Decisions on organizational boundaries are critical aspects of manufacturing firms’ business strategies. This article brings together concepts and findings from industrial ecology and business strategy in order to understand how manufacturing firms engage in initiatives to facilitate recycling of process wastes. Based on a distinction between waste recovery and use of the recovered resources, the article introduces a typology of four different strategies: Closed, Outsourcing, Diversification, and Open. Each strategy has a unique set of organizational boundaries and is associated with different motives and benefits for the manufacturing firm. The typology of strategies provides a conceptual contribution to assist industrial managers in strategic decision-making, and to support further studies on organizational boundaries in industrial ecology research.

Background and research question

Presenting possible solutions to environmental problems such as air quality, greenhouse gases, nutrient recirculation, organic waste and wastewater management, biogas is highly relevant for sustainability transitions. Besides biogas producers, the production and use of biogas engages actors from several sectors, including energy and gas distribution, waste management and wastewater treatment, agriculture, vehicles and transport.

The formation of markets for biogas depends on policy interventions at different levels, from the local municipality via the national government to the EU commission. By contrast to other European countries, which tend to subsidize biogas production, the Swedish government has the intention to stimulate demand and to favor the use of purified biogas (biomethane) as a vehicle fuel. While biomethane currently has a strong position as an alternative to fossil fuels in certain niches (notably public transport buses), the Swedish biogas sector faces challenges to reach beyond these narrow market segments.

Adopting a market constructivist perspective, this paper will analyze the formation of markets for biogas in Sweden. The following research question will guide the analysis: What characterizes market formation in this case and based on that, what is possible to learn about market formation in relation to sustainability transitions? 

Theory

Marketing scholars increasingly consider market formation as on-going processes, which a multitude of actors influence through their strategies, activities and capabilities. To understand market formation it is therefore necessary to analyze activities among a wider array of actors than merely producers and their (potential) customers.

Following a constructivist perspective, the offer is a core element in market formation. The offer describes the meanings and qualifications that actors impose on the object that is for sale. These meanings and qualifications constitute boundaries between actors and goods. Different actors engage to define the object, as well as its meanings, qualifications and potential value. Without a clear view of what is being exchanged, market formation will be difficult. Market formation also includes institutions that set boundaries and rules for the market. These are neither static, nor pre-conceived; instead, they are shaped and acted upon. Actors influence institutions through dynamic and interactive processes. 

Method

The paper combines quantitative and qualitative sources of data to study the Swedish biogas sector. The paper presents detailed data on production and use of biogas in Sweden 2010-2017. This quantitative data is complemented by qualitative data from interviews with representatives from key actors as well as secondary data from industry reports and other written sources. 

Findings

The multitude of actors involved complicates market formation for biogas. Different meanings and qualifications are attributed to the offer. Whereas it is possible to perceive biogas as a relatively simple product – a fuel – it is also possible to perceive it as a complex system that may help solving various societal and environmental problems. Different perceptions of the offer have different implications for market formation. Depicting biogas as a complex system implies that the offer will comprise a number of different qualifications. The realization of such a complex system depends on the bonding of various actors. Once established, the bonds will protect biogas from competition. By contrast, depicting biogas as a fuel means that the value of biogas will be assessed in relation to fuel prices. Qualification will thus depend on cost competitiveness vis-a-vis other fuels.

Our analysis suggests that although the contrasting perceptions of biogas cause tensions between the actors involved, the different qualifications complement each other in the market formation process. Various environmental and societal benefits makes it possible for actors argue for institutional reforms to help biogas become cost competitive, and increased competitiveness makes it attractive to establish new biogas systems.

Shredder fines is a residue of the shredding industry and is currently landfilled or used as landfill cover in Sweden. Throughout the time, the heterogeneity and small particle size have rendered resource recovery and recycling of it challenging. In spite of that, European policies envisioning circular economy, in concomitance with stringent resource recovery requirements and increased landfill taxes are challenging the current disposal practices of the shredding industry. As an attempt to address this issue, the present study has developed a systematic approach for performing an initial assessment of the feasibility of several selected mainstream applications for valorisation of shredder fines.

First, sampling of shredder fines from a major shredding plant was obtained twice a week over a 10 weeks period. The main focus of the sampling program was to encompass the variation in the material’s physical and chemical composition. The two samples from each week were then mixed and divided into six subsamples. That is, one original fraction and five size fractions; ZA (7.10-5.00 mm), ZB (5.00-3.35 mm), ZC (3.35-2.00 mm), ZD (2.00-0.25 mm), and ZE (0.25-0.063 mm). These sub-samples were subsequently sent for laboratory analysis for characterisation of contaminants, potentially valuable metals and energy recovery related properties. Second, three potential main stream applications for shredder fines were identified based on existing research on similar industrial residues (e.g. municipal waste incineration bottom ash) and current practices of the Swedish shredding industry. The selected applications are; Smelting for copper, Energy recovery in cement kilns and municipal solid waste incinerators, and Substitution of aggregates in concrete making and road construction. Third, the gate requirements of potential users and legislative requirements with regards to the identified applications were established, and the characteristics of shredder fines were benchmarked against them.

As far as copper smelting is concerned, the presence of high concentrations of lead and chromium is the biggest challenge. Otherwise, the fractions; ZA, ZB, and ZD show some potential due to manageable concentrations of arsenic, cadmium, and mercury. Concerning energy recovery, the calorific value apparently narrows down the options to municipal waste incinerators. There, the chlorine concentration only allows utilisation of the ZC fraction whereas heavy metal concentrations are too high with regards to all the fractions. With regards to the use as substitute material in construction, legislative requirements in Sweden for total content and leachate content of metals are too strict for shredder fines.

In conclusion, the benchmarking reveals the need for prior upgrading of shredder fines with respect to the different applications. Thus, integrated upgrading processes that could handle the complexity of the material in terms of contaminants and valuable recoverables is needed in order to achieve holistic valorisation of the material.

Residue products often pose a huge challenge to material recycling industry. Especially heterogenic and fine granular residues. It increases the cost and reduces the efficiency of material separation and recovery. Currently, the most common practice is to landfill such residue products. However, decreasing availability of landfills, increasing landfill costs, and new policy instruments require higher rates of resource recovery. In spite of that, business initiatives for recovering secondary raw material from residue products are often deterred by stringent environmental legislation emphasizing human toxicity concerns. Shredding industry plays a huge role in the context of circular economy via recycling important waste streams such as end-oflife vehicles (ELVs), municipal white goods, construction and demolition waste, and different industrial wastes. The core business model of industrial shredding is driven by recovering different metals while a variety of residue products including plastics, rubber, foam, wood, glass, and sand are generated. Shredder fine residue (also called shredder fines) is a fine granular residue product with intrinsic heterogeneity, which is produced by the shredding industry. A share of 15-20% of the input would end up as shredder fines in a typical plant.

The overall aim of this study is to draw technical, market and regulatory boundary conditions for improved material recovery from shredder fines. Thereby to build a framework of principal guidelines to support systematic identification, development, and evaluation of different valorization options for shredder fines. The outcome of this study is also envisioned to provide generic conclusions to the valorization of heterogenic residue products in general.

The study is performed in collaboration with a major shredding company in Sweden. The methodology reflects the Swedish context and consists of two phases. During the initial phase, firstly, the overall shredding industry structure of Sweden is studied to understand the governing regulatory framework, level of competition, and the scale of operation. Secondly, the collaborating company is studied to gain knowledge on technical feasibility of implementing recovery processes, economic, business and market aspects, and implications of national and local legislation, from the shredding company perspective. Empirical methods such as interviews and study of documentation are used in this phase.

During the second phase, detailed material and elemental characterization tests are performed on shredder fine samples. Thereby the distribution of basic elements, metals, heating value, and ash, in shredder fines as well as across different size fractions of shredder fines is established. The results are compared and contrasted against literature values. An extensive survey is also carried out to identify potential users for different materials which are possibly recoverable from shredder fines. Such potential users are then mapped against materials. Leaching tests are also performed to assess the mobility of heavy metals and thereby the potential environmental risk and human toxicity.

As the main contribution of this study, knowledge is developed and synthesized, boundary conditions are set, and principal guidelines of general relevance are drawn in order to facilitate improved valorization of fine granular residue products.

Residue products often pose a huge challenge to material recycling industry. Especially heterogenic and fine granular residues. It increases the cost and reduces the efficiency of material separation and recovery. Currently, the most common practice is to landfill such residue products. However, decreasing availability of landfills, increasing landfill costs, and new policy instruments require higher rates of resource recovery. In spite of that, business initiatives for recovering secondary raw material from residue products are often deterred by stringent environmental legislation emphasizing human toxicity concerns. Shredding industry plays a huge role in the context of circular economy via recycling important waste streams such as end-oflife vehicles (ELVs), municipal white goods, construction and demolition waste, and different industrial wastes. The core business model of industrial shredding is driven by recovering different metals while a variety of residue products including plastics, rubber, foam, wood, glass, and sand are generated. Shredder fine residue (also called shredder fines) is a fine granular residue product with intrinsic heterogeneity, which is produced by the shredding industry. A share of 15-20% of the input would end up as shredder fines in a typical plant.

The overall aim of this study is to draw technical, market and regulatory boundary conditions for improved material recovery from shredder fines. Thereby to build a framework of principal guidelines to support systematic identification, development, and evaluation of different valorization options for shredder fines. The outcome of this study is also envisioned to provide generic conclusions to the valorization of heterogenic residue products in general.

The study is performed in collaboration with a major shredding company in Sweden. The methodology reflects the Swedish context and consists of two phases. During the initial phase, firstly, the overall shredding industry structure of Sweden is studied to understand the governing regulatory framework, level of competition, and the scale of operation. Secondly, the collaborating company is studied to gain knowledge on technical feasibility of implementing recovery processes, economic, business and market aspects, and implications of national and local legislation, from the shredding company perspective. Empirical methods such as interviews and study of documentation are used in this phase.

During the second phase, detailed material and elemental characterization tests are performed on shredder fine samples. Thereby the distribution of basic elements, metals, heating value, and ash, in shredder fines as well as across different size fractions of shredder fines is established. The results are compared and contrasted against literature values. An extensive survey is also carried out to identify potential users for different materials which are possibly recoverable from shredder fines. Such potential users are then mapped against materials. Leaching tests are also performed to assess the mobility of heavy metals and thereby the potential environmental risk and human toxicity.

As the main contribution of this study, knowledge is developed and synthesized, boundary conditions are set, and principal guidelines of general relevance are drawn in order to facilitate improved valorization of fine granular residue products.

The purpose of this paper is to explore the possible uses, benefits, limitations and future directions of a formal knowledge integration perspective on design management. The paper develops the concepts of management thinking and design(erly) thinking, and questions the implied contention. With a knowledge perspective, design management may be seen as including the capability to integrate specialized, distributed and heterogeneous knowledge bases. Consequences regarding the characteristics of scope, flexibility and efficiency of knowledge integration indicate both greater difficulties and greater possibilities.  Regarding the architecture of knowledge, integration of design indicates a functional orientation and a limited role for design, while integration by design may indicate a strategic role.

The capability to integrate across a range of specialized knowledge bases is a crucial contemporary source of competitive advantage, and the field of knowledge integration aims at structuring the issues. The purpose of this paper is to explore the possible uses, benefits, limitations and future directions of a formal knowledge integration perspective on design management. The paper develops the concepts of management thinking and design(erly) thinking, and questions the contention. With a knowledge perspective, design management may be seen as including the capability to integrate specialized, distributed and heterogeneous knowledge bases. Consequences regarding the characteristics of scope, flexibility and efficiency of knowledge integration indicate both greater difficulties and greater possibilities. Regarding the architecture of knowledge, the integration of design indicates a functional orientation and a limited role for design, while integration by design may indicate a strategic role.

Den här skriften presenterar ett urval resultat och texter från forskningsprogrammet ”Kunskapsintegration och innovation i en internationaliserande ekonomi” (Knowledge Integration and Innovation in Transnational Enterprise, KITE) som finansierats av Riksbankens Jubileumsfond i två faser under åren 2007–2015. I programmet har vi analyserat hur företag, speciellt i tekniktunga industrier, påverkas av den allt mer globala konkurrensen om nya produkter och tjänster, hur nya specialiserade kunskaper växer fram och tas tillvara, och hur de kan förenas med existerande kunskapsbas. I denna skrift finns studier på tre olika nivåer: branschnivån, med analyser av innovationsprocesser och kunskapsutmaningar i industriella sektorer; företagsnivån, med skildringar av förändringar i företagens interna organisering av kunskapsbildande processer och undersökningar av nya former för utbyte och samspel mellan företag; samt mikronivån, med undersökningar av samspelet mellan individuella specialister inom företag. Skriften vänder sig både till den intresserade allmänheten och till forskare med annan vetenskaplig bakgrund. Fokus är på internationellt konkurrerande branscher och företag, men analyserna av kunskapens delning och sammanflätning, separation och integration, har bäring också på andra kunskapsintensiva sektorer och verksamheter, från statliga verk till sjukvård.

En vetenskaplig presentation av programmets forskning under de första fyra åren finns i boken Knowledge Integration and Innovation: Critical Challenges Facing International Technology-Based Firms (redigerad av Berggren, Bergek, Bengtsson, Hobday & Söderlund och utgiven av Oxford University Press 2011). En uppföljande volym, Managing Knowledge Integration Across Boundaries, planeras av samma förlag 2016 (redigerad av Tell, Berggren, Brusoni & Van de Ven). I den medverkar ett antal internationella författare vilket visar kunskapsområdets globala tyngd och intresse. Under programmets drygt åtta år har deltagarna publicerat ett mycket stort antal artiklar, konferensbidrag, bokkapitel och liknande. För dessa hänvisar vi till programmets hemsida www.liu.se/kite.

Vi har under hela programperioden arbetat intensivt med att diskuteraoch konstruktivt kritisera och utveckla varandras bidrag. Därför har det varit naturligt att denna skrift inbegriper många programdeltagares medverkan. En presentation av samtliga medverkande finns i slutet av denna skrift. Följande KITE-forskare har medverkat i nedan angivna kapitel:

Hans Andersson (kapitel 4)

Lars Bengtsson (kapitel 7)

Marie Bengtsson (kapitel 3)

Anna Bergek (kapitel 2)

Christian Berggren (kapitel 1)

Karin Bredin (kapitel 6)

Cecilia Enberg (kapitel 5, 7)

Mattias Johansson (kapitel 4)

Nicolette Lakemond (kapitel 7)

Lars Lindkvist (kapitel 3)

Thomas Magnusson (kapitel 1)

Camilla Niss (kapitel 6)

Jonas Söderlund (kapitel 6)

Fredrik Tell (kapitel 5)

Vi vill också tacka Jenny Björkman på Riksbankens Jubileumsfond och Makadam förlag för deras engagerade arbete med redigering och produktion av slutresultatet.