The environmental destruction caused by the traditional linear economic system has shifted our current focus on the circular economy. Unlike the take-make-dispose model of the linear economy, a circular economy is a closed-loop economic model. The overarching principles of circular economy are: design out waste and pollution, keep products and materials in use, and regenerate the natural ecosystem. More specifically, this model calls for the re-use, repair, recycling, repurpose, and design of products and services so that they can be turned back to the economic system as much as and as long as possible. So, this economic model can potentially reduce the consumption of environmental resources, improve environmental sink functions (an ability to absorb and purify waste and pollution), including the reduction of business operational cost. This then can maintain the health of the natural environment or ecosystem balance. In this sense, the circular economy enables achieving environmental sustainability and tackling climate change. Now let’s talk about the enabler of a circular economy which is a central point of this brief article.
Here, I will discuss one enabler of a circular economy relating to the latest information and communication technology. In particular, I am going to discuss the IoT (Internet of Things) that can promote our trajectory towards circularity. What is the IoT? There are myriad definitions of IoT that one can easily find via an internet search. At its most basic, IoT is an intelligent mechanism of collecting, processing, transferring and exchanging real-time information/data on everyday physical objects or things over the internet. This real-time information help makes decisions in order to enhance efficiencies, detect issues and prevent them before they occur. In the IoT system, physical objects/things such as home appliances, trash bins, vehicles, crops etc., remain interconnected with the embedded smart devices that can sense, receive and transfer data over the internet without human involvement. A few examples of such smart devices are sensors, electronics, software, smart door-locks, smartwatch and many more. Let’s think about home appliances or furniture, for example. We can easily set devices or sensors that can generate data and information on them, such as the percentage of recyclable, reusable or reparable wood in some furniture, or fabric in a carpet, or metal in an electronic object. This information will allow decision-makers to identify their businesses that could be part of a circular economy model.
A circular economy needs real-time information and data in making the products or services efficient. For efficiency, a circular economy needs innovation in manufacturing productions or service delivery. The interaction between IoT and the circular economy provides a fertile ground for innovation and efficiency. Therefore, it is worth bringing one practical example of IoT to understand how this system facilitates the circular economy. Cities such as San Francisco, London have already developed IoT based waste bins management that alert local councils when they get full. As such, the local authority can design ideal routes for efficient garbage collection and reduce operational costs to a significant extent. This innovative example delineates how an IoT based technology can enable efficient waste management, a core principle of a circular economy model. Thus, as a thriving digital technology, IoT can add value to our circular business operation and service delivery and accelerate our present journey towards a circular economy model.
(Source: Executive program on the Circular Economy and Sustainability Strategies, University of Cambridge Business School; internet source)
