A framework on circular production principles and a way to operationalise circularity in production industry

Abstract

In the context of increasing pressure for sustainable production practices, this paper proposes a framework for how production companies could operationalise circular economy principles. The focus is on the production organisation, and how production operations could contribute to strategic circularity change. Prior research has used the Green kaizen methodology to identify environmental aspects and circularity related to the input-output flow of resources at the production shop floor. However, this paper finds that a more comprehensive approach is required, involving all levels of the production organisation. First, the paper defines circular production principles for production operations, showing that these principles vary across different company levels. Operations and shop floor level principles tend to be closer to the production input-output system, whereas factory management level principles are more focused on information sharing and internal and external relations. The circular production principles followed a hierarchical organisational structure with a bottom-up drive, where the allocation of organisational resources increased as the level of the hierarchy increased. The study reveals parallels with Likert's management system, where green kaizen activities are suitable for the shop floor level, but business development requires authority exploitation. Secondly, the paper identifies four circularity impact factors that apply to all company levels. These factors enhance the practical utility and implementation of circularity aspects, making them applicable to all levels of the company. The framework for bottom-up escalation of circular production principles can be used as a roadmap or support for managing a circularity bottom-up transition work. The findings presented in this paper fill a knowledge gap regarding the organisational and managerial work required for circular production. Specifically, this paper addresses challenges related to circular production management, including the gap between strategic targets and operational-driven work. By proposing a comprehensive framework for operationalising circular production principles, this paper offers practical guidance for production companies seeking to transition to circular economy practices.