Circular economy made effective

Research & Innovation Manager. In the ICT industry since 1988. Business Developer in national and international research networks. Product Manager of high tech innovative products. Scrum Product Owner (CSPO). Collaboration with Universities and Research Centers. Scientific publications and lectures. Reviewer of collaborative research projects. Member of international expert's groups and scientific steering committees. Passionate open-minded researcher of people improvement through collaboration. As Research & Innovation Manager I work to the creation and realization of innovative ideas that make sense for business and people wellbeing.

Tracking and tracing materials from production to end of life and start again

Attention to sustainability and the use of resources has never been higher. The topic is considered as one of those with the highest strategic importance for Europe.

The current linear economy production – “take, make, dispose” – based on the use of enormous quantities of energy and resources, is less and less suitable and no longer sustainable for the reality in which we operate. According to Gartner, «the global pandemic disrupted the flow and pricing of raw materials and finished products, but circular economy models help build supply chain resilience in the face of such disruptions». In summary, the Circular Economy model is worthwhile both economically and environmentally.

As the process of applying a circular economy model accelerates, it becomes increasingly evident that we need effective ways to track and trace materials, components, and products across their entire life, from production to end of life and then start again with a new cycle.

In this article we will focus on tracking and tracing along the circular economy cycle.

What is circular economy

Circular economy is a new production and usage model that aims to ensure sustainable growth over time. Circular economy promotes reusing and recycling for reintroducing products and materials in the market, reaching several goals such as optimization of resources, reduction of use of raw materials, and reduction of waste.

It is about moving away from the classical linear economy, towards a circular one based on the principle of ‘closing the life-cycle’ of products, services, waste, materials, water, and energy. Starting from the analysis of the principles of the circular economy and studying business models of applicability in an enterprise, it is possible to initiate a transition from a linear model to a circular model, which knows how to seize every opportunity to limit the input of matter and energy, and to minimize waste and losses, paying attention to the creation of new social and territorial values.

With circular economy, products, components, and materials are continuously (re)put into circulation, in contrast to the “linear” economic approach, in which they are eliminated as waste or scraps after being used, with the consequence that the materials are no longer available on the market, thus increasing their scarcity. With circular economy, once a product has finished its primary function, it is re-put into the economic cycle by reusing it for a different purpose or by recycling the materials it is made of, generating raw materials for the creation of new products.

The implementation of circular economy requires deep knowledge about the product. For instance, the materials used to make it, the parts it is composed of, and other details about the possibility to decompose, reuse, recycle the product at the end of its current cycle of life.

Digitalization must provide tools and methodologies to support the circular economy process. Indeed, each stage of the circular economy loop generates a large amount of data that shall be transformed into valuable information and shared with the other actors of the value chain taking care of data privacy and ownership. Therefore, besides the manufacture cycle we need to implement the corresponding data cycle.

A viable approach for digitally track and trace

In Italtel we have developed a data-driven approach for supporting the implementation of digital economy in the physical world. We create a digital twin of a real product and follow its physical evolution in the digital realm. The participants in the product’s life can play distinct roles. In the digital realm they use the information from the product’s history and add new information describing their interaction with the product. Each interaction creates a digital transaction that enriches the product’s history with new chapters. It is worth noting that this approach includes also the audit and certification authority role that can supervise and certify the regulatory or quality process compliance.

Circular economy chain by Italtel 1

Each actor can implement green and circular policies by using all the information of the product’s history that is immediately available at each stage of its life across the whole chain.

The natural technology for the implementation of the circular economy digital twin is blockchain because of its intrinsic characteristics: its transactional nature and the immutability of historically inserted data. We see blockchain in tandem with an encrypted database for creating immutable events linked to large amount of stored data. Indeed, if blockchain is good for linking transactions, the amount of data that can be stored in the transaction itself is limited. Thus, we store large amounts of data in the encrypted database and insert its link into the blockchain transaction.

With this vision, creating a digital tool for circular product information management is key for implementing Green and Circular Economy in manufacturing.