in a global, competitive market, leading to thin margins and uncertainty about the selling price of pigs. Nijsen/Granico envisioned a novel role for their farmers: “Our customer used to be the pig farmer. We just sold pig feed to the pig farmer, who made pork out of it, which goes to the meat processor. Now, the retailer, the consumer is my customer, and my current customer becomes my customer-oriented partner” (NG1).

At the same time, Nijsen/Granico learned that the municipality had experienced pressures from its citizens to help the local pork sector as they faced severe continuation problems. They found that every farmer discussed sustainability in isolation based on their individual interests (e.g., on improving specific aspects of animal welfare such as tail cutting). This made them realize that the sector required structural rearrangements in which the municipality played a crucial role. The municipality stated that FFF would enable them to achieve their ambition for a sustainable pork sector in their region in a way that creates a sense of ownership of market actors towards sustainability.

74 use your position in the market to steer the processor, you determine the positioning, the price and the appearance of the product. That is your responsibility, you cannot put that on us’ (NG1). As a result, Nijsen/Granico searched for alternative stakeholders to engage with. This is where we see Nijsen/Granico contacting stakeholders with less prominent economic interests. Nijsen/Granico reached out to the regional municipality and an environmental NGO. They envisioned that the NGO would function as an intermediary towards retailers, which the NGO was willing to do.

During the boundary work processes, we have seen Nijsen/Granico touching upon changes in their own organizational boundaries. On the boundaries of identity and power, Nijsen/Granico wants to change their role from ‘feed producer’ to a strategic partner for sustainable feed concepts. “We want to sell good behavior in the pig meat sector to the retailer, while strengthening our supply and demand network” (NG2b). When Nijsen/Granico started to engage in network building and partnerships, they were conducting novel activities on the efficiency boundary while developing their competences to sell added value in a new, sustainability-minded stakeholder network (Figure 6).

When Nijsen/Granico engaged in external boundary work to initiate partnerships, we have seen that boundary issues became more prominent and visible. The emerging boundary work issues were particularly focused on the boundaries of power and the distribution of roles and activities between the external partners. When potential partners refused to utilize or change their boundaries – as was the case with SuperUnie – Nijsen/Granico discontinued the cooperation.

Organizational boundaries

After these conversations, Nijsen/Granico set up initial partnerships with these stakeholders. They established a project group with the environmental NGO, the municipality and Kipster, in which research, development, as well as involvement of a retailer (which is not yet involved at this stage) was planned. The project team established a WhatsApp chat group for small updates regarding new insights, connections, meetings etc. The boundary work processes in the exploration phase thus developed from internal explorations towards joint explorations with external stakeholders.

4.4.2 Brokering phase

With a project team in place, the team members started to discuss the ambitions of FFF and the implications for the different stakeholders. The team members agreed that ultimately, FFF should aim to eliminate the ‘feed-food competition’ as regards to be able to feed the world’s population in 2050. They expressed the need for research to avoid making sustainability claims that were not (fully) true, for which they decided to involve a Dutch university. The discussion continued towards the question of how the pork sector could look like once sustainable meat was the standard. They

Initial boundary work processes took place internally in Nijsen/Granico through conversations and actor modelling activities, where they physically drew the multi-actor field on an A3 sheet. When reaching out to external stakeholders, Nijsen/Granico’s managing director and business development manager acted as the main boundary spanners, assisted by Kipster. Nijsen/Granico’s business development manager pointed out that non-verbal communication was very important to discover the true perspectives of external stakeholders; “I refuse to speak by phone, I want to be able to see non-verbal communication, I want to see how others react” (NG2b). At this stage, illstructured language was used in external communication with stakeholders, such as, ‘circular pig’, ‘banquet pig’, ‘circular food concept’, and ‘back door, front door’. The importance of using ‘circular pig’ was mentioned explicitly in the project meeting with the municipality and the NGO.

Boundary spanners and objects

75 Sustainable feed concept supplier System coordinator Preferred feed supplier Value-based contracts Sustainability-minded stakeholder network Cascading value propositions Competence to sell added value Access to voluminous regional sources Engage in stakeholder network building Local sourcing NEW FOCUS NIJSEN/GRANICO SUSTAINABLE CONCEPTSGovernmental organizations RetailWholesale/CitizensButchers processing&Buyers traders&producersAgricultural Raw providersmaterial producersFeed Pig farmers Consumer Disposal NGO Pig feed producer Produce pig feed Collect residual waste streams Collection and processing of residual waste for feed Small transactionalplayer,relationships INITIAL FOCUS NIJSEN/GRANICO AS FEED PRODUCER

Boundary work processes

Figure 6: Organizational boundary changes of Nijsen/Granico

76 reasoned that, due to the available waste-feed resources, the meat sector would have to shrink by forcing the consumer to eat less meat or pay a higher price. They discussed that this would be a task for retail, which would have to establish long-term contracts with a fixed price based on the added value of FFF and supply their waste materials to Nijsen/Granico. In return, they stated that FFF enabled the retailer to offer their consumers good behavior in the production of pork, including transparency about animal welfare and environmental benefits. This would mean that the retailer could improve its image, get rid of NGO campaigns, and offer a distinguishable product at a higher price. The project partners found that the NGO would have to play a major role through certification and promotion of FFF. The NGO had preferred to eliminate meat production altogether, but realized that they had to compromise on their ambitions to a level that was acceptable for the other partners. As such, they demanded local sourcing from Nijsen/Granico, and significant environmental and welfare improvements from the farmers: “It is possible that choices are being made, which could us say - well guys, if we do it this way, we will no longer be able to attach our name to it” (NGO). Upon discussion, the partners decided to aim for a one-star ranking (out of three stars) on a Dutch animal welfare certification scheme, within a sourcing radius of 30 km around participating farms.

The discussion on the consequences of FFF also revealed major complications for farmers. The municipality expressed that “The project will not deliver a sustainable future for all pig farmers. Perhaps for some” (MPM). Nijsen/Granico explicitly accepted this consequence and was aware that these actors could try to oppose the situation. They had seen this happening before when farmers boycotted Kipster suppliers after Kipster had published a column in which they pleaded for largely abolishing livestock farming in the Netherlands due to its animal-unfriendly way of farming and its negative impacts on the natural environment. While the partners agreed on many aspects, such as that the priority should be on empowering farmers through increased margins on their selling price, there was discussion about the involvement of farmers. The NGO stated that they aimed to collaborate only with farmers who were willing to improve their environmental performance and animal welfare. Kipster proposed to involve farmers only once the project partners had established a contract with a retailer so they would be in a better position to align these farmers, stating: “If you aim for an inhibiting factor, you should ask a farmer to join the table” (KI). They decided that as first steps, Kipster and the NGO would reach out to their retailer network to discuss potential partnerships. The partners also drafted a project proposal on FFF as means of communication to internal and external stakeholders. Via Kipster, Nijsen/Granico learned that Van Loon, a meatpacker, was the only pork supplier for Lidl, a large-scale retail discounter. They pitched the FFF model to Van Loon. Although Van Loon’s managing director told Nijsen/Granico that sustainable pig feed was an interesting story, he saw several barriers; Nijsen/Granico was a (very) small player in the sector; not a single Nijsen/Granico

Several months later, Van Loon returned to Nijsen/Granico with the question: “Can you provide circular feed for the same costs?” (NG2b). Nijsen/Granico responded to that they could, Nijsen/ Granico, Kipster and Van Loon jointly developed a (second) presentation to Lidl. When Van Loon saw the draft, he became angry as Nijsen/Granico had again included slightly higher prices for fully circular feed. Nijsen/Granico had found an inventive way to deal with this by reframing the proposal into cascading value propositions, providing the retailer choices on the degree of sustainability and related costs: “For the same costs, you can get a part of the feed circular. For more investment, we can increase the circularity. By presenting it this way, the choice lies with the retailer”(NG2b).

During the presentation to the retailer, Nijsen/Granico mentioned “We want the entire value chain to benefit, and that has the consequence of an X amount of costs per pig” (NG2b). Afterwards, Van Loon indicated that Nijsen/Granico’s model could help Van Loon to become “preferred supplier” of feed and to date, Van Loon is in further discussion about the possibilities of FFF within Lidl.

Organizational boundaries

77 customer supplied pigs to Van Loon; and it would be difficult to ‘force’ pig farmers to purchase Nijsen/Granico feed. Also, Van Loon’s director said: “I would like to join, but I do not have any money”. Still, they became involved over a longer period of time, in a corrugated process. Van Loon arranged that Nijsen/Granico could present the FFF idea to Lidl, under the condition that Nijsen/ Granico would not mention specific numbers and costs. However, Nijsen/Granico was convinced that specific numbers on economic and non-economic parameters would help to convey the value proposition. Hence, Nijsen/Granico presented to Lidl: “Imagine if 520.000 pigs are being fed with circular Nijsen/Granico feed, this saves 20.000 soccer fields of agricultural land, prevents carbon emissions of 7650 cars, and saves as much energy as could be generated with about 752.000 solar panels, which equals 71.000 households” (NG2b). Nijsen/Granico indicated that this was all possible for a small increase in the price of the meat, so that feed producers and farmers would receive a better margin to improve their sustainability. “That was the straw that broke the camel’s back for Van Loon, who found Nijsen/Granico untrustworthy, stepping out of line, and stated ‘know your position’!” (NG2b). After this confrontation, it remained silent for a while.

The boundary work processes in the brokering phase elicited boundary issues that were previously unexplored. We have seen that the organizational boundaries of the project partners were partly aligned for the model; for example, by utilizing existing networks, knowledge about environmental issues, and certification skills within the competence boundary of the NGO. This made the brokering phase relatively uncomplicated with only a few issues to be negotiated, such as the NGO who was defending the credibility of the model to maintain their identity. The partners also identified the needed changes in the organizational boundaries of their external stakeholders. For instance, they

Stronger boundary issues were displayed in the brokering processes with meatpacker Van Loon. Van Loon mentioned barriers that were situated on their own organizational boundaries (the influence on their own farmers), and of Nijsen/Granico (their limited power position and supply network). We consider the conflict over the use of numbers to be positioned on the boundaries of power between Lidl, Van Loon and Nijsen/Granico, as these numbers would affect contracts and price agreements between these stakeholders. Nijsen/Granico addressed these boundary issues by coupling elements of power (the required monetary commitments) to elements of the identity (the responsiveness of retail to the added sustainability value). Interestingly, Van Loon became more engaged after understanding the consequences of this model for their own power boundary.

Boundary spanners and objects In the brokering phase, Nijsen/Granico remained the main boundary spanner, although the project partners now also conducted boundary-spanning activities (e.g., reaching out to potential partners). The project proposal functioned as a semi-structured boundary object in which the project partners could attribute their perspectives to and distribute internally. They discussed frames of evaluation of the project in terms of values, ambitions and rating schemes, but addressed the costs and benefits only qualitatively. Between the project partners, ill-structured language was used as a means to guide communication and distinguish business model options, such as ‘Pigster’, ‘Food for Feed for Food’, ‘Food, Feed, Future’, ‘new pig farming’. The representative from the municipality perceived the talks between the partners as open and informal: “Because we entered this challenge together and didn’t focus on the solution of a pre-defined problem, we created space for each other to create new values” (MPM).

Nijsen/Granico tailored their language to the purpose of the negotiation, and comprised words representing a novel, collective paradigm, such as using ‘the whole chain’ rather than ‘us’, and ‘both’ and ‘share’. In negotiations with Van Loon and Lidl, Nijsen/Granico favored concrete language and quantitative elements, whereas Van Loon preferred avoiding any talk of prices and costs. In the first presentation, Nijsen/Granico did not have a way to deal with these issues of power yet. In preparation of the second presentation, we observe Nijsen/Granico tailoring their language by coupling qualitative elements (perceptions, feelings, and ambitions) to quantitative elements (monetary investments, volumes). In these brokering activities, the language was much more concrete and closer to stakeholders’ boundaries in terms of frames of evaluation (values, schemes, ratings, costs and benefits).

78 identified a needed shift in the boundary of power between the retailer and their suppliers, and a shift in farmers’ activities on the boundary of efficiency (see Table 12 for a full overview). They subsequently developed a strategy to align these stakeholders, which was focused on the ability to shift the power of the retailer and subsequently, the competences of the farmers.

79 fordriversandtensionsemergingreconfigurations,boundaryorganizationalneededIdentified12:Table networkmulti-stakeholdertheinpropositionsvaluepotentialitsandreconfiguration boundaryNeeded reconfigurations boundaryforTensions reconfigurations external)and(internal boundaryforDrivers reconfigurations external)and(internal ReconfigurationonBrokeringpropositionsValue implemented?* Farmers yet(not involved) becometoWillingnessfarmerSustainable sustainable n.a.n.a. partnerStrategic Nijsen/Granicoof ofboycottaforCalled suppliersitsandKipster globalCurrent competitionmarket competitionglobalEliminate valuelong-termEnable contract marginincreasedReceive n.a.n.a. feedNijsen/GranicoUse stableImprove andsustainability welfareanimal neededfarmersLess fundsMunicipalityimplicationsFinancial andimprovements dropoutsforalternative n.a.n.a. LoonVan positionRethink sectorporkin yes LidltoAccessyes Nijsen/Granico supplierpreferred LoonVanfor moreinLoonVan positionpowerful retailerto price-focusCurrent playersmallveryaisNG their‘force’cannotLoonVan feedNGbuytofarmers determinesLoonVan NGnotpricing, price-focusedCurrent retailerwithcontracts non-distinguishableon puttingproduct, undermargins pressure value-basedforAbility retailwithcontracting preferredRemain Lidlforsupplier Position, volumes, pricing no

80 farmersNGSeparate suppliersotherfrom farmersNGNo LoonVansupply handlingseparateforCosts chainblockofusePossibleProcessesno Retail becometoAmbition sustainablemore circularand sustainableaEnable positioningcorporate yes behaviorgoodSell transparencyofferand customertheto NGOCurrent campaigns demandingCustomers behaviorgood NGOofridGetting campaigns no Value-focused empowertocontracting actorschainvalue topricingAdjust promote&consumer consumptionmeatless price-focusedCurrent contracting offeringEnable productdistinguishable customerstoconceptand pricingincreasedat Value propositions and contracting no certainSupply materialsraw rawcertainEliminate streamswastematerial Activityyes Muni- cipality andsustainableA municipaldiverse organization sustainabilityAvoid becannotthatclaims true(fully)made onpressuresCurrent sectorpigregionalthe theaddressingEnable onpressurescurrent sectorpigregional yes tofarmersHelp financiallyadjust outlooknovelProvide farmersfor self-managementEnable actorsmarketof yes individual,From totalksisolated approachintegrated yes

81 NGO sustainabilityAvoididentityStrengthen becannotthatclaims true(fully)made valueOnpurposeNGO’sStrengthen proposition yes certificationOrganize toaccessProvide consumersandretail yes tocredibleRemain partnersexternal withonlyCollaborate aligntowillingparties sourcingonDemands sustainabilityand possibleaslocalasSourcingOnvalue proposition yes retail,Influence attitudeconsumer behaviorand certificationthrough campaignsand researchConduct yetnot yes SuperUnie moreaforAmbition sectorsustainable yes positionpowerfulUse partnersalignto powerOnno

In addition, the presentations to Lidl triggered a series of experimentation. The director of Kipster explained to Lidl that the availability of residual flows was a limiting factor for the Kipster model, and that not all residual flows from Lidl’s stores and suppliers were going to Nijsen/Granico. As a result, Lidl invited Nijsen/Granico to provide a list of their products which could function as input for feed, stating that they had to help Nijsen/Granico to make Kipster feed. This was previously out of scope for the retailer and considered to be Nijsen/Granico’s problem, and Nijsen/Granico hoped that this would open avenues for the FFF model as well.

In the implementing phase, we see Nijsen/Granico shifting their boundary of identity as a followup to their changing boundaries of efficiency and competences. Nijsen/Granico started to conduct network-building activities at the very start of FFF, which shifted their boundary of efficiency. After the exploring and brokering phases, a preliminary sustainability-minded network was set up, and experimentation with taking back the waste streams from Lidl further developed Nijsen/Granico’s boundary of competence in terms of network relationships. These seeds ultimately resulted in a change of their boundary of identity, by redefining their purpose as a pig feed producer into a provider of sustainable, circular meat concepts. Nijsen/Granico had hoped that this would change their power position as well so that they would be able to become preferred supplier for valuebased models.

Implementing phase

Nijsen/Granico also explained that they struggled with issues of legitimacy of their new role. The general director of Nijsen/Granco expressed that “Nijsen/Granico wants to change their role from ‘feed producer’ to a strategic partner for sustainable feed concepts. This is still a struggle, as we are often introduced as the feed supplier” (personal communication, 22-3-2018). To address this issue, Nijsen/Granico named their new identity ‘Nijsen Concepts’ and embedded this in their mission and vision statement, logo, website, and other communications.

Boundary work processes

Organizational boundaries

82 4.4.3

After the period of predominantly negotiating activities, we observe Nijsen/Granico agreeing on, and testing aspects of the model, as well as embedding changes in their own organization. For example, despite the negotiations with the NGO on the region of sourcing, there appeared to be a tension in establishing a steady supply, and the NGO needed to compromise further on their ambitions: “Nature and Environment is expanding their perspective [on a local circular cycle]. First they wanted to source 30km around the farm. Then it became the Netherlands. Now they say, as close as possible and as far as they need to” (NG2b).

4.5 Discussion This study provides a detailed story of how a firm has engaged in boundary work to develop and negotiate new value propositions, and create a value creation and delivery system in a multistakeholder setting. By means of the study, we make four contributions to the literature on SBMI. First, a boundary work lens clarifies the interaction process between an initiating firm and its external stakeholders needed for SBMI. In this way, it further develops emerging theory on boundary work for SBMI introduced by Velter et al. (2020) by detailing the processes through which a business navigates its boundary work for SBMI and by identifying typical boundary reconfigurations for SBMI. The boundary work lens is particularly important for the search for new value propositions and value capture mechanisms for all stakeholders involved. Our case shows that boundary alignment is required from the initiating firm and from external stakeholders, including non-business partners such as a local municipality and an environmental NGO. The breakdown into phases of exploring, brokering, implementing helps to better understand the process and reduces the complexities of boundary work for SBMI. Specifically, it helps to elicit less tangible aspects that affect stakeholder alignment, such as power issues (Avelino and Wittmayer, 2016; Eweje et al., 2015; Hawkins et al., 2016), development of capabilities (Bocken and Geradts, 2020; Inigo et al., 2017; Luzzini et al., 2015), and changing values and identity (Bojovic et al., 2019; Breuer and Lüdeke-Freund, 2017). This assists in grasping the complexities, tensions and interdependencies in a multi-stakeholder system, which are known to be overwhelming (Oskam et al., 2020; Rohrbeck et al., 2013).

Boundary spanners and objects Nijsen/Granico functioned as the main boundary spanner in the implementing phase. As one of the earliest partners, Kipster played an important role in aligning Lidl too. Although the other partners were still involved in this phase, we did not observe boundary-spanning actions from their side at the time of the research. The project partners used more definite and well-structured versions to come to agreements and experimentations. For example, the project proposal developed earlier now contained the agreed upon vision and numbers of impact, Nijsen/Granico updated their website with their novel name, mission and vision, and the concrete list of resources created by Lidl and Nijsen/Granico served as means for experimentation.

Second, a boundary work lens helps to illuminate the required organizational boundary changes (e.g., changes in activities, competences, external relations and identity of an organization) as well revealing underlying issues of nonalignment. This may be particular important in sectors where unsustainable business models are highly institutionalized and exacerbated by price pressures such as the food sector (Bocken and Short, 2021; Reinecke et al., 2019). Boundary work with partners

4.5.1 Limitations and implications

This study and the boundary work perspective has its limitations. First, the company studied in this research was in early and mid-level phases of innovating its sustainable business model. Further research could select a case study where the critical boundaries have been reconfigured

Third, and related to the above, reconfigurations on the power boundary proved crucial in the studied SBMI case, for which the initiating business engaged in cross-sectoral collaboration (Pedersen et al., 2021; Rohrbeck et al., 2013), identity work (Bojovic et al., 2019; Mdletye et al., 2014), and adapting boundary objects (Carlile, 2002; Hawkins et al., 2016) as strategic actions for reaching alignment. The boundary work perspective enables the development of strategies to deal with boundary issues. However, the results also suggest that the entrepreneur can only offer a piece of the solution and might need support from other actors to reach agreement on boundary alignment, such as intermediaries or institutional actors (Kivimaa, 2014; Kivimaa et al., 2019; Zietsma and Lawrence, 2010).

Fourth, for practice, the boundary framework can support businesses in developing the required strategies for boundary alignment. The case study showed how alignment was required across (a) different stakeholders and (b) across different types of organizational boundaries, which suggests the need for a holistic alignment approach when pursuing SBMI. It also reveals partners’ position on sustainability and who needs to be involved the SBMI process. Space to create new values with value chain partners is necessary. Boundary objects can help to deal with uncertainties, to facilitate strategic discussions and to find solutions to different valuation frames, power tensions and role divisions between stakeholders. In our case, a project proposal functioned as a semi-structured boundary object in which the project partners could attribute their perspectives to and distribute internally. They discussed frames of evaluation of the project in terms of values, ambitions and rating schemes, but addressed the costs and benefits only qualitatively. The complexity of the topic requires a boundary object such as a vision or project plan which everyone can relate to; which is not too specific and leaves room for differing perspectives; and which is adjustable to facilitate joint experimentation and solution-finding.

84 is necessary to develop new propositions and break down unsustainable business models (Bocken and Short, 2021). For example, between Van Loon and Nijssen/Granico, the discussions first centered on price, but, becoming more aware of the ingrained problems and possibilities of SBMI Van Loon turned to helping Nijssen/Granico to become “preferred supplier” of feed. Boundary work might help companies to see the bigger picture of the change, and where they could (positively) be positioned in a future competitive landscape.

4.6 Conclusion This paper traced the efforts of a small firm engaging with strategic partners and non-traditional stakeholders in the daunting task of transforming the Dutch pork industry. The endurance and creativity of the firm suggests that there is no blueprint for SBMI, but rather requires a process of boundary work to collaboratively explore and negotiate value opportunities in the organizational boundaries of each stakeholder. The case makes transparent and nameable the intrinsic complexities of projects which are neither purely transactional nor relational.

Second, as this study comprises a single case design, alternative cases initiated by different type of actors (e.g., an intermediary or an NGO) and/or cases of international corporations conducting boundary work in global networks can be inquired and compared to one another. This can advance theory development on boundary work processes, strategies, and potential other boundary conceptions relevant for successful SBMI (Kivamaa et al, 2019; Van de Ven, 2007). Third, this work focused on organizational boundaries, but this can be extended to include physical and geographical boundaries. For instance, one of the case discussions centered around what was still considered to be ‘local’ in the circular economy, which resulted in a joint view focused on: ‘as close as possible and as far as they need to’. An extension of boundaries beyond those of the organizational context (e.g., physical, regional) but related to strategic joint decision-making in SBMI may be an interesting source for future research. Finally, for practice, the framework of this study can function as a basis for developing a practical tool that assists companies in starting multi-stakeholder SBMI (Geissdoerfer et al., 2018b; Rohrbeck et al., 2013).

85 (implementation phase) and where value capture is also integrated to assess the feasibility of the sustainable business model, and its strategic actions for boundary reconfigurations (Lepak et al., 2007).

Chapter 5. Contributions and limitations of intermediary-led boundary work for circular business model innovation

Driven by the need to halt ecological destruction while enhancing access to products and services, the reorganization of value creation between business and society is at the center of debate. Rather than a focus on economic value, businesses are increasingly challenged to co-create economic, environmental and social forms of value with a wide variety of stakeholders, such as cross-sectoral businesses, public institutions and non-governmental organizations (Freeman, 2017; Ritala et al., 2021). A proliferate area of research to enable such value co-creation deals with circular business model innovation (CBMI). CBMI is about radically enhancing positive value creation and reducing negative value creation for the environment and/or society, through integrating the narrowing, slowing, closing and regenerating of resource loops into the way the business and its stakeholders

“Een pond veren vliegt niet als er geen vogel in zit” Bert Schierbeek (2008) [no page number]

5.1 Introduction

Despite much excitement about the circular economy for sustainable development, the implementation of circular business models in practice is not yet widespread. Innovating businesses require a reconsideration of their own organizational boundaries and face a significant boundary work challenge to realign their stakeholders’ identities, external relations, competencies and activities accordingly. Intermediaries have come to the foreground to support relational work, but extant studies do not address their ability to help businesses in their boundary work. This chapter combines theoretical perspectives from intermediary work, organizational boundary theory and boundary work to analyze the ability of the intermediary to affect the organizational boundaries of the respective organizations involved. Our empirical research traces the efforts of a Dutch intermediary in three initiatives of circular business model innovation. We find that intermediary work was particularly valuable for businesses in early, exploratory stages of boundary work, but that there were clear limitations in taking a multistakeholder focus and catering for distinctive boundary work needs that go beyond exploration and initiating businesses in multi-stakeholder settings. We provide specific recommendations to improve intermediary-led boundary work and reflect on the usefulness of boundary work as a perspective to understand and improve intermediary work in processes of circular business model innovation.

Chapter 5. Contributions and limitations of intermediary-led boundary work for circular business model innovation

5.2 Literature background 5.2.1 Reconfiguring organizational boundaries for CBMI Organizational boundaries delineate the company from its environment (Dumez and Jeunemaître, 2010; Santos and Eisenhardt, 2005). All changes to a companies’ business model require changes in the companies’ organizational boundaries. In CBMI, organizational boundaries have an even more prominent role due to the focus of the innovation on creating societal (including environmental)

The resulting insights contribute to collaborative, cross-sectoral CBMI by, first, integrating and refining boundary work as a lens for understanding processes of stakeholder alignment (Oskam et al., 2020; Pedersen et al., 2021; Velter et al., 2020) and second, by assessing the ability of an intermediary actor to help businesses in their boundary work and re-align their own organizational boundaries vis-à-vis their external stakeholders (Bapuji et al., 2020; Esposito et al., 2018; Kivimaa et al., 2019; Le Ber and Branzei, 2010a). This is important as businesses tend to remain focused on their own company objectives instead of collaborative objectives needed for CBMI (Bocken and Ritala, 2021; Planko et al., 2016; Slawinski et al., 2017). For practice, the results contribute to CBMI by clarifying the relevant boundary work areas and the ability of the intermediary to assist businesses in such processes.

89 create, deliver and capture value (Bocken et al., 2016a; Geissdoerfer et al., 2018a; Konietzko et al., 2020; Lüdeke-Freund et al., 2018b). This requires changes in the business model of the initiating firm in conjunction with changes in the business models of relevant stakeholders (Bocken and Ritala, 2021; Brown et al., 2019; Salvador et al., 2019). Such multi-stakeholder alignment poses a significant challenge on businesses to negotiate issues that lie beyond direct economic benefits, while dealing with separate value logics and priorities between stakeholders (Oskam et al., 2020; Pedersen et al., 2021; van Bommel, 2018). As a result, practical examples of successful circular business models are scarce (e.g. Bocken et al., 2017; Linder and Williander, 2015; Ritala et al., 2018).

Recent work on circular business models suggests the need for external actors to catalyze and support businesses in external collaborations for circular business models (e.g. Bocken and Ritala, 2021; Brown et al., 2020; Velter et al., 2021b), but the appropriate actors and their ability to support businesses in their boundary work remain underexposed. To address this gap, this chapter traces the efforts of a Dutch intermediary organization in three initiatives of CBMI and poses the research question: how can intermediaries assist businesses in their boundary work for CBMI? We draw on boundary work as a theoretical perspective to understand the ways in which the intermediary supports businesses in exploring, brokering and reconfiguring organizational boundaries in CBMI (Keränen et al., 2020; Santos and Eisenhardt, 2005; Velter et al., 2020).

Successful CBMI requires the reconfiguration of organizational boundaries between stakeholders, but the capability of businesses to navigate such process is generally lacking (Oskam et al., 2020;

5.2.2 CBMI as a process of boundary work

90 value and the relevance of including external stakeholders (Ferasso et al., 2020; Kwiecień, 2020; Nußholz, 2017). To make organizational boundaries more specific, we draw on the definition by Santos and Eisenhardt (2005), who specify the boundaries of identity, power, competences, and efficiency. These boundaries are reciprocal to any changes in a company’s business model (Carlile, 2002; Jacobides and Billinger, 2006; Keränen et al., 2020). The boundary of identity refers to the understanding of an organization on “who they are” in relation to “what they do”. This cognitive frame can be unconscious, but is embedded in the logic (for-profit, for benefit, hybrid) and culture of the business, its management, employees and customers. Looking at the boundary of identity, in CBMI a change is needed in terms of broadening the focus from company value to environmental and societal value (Fehrer and Wieland, 2020; Kwiecień, 2020). The boundary of power concerns the ability of an organization to control external relationships, with the objective of reducing dependencies and maximizing control over key external forces. For CBMI, the business is needed to engage in long-term, relational approaches and to empower particular stakeholders to create collaborative success (Brown et al., 2019; Hörisch et al., 2014; Stead and Stead, 1996). The competence boundary comprises the configuration of resources and capabilities of an organization vis-à-vis its external partners. It concerns questions of which resources and capabilities are critical to own and which are to be deployed externally. CBMI requires the capability of a business to experiment with novel production and ownership models (such as service-based business models) and address complex, highly dynamic factors surrounding the business (Antikainen and Bocken, 2019; Bocken et al., 2021; Hopkinson et al., 2018). Efficiency boundaries involve decisions on how processes are organized and which activities are conducted by the focal firm, and which are outsourced. Choices in efficiency are typically ‘make or buy’ decisions, shaped by transaction costs, measurement difficulties (on the value of an offering) and differences in knowledge that create coordination costs despite best intentions of the different actors (Nickerson and Silverman, 2002; Poppo and Zenger, 1998; Santos and Eisenhardt, 2005; Williamson, 1975, 1981). For circular business models, this is the boundary where typically decisions about integrating repair, refurbishment and remanufacturing activities are made. CBMI thus requires changes in multiple boundaries of the initiating business and its various stakeholders to reach novel ‘fits’ between identities, competences, external relations, and practices (Geissdoerfer et al., 2018b; Kwiecień, 2020). The complexity of such boundary reconfiguration processes contributes to the scarcity of practical examples of successful circular business models (e.g. Bocken et al., 2017; Daddi et al., 2019; Linder and Williander, 2015; Ritala et al., 2018).

Boundary work considers boundaries of multiple actors to emerge set ‘inside-out’ the (Freudenreich et al., 2019; Hörisch et al., 2014; Seuring and Gold, 2013). Previous research has provided a framework help businesses boundary distinguishes (Antikainen and Valkokari, 2016; Baldassarre et al., 2019; Giskeødegård, 2016; Velter et al., 2020).

and change iteratively through challenging and negotiating processes instead of being explored and

91 Prendeville et al., 2016; van Bommel, 2018). The difficulty lies in motivating stakeholders to engage and change their organizational boundaries too, while they may have no initial incentive to do so (Brown et al., 2019; Lüdeke-Freund et al., 2018b; Salvador et al., 2019). For example, this is the case when circularity is not a priority of the stakeholders, when value appropriation is located elsewhere in the stakeholder network, when significant investment in novel processes or capabilities is required, or when boundary changes are expected to impair the stakeholders’ competitiveness. This makes boundary work different than just establishing new transactions or collaborations based on existing boundaries (Table 13) (Kwiecień, 2020; Velter et al., 2020).

Table 13: The differences between transactions, collaboration and boundary work in CBMI. Based on Austin and Seitanidi (2012b); Breuer and Lüdeke-Freund (2017); Brown et al. (2019, 2020); Chen et al. (2017); Hoppe (2010); Kanda et al. (2015); Linder and Williander (2015); Lozano (2007); Nidumolu et al. (2014); Pedersen et al. (2021); Rohrbeck et al. (2013); Velter et al. (2020) work (more

Transaction Collaboration Boundary

firm

work and

between the exploration, brokering and implementation of organizational boundary changes in relation to value opportunities

navigate

uncertain on value capture) boundaryorganizationalchange

Rationale for exchange Pool andcompetencesexistingresources Pool slightly competencesadjustedandresources Pool considerably adjusted competences and resources developmentExchange No development of new competences and resources Occasionally develop new competences and resources Prominently redefine/ develop new competences and resources Exchange form Based on existing value forms Based on existing value forms Based on new value forms alignmentStakeholder (transactional)alignmentInstrumental Strategic (relational) and instrumental alignment Normative (valuesbased), strategic and instrumental alignment Amplitude changeboundaryorganizationalof No spanningchange,boundaryboundaryonly Limited boundaryorganizationalchange Larger and riskier

5.2.3 The value of intermediaries for CBMI

Businesses engaging in CBMI thus must learn to explore and address boundary issues of multiple stakeholders simultaneously and to find resolutions for adjusting their organizational boundaries vis-à-vis one another (Hahn et al., 2015; van Bommel, 2018). Previous studies show the difficulties of engaging in such a process (e.g. Brown et al., 2020; Oskam et al., 2020; van Bommel, 2018; Velter et al., 2021b), which suggests the need for intermediaries as external actors with specific expertise in boundary-spanning work to enhance the chances of successful CBMI. Intermediaries can be individuals, organizations, or platforms, who contribute to enabling changes between actors towards one or more common goals (Backhaus, 2010; Kivimaa et al., 2019; Planko et al., 2016). Particularly publicly-owned intermediaries have the potential to deviate a focus on profit towards environmental and social objectives needed for CBMI (Dragomir et al., 2020; Kivimaa, 2014; Matschoss and Heiskanen, 2017). Such intermediaries are known to help businesses in innovating for environmental improvements through eliciting innovation and partnering opportunities beyond their organizational boundaries, providing test beds for experimentation, and mobilizing funding, networks and technical expertise (Kanda et al., 2019; Patala. et al., 2020; Warbroek et al., 2018). Yet, these studies stress the limitations of intermediaries in adapting their support to a less general level, as well as maintaining the collective functioning of the initiated projects after intermediary involvement. As a result, further research on the actual performance of intermediary work in a particular empirical setting is called for (Kanda et al., 2019; Patala. et al., 2020; Warbroek et al., 2018). Such performance can be operationalized by assessing the ability of the intermediary to affect the organizational boundaries of the respective organizations involved, which leads to the central contribution of this paper.

Exploring boundaries helps to address the origin of challenges for boundary changes, relevant for brokering activities. The brokering phase relates to future boundary setting and the creation of incentives for critical actors to align. It aims to address and solve incongruities between boundaries, i.e. envisioned mismatches of current actors or for which boundary shifts have to take place or a new actor has to be found, or overlapping boundaries for which a configuration should be agreed upon. In some cases, boundary changes need to be promoted for by temporarily involved actors, such as intermediaries or public institutions (Patala et al., 2018; Velter et al., 2020). While these are highly iterative phases, they eventually intend to lead to the implementation of organizational boundary changes through agreements, experimentation and scale-up (Antikainen and Bocken, 2019; Baldassarre et al., 2020).

The exploratory phase consists of exploring existing boundaries, sketching future boundary configurations to identify so-called ‘defenders’: those actors which have an interest in maintaining (elements of) of the status quo and ‘challengers’: those actors which have an interest in aligning with (elements of) the innovation, as a basis for selecting collaboration partners (Rana et al., 2013).

Figure 7: Visualization of the research gap 5.3 Method 5.3.1 Approach

This paper applies theoretical perspectives from the different disciplines of boundary work and intermediaries to improve our understanding of the contributions and limitations of intermediaries for CBMI (Andrew Crane et al., 2016; Gehman et al., 2018). We adopt a qualitative case study design Research gap Boundary work of the participating business Boundary work of the intermediary

5.2.4 Research gap: intermediary support in boundary work for CBMI

Exploring boundaries and boundary changes Activities Brokering boundary incongruities Activities Implementing boundary changes Activities

Several studies on CBMI have indicated the need for organizational boundary alignment between businesses and their stakeholders. Businesses can promote such alignment through exploring, negotiating and implementing activities, but the novelty of circular business models, the need to collaborate with multiple and untraditional stakeholders, and the amplitude and rationale for boundary changes poses significant challenges to successful stakeholder alignment. Intermediaries, as expected experts in boundary work, potentially provide valuable support to businesses in their boundary work for CBMI. Yet, extant research on intermediaries does not disclose their ability to affect the various organizational boundaries of the business and their external stakeholders. To shed light on the extent to which intermediaries support businesses in their boundary work for CBMI, this study delves into the intermediary activities, their effect on the participating businesses, and their contribution to the boundary work of these businesses in the discerned phases of exploring, negotiating and implementing boundary changes (Figure 7).

Circular ambition Develop a safe and 100% recyclable toy product and packaging made from recycled packaginghouseholdplastic Avoid waste incineration through 3D printing using recyclatescontaminated

Initiating actor(s) Large retailer and wholesaler of toys 3D printing start-up Timber construction company

94 to allow for the generation of rich data to feed into the development of a boundary work theory for CBMI (Eisenhardt, 1989; Stake, 1995; Velter et al., 2020). To support theory development, we provide propositions on the relationships between the different concepts at the end of the paper.

Data was collected from a Dutch intermediary organization that engaged with different businesses as part of a CBMI program. We particularly look at how the intermediary conducted boundary work in three business initiatives within the CBMI program. These three business initiatives were selected based on the following considerations: (1) all three initiatives were new to circular business models and started with similar high ambitions for which they needed to develop novel value chains, which (2) inevitably gave these initiatives a collaborative character and (3) resulted in the surfacing of different boundary issues for them (Table 14) (Gehman et al., 2018; Yin, 1994). Initiative 1, abbreviated as TOY, is about a toy wholesale company and large retailer that aimed to use plastic household waste as an input for toys. The challenge was to join forces on the technical and legal aspects and bring a shared product to the market. Initiative 2, abbreviated as 3D PRINT, is about using contaminated plastic waste as printing material for interior products in retail and hotels. The challenge was to create a circular network by coupling input and output, within technical boundaries of scale and purity of the input material. Initiative 3, abbreviated as GULLY, is about the development of a recyclable road gully made from plastic household waste. The challenge was to create a supportive supply network in the plastics sector.

actorsCollaborating Inspection bodies, granulate supplier, injection companiesmolding Retail, dyepark,company,shreddingsciencesocialworkplace,suppliers

Develop a recyclable road gully to support climate adaptation

Recycling compoundingcompany,company, crate producer, gully producer, building company, science park

5.3.2 The case study

Table 14: Overview of the initiatives in the case study 1: TOY 2: 3D PRINT 3: GULLY

The third data source comprised 15 informal conversations with CSRNL and the businesses and program data in terms of documents and reports, listed in Appendix E. These sources functioned as complementary sources to validate the findings of interviews and community of practice meetings.

This paper is based on three main data sources, which were collected from October 2018 until July 2020. The first data source comprises 8 semi-structured interviews with the intermediary and the businesses of the case initiatives to obtain a concise picture of collaboration partners, boundary work activities and the contribution and limitations of CSRNL. The interview protocols were different for the intermediary and the business in order to bring out (in)consistencies between the boundary work activities and their perceived contribution to the CBMI (Appendix D). The second data source were 7 community of practice (COP) meetings where the businesses and CSRNL were present. These meetings functioned as a useful source for eliciting barriers and opportunities perceived by the businesses, and were supported by documentation (such as timelines and meeting notes).

The higher production price of recycled plastic in relation to concrete in compensated when reviewing the overall costs, as installation of a plastic gully is easier and lighter and the plastic gullies last four times longer than concrete gullies.

CSRNL functions as a facilitator, matchmaker and lobbyist to help institutionalizing sustainability innovations from entrepreneurs, and therefore act as a ‘champion’ to promote circular innovation (Fleming and Waguespack, 2007; Martiskainen and Kivimaa, 2018). The case study concerns the role of CSRNL in their two-year program ‘Plastic Packaging Waste as Raw Material’ (2018-2020). This program aimed to promote a second life of household plastic packaging waste by focusing on their procurement and their integration in product- and business model innovation. All Dutch businesses could subscribe to join this program.

A thereturnyields,indirectmission’forcirculardesign-orientedproduct‘clientswithabasedonnexttodirectincludingandre-meltoffocalproduct

The focal Dutch intermediary organization is the umbrella organization of businesses who are committed to sustainability and responsibility, Corporate Social Responsibility Netherlands (short: CSRNL). CSRNL calls itself a “movement of companies for the new economy” (CSRNL, 26-05-2022).

The analytical process started with the development of discovery memos based on the interview transcripts, conversations, observations and documents (G. Bowen, 2009). The discovery memos were written in the original Dutch language of the initiatives. Using the full data, we coded text segments that reflected boundary work activities mentioned by the intermediary or by the

5.3.3 Data collection and analysis

Business case A structural, highquality plastics supply lowers research costs to create affordable recycled plastic and a positive financial business case

5.4.1 Exploring boundaries and boundary changes

Boundary work activities of CSRNL

96 businesses. The coded text segments allowed for identification of the different activities and their initiators, e.g. ‘motivating agreements, ‘matchmaking’ and ‘organize timeline sessions’ by the intermediary, and ‘creating letter of intent’, ‘negotiate product quality’, and ‘experiment inhouse’ by the businesses as 1st order codes. This is where the Dutch language was translated into UK codes. To be able to categorize the activities, we allocated the open codes to higher order codes in line with the boundary work phases by Velter et al (2020), the concerned organizational boundaries by Santos and Eisenhardt (2005) and the involved actors following axial coding (Corbin and Strauss, 2013; Creswell, 1998). After this, a cross-case analysis allowed us to find commonalities in the boundary work activities of CSRNL and their perceived contributions and limitations for the businesses. Fitting the purpose of theory testing, the results are presented through interpretive description of actions and meanings of the interacting organizations in the different boundary work phases (Gehman et al., 2018; Gioia et al., 2013; Sandelowski, 2000; Thorne, 2008). The integrated quotes are in English, yet it must be noted that they have been translated from the original Dutch language of the businesses.

5.4

In the early stages of the program, CSRNL took an active role in catalyzing the CBMI processes of the businesses through creating the starting conditions; a boundary space in which they stimulated the businesses to scope their innovation (with circularity as a prerequisite), share contacts and reach out to other businesses, as well as resource mobilization in terms of funding for the hours and materials involved. CSRNL also organized matchmaking between the businesses, both through events and intentional, case-specific matchmaking. For example, the initiating businesses of the TOY initiative were competitors in the toy industry. CSRNL envisioned that the scale and the consumer panel of the large retailer would benefit the toy wholesaler, whilst the knowledge of the toy wholesaler on legislative requirements for toys would be beneficial to the large retailer. CSRNL decided to introduce the firms and proposed to join forces, which the firms followed-up afterwards. Throughout the program, CSRNL organized COP meetings, where businesses could share ideas, exchange knowledge, and ask for help. At one of such meetings, some businesses asked CSRNL to address existing European EFSA legislation that functioned as a barrier to the use of waste in consumption goods: “the entrepreneurs said, now is the time to also discuss the elephant in the room, and that is a piece of legislation” (Interview CSRNL, 2020). In response, CSRNL addressed this issue at the Ministry of Infrastructure and Water Management, which resulted in a ‘Plastic Pact’ that aimed to explore the broadening of the EFSA legislation. CSRNL also organized

Findings

Contribution to boundary work of the participating businesses

All businesses were aware that they faced a challenge to create a supportive stakeholder network. In one of the COP meetings they talked about having to keep ‘fighting’ to accommodate this material flow, that they needed to keep motivating each other and don’t lose sight of the business model.

The businesses from all three initiatives indicated that the program made them to explore future partners and reach out to potential alliances that were previously unknown to them. For example, the wholesale company from initiative 1 explained that: “It was a new market for us, we had never heard of an injection molder before, we didn’t even know what it was. For granulate, I thought it was quite different ” (Interview, 26-06-2020). In this process of exploration, CSRNL facilitated connections between prospective partners. In addition, the businesses themselves showed two different strategies of stakeholder exploration. Both the TOY and the 3D PRINT initiatives engaged in stakeholder exploration themselves, in which they looked for persons and organizations with similar mind-sets, understanding of typical innovation failures, and a willingness to experiment.

97 timeline workshops to help the businesses learn from their innovation trajectory. In these timeline workshops, initiatives untangled and mapped their innovation trajectories and learning processes, and shared their experiences with other initiatives for cross-case learning. “ We had a number of timeline sessions, in which we untangled the process as a whole, what were you running into, and where could you succeed in the future because you’ve already done this now? So let’s say very process-based ” (TOY, wholesaler, personal communication, 26-06-2020).

This is where existing processes, competences and power boundaries obstructed the potential collaboration, but the initiatives did not seek collaboration with stakeholders of a different character or sector. CSRNL stepped in and connected the initiative to a different party, which would shred the badge on a voluntary basis. Another strategy of stakeholder exploration was shown in the GULLY initiative, where the construction company hired an external process intermediary that knew the plastic sector well. They did so as they had to establish an entire novel value chain on plastics instead of their existing wood partners and perceived CSRNL to have inadequate specialized knowledge of technical issues in their sector, as well as connections with the right stakeholders to collaborate with. The hired process intermediary invested intensively in getting to know potential partners through field visits, which the construction company perceived as a

Still, finding partners that were willing to take a step further and experiment with the recyclate proved difficult, as the interviewee from the 3D company explained: “ We made a lot of phone calls ourselves and asked other companies, but nobody could shred our input because it was such a specific flow and because it was important that it remained clean” (Interview, 10-07-2020). The scale of the plastic waste badge proved too big for the start-up to shred by themselves, but too small for the regular industry, and the demanded quality and purity level proved challenging too.

Coaching happened mostly during the timeline sessions and COP meetings. During one timeline session, the 3D printing company repeatedly expressed their concerns with collaboration. As a start-up, the business found it challenging to engage with external partners, while these were necessary for them to scale-up their business. After the matchmaking with another business, who offered to shred the plastic waste source for the printing company, a conflict emerged as the shredded stream got contaminated. CSRNL engaged with the printing company to reflect on what has happened. The 3D printing company stated that this made them realize that they had entered into this exchange without specifying their requirements, for which there seemed to be misaligned expectations on the pureness of the shredded stream, and that they responded in a classic producer-client relationship way rather than looking for a joint solution.

5.4.2

The second boundary work activity in the brokering phase was mediating support of CSRNL, which was particularly exemplified by the TOY initiative. Where initially the wholesaler and retailer seemed to be progressing on joining forces after being introduced by CSRNL, this stagnated when they started to discuss the terms of collaboration. The potential partners had trouble to agree on the exclusivity of commercial relationships and intellectual property rights, which can be interpreted as an incongruity on the boundaries of power. The wholesaler wanted to be able to openly distribute the product to their customers, while the retailer demanded exclusivity to selling the toy. This was detected and discussed internally by CSRNL via e-mail correspondence. In response, CSRNL took a more pro-active role in this issue, and offered mediating support to the initiating business: “Have you contacted the retailer? Do you intend to do this? If you want, I could do this for you. I can insist on the importance of cooperation and that exclusivity would be a shame for them. Just let me know if you need it ” (CSRNL, e-mail correspondence, 2-10-2018). The businesses however felt that they could deal with this incongruity themselves, after which CSRNL was no further involved. Ultimately, the wholesaler and retailer came to agreement on what issues

After reaching out to potential partners, the businesses struggled to come to agreements with each other, particularly on issues of power (in terms of exclusivity and property rights, as seen in the TOY initiative) and competencies (in terms of scale and quality demands). They indicated that these issues needed to be solved before a business case could be created, but we observed that CSRNL only came to action after these issues had surfaced. The brokering phase concerned activities of CSRNL in the form of coaching and mediating once incongruities had emerged.

98 success factor for alignment in later phases, but this exploration remained limited to value chain partners rather than other types of organizations.

B oundary work activities of CSRNL

Brokering boundary incongruities

unsuccessful boundary brokering made the businesses adopt new activities themselves. The businesses faced challenges to re-align manufacturers: injection-molding companies were found not to include certain production lines or to have a strong preference for their own production processes. Granulate suppliers, in turn, indicated that they could not meet the chemical requirements under toy safety legislation or were unable to supply the desired bright colors. As a result, the retailer and toy wholesaler explored whether they could coordinate the manufacturing activities themselves, which led to the decision to temporarily hire a molding factory.

All businesses dealt with boundary incongruities without help from CSRNL, in which some succeeded better than others. Even though the process was full of hurdles, a successful example of boundary brokering was the 3D PRINT initiative. The 3D printing company faced challenges to manage expectations and roles between their suppliers and their launching customer, the retail company (which became involved both as a provider of discarded plastics and user of the printed product). This was mainly due to the novelty of using recyclate as printing input, their dependency on volume and quality on the suppliers and the uncertainty about the resulting product. Transparency about expectations and challenges proved critical to maintain trust and create room for failure. The 3D printing company explains: “There was quite a lot of drama there […] it was important to communicate well with each other, in which you clearly state ‘this is now how you have delivered it, that is not as agreed, but can you agree to this solution? ’ (Interviewee 2, 13-07-2020). Delivery of the printed product to retail was strongly delayed, which would have been disastrous for the 3D printing company if the retailer held them accountable: “ We were much stressed about that, we had a lot of problems with the production, and in the end [the retailer] was very reasonable, they kept asking for implementation, but they never mentioned that contractually, we could be bankrupt for not delivering on time ” (Interviewee 2, 13-07-2020). Next to radical transparency, a success factor was that the 3D printing company was willing to enhance their own effort by taking up orchestrating roles: “Our role was slightly larger than had been agreed. We did indicate that a number of times in the contact […]. We have clearly communicated a number of times that we are deviating from the agreed plan” (Interviewee 1 start up 10-07-2020). CSRNL did not play a role these Innegotiations.theTOYinitiative,

99 to combine efforts in the innovation phase, and that as soon as the product would be ready for market-introduction, their roads would separate again. “ We have signed an agreement with [the wholesaler], which does not immediately state that we will bring it to the market, but it does state how we work together. And when we put it on the market, we refer to each other as partners, because it was a joint project ” (Interviewee retailer, 9-7-2020).

Contribution to boundary work of the participating businesses

Second, the CBMI required the businesses to take extra steps when working with a product made from recycled instead of virgin material, which also meant that the businesses were more risk

5.4.3 Implementing boundary changes

Boundary work activities of CSRNL

Direct activities of CSRNL in the implementation of boundary changes comprised a reflective session on which the businesses shared their learnings of the CBMI process and the future goals of their pilot. There was no intentional activity of CSRNL to embed the potential new or refined identities, power relations, competences or activities in the boundaries of the businesses and their partners. Contribution to boundary work of the participating businesses At the end of the program, all three initiatives still had boundary issues to deal with before fully implementing the new business model: “the business case is not complete until the challenges have been removed and we know where and how we can produce ” (TOY initiative, interview retailer, 0907-2020). Still, the data reported that the program did have a twofold effect on the organizational boundaries of the participating businesses. First, the program stimulated businesses to engage in CBMI, which they often did not do before. Ultimately this helped to develop and implement circular mind-sets on the identity level: all three initiatives stated that CSRNL had shifted their perception of sustainability and opened up new visions and innovation opportunities. The wholesaler expressed that “The project has been a kind of guiding force in that [novel mindsets]. It suddenly starts to live, even employees who have nothing to do with sustainability see that more things are possible with plastics ” (26-06-2020). This shifted mind-set was implemented into the vision of the organization: “ Within the management team, sustainability is just much more alive. The program was a good example of this, and that awareness has grown much bigger […] it really opened doors for us. We now see more possibilities and the topic more vividly. We even set up a sustainability vision here ” (Interviewee wholesaler, 26-06-2020).

100

They indicated that they found no need to ask CSRNL for help; “Did they help us in our supply chain? No, we really did that on our own. Their help was not really necessary because we mapped out the chain ourselves, and we also entered into discussions with those partners ” (Interviewee retailer, 09-07-2020). They also indicated the inherent limitations of CSRNL regarding their position as intermediary: “They had a facilitating role, motivating us to engage with the partners ourselves. This has not been explicitly mentioned, but CSRNL cannot take over our business operations or negotiating position” (Interviewee retailer, 09-07-2020). The GULLY initiative also did not make use of brokering support from CSRNL as they outsourced this to their own process intermediary.

5.5 Discussion and conclusion

The goal of this chapter is to elicit the contribution and limitations of intermediary-led boundary work for businesses engaging in CBMI, whilst furthering theory-building on boundary work for CBMI.

5.5.1 Discussion of the main findings

In the TOY initiative, both the wholesaler and retail company adopted an additional role to enable their circular resource stream. Usually, they had everything produced and purchased externally, while this program demanded assurance that the toys were made from household waste, which proved to be a challenge for their conventional manufacturers. As a result, they started collaborating with their manufacturers’ raw material providers to explore materials and its compliance with legislation. The interviewee from the retailer explained “In this program, we had a much broader responsibility and role, because we also started looking back into the value chain, together with [the toy wholesaler]. So not only to the partners who could make the product, but also to the supplier of the raw material. That is not common for the producer ” (09-07-2020). Apart from developing collaborative competences, the businesses also stressed that they needed more help in developing their internal CBMI competences. The community of practice meetings were found useful by the businesses to aggregate knowledge on CBMI processes and meet likeminded companies, but they found them less useful for managing their own innovation process.

This research finds that the intermediary was particularly valuable for businesses in early, exploratory stages of boundary work. To start with, the intermediary was crucial for catalyzing

The retailer of the TOY initiative explained; “what actually benefits us is to better manage that innovation process. […] I think there may be a need for a coach, for example a LEAN start-up coach, who says ‘we’re stuck here’, to take on that role more actively. That would have benefited us a little more than the meetings they organized, which were very much like ‘where do we stand’. That was really nice to hear, but it didn’t really help us in our project ” (Interview, 09-07-2020).

101 bearing. They had to collaborate with organizations beyond their direct scope, and adopt new roles, all shifting their boundary of competence: “ We will have to get used to the fact that we have to engage with more stakeholders in the value chain to enable innovation. Innovation is possible with our current partners, but sometimes we have to take control of the chain ourselves to enable innovation. As a project owner, we can do that, I think we have the leverage in the chain to do that. We cannot always expect that to come from a producer ” (Interviewee retail company, 09-07-2020).

Contribution of intermediary-led boundary work

In line with this intention, this section discusses the findings against the conceptual background outlined in section 5.2.

This study makes clear that future intermediary work can benefit from a dedicated focus on the organizational boundaries in a multi-stakeholder setting. The focus on different organizational boundaries in early stages of the process might help both the intermediary and the businesses to timely identify dissonances and potential clashes in view of the CBMI ambitions, improve successful matchmaking beyond traditional prospects (for example, on shared values rather than on complementary activities) so that they are better equipped for the boundary brokering phase.

Limitations of intermediary-led boundary work

As a limitation, the intermediary did not promote a multi-stakeholder focus, as known to be critical to successful CBMI (Velter et al., 2020). The focus of the program was primarily on creating a supplier collaboration instead of a system-perspective in which consumers, citizens, NGOs and other public organizations are involved to potentially enhance the value created. In addition, exploration of partners happened rather ad-hoc and on a technical basis instead of a focus on (changing) identities, power configurations and competences of the businesses and their potential partners. This affected the need the businesses felt to engage in boundary work and led to unanticipated boundary gaps and clashes in brokering stages. Through a multi-stakeholder, organizational boundary perspective, this program could potentially have led to wider transformative change (Hillman et al., 2018; Kemp et al., 1998; Sarasini and Linder, 2017). Consequently, there were clear limitations in the intermediary’s ability to shift organizational boundaries beyond the initiating business, towards their respective stakeholder networks. This could have been done, for example by scoping a shared CBMI vision between stakeholders, as is known from values-based innovation approaches (Breuer and Lüdeke-Freund, 2017) and translating this into potential boundary changes of the distinctive organizations (Velter et al., 2021a).

102 CBMI processes by mobilizing resources through its two-year program and creating a supportive environment (Pedersen et al., 2021). The intermediary was also valuable in helping the businesses scope their circular innovation and by proposing potential allies, as well as influencing the mindset of the initiating businesses. This confirms the value of intermediaries as is known by literature on institutional work for sustainable entrepreneurship (Bhatt et al., 2019; Zietsma and Lawrence, 2010) resource mobilization (Kanda et al., 2015) and the creation of boundary spaces as part of arrangements for facilitating interaction between potential allies (O’Mahony and Bechky, 2008; Parker and Crona, 2012). When difficulties arose, CSR mediated (on power), which helped to create initial partnerships. On the organizational level, the work of CSRNL contributed to formulating new visions and experimenting with new boundary configurations for the initiating businesses, which is known to be important for CBMI (Bocken and Antikainen, 2019; Bocken et al., 2021; Bojovic et al., 2019).

5.5.2 Contributions to practice

The findings allow us to make contributions to the literature on CBMI as well as to the literature on intermediaries. Contribution to CBMI: a reflection on the application of boundary work

103

To enhance the success of CBMI, businesses are thus advised to organize tailor-made boundary work through simultaneous cooperation with complementary types of intermediaries, such as innovation intermediaries or process intermediaries.

In the brokering phase, a boundary work focus might help to strategize brokering and arrangements beyond technicalities (for example by designing boundary objects for different boundaries, or sequencing the involvement of stakeholders, including non-business actors) (Velter et al., 2021b).

Our findings contribute to emerging theory on boundary work for CBMI in four ways. First, it elicits the focus of the intermediary and its implications for assisting businesses in their boundary work. Second, it elicits the boundary issues experienced by the businesses in three stages of the boundary work process and the potential of the intermediary to assist the businesses in dealing with these issues (Gehman et al., 2018; Velter et al., 2020). Third, this study points at the relevance of reflecting on a businesses’ own boundaries. Fourth, this study amplifies the need to help businesses and their stakeholders in developing a boundary work capability.

Depending on whether the intermediary is able to adopt multiple roles themselves (as mentioned in Kivimaa et al., 2019), various types of intermediaries might be needed to navigate boundary reconfigurations throughout the entire boundary work process, including the phases of brokering and implementing, This might also help to address the expressed limitation of the intermediary in terms of substantive knowledge, for which other type of intermediaries or actors might be sought.

5.5.3 Contributions to theory

Whereas studies on intermediaries has mostly studied their activities in particular cases, integrating boundary work helps to better understand the interaction between the intermediary activities and the organizational boundaries it aims to develop or shift. We did not observe intermediary activities that were not previously defined in contexts of sustainability-oriented innovation (Bird and Barnes, 2014; Kanda et al., 2015; Kivimaa et al., 2019; Patala. et al., 2020; Warbroek et al., 2018), but we did observe that CBMI has particular intermediary needs regarding the navigation of tensions on material ownership, distribution, quality and scale between stakeholders that could have better catered for. This requires a focus of intermediary activities on the interaction between the business and its multiple stakeholders, and necessitates a reflection on existing boundaries and envisioned reconfigurations.

Contribution to intermediary literature: a focus on interactions rather than activities

The positioning of this research at the interface between the intermediary, businesses and their businesses stakeholders makes it difficult to establish a causal relation between the intermediary activities and the boundary changes of the businesses and their stakeholders. Wider explanatory value and further empirical robustness of the findings of this paper may be reached by studying more cases of intermediary work in CBMI over a longer timeframe. This study describes the experiences of one systemic intermediary and some of the businesses involved in a dedicated program by the intermediary, which limits the findings to an in-depth understanding of this particular intermediary in this particular empirical context. In addition, while this research provides snapshots of the boundary work, the two-year timeframe does not cover the full innovation and implementation of the circular business models. We therefore call for more longitudinal research to examine the longevity and effectiveness of our observations. We also point at the potential of future work to inquire the boundary work activities of other types of intermediaries, and where and how they complement each other. Conceptually, a separate research stream could study strategies of intermediaries to deal with tensions and paradoxes in particular boundary changes, contributing to studies from Bojovic et al. (2019); Poole and Ven (1989); Smink et al. (2015); and van Bommel (2018).

5.5.5 Conclusion This paper indicates that boundary work for the innovation of circular business models is still rather unexplored terrain for businesses and intermediaries. Different from conventional business model innovation, CBMI involves larger uncertainties and risks, and amplifies the challenge to manage expectations at the start and throughout the process. This provides reasons to believe that intermediaries can make important contributions to the businesses’ boundary work processes for CBMI. This study shows that a single intermediary alone can potentially and partly provide such contributions, particularly in early stages of CBMI, but complementary intermediaries should be sought to support businesses along the entire boundary work process, when tailored boundary work, deeper in the value network is needed to re-align stakeholder boundaries.

104 5.5.4

Limitations and further work

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Chapter 6. A boundary tool for multi-stakeholder sustainable business model innovation

Published as: Velter, M. G. E., Bitzer, V., & Bocken, N. M. P. (2021). A Boundary Tool for Multi-stakeholder Sustainable Business Model Innovation. Circular Economy and Sustainability. doi: 10.1007/s43615-021-00103-3

6.1 Introduction Over the past few years SBMI has gained attention as a necessary means to contribute to sustainable development and the circular economy (Bolton and Hannon, 2016; Nikolaou et al., 2021; Pieroni et al., 2019; Stubbs and Cocklin, 2008). To reach this sustainability potential, multiple studies have found that this requires a collaborative process which innovates the business model of the initiating company (Lüdeke-Freund et al., 2016; Luzzini et al., 2015; Rohrbeck et al., 2013) and aligns the business models of multiple stakeholders (Bogers et al., 2019; Oskam et al., 2020; Pedersen et al., 2021). However, such a multi-stakeholder collaborative process is extremely difficult in practice as stakeholders often have different priorities, value logics and business models

Sustainable business model innovation cannot reach its full sustainability potential if it neglects the importance of multi-stakeholder alignment. Several studies emphasize the need for multi-stakeholder collaboration to enable sustainable business model innovation, but few studies offer guidance to companies for engaging in such a collaborative process. Based on the concept of boundary work, this study presents a tested process tool that helps companies engage with multiple stakeholders to innovate sustainable business models. The tool was developed in three iterative phases, including testing and evaluation with 74 participants in six sustainable business model innovation cases. The final process tool consists of five steps to facilitate multi-stakeholder alignment for sustainable business model innovation: (1) defining a collective ambition, (2) mapping and negotiating the changing organizational boundaries, (3) exploring opportunities and tensions for aligning stakeholders, (4) defining first interventions, and (5) developing a collaboration pitch. We found that the tool enables discussions and negotiations on sensitive topics, such as power reconfigurations and mutual responsibilities to help stakeholders align. For companies, the boundary tool enriches sustainable business model innovation by offering guidance in the process of redesigning their multi-stakeholder system, assessing their own organizational boundaries, exploring, negotiating and prioritizing strategic actions based on organizational boundary changes, and kick-starting new partnerships.

Chapter 6. A boundary tool for multi-stakeholder sustainable business model innovation

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The boundary tool presented in this paper addresses the changing and interdependent stakeholder boundaries involved in collaborative SBMI. This helps companies to engage with multiple stakeholders and improve alignment for the purpose of SBMI. The tool has been thoroughly tested in a design science research process with 74 participants from multiple organizations of different sizes, from different sectors and with different organizational characters (companies, intermediaries, NGOs, educational- and research institutes etc.). Testing comprised six sustainable business model innovation cases with companies that needed, or were involved in, boundary work with multiple stakeholders. While aiming at innovation managers in companies, the tool may also inspire innovation with NGOs, citizen initiatives and policy makers.

To develop the boundary tool, this chapter first describes the need for a tool for multi-stakeholder SBMI and the potential of the boundary work framework to address this gap, which leads to the objectives of the tool. Subsequently, the research method describes the approach of this study and

109 that pose significant challenges in finding mutual value opportunities and overcoming barriers for alignment (Oskam et al., 2020; Powell et al., 2018). As a result, many companies tend to set the scope of their SBMI process rather narrowly to avoid having to deal with multiple stakeholders in lengthy and complicated processes (Chen et al., 2017). Instead, they often opt for bilateral collaborations with producers and customers, which leads to incremental innovations rather than exploring more farreaching innovations necessary for sustainable business models (Brown et al., 2020; Chen et al., 2017; Shrivastava and Guimaraes-Costa, 2016).There is thus a crucial need to broaden the scope of SBMI and support companies in collaborating with critical stakeholders (Bocken et al., 2019a; Brown et al., 2019, 2020). While important work is being done to assist individual organizations involved in processes of SBMI (e.g. Brown et al., 2021; Leising et al., 2018; Oskam, 2020), a multi-stakeholder approach that supports the development of collaborative stakeholder environments for this purpose is missing (Bocken et al., 2019b; Breuer et al., 2018; Oskam et al., 2018; Pieroni et al., 2019).

To address this gap, the goal of this paper is to present a practical tool designed to support companies (or other organizations) in sustainable business model innovation based on a multistakeholder approach. The tool draws on boundary work, as a suitable perspective that supports exploring, negotiating, and implementing multi-stakeholder interactions on organizational boundaries (Keränen et al., 2020; Santos and Eisenhardt, 2005; Velter et al., 2020). We focus on the changing organizational boundaries of identity (the choice of ‘who we are’), power (the ability to control relationships), competence (resources, capabilities, knowledge) and efficiency (activities and transactions). These types of boundaries have been identified as critical elements in processes of sustainable business model innovation (Keränen et al., 2020; Velter et al., 2020).

6.2.1 The need for a tool for multi-stakeholder SBMI

110 its processes of data collection. This is followed by a description of the findings and implications for tool development in different stages of the research. The chapter then discusses the contributions of the paper to the theoretical and practical domain of SBMI, the implications and limitations of the study, and avenues for further research. The chapter ends with the conclusion and the key benefits of the boundary tool for companies.

Table 15: Review of SBMI tools. Developed from Bocken et al. (2019b); Breuer and Lüdeke-Freund (2017); Circular (2021); Oskam (2020); Pieroni et al. (2019) Tool name Author(s) Type of tool objective Bocken et al. (2013)

stakeholdersonPerspectiveexternal focusStakeholder inclusionStakeholder FrameworkCirculaire)Model(BusinessBM3C2 2021)Antheaume,and(Boldrini toolStrategy Visualizing the parties businessaligningconnectinginvolved,andtheirmodels Value organizationinternalcompetences,andresourcesflows, Explicit possiblefocusstakeholderMultiToolEcosystemInnovationCircular etKonietzkoal.(2020) toolCreative Analyze, ideate and develop the circularity potential of the ecosysteminnovation strategiesCircular Implicit ideasparticipantonDepending Value Mapping Tool

Tool

6.2 Theoretical framework

toolAssessmentandCreative Understand positive and aspectsnegativeofthe value proposition, identify conflicting values and opportunities for modelbusinessredesign opportunitiesvalueanddestroyedwasted,missed,created,Valuenew Explicit focusstakeholderMulti-

The redesign of a company’s stakeholder network is a key challenge for SBMI (Antikainen and Valkokari, 2016; Breuer et al., 2018; Urbinati et al., 2017). Due to this complexity, there are different SBMI tools that take into account the company’s external stakeholders in an implicit or explicit manner (Table 15).

111 ModelBusinessTriple-layeredCanvas Joyce (2016)Paquinand toolCreative Support the creative exploration of orientedandbusinesssustainablemodelssustainability-innovation Value created Explicit actorsparticularfor Limited stakeholdersparticularto PieEcosystemModel Talmar et al. (2020) toolStrategy Map, analyze and design ecosystemsinnovation ValueAddition,ValueActivities,Resources,Capture Explicit Variably CanvasCollaborationCircular Brown et al. (2021) toolCreative Think in detail upon a circular value proposition Power, propositionValue compoundedImplicit, No focusstakeholder(multi-) buildingtoolCollaborationforthesector Leising et al. (2018) Process tool collaborationEnhance for CE in the building sector ActivitiesVisions, No focusactor Limited to market & supply chain mappingmodelbusinessCircular tool Nußholz (2018) toolCreative Offer a businesscyclesandofrepresentationstandardizedelementspossibleofcircularmodels valuedelivery,creationValueproposition,Value&capture compoundedImplicit, No focusstakeholder(multi-) CanvasBusinessFlourishing Upward and Jones (2016)` toolCreative Modelling across living ecosystems and social systems Value destructionsvaluecreations,co-co- compoundedImplicit, actorsecosystemenstakeholders PackInnovationSustainability Breuer (2015)FreundLüdeke-and toolAssessment Review shared values for modelling SBMs Touchpoints compoundedImplicit, No focusstakeholder(multi-) canvasbusinessSustainable (2014,andTiemannFichter2016) toolCreative entrepreneursSupport and start-ups in their design of SBMs powerpropositions,Value compoundedImplicit, No focusstakeholder(multi-) InfrastructureBMC Foxon et al. (2015) toolCreative economic,thatbusinessinfrastructureDesigningmodelsincorporatesocial and environmental aspects streamsValue propositionsand compoundedImplicit, No focusstakeholder(multi-)

While these tools are suited for innovating the multi-stakeholder value aspects of SBMI, they overlook interdependent and underlying issues of power, identity, and competences of the various stakeholders that influence the alignment of these stakeholders (Baldassarre. et al., 2020b; Oskam et al., 2020). This study addresses this gap by developing a practical tool that assists companies in (re-)aligning their own organizational boundaries in coherence with reconfigurations in their multistakeholder network. The tool is developed based on the boundary work approach that integrates boundary phenomena in contemporary multi-stakeholder environments (Santos and Eisenhardt, 2005; Velter et al., 2020).

ActionsResources, compoundedImplicit, No focusstakeholder(multi-) Degree diagramengagementof (2020)Oskam toolandStrategyprocess Enable engagementstakeholderdegrees

6.2.2 A Boundary work approach to SBMI SBMI necessitates multi-stakeholder collaboration to realign organizational boundaries, yet prevailing studies fall short with tools that help practitioners to engage in such boundary work (Bocken et al., 2019b; Breuer et al., 2018; Oskam et al., 2018; Pieroni et al., 2019). Boundary work is a highly iterative process of navigating mutually dependent values, strategies and concrete actions of interdependent stakeholders without external control (Fleming and Waguespack, 2007).

112 SBM CanvasPilot (2020b)etBaldassarre.al.

Tools are artefacts that can support understanding, assessment, creativity and/or change on particular practices, such as (broadly applicable-) guidelines, checklists, or artefacts with an analytical focus (Bocken et al., 2019b; Romme and Reymen, 2018). However, existing tools for SBMI generally address the value creation & delivery system in an implicit way and with a focus on value innovation. Fewer tools are available that illuminate and address the interdependencies between stakeholders (e.g. Bocken et al., 2013; Oskam et al., 2020; Talmar et al., 2020). For example, the Value Mapping tool (Bocken et al., 2013) explores the multi-stakeholder network on value propositions, the Ecosystem Pie includes external stakeholders’ resources and activities that can be utilized to create and capture value (Talmar et al., 2020), and the Degree of Engagement Diagram (Oskam, 2020) guides practitioners with engaging multiple stakeholders along the SBMI process. The Sustainable Business Model Tool elicits tangible resources and competences as well as internal costs and impacts in relation to a common objective (Boldrini and Antheaume, 2021).

Recent studies on SBMI describe boundary work as the iterative activities of exploring, negotiating, disrupting and re-aligning organizational boundaries around sustainable value propositions and

Process tool Translate sustainable business model ideas into smallscale pilots

Roles Explicit focusstakeholderMulti-

113 capture mechanisms (Velter et al., 2020). To develop a tool that assists such reconfiguration processes for SBMI, this study sources from organizational boundary theory to define architectural building blocks, and from boundary work theory to define processual building blocks.

On the architectural side, SBMI affects organizational boundaries of identity, power, competence and efficiency (Keränen et al., 2020; Santos and Eisenhardt, 2005; Velter et al., 2020). On the identity dimension, typical boundary reconfigurations are the integration of a social and environmental objective in the normative orientations of the organization (e.g. mission, vision, value statements), and which is shared between organizations to develop stakeholder networks (Bojovic et al., 2019; Breuer and Lüdeke-Freund, 2017). The power boundary is typically reconfigured by a focus on network competitiveness and long-term contracts with a large element of trust instead of individual power accumulation and transactional relationships (Bolton and Landells, 2015). The boundary of competence typically shifts towards inclusion of repair and remanufacture skills, circular design, modular processing, but also more intangible aspects such as network collaboration, dynamic capabilities (Bocken and Geradts, 2020; Inigo et al., 2017) and experimentation capabilities (Aagaard et al., 2020; Bojovic et al., 2019; Weissbrod and Bocken, 2017). On the efficiency boundary, SBMI promotes a shift in the division of roles and activities. While each boundary dimension deals with a different organizational issue (i.e. coherence on identity, autonomy for power, growth for competence and transaction costs for efficiency), they are interdependent within the organization and between organizations (Figure 8).

Figure 8: Framework for organizational boundary alignment in SBMI. Based on Keränen et al. (2020); Santos and Eisenhardt (2005); Velter et al. (2020a)

SBMI thus not only requires changes in the boundaries of the initiating organization, but develops in conjunction with boundary changes of network actors, such as other companies, civil society organizations, policy-makers and intermediaries (Tsujimoto et al., 2015; Velter et al., 2020). It is likely to encounter clashes with current organizational boundary configurations and synergies on others (Kemp et al., 1998). A boundary work process can help companies in such reconfiguration processes through processes of organizational boundary exploration, negotiation, and reconfiguration around an SBMI ambition. Organizational boundary exploration helps to make boundary-spanning interactions and relations explicit, which assists the identification of the potential partner contributions, the different tensions to be addressed, and shifts individual problems to collective problems to be dealt with(Breuer et al., 2018). The latter is particularly relevant for innovation processes with a wide variety of stakeholders and that aim to exceed incremental forms of innovation (Breuer and Ketabdar, 2012; Ulrich, 2013). The negotiation of organizational boundary changes aims to reconcile tensions between current and envisioned organizational boundaries and to define interventions that accommodate these tensions. The reconfiguration of organizational boundaries happens through agreement, experimentation and embedding of the changes (Antikainen and Valkokari, 2016; Boons and Bocken, 2018). By bringing together the architectural and processual elements, we regard SBMI as a multi-actor boundary work process that requires extensive networking and continuous exploration and negotiation of mutual boundary reconfigurations in parallel to organizational boundary shifts that contribute to the development and implementation of sustainable business models. The notion of boundary work highlights that current boundary configurations and their interfaces can function as a lock-in for SBMI, whereas actively working on organizational boundaries could potentially function as a source of innovation.

6.2.3 Research gap: a tool for multi-stakeholder SBMI SBMI not only requires changes within a single organization, but also develops in conjunction with changes in the stakeholder network. These changes can be processes or activities (for example, producers experiment with recycled materials); skills (for example, recyclers need different processing methods); roles (for example, the role of system orchestrator, or service provider in addition to an existing role), and sometimes even a modified identity, by integrating a social purpose in the mission and vision of the organization. These changes all have to do with changes in organizational boundaries. The creation of a sustainable business model therefore requires a process of exploring, negotiating, and implementing organizational changes. As part of this process, this study presents two gaps on SBMI:

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2 T he practical gap of companies lacking tools to engage with their multi-stakeholder network to innovate sustainable business models.

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The purpose of this study is to address these gaps by developing a practical tool that assists companies in realigning their own organizational boundaries in coherence with reconfigurations in their multi-stakeholder network, to innovate sustainable business models. The potential of boundary work for SBMI to contribute to these gaps lies in its two-stream approach of, first, the boundary work process, being the exploration and negotiation of actor boundaries to promote boundary alignment, and second, the inclusion of architectural changes in organizational boundaries of the initiating firm and its stakeholders to develop sustainable business model(s).

The purpose of the tool is to assist companies in aligning multiple stakeholders for the innovation of sustainable business models. It aims to do so by integrating the changing and interdependent organizational boundary phenomena in SBMI on the company- and multi-stakeholder level. As part of this process, this tool focuses on: (1) crafting a collective SBMI ambition (2) mapping and negotiating the changing organizational boundaries of the individual organization and its multi-stakeholder network (3) exploring opportunities and tensions for stakeholder alignment (4) defining first interventions (5) forming a collaboration pitch We used the checklist for sustainability tool development (Bocken et al., 2019b) to determine the practical requirements of the tool: the tool should be easy to use, adaptable to the different SBMI ideas and stakeholder contexts of the users, and feasible to apply within a single workshop timeframe of max. 3 hours.

1 T he theoretical gap of a lack of approaches that integrate boundary phenomena of stakeholders in contemporary multi-stakeholder environments.

6.3 Methods 6.3.1 Research approach

This study used design science research (DSR) to develop the boundary work tool (Antikainen and Valkokari, 2016; Boons and Bocken, 2018). DSR intends to create artefacts as objects that embed solutions to an understood research problem (Peffers et al., 2007). According to DSR, the artefact development should be a search process drawing from existing theory and knowledge to come up with a solution to a defined problem, with its utility, quality and efficacy thoroughly evaluated.

6.3.2 Tool development process

We followed the stepwise DSR approach to develop the tool (Figure 9). In total, nine workshops were held involving 74 participants from six SBMI cases, where a case constitutes an initiating company and its various stakeholders. The workshops were facilitated by the first author. All workshops took place in the first quarter of 2021 and took between 1.5-2.5 hours. Due to the COVID-19 crisis, all sessions were held digitally. Start of the process We started the process by studying the practical problem of aligning external stakeholders for SBMI through a literature review, multiple practitioner interviews and discussions on topics of the framework (see Velter et al., 2020; Velter et al., 2021b; Velter et al., 2017). This led to the development of first objectives of the tool. Based on these objectives, we organized four expert panel groups with a total of 28 participants: eight entrepreneurs, three innovation managers, five sustainability managers, three intermediaries, four design students and five researchers in the field of Sustainability Transitions and Sustainability-oriented Innovation. Most of the participants did not know each other beforehand and were not familiar with each other’s SBMI trajectories. The expert panels comprised two-hour meetings of exploratory discussions on central elements of the framework. In addition to companies, each panel involved at least two other types of actors, such as an NGO, intermediary actor, academics and students. We used the software Mentimeter to pose questions centered on elements of the boundary work framework. Practitioners shared their experiences and needs regarding stakeholder alignment and sustainable business model innovation taking the Mentimeter questions as the starting point. This evaluation helped to refine the objectives of the solution and understand the different contexts and linguistic frames used by the participants, leading to an initial tool and workshop design.

The ability of DSR to integrate science and practice in developing solutions for stakeholders and users makes it appropriate for the development of a boundary work tool (Peffers et al., 2007; Romme and Reymen, 2018). In addition, in the context of boundary work for SBMI, such artefacts can function as boundary objects for societal problems too, on which the multiple stakeholders involved can frame, shape, refer to and use as means to accommodate organizational boundary changes (Fox, 2011; Hawkins et al., 2016; C. Lee, 2007).

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DSR facilitates a thorough scientific and empirical process of developing such an artefact, consisting of six steps of problem identification and motivation, definition of objectives for a solution, design and development, demonstration, evaluation and communication (van Aken and Romme, 2009).

We tested the initial tool and setup of the workshop in three trial runs with 16 participants in total. Two trial runs were held with academics and PhD students of sustainability-related research fields. As part of the Dutch Circular Economy Week, entrepreneurs, students, consultants, intermediaries and teachers joined the third trial run. Each trial run had a different fictional SBMI topic and stakeholder network. We evaluated the workshop using recordings, discussions at the end of the workshop, and a questionnaire that inquired the relevance of the tool for the targeted purpose, ease of use, conceptual clarity, learnings and recommendations (Appendix F). In addition to the trial runs, we demonstrated and discussed the workshop setup and tool with five companies, where we placed the tool in their SBMI context and gathered insight on the relevance of the tool for their organization, and improvements in setup and design of the tool. Evaluation took place using the discussions, recordings and meeting notes and led to an improved tool and workshop design.

Second iteration of the tool We tested the improved tool in six Dutch SBMI cases: in two internal workshops at companies, and four workshops with companies and their external stakeholders. The contexts in which the workshops were applied are as follows:

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- Arveco: A medium-sized company-clothing distributor that wanted to develop a circular business model and used the workshop to explore how they together with network partners can collaborate to use company-clothing for as long as possible. External workshop with the clothing distributor, reversed logistics provider, potential customers, funding company, intermediary, clothing producer, innovation company, educational institute (11 participants).

- Lightronics: A medium-sized lighting solution company that wanted to explore how to develop business models for future-proof and circular street lighting that takes into account interests of the users, surrounding residents and the natural environment. Internal workshop consisting of a sustainability manager, smart solutions consultant, tender manager and three circular economy students (6 participants).

- Lightronics: For the same company, the internal workshop was followed up by an external workshop with the initiating company, a light pole company and an educational institute (8 participants). The workshop focused on organizing the return process for street luminaires.

- Arapaha: A purpose-driven start-up that develops zero-waste, climate friendly and fossilfree consumer products wanted to explore their own boundary setting in relation to their network and identify stakeholder tensions to enhance circularity along the design, production and consumption of their products. Internal workshop consisting of the two directors and a communications employee (3 participants).

First iteration of the tool

be continuously demonstrated and improved. ProblemResearchdefinitiongap Objectives of the solution Objectives of the toolkit Tool development Initial ImprovedworkshopInitialquestionstoolanddesigntoolandworkshopdesignFinaltoolandworkshopdesign Continuous demonstration and improvement Demonstration 18195practitioners,4students,academics3trialrunsacademics 72entrepreneursinternalruns2cases9participants Observation 2 session recordings 2 discussions5forms 59demonstrations5casesentrepreneurs4externalruns28companies39participants Observation 4 session recordings &22reportsforms 8 impact assmnts Evaluation 4Observationdiscussions23forms 3 session recordings 32Discussionsdiscussions14formsrecordings 5 meeting notes Communication Narrative on one visualizedworkshopOnepaperAcademicpager&toolpager,onlineformat,workshoppresentationDigitalworkshopreportNL&UK,summary,workshoppresentationLiteraturereviewdiscussionsExpertPractitionerinterviews Iteration 1 Iteration 2 Iteration 3 Figure 9: Tool development process applied in this study

118 - Philips: A large health technology company that wanted to develop a structural way of reusing healthcare equipment in underserved communities. External workshop with a refurbished systems manager, access to care manager, medical donation NGOs, academic hospital, recycling company, innovation company, research institute and visual illustrator (11 participants).

We used observations, session recordings, digital reports of the content of the sessions and an extended questionnaire (Appendix G) to evaluate and adjust the workshop and tool. In addition, we inquired with the initiators about the impact on personal realizations, follow-up meetings and choices made after the workshop. Third iteration and final tool development The previous iterations led to the final tool and workshop presented in this paper. The tool and workshop can

- City Farm Brandevoort: A citizen initiative that aimed to develop a business model for a city farm. They were looking for partners to join this initiative and contribute to the social, sustainability and health ambitions of the city farm. External workshop with the initiators, an educational institute, horeca entrepreneur, coffee roaster, social workplace, green maintenance company and visual illustrator (9 participants).

design and accompanying files

6.4.1 The boundary tool The boundary tool is conceived to help companies engaging in or intensifying multi-stakeholder collaborations for sustainable business model innovation. The tool features a circle that centers on a collective ambition and is surrounded by four different organizational boundary dimensions (Figure 10). The boundary dimensions have a distinct color: light blue represents ‘identity and mindset’, dark blue represents ‘power’, black represents ‘competence’ and orange represents ‘efficiency’. The names of the boundaries’ dimensions have been adjusted based on the linguistic frames of the participants. A populated example of the tool can be found in Appendix H. Organizational boundary cards with similar colors support the tool (Figure 11). Each card contains the title of the boundary, a description of the typical reconfiguration and guiding questions that help participants to map the focal boundary changes and reflect on its internal alignment. The backside of the cards contains one or more examples of boundary changes. Figure 10: Boundary tool

119 6.4 Results

Based on this conversation, potential participants are identified, placed in the tool, and invited for the workshop. The expectations can be managed by presenting the boundary framework and workshop setup to the initiators, and asking them when they perceive the workshop successful. We also sent a one-pager containing the workshop description and relevance to the participants beforehand.

Offerwaste-to-productWeExampleareacompanyandincludesustainabilityineverydecisionwemakeExampleajointpropositiontothecustomerPromotelong-termuseShareownershipofmaterialsLong-termcontractsbasedonaddedvalueEnhanceaccesstoproduct UseKnowledgeExampleoncircularmaterials,design,(re)production,reuseUtilizelocalnetworksLearntoselladdedvalueUsecustomerbasetoexperimentUsemachineryforrefurbishmentExampleAdoptcirculardesignbiobasedmaterialsCollaborateregionallySeparateandexchangewasteflowsMonitorandrepairRefurbishRedistributeAnnualinvoicing

The boundary work tool can be used in a workshop with multiple type of stakeholders, such as companies, NGOs, governmental agencies, consumers, and research and educational institutes. These stakeholders do not have to be collaborating with the initiating company yet, and can even be stakeholders from other sectors that have the potential to be relevant for the SBMI case, such as remanufacturing or recycling organizations. The workshop setting is chosen to facilitate debate and collaborative discussions on issues that a single stakeholder might face. Pre-workshop preparation

Processes & activities What of our activities can we utilize for the collective ambition? Is there a need to develop or adopt new activities? Do the activities fit our identity?

120 Identity & mindset

For-benefit becomes an objective equal to profit Fair sharing of costs and benefits, enhancing network competitiveness

Why does our organization exist? What values do we stand for and Does our identity fit the collective ambition, or is there a need for accordingDoWatonourHowRelationsadjustment?&contractingdoestheambitionchangedependencyandinfluencepartnersandmaterials?canwedotoalignpartners?wehavethepowertoacttoouridentity?

Acquiring new competences, such as repair, remanufacture, circular design, remanufacture,enablingoutsourceChange,collaborationnetworkdeveloporactivitiesreuse,repair,redesign

Figure 11: Organizational boundary cards

6.4.2 The process of using the tool

In preparation of the workshop, a discussion should take place with the initiating company to frame the problem and manage expectations of the workshop. The problem can be framed by discussing the SBMI ambition, the relevant stakeholders (collaborators and non-collaborators), and the main issues that the company faces in aligning these stakeholders. In these conversations, it is important to include a multistakeholder perspective by explicitly asking for the current and expected role of these stakeholders.

Materials & skills

What of our skills can we utilize for the collective ambition? Is there a need to develop or adopt new skills? Do the skills fit our identity?

5) Prioritizing matches and mismatches. The goal of this step is to make a selection of the matches and mismatches to continue with. Participants can use voting dots to cast their vote on matches and mismatches that they think are most important to take further. In our experience, an amount of three matches/mismatches to define interventions on provides a solid base to proceed with.

1) Setting the scene and getting started. The goal of this step is to introduce the topic of the workshop, to familiarize the participants with the boundary concepts and the different steps of the workshop, and to introduce the participants to each other. Depending on whether stakeholders already know each other, the role of the facilitator adjusts. For example, when the stakeholders are unfamiliar with each other, the facilitator functions as an intermediary that connects and involves the different stakeholders.

3) Exploring the changing organizational boundaries. The goal of this exercise is to explore how the ambition affects the organizational boundaries of the individual organizations in the multi-stakeholder network. Participants can use the organizational boundary cards to map their existing boundaries, but probably the proposed SBMI ambition requires them to adjust their existing boundaries. The mapping is followed up by a discussion on the boundary changes.

6) Defining first interventions. The goal of this step is to define first interventions on the matches/mismatches that help to implement the novel organizational boundaries. In addition to steps the participants themselves can take, this can also lead to the need to involve additional stakeholders, to acquire additional knowledge, or to revise the ambition.

121 Workshop process Applying the tool consists of seven steps:

4) Negotiating boundary changes and identifying matches and mismatches. This step aims to negotiate the required boundary changes and identify opportunities (matches) and tensions (mismatches) between stakeholders. The discussion about boundary changes often intrinsically leads to the identification of matches and mismatches, which can be written down on separate post-its. Be aware that matches and mismatches can relate to multiple instead of bilateral boundary changes or to a sequence of boundary changes to be made, but try to specify the ‘we will if you all will’ notion to actors as far as possible. This may be repeated several times throughout the collaboration to enhance collective action [54].

2) Developing a collective SBMI ambition. The goal of this step is to formulate the SBMI ambition of the multi-stakeholder network, which guides the development of opportunities for collaboration in the next steps. We challenge the participants to include both profit, social and environmental aspects, and to think about their potential modest and advanced improvements that contribute to the ambition.

7) Drafting a collaboration pitch. The goal of this step is to provide the participants with a clear starting point for collaboration. Using the collaboration pitch format (Appendix I), participants summarize the workshop by defining a collaboration pitch that includes the collective ambition, specific interventions and the actions that the relevant stakeholders aim to take to proceed the collaboration.

Exploring

Table 16: A detailed description of the different workshop steps in a typical tested format Phase No Step Tool TimeDescription

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3 changesboundaryExplore +/- 20 minMap and discuss the changing organiza t ional boundaries for each of the stakeholders to contribute to the collective ambition. The organizational boundary cards can assist in understanding the different boundaries. The internal alignment of the different boundaries is integrated in the questions on the organizational boundary cards. After mapping the own organizational boundaries, participants can map what they need others for by placing post-its at other stakeholders' positions in the tool.

2 Develop ambitioncollectivea +/- 15 minFormulate the collective ambition of the participants, including its societal/ environmental aspects, and position this ambition at the center of the tool.

The stepwise description of the workshop setup for a 2.5 hr. setting is provided in Table 16. The work shop should be guided by a skilled facilitator who is familiar with the organizational boundary framework. To assist facilitation, we provided detailed lines and probing questions for each of the steps in Appendix J.

1 Set getscenetheandstarted +/- 10 min Short introduction of the background, objective and procedure of the workshop. +/- 10 min Introduction of the different stakeholders. When working in an online format, you can ask participants to add a post-it with their name and company and to shortly introduce themselves. +/- 5 minAdd missing stakeholders, both current and future, are addedd to the edges of the tool. In case of proxy's for the different stakeholders, allocate stakeholder roles to participants.

7 Create pitchcollaborationa +/- 15 minSummarize the workshop by defining a collaboration pitch that includes the collective ambition, specific interventions and the actions that the relevant stakeholders aim to take to proceed the collaboration.

6 Define interventionsfirst +/- 25 minDefine first interventions to implement the matches, and to find ways for accomodating mismatches between stakeholders.

+/- 30 min Identify and negotiate the critical matches and mismatches between organizational boundaries in the network. Throughout the discussion, ask participants to write the matches and mismatches down. This step is usually followed by a 10 minute break.

5 matchesPrioritize mismatchesand +/- 10 min Review the listed (mis)matches and vote on (mis)matches to take further.

Implementing

123 Negotiating

6.4.3 Tool evaluations and adjustments After each iteration in the tool development process, the tool has been evaluated using observations, discussions and questionnaires. Ultimately, we arrive at an average evaluation of the final tool of 2.1 (σ= 1.04) on a scale from 1-5, where ‘1’ means ‘fully agree’ and ‘5’ means ‘fully disagree’, where the support of the boundary cards and the ease of use scored best. Participants of the SBMI cases appreciated the focus on organizational boundaries, expressing that the tool provided “ deeper insights in the potential to leverage other organizations’ strengths and opportunities ” (participant 1 of Philips workshop, 15-04-2021), that it was “excellent to work down from identity & purpose. And to understand common ground ” (participant 2 of Philips workshop, 15-04-2021), that the tool helped to “ find opportunities and difficulties in the boundaries ” (participant 3 of Philips workshop, 15-04-2021) and to “Make a clearer distinction between certain ideas and where they belong in the organization” (participant of Lightronics workshop, 24-02-2021). Participants also appreciated the tool’s ability to connect to internal and external stakeholders, something that would otherwise be challenging to organize, as illustrated by a participant of the CityFarm Brandevoort workshop: “How beautiful it is to work together across borders. By exploring this in this way you can get to know each other and our cooperation opportunities” (30-03-2021) and by a participant of the Arveco workshop: “The tool shows how we can tackle obstacles together. Through consultation with various parties it suddenly becomes clear where opportunities lie, but also where things can be improved ” (31-03-2021).

4Negotiateboundarychangesandlistmatchesandmismatches

124

The tool also triggered two different participants to share the tool with others within their organization. In one situation, the sharing was intended to enable follow-up on interventions: “I am also going to bring this tool to the attention of colleagues to convert structured matches and mismatches into interventions ” (participant of Lightronics workshop, 29-03-2021). The other situation might point at a wider need for company employees to be assisted in connecting with external stakeholders. As the participant of the Philips workshop pointed out: “ Very nice way of structuring the workshop and align thoughts. Easy to use. I will introduce this within my organization” (15-04-2021).

While the online format provided an effective way to include multiple stakeholders, we felt that it made it more challenging to let the participants see the whole picture from the beginning and to make them familiar with the technical tools and working format. After each iteration, we adjusted the workshop and tool based on the quantitative feedback in Table 17, and the qualitative feedback in Table 18.

Table 17: Average participant evaluation Average evaluation on a scale from 1 to 5 (1 = fully agree, 5 = fully disagree) The ambitioncollectivetohelpedtoolforma The tool helped to learn about implications on the multistakeholder network The stakeholdersbetweenmismatchesmatchesnegotiateexplorehelpedtooltoandand The tionsinterven-firsttohelpedtooldefine toolThe toeasyisuse thesupportusefulwerecardsboundaryThetotool The meaning of towereboundariesorganizationaldifferenttheclearme runsTrial 1.9 (usefulness for purpose) 2.1 1.7 2.4 runsInternal 3.2 2.8 2.6 2.4 2.6 3.23.2 runsExternal 2.4, σ =1.14 2.3, σ =0.86 2.4, σ =1.13 2.3, σ =1.21 2.2, σ =1.11 1.9, =0.89σ 2.3, σ =0.95

125 Table 18: Workshop feedback and development Feedback Adjustments made panelExpert • Boundary of power and identity seems most challenging to change. Focus on in workshop. • Many insights on boundaries (content, framing, relevance) • Include triple bottom line identity • Identify changes needed on company and network level. Mark the crucial changes. • A joint purpose, shared identity and intrinsic motivation is important • Include social & technical competences • Think about strategic change/strengthen/disruptoptions: • Include what one can do themselves and what they need others for • Create letter of intent • Created tool and workshop • Adjusted ‘identity’ to ‘identity & mindset’ • Adjusted ‘power’ to ‘influence & control’ • Adjusted ‘competence’ to ‘materials & skills’ • Included multi-purpose in identity boundary card • Formulated facilitating questions for the different boundaries and activities • Included questions about own contribution vs. contribution of others • Created a collaboration pitch with own contribution in relation to others’ contribution • Added ‘matches & mismatches’ to the workshop Trial runs • Think about how to process the information in the central tool • Include implementation of proposed ideas • Pre-define goal of the workshop • Translate for Dutch participants • More elaborate description and examples of the boundary cards. • Include break to digest before defining matches/mismatches • Nice way to stay connected in a digital pandemic world • Include test to work with the digital platform and if possible technical assistant • Included the formulation of a common goal in which profit and purpose is balanced • Included first interventions after (mis)matches • Revised description of the boundary cards to enhance differentiation • Revised example • Included workshop purpose in instructions • Included a 10 min break time before defining matches/mismatches • Translated into Dutch • Included platform test at the start of the workshop runsInternal • More time to define the ambition • Enhance conceptual clarity of boundary cards • Prioritize (mis)matches • More discussion time needed (the workshop can easily be split into 3 times 2 hours separate sessions) • More elaborated description of the boundary cards to enhance conceptual clarity. Added a (digital) backside to the card with more examples. Positioned the cards next to the tool • Adjusted ‘influence & control’ to ‘relations & contracting’ • Changed sequence of boundary mapping from identity towards efficiency • Included voting to focus (mis)matches • E xtended time for negotiation to 30 mints

126 runsExternal • E xplain the focal stakeholder network as each actor in the network has its own stakeholder network too • Spend a little more time on training • Added the related stakeholder network to the workshop purpose in instructions

• For the future: create webinar to prepare the workshop 6.4.4

Impact of the tool

• 2.5 – 3 hrs for the workshop

- Have there been internal or external follow-up meetings?

• Avoid too abstract ambition in preworkshop conversation

Following up shortly after the external workshops, we inquired the initiating companies with the following questions:-What realizations have come to you in the past week?

- Is there something else you want to share?

The short-term impact assessment showed that the tool made participants realize which visible and invisible elements their organization had to strengthen and/or let go. For example, Arveco expressed that “ We realize that we need a new brand ” and that the workshop made them “choose a path, what do I have to let go, what falls into place ” (Arveco representative, personal communication, 31-03-2021). Additionally, the tool helped to gain confidence to start new partnerships, as was illustrated by Philips “It is a complex issue but there is willingness in the network to address and cooperate ” (Philips representative, personal communication, 19-04-2021). Also City Farm Brandevoort expressed this function of the tool “The workshop has given a boost in confidence

In the past, rigorous testing and practical validation of tools in business innovation was not selfevident (Baumann et al., 2002; Bocken et al., 2019b). Recent developed tools for SBMI were tested in practice and evaluated based on whether the users found the tools useful and easy to use (Brown et al., 2021; Konietzko et al., 2020). This study advances the testing of the tool by integrating the outcomes of the tool intervention, building on the importance of reflection and learning on relationships between the company and its external environment to integrate these insights into business decisions (Baumann et al., 2002; N. Roome, 1999; van Aken and Romme, 2009). Therefore, we inquired the impact on the users directly after the workshop and one week afterwards. Instead of measuring the impact of the tool in a quantitative way (e.g. number of interventions defined), we asked what participants had learned, realized, and decided, and what actions they had taken after the workshop. Illustrative quotes from the learnings indicated by the participants directly after the workshop are presented in Table 19.

- Have choices been made? (e.g. to continue, to focus, to go one step further)

runsInternal

• I realize better now that all stakeholders look from their own perspective. Despite the common purpose, the direction of ideas and thought is very different from everybody’s perspective.

• The tool readily showed the different organizations and their interlinkages, as well as the need for a systemic view for any project (especially circular).

The same representative also expressed that it is important to find and connect to the right people within the different organizations to organize such follow-up.

• I learned a lot about organizational boundaries and that change is needed to apply new, circular business ideas. The Tool helps to formulate those changes.

• That all the different stakeholders have different aims and goals, and that it is tough (but possible) to create collective goals that will benefit all the stakeholders involved. Also, it will be useful for future plans, to be able to look back on the work that has been done in previous workshops/etc.

• Formulate or find out concrete problems / solutions.

What have you learned from applying the tool?

• I learned that collaboration between stakeholder rely heavily on understanding their perspective boundary, and control over resources and assets.

127 for cooperation in the future ” (City Farm Brandevoort representative 1, personal communication, 13-04-2021) and “I realize, hey, there is really energy in these people, they really want to. But the parties also learn from each other that this energy is in it, so not just Brandevoort as a connecting factor ” (City Farm Brandevoort representative 2, personal communication, 13-04-2021). A representative from an external stakeholder of Lightronics expressed “I hope we get to proceed on the generated ideas and am curious whether and how it will be followed-up ” (Hydro representative, personal communication, 25-03-2021), while the representative from Lightronics stated that they will have to await the students’ research results to get approval from the management, but also stated that “there is again talk of light as a service ” (personal communication, 06-04-2021).

• We are well underway but often do things based on experience but not based on knowingly applying them as a tool.

Except for Lightronics, all cases held follow-up meetings with potential partners within seven days after the workshop. Philips and Arveco established a new working group as self-managing multi-stakeholder teams to work on the interventions: “ We organize an open invitation to tune-in with each other after two months ” (Philips representative, personal communication, 19-04-2021).

Table 19: Illustrative participants’ learnings directly after the workshop. The feedback process itself was anonymous.

• Mainly, I believe this tool is useful to gain insight in who the most valuable potential stakeholder are, and what needs to be done with them. For example, in our case the waste-processer proved to play a vital part in any solution, whilst the contribution of citizens was marginal in the first stage. This helps in identifying where most attention can be spend.

• Confirmation of the necessity and strength of the stakeholder approach, especially in the circular transition.

• Make a clearer distinction between certain ideas and where they belong in the organization.

• Converting a general ambition into concrete interventions

Trial runs

• I found it very educational to work from efficiency to identity.

• Where we looked at how we can tackle these together through consultation with various parties, it suddenly becomes clear where opportunities lie, but also where things can be improved.

128 runsExternal

• Deeper insights in potential to leverage other organizations strengths and opportunities very nice way of structuring the workshop and align thoughts

• To provide insight into opportunities and threats and to link them to new action points

6.5 Discussion

The theoretical contribution of the tool lies in the integration of a multi-stakeholder boundary work perspective to existing SBMI approaches and its translation into entrepreneurial linguistics. The tool has the potential to integrate both values-based network and business model innovation approaches (Breuer & Lüdeke-Freund 2017) as well as effectuation approaches (Brown et al., 2021; Sarasvathy, 2001), depending on the sequence of boundary mapping. Additionally, this study contributes to tool development for SBMI by taking an explicit (multi-)stakeholder focus, and integrating its visible (e.g., materials, costs, machinery) and invisible (e.g. mind-set, power and trust) organizational boundary phenomena. This makes the tool well suited as a follow-up exercise for value proposition and strategy-based SBMI tools, such as the recently developed Circular Card Desk (Konietzko, 2020), which excludes social and institutional actors, the Value Mapping tool (Bocken et al., 2013) or the collaborative circular proposition tool (Brown et al., 2021). The boundary tool can be proceeded by experimentations on the desirability, feasibility, viability and sustainability of the configuration (Baldassarre. et al., 2020b). Additionally, this study advances research on SBMI tool development by proposing a research strategy to inquire the impact of tools, called for in previous research (Bocken et al., 2019b). The output of the tool is not a clear-cut process outline, but leads to critical realizations and follow-up actions for the purpose of SBMI. The visualizations and interventions defined in the tool may function as artefacts to further design and assess the organizational boundary changes in the multi-stakeholder network in a collaborative process, keeping the SBMI ‘alive’ (Phaal et al., 2003; Wirtz et al., 2016). The practical contribution lies in presenting a well-tested boundary tool that assists companies in engaging with multiple stakeholders for the purpose of SBMI. The tool enables interactive, collaborative exploration and

This study presents a boundary tool that contributes to SBMI research and practice. The tool bridges the theory and practice by integrating exploratory, negotiation and agreement activities on the four organizational boundary dimensions in relation to a collective SBMI ambition.

• That it is an immense challenge to improve a system with such a broad range of stakeholders and problems. We went from software to shipping and from local use to Dutch regulations –let alone discuss the hard-core financials.

• That by exploring this in this way you can get to know each other and cooperation opportunities.

• Find opportunities and difficulties in the boundaries.

In response, another participant offered their expertise and proposed to discuss the sharing of their own reversed logistics operations as well as the exchange of returned materials, something that would otherwise not have been discussed. A field of tension is whether it feels safe enough for the initiating organization to open up the relationship to other stakeholders, and bring multiple value chain partners together in one workshop. The case of Lightronics showed a tension from a potential supplier to invite municipalities (as procurers). This is where the role of the facilitator was challenged towards politics, diverting from a broker towards becoming an issue advocate (Pielke, 2007). While the purpose of the tool is to help companies engage in or intensify multi-stakeholder collaborations for sustainable business model innovation, the internal runs showed that the tool can also be used to find business model opportunities within the company’s own boundaries. In addition to companies aiming for strategic innovation, potential users are intermediaries in the sustainability field, trying to promote sustainability with sense making, conveying the message of collective action and collaboration, and change agents aiming for interventions in missionoriented innovation systems (Hekkert et al., 2020).

129 stimulates the thought-process and the development of narratives in preparation for (bottomup) actions (Dyer et al., 2021). Through the boundary work tool visible and invisible aspects can be explored and addressed. Based on our workshop observations, we can infer that the tool helps companies to become more aware of their own boundaries in relation to their stakeholder environment, and to respond to it more strategically. For example, by making decisions on the organizational purpose, by including end-of-life contracting, and the redistribution of roles and activities through partnerships. Additionally, the tool stimulated joint discussions on stakeholder’s individual challenges for alignment, leading to a shared commitment for finding solutions. This was illustrated by a light provider, which struggled to grasp the implications of reversed logistics of street fixtures on their competences and activities, and to find a way to implement these changes.

The tool is flexible to engage different types and numbers of stakeholders in the workshop, although for large or multiple stakeholder networks adjustments and reiterations are needed to facilitate broad-based participation. However, the tool also has its limitations. First, boundary work for SBMI is a long and reflexive process that can easily take multiple years to lead to alignment of the critical stakeholders. While a single tool cannot easily organize such a complex process, the boundary tool provides for a comprehensive starting point of multi-stakeholder collaboration, and can be used to assess the progress on stakeholder alignment during the SBMI process (van Aken and Romme, 2009). Second, the workshop should be facilitated by someone who is familiar with the organizational boundary framework. This relates to the third limitation: organizational boundaries

130 emerge in different forms depending on the various contexts and SBMI ambitions. Currently, there is no complete ‘indicator list’ per boundary or typical boundary configurations per type of actor. Further research could enhance organizational boundary thinking by inquiring the typical boundary indicators and boundary reconfigurations in specific contexts and for specific actors, advancing recent research (Keränen et al., 2020; Santos and Eisenhardt, 2005; Velter et al., 2020). This research would enable further customization per strategic application (Phaal, 2014) and per type of boundary work, such as identity work (Bojovic et al., 2019), or power work (Bolton and Landells, 2015; Eweje et al., 2015; Hawkins et al., 2016), but also enable a more independent use of the boundary tool by practitioners.

6.6 Conclusion Multi-stakeholder alignment is imperative for capturing the sustainability potential of SBMI, but few studies offer guidance to companies for engaging in such a collaborative process. Organizational boundary work provides a novel perspective to explore, negotiate and align stakeholders for this purpose. This study presents a tested boundary tool that helps companies to engage in and/or intensify multi-stakeholder collaborations for SBMI. For companies, key benefits of the boundary tool are: (1) a re-design of the multi-stakeholder system based on a collective SBMI ambition, (2) an assessment of a companies’ own organizational boundaries and its multi-stakeholder network, (3) the exploration, negotiation and prioritization of strategic actions based on organizational boundary changes, (4) the exploration of new partnerships and (5) a kick-start to engage with these partners. Engaged scholarship into multiple contexts is needed to further improve the boundary work approach and the boundary tool.

A potential theoretical avenue that helps to navigate tensions in SBMI is the field of paradox theory, which focuses on the accommodation of interrelated and conflicting economic, environmental, and social concerns involved in achieving business contributions to sustainable development (Daddi et al., 2019; Hahn et al., 2018; van Bommel, 2018). Building on recent work that integrates paradox theory into SBMI and circular business models (De Angelis, 2021; van Bommel, 2018), an interesting research avenue lies at expanding paradox theory from managing paradoxes at the organizational level towards managing paradoxes at the inter-organizational level, encountered by multiple stakeholders simultaneously, which is the domain of boundary work. For example, paradox theory could help resolve boundary issues between multiple stakeholders in SBMI and the principles and building blocks of boundary work could be used for future research on tools and theory development. Additionally, further research could integrate the boundary tool in experimentation with circular service driven business models to enable iteration on multistakeholder value propositions (Bocken et al., 2021; Eweje et al., 2015).

131

Chapter 7. Discussion & Conclusion

Through empirical and theoretical research on the stakeholder interactions in SBMI processes, this section first presents the main findings of this research by answering the research questions, and then discusses the contribution to existing theory and management practice, followed by the main limitations of the work at hand and its concluding remarks.

Businesses can contribute to addressing sustainability challenges via alternative business models that offer attractive value propositions to a wide array of stakeholders. This thesis offers a theoretical and empirical study of the interactive processes towards new, sustainable business models. Such processes are found to be explorative, relational, and characterized by uncertainty, inter-organizational difficulties and poor or misaligned incentives (Chapter 3). Having been involved in a real-time SBMI process proved to be useful in recognizing the need for mutual alignment, building trust and relational values (Chapter 4). It also clarified the presence of divergent beliefs, counter moves, resistance and power play in a changing network of stakeholders who are ambivalent about doing things differently.

The successive studies of this thesis found that in order to address sustainability issues through business model innovation, companies need to develop and acquire capabilities that are outside their current remit, collaborate with others even beyond designated partners, and come to agreement with partners on their (future) positions and roles in these new business models (Chapter 5 and 6). These are all issues that touch upon the different types of boundaries of the business, which led us to develop a boundary work framework as a lens for making sense of discovery journeys towards alternative, sustainable business models. These journeys are interactive and relational, and frequently involve changes in identity, roles, power, and the acceptance of (new) dependencies. New value propositions based on sustainability are surrounded with uncertainty about the attention, valuation and action of partners and external stakeholders, affecting the organizational boundary setting throughout the SBMI process. As boundary setting influences the value propositions to stakeholders, the alignment of these partners and stakeholders is subject to conditions that are not under control of any single actor.

134 Chapter 7. Discussion & Conclusion

Giving up a certain degree of control and accepting dependencies are important boundary changes that only few businesses are prepared to undertake, but which are necessary to SBMI. This is an important insight that is insufficiently recognized in the literature on sustainable value creation and inter-organizational collaboration for SBMI.

• Attempts for stakeholder alignment happened through iterative processes of exploration, brokering and implementation. Businesses found it challenging to engage all relevant stakeholders throughout the three processes: implementation did not succeed with all relevant stakeholders.

Chapter(s)

3,4,5

By means of five research questions, this thesis systematically explored the overarching research question ‘How can businesses innovate sustainable business models through aligning stakeholders in their multi-stakeholder network?’. This section presents the main insights of the previous chapters to answer the research questions sequentially. An overview of research questions, chapters and key findings is presented in Table 20.

• Boundary work as a comprehensive framework consisting of phases, boundaries and arrangements.

• SBMI is a challenging process because of the need to align different external stakeholders at four different dimensions: understandings of value, roles, competences and operations.

• Boundary work interlinks concepts of identity, power, competences and efficiency in entrepreneurial processes of collaborative SBMI. Addressing different boundaries simultaneously helped to prevent a lock-in or even a potential ending of the collaboration.

135 7.1 Answering the research questions

• New collaborations with multiple, potentially cross-sectoral stakeholders are needed to develop sustainable value propositions to consumers as well as to these multiple stakeholders.

• The iterative three stage-model of boundary work processes for alignment: exploring boundaries and boundary dissonances, brokering boundaries, and implementing boundary changes, which can be operationalized into nine steps businesses can take in their boundary work.

Chapter(s) Key findings Empirical evidence

Cases of Heijmans One, Thuisbaas.UrgendaBeeBanking,Karolinska,PhilipsKipster,feed-for-food,GranicoEcor,EnvironmentalFutureproof,KingspanDSM-Niaga,NobleNijsen/Food-for-RoyalNewStroom

Table 20: Overview of research questions, chapters, key findings and empirical evidence

Research question 1. How can processes of multi-stakeholder alignment for SBMI be better understood?

• A lignment enhanced the potential value creation. Without alignment beyond company boundaries, value creation opportunities remain uncaptured.

Research question 2. Which theoretical perspectives help explain processes of stakeholder alignment for SBMI? Key findings

• Integration of boundary arrangements, being spanners, spaces and objects, to learn about value creation and appropriation between stakeholders. Specifically, there is a pivotal role for boundary objects to deal with uncertainties, to facilitate strategic discussions and to find solutions to different valuation frames, power tensions and role divisions between stakeholders.

• A lignment of the power boundary is crucial, particularly for relative small businesses in the industry. Strategically designed boundary objects and collaboration with governments and NGOs are used to work on this boundary.

• Businesses can only offer a piece of the solution and might need support from other stakeholders to reach alignment.

Research question 3. How do businesses engage with stakeholders to create, maintain, bridge, or dissolve boundaries that interfere with their envisioned sustainable business model?

Chapter(s) Key findings Empirical evidence

3,4

• T he intermediary was valuable for engaging the participating businesses in rethinking their own boundaries and starting with the first steps of boundary work.

• B oundary work is concerned with two forces: stakeholders for whom the SBM is attractive (advancing elements of their boundaries) and stakeholders for whom the SBM is unattractive (impeding with elements of their boundaries).

Chapter(s) Key findings Empirical evidence

136

• Intermediary work can be improved by taking a multi-stakeholder approach, involve different types of intermediaries (such as a process intermediary), and integrate an explicit focus on boundaries to enhance reflection, matchmaking and upfront identification of dissonances between stakeholders.

CSRNL, Toy retail/ wholesale, 3D printing start-up, companyconstructionTimber

• Businesses shift their own boundaries to start the SBMI process, but can only implement boundary shifts on all dimensions in concert with their stakeholders.

Research question 4. How can intermediaries assist businesses in their boundary work for SBMI?

‘circularNijsen/GranicoCircularEnvironmentalFood,Food-for-Feed-for-Nijsen/GranicoNobleEcorFriesland,pig’

• T he intermediary was unable to assist businesses throughout all boundary work phases, tailor their boundary work to the different cases and types of boundaries and influence stakeholders beyond the participating businesses.

• T here was a strategic sequence in whom to involve at what stage of the SBMI process, depending on the notion of what has to be defended and what has to be changed.

• T he tool helped businesses to re-assess their boundaries vis-à-vis their multi-stakeholder network and/or a sustainability ambition, to gain confidence in taking a collaborative approach to SBMI, to create willingness from stakeholders for future collaboration, and to kick-start follow-up meetings with potential partners.

• T he tool provides a starting point for SBMI, but cannot organize such a complex process.

ofBrandevoortCityArveco,Lightronics,Arapaha,Philips,Farm(total74participants)

• T he tool is flexible to engage different types and numbers of stakeholders in the workshop, although for large or multiple stakeholder networks adjustments and reiterations are needed.

137 Research question 5: How can the practical uptake of SBMI be enhanced through tools that support alignment within the organization’s multi-stakeholder network?

• T he boundary tool helps businesses to engage in and/or intensify multi-stakeholder collaboration for SBMI in five steps: 1) defining a collective ambition, 2) mapping and negotiating the changing organizational boundaries, 3) exploring opportunities and tensions for aligning stakeholders, 4) defining first interventions, 5) developing a collaboration pitch.

Chapter(s) Key findings Empirical evidence

7.1.1 How can processes of multi-stakeholder alignment for SBMI be better understood? In the literature on SBMI, the need for multi-stakeholder alignment is recognized and theorized, but the how of developing stakeholder alignment has remained poorly understood. The approach of this thesis differs from the existing literature in taking a boundary work lens to multi-stakeholder alignment, which helps to deal with issues of power, identity and new roles to be identified, reflected on, and agreed upon by stakeholders through self-coordinated action. Chapter 3 provides an overview of the literature on multi-stakeholder alignment for SBMI and newly gained insights about the why, who, what , and how of stakeholder alignment processes in SBMI, as revealed by case study analysis using the prototype framework of boundary work. The 9 empirical cases illustrate the rationale for aligning multiple stakeholders, as the initiating businesses and organizations quickly realized that the reciprocity of stakeholders enabled – or obstructed, in case it was absent – the development of sustainable value propositions. Alignment enhanced the potential value creation, as seen in the case of Kipster, where the long-term, value-based contract of the retailer enabled sustainable egg development. In contrast, non-alignment impeded potential value creation, as seen in the case of DSMNiaga, where the neglect for absorption of a new activity by the carpet installer – to maintain customer contact and return the carpet at end of life – obstructed the potential of a circular business model. This indicates that without alignment beyond company boundaries, value creation opportunities remain uncaptured, limiting the businesses’ contribution to sustainability challenges.

138

For topics of alignment, the cases illustrated that businesses needed to find alignment on multiple dimensions . Most apparently, external stakeholders needed to adjust their own operations to innovate the sustainable business model, which is true for many business model innovations. However, in SBMI, these changes might not be financially attractive, or put the business into a different, possibly uncomfortable, role or position, as we have seen in the case of Kingspan, where the pre-financer found itself in a too risky position to maintain its alignment. To address this issue, the cases show the need to find alignment on understandings of value (not on the specific content but on the priority of types of value), roles (e.g., taking up roles as a resource steward or system orchestrator), and on associated competences (e.g., implementing take-back systems, value-based selling, funneling processes). We have also seen businesses reaching out to other stakeholders to help dampen the risks (e.g., by providing long-term contracts and/or a fixed price) or improve the attractiveness of the proposition (e.g., by certifying the product or mobilizing consumers).

Public organizations were more comfortable with engaging non-business stakeholders, such as citizens, governmental institutes and sustainability funds next to businesses. The cases show that building relations with a plurality of private and public partners provides the ability to develop stronger value propositions to consumers and the various partners.

Building on this rationale, the empirical cases confirm that these businesses attempted to innovate sustainable business models by engaging in new collaborations, but they also revealed that these were predominantly private partners, sometimes from different sectors (for example, DSM-Niaga collaborating with a car engine manufacturer, or Kingspan collaborating with an energy cooperation).

The building of relationships with multiple stakeholders who had to align on various dimensions proved to be very challenging for businesses. As this was new terrain for them, businesses engaged with their stakeholders rather ad-hoc. Differences were observed in the rate of closed and open innovation: some businesses explored their multi-stakeholder network, but did not engage with the relevant external stakeholders. Others did engage with external stakeholders, and discussed the needed changes, but did not manage to align them on the needed dimensions. The research findings resulted in the identification of an iterative stage-model based on the processes of exploration, brokering and implementation. The iterative character was particularly visible in the case of Kingspan, where a boundary shift of the energy company accelerated the SBMI process, but their successive withdrawal made Kingspan reassess its own boundaries and re-explore business model and network configurations. The cases illustrate the arduousness of this stakeholder and change process and show the great nescience amongst businesses as to how to deal with stakeholder exploration and alignment for SBMI.

139 7.1.2

Testing the framework in Chapter 4 showed that the breakdown into the three phases helped to clarify the interaction processes between Nijsen/Granico and their stakeholders. The study delivered four key-insights. First, the boundary work processes of Nijsen/Granico could be consolidated into nine steps businesses can take in their boundary work (Figure 5 in Chapter 4). Whilst these steps are not generalizable, they do provide a starting point and potential direction for businesses to proceed. Second, the framework’s focus on boundaries helped to elicit boundary changes as the intangible aspects that influence (non-)alignment, such as the development of competences, or the rigidity of the boundary of power. The focus on boundaries also illustrated that addressing different boundaries simultaneously helped to prevent a lock-in or even a potential ending of the collaboration. For example, in interactions with Van Loon, the shifting focus from pricing of the circular pork to the role of Nijsen/Granico as preferred supplier led to a breakthrough from stuck conversations on the efficiency level. As a third key-insight, the empirical case showed how boundary objects support alignment when they are strategized per phase (from open to more closed objects), stakeholder (in terms of framing) and type of boundaries (in terms of content) Last, the study showed that the boundary work framework holds its relevance in CBMI, as a subset of SBMI, as well.

The subsequent Chapter 5 advanced the boundary work framework by studying whether and how the activities of a systemic intermediary assisted the participating businesses in shifting their own

- identify four different types of organizational boundaries as means to understand ‘what has to be aligned’ within and across organizations: the boundary of identity, the boundary of power, the boundary of competence and the boundary of efficiency

Which theoretical perspectives help explain processes of stakeholder alignment for SBMI?

To the existing theories of stakeholder alignment for SBMI (e.g., Breuer and Lüdeke-Freund, 2017; Freudenreich et al., 2019), we offer a theory of boundary work. The theory of boundary work was developed in the research described in Chapter 3, where it consisted of a prototype framework that was adjusted in three rounds of a submission process. Later on, the framework was refined in the research and writing process which form Chapters 4 and 5. Theoretically, boundary work is complemented with organizational boundary theory, which resulted in a new, comprehensive boundary work framework consisting of boundaries, phases and arrangements that is able to:

- distinguish three iterative boundary work phases as processes for alignment; exploring boundaries and boundary dissonances, brokering boundaries, and implementing boundary changes support alignment through boundary arrangements, consisting of boundary spanners, boundary spaces and boundary objects.

Both Chapter 3 and 4 show that all investigated businesses did not manage to innovate the sustainable business model by themselves, and had to consistently collaborate with external stakeholders. The businesses in Chapter 3 attempted to align different stakeholders themselves, staying in the lead of their boundary work. The businesses in Chapter 4 used collaboration to create multiple boundary spanners: Nijsen/Granico strategically reached out to their client Kipster, the NGO Nature & Environment and the butcher Van Loon to help them shift the boundaries of the retailer. This reveals that businesses themselves can only offer a piece of the solution and need (temporary) boundary work from other stakeholders to reach alignment

140 boundaries and conducting boundary work with their stakeholders. The results showed that the intermediary supported boundary exploration and change of the participating businesses, but was limited in terms of a multi-stakeholder focus, reflection on identities and power, strategizing boundary objects for addressing non-alignment and meeting the boundary work needs of the distinctive businesses and their stakeholders 7.1.3 How do businesses engage in boundary work to create, maintain, bridge, or dissolve boundaries that interfere with their envisioned sustainable business model?

Literature on SBMI mentions the need to collaborate with external stakeholders, but the study in Chapter 3 already found that SBMI requires more than just collaboration. Businesses have to engage in a dynamic process of collaboration and organizational change. The data shows that businesses shift their own boundaries to start the SBMI process, but can only implement these shifts when they achieve alignment across different stakeholders and different organizational boundaries . The Nijsen/Granico case clearly illustrated that their shift to a network focus on stakeholders enabled the development of new value creation opportunities, which even led to a new corporate identity (Chapter 4). However, they needed to implement the business model to roll out their new identity in their efficiency, competence and power boundaries. This required rather simultaneous alignment from butchers, processors, retailers and farmers. The case displayed that the needed alignment was easiest to identify on the efficiency dimension, by looking at the changing processes and activities in the envisioned business model. As these changes did not always provide attractive propositions for the relevant stakeholders, other dimensions of boundary change (e.g., identity, power, competence) were needed to compensate and create attractive propositions for alignment on the efficiency level. This corresponds with the need to align on understandings of value, roles and competences displayed in Chapter 3. The reconfiguration of power boundaries was crucial, particularly for Nijsen/Granico as a small business, but this boundary also seemed to be the most difficult to change, as it was closely related to an expected decrease in revenue of the powerful actors.

In this process of collaboration, the Nijsen/Granico case displayed an interesting pattern: in early phases, they purposefully engaged with partners who possessed similar goals and/or understandings of value to form an initial coalition. After this, they engaged with more critical (the butcher) or powerful (the retailer) stakeholders, to eventually align the pig farmers. Ultimately, a complete boundary arrangement was needed that involved all relevant stakeholders in the value network, but there was a strategic sequence in whom to involve at what stage of the SBMI process This is based on the notion that boundary work in concerned with two forces: stakeholders for whom the SBM is attractive (advancing elements of their boundaries) and parties for whom the SBM is unattractive (impeding with elements of their boundaries). In addition to showing the multi-directional nature of boundary work, the case of Nijsen/Granico provided a clearer view on the steps a business can take in the different boundary work phases. In the exploration phase, major activities were exploring stakeholders, value propositions, reconfigurations and tensions as a basis for setting-up first partnerships. The brokering phase displayed activities of negotiating reconfigurations and value propositions, as well as setting-up critical partnerships. In the implementation phase, agreements were made, experiments were set-up, and in some aspects, reconfigurations were embedded into the organization (e.g., a changed corporate identity).

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The cases in Chapter 3 also offer evidence that boundary objects can be designed strategically, depending on the boundary work phase, stakeholder and type of boundaries. Boundary objects transformed from abstract and open for adaptation (mock-ups, sketches) to concrete, rather fixed objects in later boundary work phases (calculation sheets, prototypes). Chapter 4 confirmed the strategic importance of designing boundary objects to deal with uncertainties, facilitate strategic discussions and find solutions to different valuation frames, power tensions and role divisions between stakeholders. Illustratively, Nijsen/Granico coupled elements of power (the required monetary commitments) to elements of identity (the responsiveness of retail to the added sustainability value) and the impact on the shared goal of the coalition (to eliminate the feed-food competition) in their presentation to the retailer.

7.1.4 How can intermediaries assist businesses in their boundary work for SBMI?

The fourth research question deals with the role of intermediaries in boundary work for SBMI. This question draws on and contributes to the growing literature on intermediary activities and actors in innovation, involving stakeholders from different societal domains (Dragomir et al., 2020; Kivimaa et al., 2019; Warbroek et al., 2018). Businesses’ ad-hoc approach to stakeholder engagement illustrated that they often did not know where to start, how to navigate such a process and deal with associated dissonances between stakeholders, on top of which boundary work proved a lengthy, resource-intensive process. The engagement of multiple boundary spanners as intermediaries

7.1.5 How can the practical uptake of SBMI be enhanced through tools that support alignment within the organization’s multi-stakeholder network?

142 helps to support boundary work and alignment. In order to gain deeper insights into this, Chapter 5 explored the ability of a dedicated intermediary organization (CSRNL) to help businesses in their boundary work. Applying a boundary work lens to intermediary work of CSRNL revealed that the intermediary was particularly valuable for engaging the participating businesses in rethinking their own boundaries and starting with the first steps of boundary work . At the start, the intermediary created the starting conditions for a potential SBMI process (being the project platform and its meetings as a digital and physical boundary spaces, scoping of the innovation and providing initial relations), facilitated knowledge aggregation and organized matchmaking between stakeholders. This affected the boundaries of the participating businesses by making them rethink their own boundaries (e.g., the wholesale company engaging with circularity as something new for them), explore their future stakeholder network (including the crossing of traditional sectors, e.g., the timber construction company exploring a plastic value chain, and the 3D printing start-up exploring retail) and reach out to new potential partners (e.g., the wholesale company reaching out to injection molders). In the brokering phases, intermediary activities by CSRNL typically focused on ex-post coaching and mediating between value chain partners bilaterally. The activities of the intermediary in implementing boundary changes were oriented to shifting the boundaries of the participating businesses as was seen in the adoption of a sustainability vision and experimentation with new boundary configurations by the businesses.

The developed boundary tool consists of five steps to explore and address the interdependent

To help stakeholders navigate the SBMI journey, Chapter 6 presents a process tool that aims to enhance the practical uptake of collaborative, multi-stakeholder SBMI, based on boundary work.

Next to showing the nature and value of intermediary work by CSRNL, the research also elicited clear limitations of the intermediary in helping businesses to conduct boundary work. For example, the intermediary was unable to assist businesses throughout all boundary work phases, tailor their boundary work to the different cases and types of boundaries (for which we have seen the timber construction company hiring a process intermediary), as well as influence stakeholders beyond the participating businesses. In general, a multi-stakeholder approach might have helped to create a stronger initial coalition. This complements the findings in Chapter 3 and 4 that amongst multiple type of boundary spanners, different types of intermediaries are needed to support boundary work throughout all phases .

143 stakeholder boundaries in view of a collective SBMI ambition. Assessments showed that the tool helped businesses to engage in, and/or intensify collaboration with their stakeholder network for SBMI. Participants valued the ability of the tool to locate opportunities and difficulties using organizational boundaries, enable negotiation on sensitive topics, and the functioning of the workshop and tool as a boundary arrangement itself where stakeholders meet, interact and refer to afterwards. The study developed and applied new ways to assess the impact of the tool by integrating the outcomes of the tool intervention in a qualitative way, asking for realizations, followup actions and choices made at two timeframes after the workshop. The tool helped businesses to re-assess their boundaries vis-à-vis their multi-stakeholder network and/or a sustainability ambition (e.g., workwear company Arveco realizing they need a new brand to align others, shifting their boundary of identity, or light producer Lightronics reviving internal talks of light as a service), to gain confidence in taking a collaborative approach to SBMI (expressed by Philips and City Farm Brandevoort), to create willingness from stakeholders for future collaboration (e.g., Hydro expressing that they are looking forward to a follow-up), and to kick-start follow-up meetings with potential partners (expressed by all participants). The tool is flexible to engage different types and numbers of stakeholders in the workshop, although for large or multiple stakeholder networks adjustments and reiterations are needed. The tool provides a starting point for SBMI, but cannot organize such a complex process.

This section discusses the main insights of this research in terms of their contribution to the discourse and practice on SBMI. The specific contributions are structured according to the three knowledge gaps defined in Chapter 2.

7.2 Contribution to theory and practice

7.2.1 Contribution to understanding processes of stakeholder alignment in SBMI

The main contribution in this area is that SBMI must be seen as a relational process between a business and its stakeholder network instead of an internal (re)configuration of company products, processes and revenue models . Aspects like identity, reputation and power are important influencers of products, processes and revenue models. Organizations have to reassess their own boundaries and agree to new roles, distribution of costs and benefits, identities and activities through a journey of exploration in which stakeholders influence each other based on new ways of thinking. This advances the boundary spanning perspective on SBMI as introduced by Brehmer et al. (2018) and Zott and Amit (2010), by illustrating that sustainable business models do not just transcend organizational boundaries (through transfers of value), but that these business models require mutual adjustment of organizational boundaries between organizations to enable

144 new transfers of value. Through boundary work, SBMI might lead to more heterogeneous and hybrid forms of sustainable business models (Busco et al., 2017; Laasch, 2018). The second contribution lies in the need to understand SBMI as a dynamic process , which is full of impeding and accelerating forces and constant change. The cases have shown that there is no blueprint for an SBMI process, but rather that the shaping and shifting of organizational boundaries highly influences the process and content of the SBMI. Framing SBMI as a relational and dynamic process helps to address the ‘how’ of SBMI, which is still rather unexplored (Zollo et al., 2013). This study iterates the process perspective because scholars still point at the theory-practice gap (Baldassarre. et al., 2020a), illustrating that action from businesses lags behind on what is expected from them in resolving environmental and societal issues. Framing SBMI as a relational activity helps to address the gap between developing business model ideas and implementing it into the market (Baldassarre. et al., 2020b). The rich empirical insights of this study and the iterative structuring of influential elements into boundaries, arrangements and phases might empower businesses in their discovery journey for SBMI while helping them to remain flexible to the insecurities and inevitable drawbacks in this process. This thesis illuminates that both collaboration and boundary work involve “the creation of new value by doing something new or different” (Thomson and Perry, 2006, p. 20). However, boundary work differs from collaboration in terms of multi-directional dependencies, larger and multifaceted mutual adjustments (e.g., value frames, power reconfigurations, new competences), higher novelty and associated uncertainties, and the larger role of normativity. Whereas collaboration aims to increase the competitive advantage of collaborators, boundary work requires collaboration even when there might be no clear incentive for the collaborator (Chen et al., 2017). This advances perspectives of open and closed innovation, which is grounded in rational choice viewpoints on sharing knowledge to accelerate internal innovation (Bogers et al., 2019; Chesbrough, 2003; Fleming and Waguespack, 2007). It is important to notice that collaborative innovation might not always be open innovation (Brown et al., 2020; Oskam, 2020; Quist and Tukker, 2013). This is the case when, for example, collaborators are protective of their assets or true intentions. In the context of SBMI, where attention for multiple value creation and the sharing of power and competences are key, a lack of openness might lead to boundary reinforcement and a narrowing of the scope of collaborating stakeholders. The empirical cases show that choices for degrees of closed and open innovation go beyond considerations for the in-or outsourcing of capabilities and intellectual property rights. Attention to identities, emotions and assumptions, such as proudness and negative images of others, might help to enhance the openness in collaborative SBMI.

A fourth contribution in understanding processes of SBMI lies in specifying what constitutes ‘alignment’ in boundary work for SBMI. There is debate about whether alignment can be

145 characterized as ‘sharing’ or finding a ‘strategic fit’ (Aakhus and Bzdak, 2012; Breuer and LüdekeFreund, 2017; Crane et al., 2014; Porter and Kramer, 2011). The distinction lies in whether partners develop similar aspects of alignment or whether these aspects are complementary to each other. The empirical cases show that partners attempted to develop a shared future vision. For example, and its stakeholders aiming for eliminating the feed-food competition, and Ecor and its stakeholders aiming for a circular Friesland. This corresponds with research on valuesbased innovation that states that normative values should be shared for an SBMI to start (Breuer and Lüdeke-Freund, 2017). However, each partner had very different identities, power, competences and efficiency boundaries and associated value propositions, for which they aimed to develop a configuration in which boundaries work synergistically rather than similarly. This thesis therefore relates to alignment for SBMI in terms of developing a strategic fit between organizational boundaries that may be very different from one another, rather than developing similar boundaries . Knowing that alignment comprises a ‘strategic fit’, we observe two directions of organizational boundary alignment. The first direction is alignment within stakeholders. Alignment theory refers to a strategic fit as the extent to which a company internally displays consistent positions in their logic of competitive situation, strategy, organization culture and leadership style (Chorn, 1991; Danny Miller, 1986; Siggelkow, 2001). The data showed that operationalization of the shared vision necessitated internal consistency between identity, power, competence and efficiency. A discrepancy between internal boundaries led to an obstruction of alignment. For example, SuperUnie identified themselves with the vision of a more sustainable feedstock, but refused to utilize their power to operationalize this vision. These findings advance alignment theory as they show that developing this internal strategic fit is a network rather than a firmlevel activity. Existing alignment theory acknowledges the interconnectedness between internal alignment and external environments, but considers the process of developing a strategic fit as an internal management task (Auster et al., 2016). The second direction of organizational boundary alignment concerns alignment between stakeholders, based on a shared vision. This shifts existing alignment theory to a multi-stakeholder perspective by illustrating that a strategic fit is not just needed on the organizational level, but also between stakeholders. Last, the findings show that there is no final state of alignment. Alike SBMI as a dynamic, continuous process, alignment is about developing ‘strategic fitness’ rather than reaching a ‘strategic fit’. Strategic fitness refers to a “continuous process of value creation for diverse stakeholders by leaders throughout the organization” (Auster et al., 2016, p. 4).

Nijsen/Granico

This study shows that the relational and dynamic process brings near infinite possible paths of value creation. Boundary work with multiple stakeholders enhances the development of value propositions in terms of both quantity and quality, and helps to utilize the full potential of SBMI.

This confirms findings of Oskam et al. (2018), and strengthens the rationale for multi-stakeholder innovation (Inigo et al., 2020). However, this thesis also shows that SBMI requires new capabilities of boundary work to understand, coordinate and adapt the different organizational boundaries of the respective actors, to develop new propositions, and to break down unsustainable business models (Bocken & Short, 2021). This makes boundary work a crucial aspect to processes of SBMI, but most businesses display shortcomings in their capability for boundary work. In extreme cases, this can lead to a ‘dynamic misfit’, being “an organization with a strategy that has become obsolete, outdated or otherwise inappropriate in light of changing conditions” (Auster et al., 2016, p. 2), which is often the result of organizational inability, unawareness or unwillingness to change.

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7.2.2 Contribution to theorizing processes of stakeholder alignment for SBMI

The second contribution lies in the theorization of stakeholder alignment processes in SBMI. The presented boundary work framework (Figure 12) better explains processes of SBMI by integrating organizational theory and boundary work in a dynamic way. Current theories lack an integrated approach on the dynamic relational processes in SBMI and its components of alignment. The boundary work framework provides a stronger foundation of organizational theory in SBMI, by examining how the development and innovation of sustainable business models are related to organizational change of the initiating business and their stakeholders.

147 thesis.thisof6and54,3,Chapteronbasedframework,workboundaryThe12:FigureWORKBOUNDARY OrganizationalPhasesboundariesArrangements Spaces inre-aligned ObjectsSpanners ExploringImplementing Brokering Boundary reconfigurations tensions& propositionsValue appropriations& Critical partnerships &Boundaries reconfigurations propositionsValue tensions& potential&Critical partnerships onAgreeing reconfigurations propositionsand withExperimenting reconfigurations propositionsand Embedding reconfigurations propositionsand Organizations Physical/digital spaces Tools Documents Figures/texts Businesses Intermediaries bysupported Identity Power Competence Efficiency withconcernedis

The framework presents organizational boundaries as components of alignment. Previous studies indicate that some form of alignment is needed to innovate sustainable business models (Le Ber and Branzei, 2010c; Oskam et al., 2020; Zott and Amit, 2010), but they only fragmentally explain what has to be aligned. This thesis integrates the various tangible and intangible aspects on which alignment is needed within and between organizations and theorizes them into interlinked concepts of identity, power, competences and efficiency boundaries. It thereby provides a comprehensive structure to operationalize the interlinked the aspects of alignment in processes of SBMI. Organizational boundaries display an underlying ‘force’ for (non)alignment. Boundaries emerge when they become socially relevant, and therefore provide leads to what is really at stake: what there is to shift and what there is to protect (Barth, 1969; Giskeødegård, 2016; Paulsen and Hernes, 2003). Therefore, boundary work processes are particularly insightful for learning about stakeholders in SBMI, rather than just the value exchanges, transcending the design of SBMs and value exchanges as such (Keränen et al., 2020).

7.2.3 Contribution to enhancing the practical uptake and stakeholder alignment of SBMI

The empirical cases have shown that developing a successful multi-stakeholder SBMI process is extremely difficult in practice. The complexity to navigate mutual dependencies, uncertainty, unexpected events and differing logics and priorities in a lengthy process can be overwhelming for businesses, both in the ability to deal with the complexity, as in the resources needed for such a process. This all adds to the scarcity of successful SBMI examples, particularly its multistakeholder forms (Baldassarre. et al., 2020a; Bocken and Ritala, 2021; Chen et al., 2017). By applying the boundary tool (Chapter 6), businesses became more aware of their own position in the wider stakeholder network and were strengthened in their confidence to reach out to other stakeholders and explore sensitive issues, for which they might have had false assumptions

As a third contribution, the framework presents boundary arrangements as tools for alignment. Businesses can increase the chances of successful alignment when developing boundary arrangements in the form of spaces, objects and the mobilization of spanners. Boundary arrangements are usually not discussed in SBMI, while they are of strategic importance for the shaping and implementation of the SBMI.

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Despite that boundary processes appeared to be very dynamic, the empirical cases display disperse processes of exploration, brokering and implementation. The operationalization of these processes into nine steps to engage with stakeholders presented in Chapter 4, and the tool in Chapter 6, contributes to understanding the processes that go beyond the patterns of collaboration as displayed in Boons et al. (2016), forming the second contribution of the framework.

7.3 Limitations and future research

These form the first steps of collaborative SBMI from which ultimately a sustainable business model may result. The tool is well-tested and flexible to be used as a values-based approach to SBMI (Breuer and Lüdeke-Freund, 2017) as well as effectuation approaches (Sarasvathy, 2001), depending on need of the multi-stakeholder network at hand. In addition to this contribution to businesses, the framework and tool can help intermediaries to improve their assistance to businesses in their SBMI. The study contributes to better future tool design as the research in Chapter 6 advances the status-quo on assessing the impact of tools, by integrating reflection and learning at two different timeframes after using the tool in addition to a direct assessment as conventionally used (Bocken et al., 2019b). Future design science might benefit from this method to assess their tools on their impact and improve them accordingly.

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While the limitations of the individual studies have been discussed in their separate chapters, this section discusses three overarching limitations of this thesis and provides avenues for future research to address these limitations.

First, this thesis studied the stakeholders and their interaction processes in SBMI contexts. The influence of broader situational factors such as policy frameworks, macro trends and competitive dynamics was not taken into account in the theorization process. Still, the empirical cases in the intermediary study in Chapter 5 displayed the negative influence of the legal framework (on waste) on the motivation of businesses to start an SBMI and the confidence that this will lead to a successful SBMI. Future research could comprise a broader situational analysis with particular attention for the interface between the external environment and boundary-shifting processes. This might help to understand the effect of institutional change on organizational boundaries, and how such change might provide an entry point for starting a collaborative SBMI process.

Second, this thesis analyses the first stages of the collaborative SBMI process. Previous studies have clearly highlighted the importance of engaging with stakeholders for SBMI and the difficulties that businesses face in this process. This thesis gives an in-depth understanding of how stakeholder alignment processes in early SBMI phases look like, why they are so difficult, and how boundary work can help to navigate these processes and successfully start a stakeholder process. Future research that covers the full SBMI process, from idea generation and design to implementation, might form a valuable contribution to the further development of boundary work as a framework that supports alignment along the entire SBMI process.

Third, future research could complement the middle-range theory developed in this study with tailored insights into strategies to deal with the specific, dispersed but related, organizational boundaries. This requires cases from different initiators, sectors, and countries to further study the components and relations of the boundary work framework. Such insights could function as ‘add-ons’ to the boundary work framework as a meta-framework for SBMI. Particular attention could be paid to the boundary of power, as this proved to be one of the major obstructing factors for successful SBMI.

While the resulting boundary work framework forms a comprehensive lens for navigating processes of organizational change, innovation and stakeholder relations, SBMI still is a very diverse and complicated phenomenon full of uncertainties, emergence and reframing elements.

This thesis provides a sharper view on the role of business in society. It forms a plea for better future SBMI design in terms of inclusivity of and responsiveness to stakeholders and their values, with attention for reflexivity, capability building and systems thinking. For businesses, boundary work can unlock a discovery journey to new relations and forms of SBMI. As a researcher, I experienced the same discovery path in finding ways to make sense of the empirical observations, which were more dynamic than literature suggested, by using concepts and theories from various backgrounds.

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7.4 Concluding remarks

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My research was guided by a strong ambition to make a difference. I wanted to help real businesses realize more sustainable business models and felt that this required new frameworks for thinking, doing and action research. Climate change and the need to create a better world for future generations deeply concerns me. During my Master Sustainability Science, Policy and Society, it became clear that businesses worry about climate change and increasing resource use too, but they struggle to change track in a fundamental way as the profits-to-be are smaller and surrounded by larger uncertainty and uncomfortable dependencies, not only for them but also for the parties around them. Perhaps more than other students I felt that I had to understand the problems for shifting to sustainability from a business point of view. This resulted in the decision to be actively involved in an attempt by a business entrepreneur (Nijsen/Granico) to create a sustainable business model for food waste as pig feed. During this project, it became clear that new ways of thinking (for example, in purpose and outcomes rather than products) and collaborating are direly needed, which necessitates a process of discovery in which not just companies but also their stakeholders within and beyond traditional sectors are willing to adopt new roles and accept new mutual dependencies. As John Geurts from Nijsen inspirationally said during a joint lecture on boundary work on May 17, 2022: “the time for companies to fulfil just one function is gone”. The notion of boundaries turned out to be useful in this regard, but it took a lot of hard work to create a framework of boundary work for SBMI. The journey was far from easy but rewarding in terms of a new framework for science, 4 articles which are published in good journals and the creation of a tool for SBMI based on boundary work, which was greatly appreciated by businesses. Contribution and relevance to the scientific field

Impact A reflection on the scientific, societal and personal impact of this thesis

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This thesis was set out to develop a theoretical and actionable framework that helps businesses in becoming a positive force for sustainable development. Through 4 studies, the findings show that SBMI cannot reach its full sustainability potential if it neglects the importance of multi-stakeholder alignment. Even the most ambitious cases need to develop supportive multi-stakeholder networks to fully unroll the sustainability potential of their business model. This requires organizations to be reflective on their organizational boundaries, and mobilize others to reflect on and re-align their organizational boundaries too. The organizational boundary focus comprises the identities, power relations and competences next to the more widely known processes and activities of an organization. For example, a production company might realize that its current ‘make-andsell’ identity becomes rapidly obsolete in a circular economy. As a solution, the company might

153 need to shift to the redesign, repair, refurbish and remanufacturing of their products in creating a sustainability-oriented service-based business model. This affects their identity, their need to develop circular skills, and ownership of the materials they work with. In questioning how such alignment can be approached by businesses, this thesis identified exploring, brokering and implementing activities, which are supported by boundary arrangements in the form of people, spaces and physical and digital objects. These insights have been translated into a boundary work framework consisting of phases, organizational boundaries and arrangements. Overall, boundary work is about exploring, negotiating, disrupting and realigning organizational boundaries based on multiple value creation, and requires brokering to re-align critical boundary dissonances in multi-stakeholder networks.

The importance of utilizing the full sustainability potential is becoming vastly urgent, given that the consequences of unsustainable production and consumption become more discernible and lead to pressing societal challenges of, for example, food scarcity and health risks, as recently exposed by the COVID-19 pandemic. The need to change our behavior will be inevitable. Whether it

For both science and society, the findings of this thesis contribute to our understanding of the potential role of businesses in sustainable development. For science, the relevance of the findings are twofold. First, the scientific literature has lauded SBMI for its sustainability potential, but this potential is dependent on a variety of factors amongst which, this thesis shows, the need for multi-stakeholder alignment. This research addresses the theoretical gap in understanding these processes of multi-stakeholder alignment in SBMI. The thesis pleas for approaching SBMI as a relational and dynamic process between a business and its multi-stakeholder network, with attention for shifting identities, power and the adoption of new roles between stakeholders, instead of an (often internally focused) reconfiguration of company products, processes and revenue models. The second relevance of this thesis for the scientific field lies in the role of science in society. Given the complexity of societal challenges, the scientific community is increasingly challenged to bridge the scientific boundaries with practice work, which is defined as “the work of actors to create, maintain, and disrupt the practices that are considered legitimate within a field” (Zietsma and Lawrence, 2010, p. 189). This development is happening not just in sustainability science, where it is particularly geared to science-policy interactions, it is also apparent in other science disciplines (Gibbons, 2000). I will elaborate on my personal position with regard to practice work further on in this chapter. This research functions as an example of such engaged scholarship: compared to existing theories that explain concepts and their relations, the boundary work approach is a middle-range theory that combines scientific theory with practical frameworks and tools that are co-developed through deep and reflexive empirical investigation.

Contribution and relevance to society and societal actors

For businesses and entrepreneurs, the boundary work framework and tool helps to improve the understanding of their multi-stakeholder network as a means to identify and develop opportunities for SBMI. This is particularly relevant given that sustainability ambitions transcend the experience of individual actors (Sarewitz, 2000). In such interactions between organizations, businesses often do not realize that identities, power, competences and efficiency are relevant influencers of the SBMI process. This realization came to Karel van der Velden from Nijsen Group as well: “Myrthe’s research has provided us the insight that the perspectives of other parties in the value chain make that a message, that is perceived as clear by us, does not come across as we would expect, and that helps to better understand the reasons why communication is so difficult ” (e-mail correspondence, What22-05-2022).ifaproduction company engages directly with actors that are situated at the end of the traditional value chain? This brings up whole new opportunities for creating value, as the Nijsen/Granico case nicely illustrates. The boundary work framework is unique in combining an enlightenment function with practical steps for dealing with challenges of boundary-shifting processes in multi-stakeholder settings. As John Geurts, corporate director from Nijsen Group pointed out: “Boundary work helped us to move away from thinking in value chains, integrations and squares, towards a much needed transcending paradigm and framework ” (e-mail correspondence, 15-05-2022). The phrase he used for this was: to “circle the square”. For policy and policy-makers, boundary work has the potential to inform policy-making in a more holistic way, taking into account the complexity of multi-actor interactions and underlying aspects of identity and power. For policy makers this is not easy, as they maneuver between vested stakes and the limits of their own position and sphere of influence within the multi-actor field. Boundary work encourages them to explore new ways of stakeholder engagement, mobilizing multiple actors as a basis for more contextualized, progressive policy-making.

154 fits our current interests or not, ultimately, the environmental and social consequences of our practices will force a reconsideration of how we produce and consume. It is therefore paramount that research is being conducted that helps policy-makers, businesses and other organizations to create a supportive environment for the innovation of sustainable business models. However existing research largely limits itself to boundary spanning, overlooking the relevance of the organizational and relational dynamics involved in an SBMI process. Famous tools like the business model canvas are bound to ‘boxes and squares’, but it is exactly these boxes and squares that boundary work aims to transcend.

For educational institutes and educators, boundary work can contribute to equip future decisionmakers with necessary values and skills for more sustainable development, such as systems thinking, reflexivity and multi-disciplinary collaboration. The experiences with students are very encouraging, both in their active participation in lectures and workshops, as well as graduate students that used boundary work as a framework, from which ideas even led to the request for successive graduates by the companies involved. In education, students are taught to do an actor analysis and sometimes a system analysis but they fail to examine the question of why the problem exists, despite attempts and calls to do something about it.

For intermediary organizations and boundary workers, boundary work can help to strategically design consortia and guide innovation processes in such a way that dissonances (which require creative congruence) can be identified and dealt with at an early stage. Boundary work helps to understand why existing value chains are unable to re-invent themselves, and why SBMI based on new roles amongst collaborating partners requires new value networks. There is little theory on the creation of new value networks for business model innovation and most articles on this are rather abstract and lacking in empirical depth. A personal perspective on this thesis I realize that the position of a scientific researcher holds a responsibility with regard to the normative positioning of the research. My personal affection with the need to conserve our precious natural environment influenced the way I engaged with my research. For me, the PhD journey was also a process to better understand my own societal position and its boundaries. Particularly the Nijsen/Granico case demanded me to be conscious of my role as a researcher. I attempted to function as an honest broker, clarifying the scope of options for Nijsen/Granico rather than telling them what option to prefer. Simultaneously, aspects of stealth issue advocacy crept in. My deep engagement in creating a successful SBMI made me help in laying out options in this direction (rather than options that were less aimed at sustainability), and advise on steps that could lead to this success. Hence, I was not neutral to the ideas we produced. This tension on the boundaries of my scientific role was also apparent in the tool development study, where I took up intermediary activities and actively encouraged organizations to become involved in SBMI processes. This had political overtones as it concerned a means to spark debate and promote consensus that enables action (Sarewitz, 2000). To me, this is boundary work too. In education, we are told to be objective and to take a reductive approach to problems, which make us overlook the normative dimension and own responsibility for making the world a better place. My colleague at Fontys University of Applied Sciences, Jifke Sol, once remarked in one of our conversations: “People who work on a sustainability transition based on a deep conviction [of fostering positive change]

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For further non-science dissemination, I have initiated collaboration with a Maastricht University Sustainability Science & Policy master student to publish an article about his master thesis for the Brainport ‘Food from Food’ magazine (accessible via www.foodfromfood.eu/food-food-magazinenajaar-2020). For him, the framework had clarifying value: “During my graduation research into sustainability transitions at SME production companies in the Netherlands, boundary work helped to understand bottlenecks and opportunities of circular innovations by pointing at the boundaries of organizations, where they touch each other and how they change through interaction and collaboration” (Maarten van de Westelaken, graduation student 2020) 5 other Maastricht University students have used boundary work as a lens for their masters’ thesis and pointed at the strength of the framework to grasp multi-stakeholder complexities: “Thinking in organizational boundaries, especially by employing Myrthe’s model, helped me tremendously to develop my master thesis. I analyzed the potential of a reusable food container scheme in Moroccan supermarkets through a boundary work lens. Especially for the comparison of the status quo with the desired reusable food container scheme, the model deemed invaluable, as I could grasp complex stakeholder systems in an easy, straight-forward and yet precise way ” (Anna-Lena Henke, graduation student 2020).

Disseminating knowledge to create impact

For this thesis, I have engaged with 45 companies, of which 28 have been actively involved in applying the boundary tool. The application of the tool has led to strategic reflection and decisions about the boundaries of the participants and in 5 out of 6 cases, the tool led to follow-up actions in their SBMI process. Although I developed skills at intermediation, at heart I remained a researcher. The encounters with practitioners in companies resulted in 3 funding applications to further experiment with new boundary configurations. The tool development process was supported by students from Fontys University of Applied Sciences, both from the minor Circular Economy as well as from the course Sustainability in Business. This provided the students the opportunity to engage with scientific research in a practical societal context.

156 often put their own position at stake [because you are not rewarded for making a difference in the world but for publishing articles]. That requires courage ”. For me this was not a matter of courage, but deeply uplifting. On a practical level, you might have noticed that this thesis looks different from well-known office paper. By choosing paper made from waste, and limiting the amount of printed copies, even the smallest actions contribute to doing less harm to our natural environment. My future mission lies in reconnecting humans and businesses with nature, whilst being aware that this is not done to preserve unsustainable ways of doing.

157 In terms of outreach and engagement, this work disseminated in 3 public workshops during the ‘Dutch Circular Economy Week’, as well as a public lecture via Innovation Origins, an Eindhovenbased Innovation platform. The Fontys Sustainability platform for students, employees and external interested parties published two articles on boundary work, accessible via avenue,enhanceandtotoresearchForleveluniversity-orientedisDisseminationfontysforsustainability.nl/inzet-boundary-tool-bij-circulair-bedrijfstextiel/.boundary-tool-helpt-bedrijven-in-samenwerkingen-voor-een-circulair-businessmodel/www.fontys.nl/actueel/andhttps://tothescientificcommunityhastakenplacethrough4journalpublications(the5thinpreparationforsubmission),thepresentationofmyresearchat4globalconferencesand3conferences.Additionally,Thisthesisresultedinabachelorandamasters’lectureonboundarywork,aspartofcourseson‘InnovationforSustainability’.futureresearchanddissemination,IwouldliketoencouragemoreprojectsofengagedliketheprojectofNijsen/Granico.AsIdo,Ipointattheequalneedforresearchersbeexplicitandreflectiveontheirownboundaries,particularlyontheirpositionwithregardscienceandconsultancy.Throughcollaborationwithentrepreneurs,policy-makers,educatorsintermediaries,boundaryworkcanbeincorporatedintoothermulti-stakeholdersettingstoitssocietalimpact.Forpublicengagement,citizenparticipationwouldbeavaluableforexamplethroughcitizenpanels,experimentationgroups,orapublic‘guerrillacollege’. THIS THESIS IN NUMBERS companies45 cases26 74participantsworkshop 4 publicationsjournal 6 thesesmaster 6 activitiespublic citations1281 reads20752 conferences7 lectures2 1 https://scholar.google.com/citations?user=2aE9ycUAAAAJ&hl=nl, accessed 13-08-2022 2 https://www.researchgate.net/profile/Myrthe-Velter/stats, accessed 13-08-2022

Acknowledgements

158

It was September 2016, and I recall the proudness that I felt as a PhD opportunity for the topic I felt hopelessly engaged with for was offered to me. What an opportunity it was. Somewhere in between anxiety and excitement I told René that I did not yet know how to conduct such highquality scientific research, after which he reassured me to learn along the way. This PhD thesis illustrates the many scientific as well as personal lessons learned during this PhD trajectory. It goes without saying that this journey would have been impossible without the many people involved along the way. René, I am grateful that you dove into the deep with me as my promotor. Your continuous encouragement to explore novel trajectories, and your endless trust in my capabilities taught me that it’s okay to not know everything, and gave me the confidence to shape and deliver this research independently.

Verena, as my supervisor you tirelessly guided me through peaks and valleys. What have we overcome many barriers! You taught me to put things into perspective and your critical look helped greatly to clarify my spinning thoughts. Thank you for making time for me, always.

Thank you to all my colleagues at Maastricht Sustainability Institute. Specifically to Anja (van Bogaert) and Ron for granting me the opportunity to do this PhD. To Henk for nudging me towards a continuous questioning of my own position and whether I had sold my soul already. To Bram for the Age of Empires evenings and wheelchair ‘walks’. To Annemarie for the horsey-talk. And to all others for their support. Anja (Klomps), thank you for providing me the opportunity to further unfold my thoughts into a warm nest of experienced researchers at Fontys. To Yvonne, Jeske, Jifke, Fons, Mascha, Mendy, Mignon, Geert, Dankeld, Magid and Cees-Jan, thank you for your encouragement, discussions, and participation in my research experiments. That many may follow!

Nancy, look where our spontaneous phone call back in 2016 has led us! It was an unspoken prerequisite for me to have you on board as my copromotor. You showed me that research improves through design and creativity, encouraged me to develop actionable results and to engage with like-minded businesses and researchers. Thank you for the paths travelled, and the paths to come!

Mom and dad, I am particularly grateful for your unconditional support. For my PhD, for taking care of me after the multiple horsey accidents, for keeping an eye on my own wellbeing, for taking up practical matters that enabled me to continue writing my dissertation while I was bed-bound... you were always there for me and I cannot thank you enough for that. To my sister Ilse, you help me to reflect on the choices I make. Thank you for being an independent sister and a great example! Nelly, oma Nelly, you keep putting a smile on my face with your challenging and kind eyes. I know you are looking as much forward to this dissertation as I do!

I owe a special thanks to the many practitioners who agreed to be interviewed, who provided me with access to documentation, and who allowed me to be part of their projects. Specifically, I would like to thank Karel, John, Josse and Marion. You allowed me to be part of your quest for sustainable innovation, and helped me when I needed a reality check from my theory-overflowing Dearmind.family.

To my closest friends. Elki, we have reached many milestones together and this is definitely one that you will feel just as much as I do! Sabien for the endless outdoor rides on our favourite steeds. To Gabrielle, my lifelong friend and PhD buddy. Marjolein and Jacklien, I am proud to have you by my side as my paranimfs! To Denise for being there as a neighbour and a friend. To the endless nerdies Ruth and Andrea, Meike, Alain, Ineke, Arno, Bob, Mette, and all the ‘lelijke draken’, thank you for your support, I promise to join for beers next time. Joep, I am grateful to have met you last year. We literally learned to walk together, and as we did, you helped me to finish the last miles of this PhD. Thank you - everyone who contributed and sympathized.

159

Thank you to all my unofficial colleagues: Christiaan for helping me to understand the practitioners’ perspective and giving me the courage to reach out and organize the boundary tool workshops. Sjoerd, Boukje, Myriam and all fellow PhDs at TU/e, for giving me the heads up and warm welcome as their ‘unofficial colleague’.

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Bocken et al. (2015) Value forms; social, economic, ethical Evans, Fernando, et al. (2017) Value created and captured Value created and captured plus value absence, surplus, destroyed, missed, new value opportunities

Schaltegger et al. (2016) Economic first Economic through societal & environmental first

Bocken and Allwood (2012) Customer value Sustainable customer value through offering and value for society & environment Boons and LüdekeFreund (2013) Customer interface Customer’s sustainable value through transparency about production and consumption systems. Ecological and social value through customer value / measurable ecological and/or social value in concert with economic value. Krantz (2010) Better value; customer’s sustainable value through transparency about co-benefits

Madden (2017) Environment Stubbs and Cocklin (2008) Maximize shareholder(refined)value All stakeholders on the organizational & socioeconomic level

Madden (2017) Direct, short- or medium- termDirect- short- or medium- term plus long-term, future generations

Bocken et al. (2013) Value created and captured Value created and captured plus value destroyed, missed or surplus, new value opportunities

Schaltegger et al. (2016) Organizational value Organizational + Social and ecological value Value proposition Customer value Sustainable customer value and co-benefits through value for society & environment

Value priority Economic first Societal & environmental value first or equal to economic value

Stubbs and Cocklin (2008) Longer-term Value created (refined) shareholder value Value for the common good Dyllick and Muff (2016) (refined) shareholder value and/or triple bottom line Value for the common good Lüdeke-Freund (2010) Private/customer and public benefits

Value form Value created and captured Value created and captured plus value absence, destroyed, missed or surplus, new value opportunities

Freeman (1984) Economic first Economic through societal & environmental first

Business model Sustainable business model

Stubbs and Cocklin (2008) Maximize shareholder value No prioritizing of stakeholders Value horizon Direct, short- or medium- termDirect, short- or medium- term plus indirect, long-term Freeman (1984) Long-term Krantz (2010) The entire life cycle

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Bocken et al. (2013) Customer Customer, other stakeholders, society, environment Chesbrough (2010) Users Osterwalder and Pigneur (2010) Customer Richardson (2008) Customer Teece (2010) Customer, business Customer value proposition

Appendix A: Review of interlinkage between sustainable business models and value creation

Stubbs and Cocklin (2008) Stakeholders in the network; for example, non-government organizations (NGOs), the media, upstream and downstream supply chain players, financial markets, and investors.

Zott and Amit (2010) Firm in concert with its partners Value capture Economic business value (monetary & non-monetary) Societal, environmental and economic value

Chesbrough (2010) Firm revenue Dyllick and Hockerts (2002) Natural, societal and business

Stubbs and Cocklin (2008) Financial, Environmental, Social outcomes

Evans, Vladimirova, et al. (2017) Economic value Societal, environmental and economic value

Chen et al. (2017) Internal, value chain and competitor/other organizations

Richardson (2008) Revenue and business economics

Lüdeke-Freund (2010) Network of partners

Boons and LüdekeFreund (2013) Appropriate distribution of economic costs and benefits, and ecological and social value capture

Freeman (1984) Value network instead of value chain Krantz (2010) Interlinked value chains

Patala et al. (2016) Customer’s sustainable value through co-benefits such as health, design, energy savings. Sustainable value proposition: economic, environmental, social Schaltegger et al. (2016) Sustainable customer value through value for broad stakeholder network including natural environment

Lüdeke-Freund (2010) Superior/extended customer value, company and society & environment/public customer value/public value propositions

Bocken et al. (2013) Wider set of stakeholders Boons and LüdekeFreund (2013) Sustainable supply chain management and responsibility for stakeholders

Richardson (2008) Value chain, activity system, business processes, value network of suppliers, partners and customers

180

Zott and Amit (2010) Customer value Value creation & deliveryBusiness, value chain, relevant value network partners Business and interlinked value chains plus stakeholder network including new and possibly unusual partners

Chesbrough and Schwartz (2007) Value chain and value network of suppliers, customers and rivals Evans, Vladimirova, et al. (2017) Business and value chain Business and value chain plus stakeholder network including new and possibly unusual partners

Madden (2017) Environment, local communities, other ‘public interest’ representatives next to customers and employees

Schaltegger et al. (2016) Economic value capture through societal and environmental value capture

Teece (2010) Business value (monetary & non-monetary) Zott and Amit (2010) Business profit through revenue model

181

182 creationvaluetargetedandnoveltypartnerpartners,collaborationMainB:Appendix PartnersMainCasePartner Novelty PropositionsConsumerPropositionsPropositionsPartnerEnvironmentalPropositionsSocietal One (initiator: Heijmans) agencyhousingPublic fundinvestmentPrivate Municipalities citizensLocal utilities/energyPrivate company CorporationsLeasing Producer Familiar Familiar Familiar New Familiar New New high-qualityffordableA• singleyoung,forhousing professionals tocontributionositiveP• attractingbyareasempty flows,cashnew binding,community safetyimproving Emerged asylumforousingH• market)(newseekers throughrecoveryesourceR• circularity efficiencyenergyighH• All-electric• Intermediaries (investors, leasingcorporations,housing companies): goodawithproductnnovativeI• return housingoveableM• investmentong-termL• corporationsHousing housingemporaryT• Municipalities tohousingdesignemporaryT• qualityurbanimprove Immediate: independent,lexible,F• rentalaffordableandqualitative housing Long-term: (•Dutch)Design environmentallyandociallyS• municipalitiessustainable Niaga (initiator: DSM-Niaga) /(chemicalMNE producer)material producerCarpet New New healthpopulationmproveI• andallergylessthrough asthma decreaseadicallyR• pollutionpolyester recoveryresourceullF• resourcerawofliminationE• extraction wasteofliminationE• duringusageenergyless0%9• recyclingandproduction Manufacturer NiagaproducetodProu• opportunitymarketewN• exclusivity(limited)through sustainabilitytureFu• Retailer easythroughsavingsostC• replacementandapplication Immediate: experienceanuyB• fireofcaseinsmokeoN• smellno&ightweightL• replaceableuse;asyE• valueeturnR• Long-term: healthmprovedI• materialureP• N•owaste Futureproof (initiator: Kingspan) Farmer cooperationEnergy banks(Regional) buildersRegional removersAsbestos installersSolar Familiar New New Familiar New Familiar hazardousiscardD• improvetosubstances health hazardousiscardD• substances (solarenergyenewableR• panels) (intelligentefficiencynergyE• isolation)andlighting companyInsurance asbestosriskecreasedD• Banks cash/opportunitynvestmentI• flow ofriskdecreasedsharing,iskR• asbestosonloanhaving companyEnergy flowcashong-termL• sharingiskR• Immediate: withoutremovalasbestosafeS• animalsandsuppliesmoving basedfeemonthlyost-neutral:C• revenuesolaron betteradministration;essL• &warrantymaintenance, insurance barrierinvestmentvercomeO• Long-term: sustainableforncentiveI• certification safetyfirencreasedI• premises;businessncreasedI• accessvalue,salesandproperty insuranceandfinanceto

183 CircularEcor Friesland Noble(initiator: Environmental) regionalPublic &Investment Development FrieslandCircular (public) industryLocal collectorwastePrivate processorand New New New New throughcohesionegionalR• circularity creationjobegionalR• harmfulofliminationE• VOCs celluloseofliminationE• waste&VOCsharmfulwaste, productionin transporteducedR• bio-basedcertified00%1• recoveryresource00%1• wasteforestandfarm(urban, reducingmaterials), landfillandincineration traditionalforlternativeA• corrugatedplywood,wood, plasticsand inreusewater9%9• production factoriesimpacteroZ• /municipalities/Provinces investors:publicregional sustainabilityregion,ircularC• performance creationbJo• cohesionegionalR• investorsPrivate investmentoodG• MDFseliminationlobalG• usematerialairF• application&Sourcing potentials Sales• movementcircularofartP• performanceustainabilityS• Immediate: costswastevoidingA• anddesigndvancedA• performance recycledandnon-toxic00%1• creditsLEEDtoontributionC• Long-term: designers,creation:ommunityC• craftsmen Food-for-Feed- for-Food (initiator: Nijsen-Granico) Municipality NGOEnvironmental New Familiar spacepublicncreasedI• availability,foodncreasedI• human-ofelimination forcompetitionanimal land solvingtoontributeC• problemmanure andsmellecreaseD• inqualityairimprove stablessurroundingareas forneedadditionaloN• landagricultural&resources wheat)soy,(forests, emissioncarbonadicalR• localthroughreduction production&sourcing process manurepigphosphateessL• farmersPig problemmanureecreaseD• certaintyrice/volumeP• imagemprovedI• Retailer Circularity• costswastevoidA• NGOavoid&imagemprovedI• campaigns Butchers identifiedvalueoN• NGO &needresourceadditionaloN• landagricultural throughemissionCO2educedR• production&sourcingregional manurepigphosphateessL• Immediate: meatertifiedC• structureandtastemprovedI• welfareanimalmprovedI• environmentalmprovedI• performance Long-term: environmentalmprovedI• performance Kipster (initiator: Kipster) workersBoundary Retailer NGO Builders suppliersFood New Familiar Familiar Familiar New wastefromfoodhickenC• impedenotdoesstreams humanforfoodwith consumption functionalandstheticE• design andvisitorransparency:T• centereducation urbanforuitableS• agriculture helptomeatroosterellS• demandsfoodmeeting &ammonialoweringadicallyR• matterparticulate wastefromfoodhickenC• streams solarthroughnergy-positiveE• panels usefuelfossiloN• directandpackagingocalL• transportlimitsdistribution insteadmeatroosterellS• chickenextraproducing Retailer fromeggcertifiedhree-starT• ProtectionAnimal certificationnvironmentalE• Energy-neutral• Exclusivity• Farmer marketewN• pricingairF• NGOs eggsustainabletoontributionC• production Immediate: eggbestthewithfarmbesthe‘•T price’bestthefor andanimal,uman,H• eggfriendlyenvironmentally

184 KarolinskaNew partnership Philips(initiator: Healthcare) (initiator)CouncilCounty (private1Competitor healthcare) (private2Competitor healthcare) (semi-public)Hospital Users constructionPrivate company Familiar New New Familiar Familiar New affordableIncrease healthcare toaccessIncrease healthcare materialefficiency,nergyE• declarations,chemicaland disposalswaste materialsrawforneedessL• circularitythrough Hospital warrantyptimeU• choiceproductofreedomF• competitor’s)(also priceixedF• technologylatesttoccessA• responsibilitynburdeningU• equipment Immediate: andconvenientaffordable,oreM• healthcarequalityhigh BeeBanking (initiator: TheStroom Hague) Artist Beekeepers (association) Crowd Retailer investorsPrivate NGOs fundSustainability Politicians New New New New New Familiar Familiar New ofawarenessncreasedI• beeandproductionfood mortality foodofawarenessncreasedI• mortalitybeeandproduction Artist salerojectP• Beekeepers craftforromotionP• environmentaltoontributeC• goal citizens/investorsPrivate lifetoontributeC• forreturnaspackageoneyH• supportfinancial Retail salesoneyH• Immediate: lifetoontributeC• packageoneyH• Co-benefit• honeyurbanofasteT• Urgenda (initiator: Thuisbaas) ownersHouse (association) installersSolar installerspumpHeath installersInfrared Municipality Familiar New New New New mitigatetoontributionC• throughchangeclimate homeenergy-neutral mitigatetoontributionC• throughchangeclimate homeenergy-neutral consultants&Suppliers opportunityentrancearketM• scale-upforpportunityO• Immediate: warrantyero-on-the-meterZ• withinvestmentost-friendlyC• municipalityco-funding planstep8ustomizedC• emissionsCO2liminateE• Self-sufficiency• subsidies,assistance:inancialF• savingsloans, Long-term: valuehousencreasedI• fastersoldouseH•

185 processSBMItheofTimelineC:Appendix 20182017201620152014 Nijsen/modelbusinessraditionalT• toduepressureunderGranico positioncommoditymargins,small flows.residualofsupplyscarceand forNijsen/GranicoasksipsterK• feedchickencircular SuperUnieconnectionCoincidental• i.c.w.feedalue-researchV• UniversityWageningen KipsterbusinesscaseSketch• FoodforFeedforFoodIdea• toKipster,meetingsxploratoryE• NGOsandretailalign NatuurNGOsmeetingsxploratoryE• andMilieudefensieMilieu,& Dierenbescherming criticalexploringnitialI• barriers:andstakeholders aligntorequiredSuperUnie workcannotbutchersasbutchers badgesin onSuperUnieonflictC• responsibilities activities,androlesovelN• pigandretailerforparticularly entrepreneur criticalalignmentforarriersB• stakeholders partnerscollaborationPrioritizing• interestshowFinancers• KipsterStart• networkstakeholderodellingM• collaborationinto-be,andas-is aandresearcherfocalthewith consultant theirkey-stakeholders,efineD• envisionedandcharacteristics alignmentforbarriers andpartnerspotentialefineD• (Knowhouse,defenders farmers)pigMunicipality, businessthreeofevelopmentD• preferredandstrategiesmodel strategy Nijsen/rolefuturenvisioningE• toproducer’‘feedfromGranico: provider’concept‘circular 202120202019 totalkingstartsijsen/GranicoN• partnersinternational andLoonVanwithonversationsC• continueLidl residualsupplytocontinuesidlL• Kipsterforproducts stable3rdopensipsterK• potentialoflistwithhelpsLidlKipster,forNijsen/GranicoproblemsupplyS• productsresidual Pig:Circular creationvalueprioritiesegotiateN• processsourcingonagreesGON• feed-farmerpricing,sector:theinsensitivitiesandstructurexploringE• relations pricingconcretenessoveronflictC• rolenewNijsen/Granico’sofpositionandpowerunderstandingmprovedI• PigCircularexplainermakesGON• Pig:Banquet specificmentioningbutcher,andLidltoNijsen/GranicoresentationP• costspropositions,valuepricing,numbers farmersexistingdiscontentemergingrevealingKipster,publicationriticalC• projects:3inupsplitProcess• aboutconsortium,PigsterheT1 farming.pigcircular customer1Participants: Schepers.KeesBOM,(Albron), Duke"thepigswithExperiment Berkshire"of projectaPig,BanquetThe2 retailerslargeataimed ofprojectPig,CircularThe3 othertoconcepttheoffering retailers toduePigBanquetccelerationA• LoonVanandLidlmeetings newitsproposesijsen/GranicoN• forpartnerstrategicaasrole additioninconceptsfoodcircular Lidtoproducerfeedpigto NGO’s,bydraftedproposalrojectP• Municipality.andZandersRuud isgrowthcompanythatealisationR• thetostickingwhenlimited propositionvaluesocietal certificationaboutiscussionD• schemes (limiteddropoutsofealisationR• farmers)pigofamount independenttherequestsGN• brokerexternalanbetoconsultant

Initial VP What was the initial goal of the project? What was your role in this project?

If so, what kind of changes? Think of new visions, values, positions, activities, processes, skills. What were the challenges in these changes? Were there any clashes with existing situations? How has MVO Nederland helped you and the other organizations involved to discuss these changes and difficulties?

Negotiating Who has been spoken to to make the necessary changes or adjustments? How did you do this? How were the necessary changes or adjustments negotiated?

Incentive collaborationfor How did you motivate parties to participate?

Spanning intermediatingor Were you mainly in contact bilaterally or with several parties at the same time?

Exploring boundary changes

IntroductionINITIATIVES

Have you held discussions internally or with chain parties / pilot partners about whether it is necessary to implement changes in your organization or in the chain as a result of the pilot project?

186 Appendix D: Interview protocols

Improvements You have told me a lot about the role of MVO Nederland. What do you think they could improve in a next project where they help organizations with circular business model innovations?

Have there been discussions about necessary changes in the chain? If so, what changes were these conversations about? Think of new visions, values, positions, activities, processes, skills. What were the difficulties in these changes? Were there any clashes with existing situations?

Initiating actor(s) Who was or were the initiator (s) of the project?

IntroductionINTERMEDIARY

Stakeholder network Which parties have you worked with? Were these new to your organization?

Implementing Role MVO NL How did you agree on the changes? How have these changes been implemented? How has MVO Nederland helped you and the other parties involved to reach an agreement?

Can you briefly describe what the project was about?

Incentive collaborationfor What was the motivation for you to participate?

Stakeholder network Which parties have you worked with in this project? Were these new to your organization?

RoleefficiencyCompetence/Identity/power/MVONL

Role MVO NLHow has MVO Nederland helped you to negotiate / tackle the various changes?

Spanning intermediatingor Were you mainly in contact bilaterally or with several parties at the same time?

Exploring boundary changes

Initial VP What was the initial proposition / goal of the project? Can you briefly describe your role in this project?

Can you briefly describe what the project was about?

How have you identified these needed changes and difficulties? Which resources were helpful in this? Such as objects, models, maps, forms, drawings, methods, words ..?

Initiating actor(s) Who was or were the initiator (s) of the project?

Negotiating Have there been negotiations about the necessary changes or adjustments?

187

How did you help the organizations involved negotiate the various changes and interests? Again, the question, which resources have helped you with this? Think of objects, models, maps, forms, drawings, methods, words?

innovations? Appendix E: Data collection and analysis Data sources Total no. engagementsof Collection method Data preparation Community of Practice meetings 7 (39hrs) Observation, field notes, minutes, learning goals, presentations Discovery memos Semi-structured interviews (2 with CSRNL, 6 with participants) 8 (4hrs 9 min) Recorded and transcribed Discovery memos Informal conversations 15 Notes Discovery memos E-mail correspondences of CSRNL with program partners 8 Initial coding Discovery memos E-mail correspondences of CSRNL and initiatives with researcher 39 Initial coding Discovery memos Learning process timeline 3 Initial coding Discovery memos Documents of initial interviews 4 Transcription Discovery memos Preparatory documents 3 Initial coding Discovery memos Case study reports 3 Initial coding Discovery memos Program publications 3 Initial coding Discovery memos Websites 19 Discovery memos

forms, drawings, methods,

Implementing How have you helped the initiatives to agree on the changes?

What were these negotiations about?

Improvements What did you think of your role in the project? What could you do in the next project where you can help organizations improve with circular business model

Again, the question, which resources have helped you with this? Think of objects, models, maps, words?

What of Is

our activities can we utilize for the collective ambition?

there a need to develop or adopt new activities? Do the activities fit our identity? Change, develop or outsource activities enabling reuse, repair, remanufacture, redesign

our skills can we utilize for the collective ambition?

188 Appendix F: Digital tool assessment form initial tool design TOOL ASSESSMENT FORM You have just used the boundary work tool. The purpose of the tool (figure 1) is to learn about circular opportunities in the multi-stakeholder network based on the changing organizational boundaries, and to explore boundary matches and mismatches between stakeholders. The tool is supported by organizational boundary cards (figure 2). Figure 1: Boundary tool F igure 2: Organizational boundary cards 1. The boundary work tool is useful to address the purpose stated above: Fully agree fully disagree Please explain your answer (What was most useful? what was less useful? why?) 2. The boundary work tool is easy to use: Fully agree f ully disagree Please explain your answer: 3. The boundary cards were easy to use Fully agree f ully disagree 4. The meaning of the different organizational boundaries were clear to me Fully agree f ully disagree 5. What have you learned from applying the tool? 6. Do you have any recommendations for workshop and tool improvement? What should be started/stopped/considered or continued?Identity&mindsetWhydoesourorganizationexist?WhatvaluesdowestandforandDoesouridentityfitthecollectiveambition,oristhereaneedforadjustment? For-benefit becomes an objective equal to profit Relations & contracting How does the ambition change our dependency and influence on partners and materials? Wat can we do to align partners? Do we have the power to act according to our identity? Fair sharing of costs and benefits, enhancing network competitiveness Materials & skills

there a need to develop or adopt new skills? Do the skills fit our identity? Acquiring new competences, such as repair, remanufacture, circular design, collaborationnetwork Processes & activities

Fully agree fully disagree explain your answer: The workshop helped to define first interventions

Please

Fully agree fully disagree explain your answer (What did the tool do well/what could be improved?)

Fully agree fully disagree The tool is easy to use: Fully agree fully disagree The tool is supported by organizational boundary cards (see figure below). To what extent did you find these cards useful to support the tool? Very useful not useful at all

1. The workshop helped to form a collective ambition

Please

3. The tool helped to explore and negotiate opportunities and tensions between stakeholders

189 Appendix G: Digital tool assessment form improved tool design TOOL ASSESSMENT FORM

Figure 1: Boundary Work Tool

You have just followed the workshop ‘boundary work’. The aim of the workshop is to formulate a joint ambition and to explore and negotiate the needed changes, opportunities and tensions in the multi-stakeholder network, as a basis for finding first interventions. To improve the tool (figure 1) and workshop, we would like to ask you to fill in the questions below.

Fully agree fully disagree Please explain your answer: The tool helped to learn about necessary changes in the multi-stakeholder network

Acquiring new competences, such as repair, remanufacture, circular design, collaborationnetwork

Relations & contracting

to me Fully agree fully disagree 8. What have you learned from applying the

and

stopped / or adjusted?

What of our activities can we utilize for the collective ambition? Is there a need to develop or adopt new activities? Do the activities fit our identity? Change, develop or outsource activities enabling reuse, repair, remanufacture, redesign meaning organizational boundaries clear tool? workshop tool well, /

be improved? What went

Why does our organization exist? What values do we stand for and Does our identity fit the collective ambition, or is there a need for adjustment? For-benefit becomes an objective equal to profit Materials & skills

9. How can the

190 Identity & mindset

What of our skills can we utilize for the collective ambition? Is there a need to develop or adopt new skills? Do the skills fit our identity?

of the different

were

and what should be started

How does the ambition change our dependency and influence on partners and materials? Wat can we do to align partners? Do we have the power to act according to our identity?

Fair sharing of costs and benefits, enhancing network competitiveness Processes & activities

The

191 Appendix H: Populated example of the boundary tool

192 Appendix I: Collaboration pitch format

Exploring

Phase No Step Guiding lines and questions

Why are we here? What are we going to do? In five steps we will create a sharper perspective on our collective ambition, and explore how we can contribute to this ambition and where we need to jointly change aspects of what we do.

How is power being shared amongst us? whom has control/ influence over others? Whom should be empowered and whom can help with that? Whom/where should power be declined? Whom has the power to align others? How do we share information?

Whom at the table represents which stakeholder?

2 Develop a collective ambition How would we define the sustainability ambition of this group? What are modest improvements that we can already do for this ambition? What do we want to go into further that requires significant changes?

How does the innovation change your organization's influence on stakeholders and/or materials? Whom are you steering and whom do you depend on? Does your organization have the influence to align others? What can your organization do in terms of contracting? How can you as a network enhance your competitiveness?

What (novel) activities could your organization deploy for this ambition? What do you do differently in five years? What are the implications for the organization's processes? Do you deploy these activities yourself or are others needed? Do the envisioned activities still fit your envisioned organizational identity?

How does the ambition affect your organizational boundaries? Sketch how your future organization would look like using the OB cards. Keep in mind that your future boundaries should contribute to the collective purpose. You can build on your existing boundaries, but probably these will need to be adjusted more or less. For example, are you still a producer of products, or rather a circular concept developer? Write your future boundaries down with post-its and map them on the boundary tool. Let's start with the boundary of identity....

Negotiating

Appendix J: Guiding lines and questions for the workshop

Who's purpose seems contradictory with the collective purpose? What mission or vision statement is challenging here?

How do you see the identity of your organisation in this future? Does your current corporate identit fit the ambition? If so, how? If not, how should our purpuse be changed to improve alignment?

Which stakeholders are relevant? Go all the way downstream and upstream, and don't forget societal stakeholders such as public organizations, environmental organizations, citizens, consumers... Do we miss stakeholders to achieve our common goal? Are there stakeholders that become redundant?

What competencies, skills and materials does the innovation require from your organization? Are there new materials or skills to be developed? Do you aim to develop these yourselve, or can others help with that? Does this still fit within your organizational identity?

193

Name three things that you notice. Can you share what you can do yourself, and what you need others for?

3 Explore boundary changes

1 Set the scene and get started

4 Negotiate boundary changes and list matches and mismatches Where do you see the greatest possibilities? Where do we see opportunities to get started easily? What takes more time? Where do we see obstacles? Are they crucial? Who feels its difficult to align? What still needs to be found out?

In the previous discussion, we have identified the following matches and mismatches. Do we still have any additions? Which matches would you like to get started with right away or have major potential? What else do we have to do or find out? Which mismatches are critical?

7 Create a collaboration pitch Mismatch: For the topic of Y, what can we, or others, do to address this tension? Do we need to align our collective purpose? We can now fil lthe collaboration pitches for the different interventions

Implementing

194 Negotiating

Who has skills, networks or machinery that could be useful for another organization? Are there stakeholders from other sectors or markets who could have relevant compentences? Will we need a new kind of stakeholder?

6 Define first interventions Match: For the topic of X, what could be ways to start with capturing this opportunity? (match)

5 Prioritize matches and mismatches How does this change the activities of stakeholders in our network ? E.g. Could suppliers adopt a repair/remanufacturing role? Who will be responsible for reversed logistics? What different consuming habits have to be nudged for?

Figure

4: Configuration of the Dutch pork sector 7 1

195 List of Abbreviations CBMI Circular Business Model Innovation COP Community of Practice CSRNL Corporate Social Responsibility Netherlands DSR Design Science Research FFF Food for Feed for Food MRT Middle Range Theory NGO Non-governmental Organization SBMI Sustainable Business Model Innovation SME Small-Medium Enterprise List of Figures Figure 1: The three-layered reality of critical realism 2 1 Figure 2: The research process 26 Figure 3: Conceptual framework for Boundary Work in SBMI 5 7

Figure

3: Value as a multi-dimensional, multi-relational and multi-level concept 3 4

Figure

Table

5: Synthesis of the boundary work processe 7 2

6: Organizational boundary changes of Nijsen/Granico 7 5 Figure 7: Visualization of the research gap 93 Figure 8: Framework for organizational boundary alignment in SBMI 113 Figure 9: Tool development process applied in this study 118 Figure 10: Boundary tool 119 Figure 11: Organizational boundary cards 120

Figure

4: Case description, as emerged from empirical enquiry 39 Table 5: Semi-structured interviews per case 41 Table 6: (Promoted) boundary change of the initiating organization and actors in the value network, mentioned by the interviewees 45 Table 7: Boundary dissonance mentioned by interviewees 4 8

Table

12: The boundary work framework, based on Chapter 3, 4, 5 and 6 of this thesis 147 List of Tables Table 1: Structure of this thesis, research articles and their contributions 14 Table 2: Overview of empirical research 2 2

196 Table 8: Boundary objects mentioned by the interviewees 51 Table 9: Interlinkage between organizational boundary theory and SBMI 6 5 Table 10: Overview of empirical data-collection and analysis 69 Table 11: Phases and examples of their indicators 70 Table 12: Identified needed organizational boundary reconfigurations, emerging tensions and drivers for reconfiguration and its potential value propositions in the multi-stakeholder network 79 Table 13: The differences between transactions, collaboration and boundary work in CBMI 9 1 Table 14: Overview of the initiatives in the case study 94 Table 15: Review of SBMI tools 110 Table 16: A detailed description of the different workshop steps in a typical tested format 122 Table 17: Average participant evaluation 124 Table 18: Workshop feedback and development 125 Table 19: Illustrative participants’ learnings directly after the workshop 127 Table 20: Overview of research questions, chapters, key findings and empirical evidence 135

197

Curriculum Vitae Myrthe Velter was born on June 17, 1987 in Weert, The Netherlands. After living in the countryside of Limburg for 18 years, she moved to Eindhoven in 2005, where 4 years later she graduated from ‘Management, Economics and Law’ at the Fontys University of Applied Sciences. Myrthe started working at public and private creative industries in functions as change management, project management and head of communications. After five years, she established her own consultancy company METMYRTHE, in which she helped social and cultural-oriented businesses to strategize and operationalize their sustainability ambitions. For the Province of Noord-Brabant, she organized indepth knowledge events on the edge of culture and business, in which public policymakers, students, researchers and businesses collaboratively explore impactful trends and reflect on their implications for the regional innovativeness. In search for more knowledge and to put action to words, Myrthe started her masters Sustainability Science & Policy at Maastricht University. She graduated cum laude in 2016, after which she started her PhD on Business Model Innovation for Sustainability. Throughout this PhD, she bridged the science-practice field by working intensively with businesses and their stakeholders. The results of the PhD studies have been translated into scientific and popular publications. Next to her PhD, she was responsible for the positioning and installation of a multidisciplinary research group on circular transitions at Fontys University of Applied Sciences, where she now conducts applied research on circular business innovation alongside engineering, social and natural science researchers.

198

Popular science publications: Velter, M. (2021). Samen innoveren voor circulariteit: Een boundary tool voor multi-stakeholder circulaire businessmodel innovatie, Deel 1: over de tool. Fontys For Sustainability Velter, M. (2021) Een boundary tool voor multi-stakeholder circulaire businessmodel innovatie – Deel 2: Toepassing voor circulair bedrijfstextiel. Fontys for Sustainability Y. van Lith, & Velter, M. (2021). Stappen in de transitie naar toekomstbestendige zonne-energie. Retrieved from enM.,Velter,naar-toekomstbestendige-zonne-energie/fontysforsustainability.nl/stappen-in-de-transitie-https://M.,VanderWestelaken,M.,Sonnemans,&Hultermans,T.(2020).FoodfromFooddeCirculaireEconomie’.

Food from Food Magazine, 2, 14,15 Public lecture on Circular Business Model Innovation, (2020) Innovation Origins, lecture series

Academic publications: Velter, M., Bitzer, V., Bocken, N., & Kemp, R. (2020). Sustainable business model innovation: The role of boundary work for multi-stakeholder alignment. Journal of Cleaner Production, 247, 119497. doi:10.1016/j.jclepro.2019.119497 Velter, M., Kemp, R., Bocken, N., & Bitzer, V. (2017). Creating Shared Value through Business Model Innovation for Sustainability: the role of Boundary Work. Paper presented at the 18th European Roundtable for Sustainable Consumption and Production, Skiathos Island, Velter,GreeceM., Bitzer, V., Bocken, N., & Kemp, R. (2021). Boundary work for collaborative sustainable business model innovation: the journey of a Dutch SME. Journal of Business Models, 9 (4), 36-66. Diepenmaat,doi:10.5278/jbm.v9i4.6267H.,Kemp,R.,&Velter, M. (2020). Why Sustainable Development needs Societal Innovation and cannot be achieved without this Sustainability, 12 (3), 1270. doi: 10.3390/ su12031270 Velter, M., Bitzer, V., & Bocken, N. (2021). A Boundary Tool for Multi-stakeholder Sustainable Business Model Innovation. Circular Economy and Sustainability. doi:10.1007/s43615-021-00103-3

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“The artist finds waiting for him, as subject, not the trees, not the flowers, not the landscape, but the waving of branches and the trembling of stems, the piling up or scudding of clouds, the rising and setting and waxing and waning of heavenly bodies” (Rickey, 1963, p. 228)

Journeying towards sustainable business models (PhD Thesis M.G.E. Velter, 2022)

Articles inside

Chapter 3. SBMI: the role of boundary work for multi-stakeholder alignment

Chapter 2. Philosophical grounding and research methodology

Chapter 1. Introduction