Applying circular economy innovation theory in business process modeling and analysis

The overall aim of this paper is to develop a new conceptual framework for business process modeling and analysis using circular economy innovative theory as a source for business knowledge management. The last part of the paper presents an author’s proposed basic structure for a new business models applying circular economy innovation theories. For people working on new innovative business models in the field of the circular economy this paper provides new ideas for clustering their concepts.


Introduction
The companies' are required, not only operating effective green business processes, but they also need to accommodate to changing business conditions at an unexpected rate. The conceptual framework for business process modeling there is focused on innovation in conditions of circular economy innovation requirements. Hedman and Kalling [1], on the other hand theorize that the business model concept is a model to integrate all main strategy perspectives into one framework. Mansfield and Fourie [2] describe business model and strategy as two distinctly different but complementary tools. Claiming that a discussion on the possible overlap between strategy and business model is not of interest, Seddon and Lewis [3], define the two terms in different levels of abstraction. "A business model is an abstract representation of some aspect of a firm's strategy."

Environmental innovations and corporate social responsibility -CSR
In most econometric studies, environmental innovations in general were analysed while only a few papers distinguished between end-of-pipe-innovations and cleaner production. In the literature, there is agreement that environmental innovations are more or less regulation driven though many studies show a positive role of cost-savings as a motivation especially for cleaner production technologies Horbach, [4]. The "Measuring Eco-Innovation"MEI definition is as follows, [5]: "Eco-innovation is the production, application or exploitation of a good, service, production process, organizational structure, or management or business method that is novel to the firm or user and which results, throughout its life cycle, in a reduction of environmental risk, pollution and the negative impacts of resources use (including energy use) compared to relevant alternatives".
The Europen Commission has defined CSR as "the responsibility of enterprises for their impact on society". According with Archie B. Carroll and Kareem M. Shaban, "The green philosophy adopted by the company is not mandated by law. Rather, it is a voluntary initiative which aims to fulfill an ethical 2 1234567890

Structuring new business models from the customer perspective
The overall objective of a company's business model is to identify a business opportunity by creating value for the stakeholders involved, to fulfill customers' needs and create customer surplus while generating a company profit. Until 2020 European Union has seven priorities as following: Capital Markets Union -Triggering sustainable finance for the clean economy; Energy Union and Climate Action; Investment Plan -Attracting additional Investments; Circular Economy -Achieving a resource efficient, low-carbon economy; Innovation -Bringing new technologies from research to market; Skills Agenda -Adapting the workforce; Digital Single Market Empowering citizens and consumers The term "business model", it is defined as: "the chosen system of inputs, business activities, outputs and outcomes that aims to create value over the short, medium and long term." [8] An activity in a company's business model, can be viewed as the engagement of human, material and/or financial resources of any party to the business model to serve a specific purpose toward the fulfillment of the customers objective [9], table 1. According with "The Communication from the commission to the European Parliament [10]", there are identified three circular economy innovations components (Technological innovation, Social innovation and Organisational innovation) and 11 directions as following: Design of materials and processes, Design of products, Resource management (waste, water, energy and raw materials), New production and consumption models, Citizens' involvement, Product service models, Design services, Integrated solutions and systems, Logistics, Business models and Policy supporting tools.
Based on document [10] and our expertise, we have created a matrix named "The influence of Circular economy innovations components "over"Business model category from the customer perspective". The calculation of the influence of Circular economy innovations components "over"Business model category from the customer perspective" are starts from a matrix (table 2) in which data is organized as following: Where: m -Circular economy inovations components number The weighting coefficient (Wc) of criterion Csj is determined by the relationship: The influence of Circular economy inovations components"over "Business model category from the customer perspective" is presented in table 3 and figure 1. As we can see in figure 1, the items named "Result-based business models", is strongly influenced by  the "Circular economy inovations components", having the highest score (35, 48%).
According with this result, the companies'managers from Romanian economy, need to take in consideration the fact that the best "Business model category from the customer perspective" is "Resultbased business models". In the "Result-based business models", outcome indicators can be at the organizational, sector, or societal goal level. An outcome indicator measures a change in a high-level characteristic of the environment in which the company is operating. Figure 2 shows a general outline of Ellen McArthur Foundation model and the associated business models on each level. The circular flow of income and spending shows connections between different sectors of an economy. It shows flows of goods and services and factors of production between companies and stakeholder. Scarcity of resources (material, human and financial) is a challenge for future production. As all resources get scarcer, circulating them within the circular economy is increasingly valuable.
Parallel to increasing scarcity of resources, there is increasing people focus on clean water, good soil and pure air, healthy food and consumer products. The structure of new business models along the circular flows, it is presented in table 4.  Based on document [10] and our expertise, we have created "The influence of Circular economy innovations components "over "Business model category from the customer perspective" Matrix. The influence of Circular economy innovations components "over "Business model category along the circular flows" Matrix is presented in table 5 and figure 3.
The calculation of the influence of Circular economy innovations components "over "Business model category along the circular flows" is starts from a matrix (table 5) in which data is organized in the table 4, below. As we can see in figure 3, the items named "Performance model/ Products as Services / Result-based models", it is strongly influenced by the "Circular economy innovations components", having the highest score (15.62%). According with this result, the companies 'managers from Romanian economy, need to take in consideration the fact that the best "Business model category along the circular flows" is "Performance model/ Products as Services / Result-based models".

Conclusions
In every industrial sector, circular economy innovations components are involved in green product complexity in order to obtain good business outcomes. A good business model yields value propositions that are compelling to customers, achieves advantageous cost and risk structures, and enables significant value capture by the business that generates and delivers products and services. The business model category, from the customer perspective, is focused on increasing green product lifecycle and is now a critical element in circular economy industries that traditionally provided customer-oriented products. To extent the type of any circular economy innovation processes (technological innovation, social innovation and organisational innovation), the managers should be determined by current company business performance and future expectations according with their organization's tolerance to risk. As product complexity increases and innovation applications make their way into more and more product offerings, today's high tech companies need to find a way to break down the barriers and integrate appropriate elements and cross-link elements of their enterprises; Circular economy innovation components are more than just new green product development process. It is also about redesigning the core circular economy business practices that help take these products to market eco profitably.