PLM in the Center of Circular Economy

A circular economy is based on three principles:?designing out waste and pollution, keeping products and materials in use, and regenerating natural systems.

Electrolux AB, a European maker of consumer appliances, announced last week that they have already started to experience the changes caused by a circular economy. In November 2018, Electrolux launched the trial of a subscription-based business model in Sweden for Pure i9, a high-end robotic vacuum cleaner. Last week, Electrolux also launched the "Appliance-as-a-Service"?program to promote a circular economy. Currently, the service is only offered in Sweden, and Electrolux has plans to expand this service across Europe.

This is a first in the industry for consumer appliances. Just imagine all the large appliances that we have in our homes. In the near future, we will no longer own them and will be consumers of their services. US consumer electronics companies are typical laggers compared to their European counterparts and will follow this new business practice soon.

   Carbon dioxide now more than 50% higher than pre-industrial levels
 
                                                  Source:https://www.noaa.gov        

For organizations to offer subscription services, products need to be connected, and the organization needs to focus on Re-Use, Re-Design, and Re-cycle. PLM and IoT become the core foundation for the circular economy, and the digital thread becomes one of the critical elements. ??

Organizations also need to leverage and monetize the vast data collected as part of connected services to offer additional services, improve product design, reduce service costs and extend the life of their appliances.

Similarly, Patagonia, a US-based apparel company, announced they had opened their first repair store in Europe last week.?They already had one such store open in Salt Lake City in the US.

This is excellent news; imagine being able to get your favorite jackets, bags, and other apparel repaired, which helps extend the product lifespan. In addition, Patagonia has created a website called WornWear (https://wornwear.patagonia.com), where you can buy lightly used clothes, further promoting the re-use and repurposing of worn clothing. Additionally, you can trade in your old jackets at a Patagonia store for a new one.

Imagine trading in your used jackets and bags for a new one. It is fantastic for consumers and great for the environment, and I expect this to become the mainstream practice in a big way in the next few years and for other retail organizations to follow soon.

The circular economy is here to stay and will positively change our daily lives.