How Can Circular Economy and Fair Data Economy Help to Rebuild Your Company Post-Corona?
Circular business models are hot, thanks to rapid technological development, the rebirth of sustainability on the corporate agendas, and the need for customer-centricity. Pioneering companies are building sustainable and circular business models. Competitive advantage can be gained through sharing platforms, offering products as services or by increasing efficiency through circular supply chains. New business models run on data and the insight that the enriched data gives to decision-making and optimization. As an optimist and a firm believer in technology, data and analytics, I think that there’s enormous potential in the data economy even for smaller companies if they are cunning, agile and able to work through networks.
I think that there’s enormous potential in the data economy even for smaller companies if they are cunning, agile and able to work through networks.
By saying cunning, I mean finding new ways to be more customer-centric and building new innovative partnerships. Platform giants were great in streamlining processes and matching demand and supply with zero time in one platform building huge data reserves – but if we can create data sharing ecosystems and make use of all data stored on the internet or at individual companies with fair rules, even smaller companies have a chance to win. Data needs to be commoditized and put to real world use. We need to decrease the cost of data access and improve internet standards so that they can understand need, purpose and economics. This is what we are trying to achieve with our ihan.fi testbed.
If we can create data sharing ecosystems and make use of all data stored on the internet or at individual companies with fair rules, even smaller companies have a chance to win.
The role of technology in business innovation should not be underestimated anymore. Gartner writes interestingly about innovation waves in their report Hype Cycles: Riding the Innovation Wave, A Gartner Trend Insight Report (2018). The first wave of innovation focused on the value chain, a linear process like converting raw materials to products. Technologies like cloud and mobile allowed organizational processes to become more real time, analytics helped automate and optimize, and collaborative technologies helped the workforce become more productive. Increased efficiency was the key. The second wave is focused on building platforms for new services and enhancing customer experience. Platforms are underpinned by technologies, such as cloud and analytics, multi-experience platforms, and open modular architectures. The platform also allows an organization to play an active role in its business ecosystem. This is the wave that most companies are riding on. The third wave builds and deepens what has gone before, oriented outward toward the business ecosystem. There is a need to participate in these ecosystems, but not necessarily to have control over them. This perspective has been driven by technologies such as blockchain, and the recognition that many challenges need such an approach.
This is where Fair Data Economy plays in. Fairness means that the rights of individuals are protected, and the needs of all stakeholders are taken into account in a data economy. What if we could brand those companies that are fair in the data sharing ecosystems? Fair Data Economy builds on the assumption that in the future, it is not just the access and ownership of data that builds competitive advantage, but it is merely the custody of data needed for services and data-based products. What if good corporate citizenship also covered the sustainable use of data, using data in an ethical and transparent manner?
In March 2020 The European Commission adopted a New Circular Economy Action Plan, which is one of the main cornerstones of the European Green Deal. The success of the Green Deal depends on digitalization, for the good and for the bad. In the European Digital Strategy the European Commission defines three streams of action 1) technology that works for people, 2) a fair and competitive digital economy and 3) an open, democratic and sustainable society.
Fair Data Economy builds on the assumption that in the future, it is not just the access and ownership of data that builds competitive advantage, but it is merely the custody of data needed for services and data-based products.
Regulation has become a key tool for advancing the European agenda and values, but post-corona resilience asks for innovative public-private-people-partnerships. Europe has a chance to define what is meant with purpose-driven technology, but we need more collaboration at all levels of society: policies, economic measures, and active citizenship demanding companies be more sustainable. The momentum to act for renewed sustainability is now. With all the uncertainties, trusting in the system, the institutions and the people working in the institutions is crucial. We just need to brand the inevitable – for a sustainable future, trust is the must! This branding should be “Made in Europe”.
Jaana Sinipuro is a Project Director at Sitra, the Finnish Innovation Fund. She’s an experienced ICT and management professional, and a certified Enterprise Architect with over 20 years of experience within data, analytics and knowledge management. At Shift 2020, Jaana will further discuss the circular economy and fair data economy regarding company rebuilding.