IDEAS home Printed from https://ideas.repec.org/a/bla/bstrat/v30y2021i4p2038-2060.html
   My bibliography  Save this article

Industry 4.0 and the circular economy: A literature review and recommendations for future research

Author

Listed:
  • Usama Awan
  • Robert Sroufe
  • Muhammad Shahbaz

Abstract

Research regarding the Fourth Industrial Revolution (Industry 4.0) and the circular economy has gained traction since 2014. Paralleling the growth in the internet of things (IoT), the circular economy poses both risks and opportunities to various stakeholders in its development. This literature review aims to identify Industry 4.0 stakeholders' interests and expectations regarding how the IoT can be part of circular economy management. Contributions include identifying various IoT tools for dealing with circular economy challenges while also addressing implementation best practices. The transition of the circular economy within Industry 4.0 requires a better understanding of government, suppliers, international organizational interests, and expectations regarding the IoT. This study enables future research on circular economy practices and their potential sustainability benefits for manufacturing firms. This study's findings allow practitioners and researchers to understand the literature and critical elements of the transition toward a more circular economy.

Suggested Citation

  • Usama Awan & Robert Sroufe & Muhammad Shahbaz, 2021. "Industry 4.0 and the circular economy: A literature review and recommendations for future research," Business Strategy and the Environment, Wiley Blackwell, vol. 30(4), pages 2038-2060, May.
    • Handle: RePEc:bla:bstrat:v:30:y:2021:i:4:p:2038-2060
    DOI: 10.1002/bse.2731
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/bse.2731
    Download Restriction: no
    File URL: https://libkey.io/10.1002/bse.2731?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Jorge Tarifa-Fernández & Ana María Sánchez-Pérez & Salvador Cruz-Rambaud, 2019. "Internet of Things and Their Coming Perspectives: A Real Options Approach," Sustainability, MDPI, vol. 11(11), pages 1-15, June.
    2. Leonilde Varela & Adriana Araújo & Paulo Ávila & Hélio Castro & Goran Putnik, 2019. "Evaluation of the Relation between Lean Manufacturing, Industry 4.0, and Sustainability," Sustainability, MDPI, vol. 11(5), pages 1-19, March.
    3. Chuang, Chia-Hung & Wang, Charles X. & Zhao, Yabing, 2014. "Closed-loop supply chain models for a high-tech product under alternative reverse channel and collection cost structures," International Journal of Production Economics, Elsevier, vol. 156(C), pages 108-123.
    4. Gunasekaran, Angappa & Papadopoulos, Thanos & Dubey, Rameshwar & Wamba, Samuel Fosso & Childe, Stephen J. & Hazen, Benjamin & Akter, Shahriar, 2017. "Big data and predictive analytics for supply chain and organizational performance," Journal of Business Research, Elsevier, vol. 70(C), pages 308-317.
    5. John A. Mathews & Hao Tan, 2011. "Progress Toward a Circular Economy in China," Journal of Industrial Ecology, Yale University, vol. 15(3), pages 435-457, June.
    6. Kannan Govindan & Mia Hasanagic, 2018. "A systematic review on drivers, barriers, and practices towards circular economy: a supply chain perspective," International Journal of Production Research, Taylor & Francis Journals, vol. 56(1-2), pages 278-311, January.
    7. Fosso Wamba, Samuel & Akter, Shahriar & Edwards, Andrew & Chopin, Geoffrey & Gnanzou, Denis, 2015. "How ‘big data’ can make big impact: Findings from a systematic review and a longitudinal case study," International Journal of Production Economics, Elsevier, vol. 165(C), pages 234-246.
    8. Usama Awan & Andrzej Kraslawski & Janne Huiskonen, 2018. "Governing Interfirm Relationships for Social Sustainability: The Relationship between Governance Mechanisms, Sustainable Collaboration, and Cultural Intelligence," Sustainability, MDPI, vol. 10(12), pages 1-20, November.
    9. Claudia Marcela Betancourt Morales & Jhon Wilder Zartha Sossa, 2020. "Circular economy in Latin America: A systematic literature review," Business Strategy and the Environment, Wiley Blackwell, vol. 29(6), pages 2479-2497, September.
    10. Gustavo Cattelan Nobre & Elaine Tavares, 2017. "Scientific literature analysis on big data and internet of things applications on circular economy: a bibliometric study," Scientometrics, Springer;Akadémiai Kiadó, vol. 111(1), pages 463-492, April.
    11. Alexandre Dolgui & Dmitry Ivanov & Suresh P. Sethi & Boris Sokolov, 2019. "Scheduling in production, supply chain and Industry 4.0 systems by optimal control: fundamentals, state-of-the-art and applications," International Journal of Production Research, Taylor & Francis Journals, vol. 57(2), pages 411-432, January.
    12. Sven-Vegard Buer & Jan Ola Strandhagen & Felix T. S. Chan, 2018. "The link between Industry 4.0 and lean manufacturing: mapping current research and establishing a research agenda," International Journal of Production Research, Taylor & Francis Journals, vol. 56(8), pages 2924-2940, April.
    13. Arunachalam, Deepak & Kumar, Niraj & Kawalek, John Paul, 2018. "Understanding big data analytics capabilities in supply chain management: Unravelling the issues, challenges and implications for practice," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 114(C), pages 416-436.
    14. Fernando E. Garcia-Muiña & Rocío González-Sánchez & Anna Maria Ferrari & Lucrezia Volpi & Martina Pini & Cristina Siligardi & Davide Settembre-Blundo, 2019. "Identifying the Equilibrium Point between Sustainability Goals and Circular Economy Practices in an Industry 4.0 Manufacturing Context Using Eco-Design," Social Sciences, MDPI, vol. 8(8), pages 1-22, August.
    15. Paolo Rosa & Claudio Sassanelli & Andrea Urbinati & Davide Chiaroni & Sergio Terzi, 2020. "Assessing relations between Circular Economy and Industry 4.0: a systematic literature review," International Journal of Production Research, Taylor & Francis Journals, vol. 58(6), pages 1662-1687, March.
    16. Dalenogare, Lucas Santos & Benitez, Guilherme Brittes & Ayala, Néstor Fabián & Frank, Alejandro Germán, 2018. "The expected contribution of Industry 4.0 technologies for industrial performance," International Journal of Production Economics, Elsevier, vol. 204(C), pages 383-394.
    17. Maria Barreiro‐Gen & Rodrigo Lozano, 2020. "How circular is the circular economy? Analysing the implementation of circular economy in organisations," Business Strategy and the Environment, Wiley Blackwell, vol. 29(8), pages 3484-3494, December.
    18. David Moher & Alessandro Liberati & Jennifer Tetzlaff & Douglas G Altman & The PRISMA Group, 2009. "Preferred Reporting Items for Systematic Reviews and Meta-Analyses: The PRISMA Statement," PLOS Medicine, Public Library of Science, vol. 6(7), pages 1-6, July.
    19. Robert Perey & Suzanne Benn & Renu Agarwal & Melissa Edwards, 2018. "The place of waste: Changing business value for the circular economy," Business Strategy and the Environment, Wiley Blackwell, vol. 27(5), pages 631-642, July.
    20. Wamba, Samuel Fosso & Gunasekaran, Angappa & Akter, Shahriar & Ren, Steven Ji-fan & Dubey, Rameshwar & Childe, Stephen J., 2017. "Big data analytics and firm performance: Effects of dynamic capabilities," Journal of Business Research, Elsevier, vol. 70(C), pages 356-365.
    21. Chris Turner & Mariale Moreno & Luigi Mondini & Konstantinos Salonitis & Fiona Charnley & Ashutosh Tiwari & Windo Hutabarat, 2019. "Sustainable Production in a Circular Economy: A Business Model for Re-Distributed Manufacturing," Sustainability, MDPI, vol. 11(16), pages 1-19, August.
    22. María del Mar Alonso‐Almeida & José Miguel Rodríguez‐Antón & Llorenç Bagur‐Femenías & Jordi Perramon, 2020. "Sustainable development and circular economy: The role of institutional promotion on circular consumption and market competitiveness from a multistakeholder engagement approach," Business Strategy and the Environment, Wiley Blackwell, vol. 29(6), pages 2803-2814, September.
    23. Florian Hofmann & Melanie Jaeger‐Erben, 2020. "Organizational transition management of circular business model innovations," Business Strategy and the Environment, Wiley Blackwell, vol. 29(6), pages 2770-2788, September.
    24. Mark Ferguson & V. Daniel R. Guide , Jr. & Gilvan C. Souza, 2006. "Supply Chain Coordination for False Failure Returns," Manufacturing & Service Operations Management, INFORMS, vol. 8(4), pages 376-393, August.
    25. Zengwei Yuan & Jun Bi & Yuichi Moriguichi, 2006. "The Circular Economy: A New Development Strategy in China," Journal of Industrial Ecology, Yale University, vol. 10(1‐2), pages 4-8, January.
    26. Okechukwu Okorie & Konstantinos Salonitis & Fiona Charnley & Mariale Moreno & Christopher Turner & Ashutosh Tiwari, 2018. "Digitisation and the Circular Economy: A Review of Current Research and Future Trends," Energies, MDPI, vol. 11(11), pages 1-31, November.
    27. Govindan, Kannan & Soleimani, Hamed & Kannan, Devika, 2015. "Reverse logistics and closed-loop supply chain: A comprehensive review to explore the future," European Journal of Operational Research, Elsevier, vol. 240(3), pages 603-626.
    28. Guilherme Luz Tortorella & Diego Fettermann, 2018. "Implementation of Industry 4.0 and lean production in Brazilian manufacturing companies," International Journal of Production Research, Taylor & Francis Journals, vol. 56(8), pages 2975-2987, April.
    29. Gláucya Daú & Annibal Scavarda & Luiz Felipe Scavarda & Vivianne Julianelli Taveira Portugal, 2019. "The Healthcare Sustainable Supply Chain 4.0: The Circular Economy Transition Conceptual Framework with the Corporate Social Responsibility Mirror," Sustainability, MDPI, vol. 11(12), pages 1-19, June.
    30. Genovese, Andrea & Acquaye, Adolf A. & Figueroa, Alejandro & Koh, S.C. Lenny, 2017. "Sustainable supply chain management and the transition towards a circular economy: Evidence and some applications," Omega, Elsevier, vol. 66(PB), pages 344-357.
    31. Alan Murray & Keith Skene & Kathryn Haynes, 2017. "The Circular Economy: An Interdisciplinary Exploration of the Concept and Application in a Global Context," Journal of Business Ethics, Springer, vol. 140(3), pages 369-380, February.
    32. Andoni, Merlinda & Robu, Valentin & Flynn, David & Abram, Simone & Geach, Dale & Jenkins, David & McCallum, Peter & Peacock, Andrew, 2019. "Blockchain technology in the energy sector: A systematic review of challenges and opportunities," Renewable and Sustainable Energy Reviews, Elsevier, vol. 100(C), pages 143-174.
    33. Marcus Linder & Mats Williander, 2017. "Circular Business Model Innovation: Inherent Uncertainties," Business Strategy and the Environment, Wiley Blackwell, vol. 26(2), pages 182-196, February.
    34. Gupta, Shivam & Chen, Haozhe & Hazen, Benjamin T. & Kaur, Sarabjot & Santibañez Gonzalez, Ernesto D.R., 2019. "Circular economy and big data analytics: A stakeholder perspective," Technological Forecasting and Social Change, Elsevier, vol. 144(C), pages 466-474.
    35. Piera Centobelli & Roberto Cerchione & Davide Chiaroni & Pasquale Del Vecchio & Andrea Urbinati, 2020. "Designing business models in circular economy: A systematic literature review and research agenda," Business Strategy and the Environment, Wiley Blackwell, vol. 29(4), pages 1734-1749, May.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Luoma, Päivi & Penttinen, Esko & Tapio, Petri & Toppinen, Anne, 2022. "Future images of data in circular economy for textiles," Technological Forecasting and Social Change, Elsevier, vol. 182(C).
    2. Basile, Vincenzo & Tregua, Marco & Giacalone, Massimiliano, 2024. "A three-level view of readiness models: Statistical and managerial insights on industry 4.0," Technology in Society, Elsevier, vol. 77(C).
    3. Dian, Jie & Song, Tian & Li, Shenglan, 2024. "Facilitating or inhibiting? Spatial effects of the digital economy affecting urban green technology innovation," Energy Economics, Elsevier, vol. 129(C).
    4. Kayikci, Yasanur & Kazancoglu, Yigit & Gozacan-Chase, Nazlican & Lafci, Cisem & Batista, Luciano, 2022. "Assessing smart circular supply chain readiness and maturity level of small and medium-sized enterprises," Journal of Business Research, Elsevier, vol. 149(C), pages 375-392.
    5. Govindan, Kannan & Kannan, Devika & Jørgensen, Thomas Ballegård & Nielsen, Tim Straarup, 2022. "Supply Chain 4.0 performance measurement: A systematic literature review, framework development, and empirical evidence," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 164(C).
    6. Liang, Jinhao & Irfan, Muhammad & Ikram, Muhammad & Zimon, Dominik, 2022. "Evaluating natural resources volatility in an emerging economy: The influence of solar energy development barriers," Resources Policy, Elsevier, vol. 78(C).
    7. Simonetto, Marco & Sgarbossa, Fabio & Battini, Daria & Govindan, Kannan, 2022. "Closed loop supply chains 4.0: From risks to benefits through advanced technologies. A literature review and research agenda," International Journal of Production Economics, Elsevier, vol. 253(C).
    8. Piccarozzi, Michela & Silvestri, Cecilia & Aquilani, Barbara & Silvestri, Luca, 2022. "Is this a new story of the ‘Two Giants’? A systematic literature review of the relationship between industry 4.0, sustainability and its pillars," Technological Forecasting and Social Change, Elsevier, vol. 177(C).
    9. Truant, Elisa & Giordino, Daniele & Borlatto, Edoardo & Bhatia, Meena, 2024. "Drivers and barriers of smart technologies for circular economy: Leveraging smart circular economy implementation to nurture companies' performance," Technological Forecasting and Social Change, Elsevier, vol. 198(C).
    10. Vigoda-Gadot, Eran & Mizrahi, Shlomo, 2024. "The digital governance puzzle: Towards integrative theory of humans, machines, and organizations in public management," Technology in Society, Elsevier, vol. 77(C).
    11. Hong Nham, Nguyen Thi & Ha, Le Thanh, 2022. "Making the circular economy digital or the digital economy circular? Empirical evidence from the European region," Technology in Society, Elsevier, vol. 70(C).
    12. Calabrese, Armando & Costa, Roberta & Tiburzi, Luigi & Brem, Alexander, 2023. "Merging two revolutions: A human-artificial intelligence method to study how sustainability and Industry 4.0 are intertwined," Technological Forecasting and Social Change, Elsevier, vol. 188(C).
    13. Bilgen, Hakki, 2021. "A global comparison methodology to determine critical requirements for achieving industry 4.0," Technological Forecasting and Social Change, Elsevier, vol. 172(C).
    14. Chauhan, Chetna & Parida, Vinit & Dhir, Amandeep, 2022. "Linking circular economy and digitalisation technologies: A systematic literature review of past achievements and future promises," Technological Forecasting and Social Change, Elsevier, vol. 177(C).
    15. Langley, David J. & Rosca, Eugenia & Angelopoulos, Marios & Kamminga, Oscar & Hooijer, Christa, 2023. "Orchestrating a smart circular economy: Guiding principles for digital product passports," Journal of Business Research, Elsevier, vol. 169(C).
    16. Awan, Usama & Shamim, Saqib & Khan, Zaheer & Zia, Najam Ul & Shariq, Syed Muhammad & Khan, Muhammad Naveed, 2021. "Big data analytics capability and decision-making: The role of data-driven insight on circular economy performance," Technological Forecasting and Social Change, Elsevier, vol. 168(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Kristoffersen, Eivind & Blomsma, Fenna & Mikalef, Patrick & Li, Jingyue, 2020. "The smart circular economy: A digital-enabled circular strategies framework for manufacturing companies," Journal of Business Research, Elsevier, vol. 120(C), pages 241-261.
    2. Yasanur Kayikci & Yigit Kazancoglu & Nazlican Gozacan‐Chase & Cisem Lafci, 2022. "Analyzing the drivers of smart sustainable circular supply chain for sustainable development goals through stakeholder theory," Business Strategy and the Environment, Wiley Blackwell, vol. 31(7), pages 3335-3353, November.
    3. Armaghan Chizaryfard & Paolo Trucco & Cali Nuur, 2021. "The transformation to a circular economy: framing an evolutionary view," Journal of Evolutionary Economics, Springer, vol. 31(2), pages 475-504, April.
    4. Kristoffersen, Eivind & Mikalef, Patrick & Blomsma, Fenna & Li, Jingyue, 2021. "The effects of business analytics capability on circular economy implementation, resource orchestration capability, and firm performance," International Journal of Production Economics, Elsevier, vol. 239(C).
    5. Patricia van Loon & Luk N. Van Wassenhove & Ales Mihelic, 2022. "Designing a circular business strategy: 7 years of evolution at a large washing machine manufacturer," Business Strategy and the Environment, Wiley Blackwell, vol. 31(3), pages 1030-1041, March.
    6. Ida K. Rovanto & Anu Bask, 2021. "Systemic circular business model application at the company, supply chain and society levels—A view into circular economy native and adopter companies," Business Strategy and the Environment, Wiley Blackwell, vol. 30(2), pages 1153-1173, February.
    7. Yamoah, Fred A. & Sivarajah, Uthayasankar & Mahroof, Kamran & Peña, Iker González, 2022. "Demystifying corporate inertia towards transition to circular economy: A management frame of reference," International Journal of Production Economics, Elsevier, vol. 244(C).
    8. Davide Aloini & Riccardo Dulmin & Valeria Mininno & Alessandro Stefanini & Pierluigi Zerbino, 2020. "Driving the Transition to a Circular Economic Model: A Systematic Review on Drivers and Critical Success Factors in Circular Economy," Sustainability, MDPI, vol. 12(24), pages 1-14, December.
    9. Kristoffersen, Eivind & Mikalef, Patrick & Blomsma, Fenna & Li, Jingyue, 2021. "Towards a business analytics capability for the circular economy," Technological Forecasting and Social Change, Elsevier, vol. 171(C).
    10. Kamble, Sachin S. & Belhadi, Amine & Gunasekaran, Angappa & Ganapathy, L. & Verma, Surabhi, 2021. "A large multi-group decision-making technique for prioritizing the big data-driven circular economy practices in the automobile component manufacturing industry," Technological Forecasting and Social Change, Elsevier, vol. 165(C).
    11. Omar Alhawari & Usama Awan & M. Khurrum S. Bhutta & M. Ali Ülkü, 2021. "Insights from Circular Economy Literature: A Review of Extant Definitions and Unravelling Paths to Future Research," Sustainability, MDPI, vol. 13(2), pages 1-22, January.
    12. Miranda, Bruno Varella & Monteiro, Guilherme Fowler A. & Rodrigues, Vinicius Picanço, 2021. "Circular agri-food systems: A governance perspective for the analysis of sustainable agri-food value chains," Technological Forecasting and Social Change, Elsevier, vol. 170(C).
    13. German Arana‐Landin & Waleska Sigüenza & Beñat Landeta‐Manzano & Iker Laskurain‐Iturbe, 2024. "Circular economy: On the road to ISO 59000 family of standards," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 31(3), pages 1977-2009, May.
    14. Fredrick Betuel Sawe & Anil Kumar & Jose Arturo Garza‐Reyes & Rohit Agrawal, 2021. "Assessing people‐driven factors for circular economy practices in small and medium‐sized enterprise supply chains: Business strategies and environmental perspectives," Business Strategy and the Environment, Wiley Blackwell, vol. 30(7), pages 2951-2965, November.
    15. Qinglan Liu & Adriana Hofmann Trevisan & Miying Yang & Janaina Mascarenhas, 2022. "A framework of digital technologies for the circular economy: Digital functions and mechanisms," Business Strategy and the Environment, Wiley Blackwell, vol. 31(5), pages 2171-2192, July.
    16. Biman Darshana Hettiarachchi & Stefan Seuring & Marcus Brandenburg, 2022. "Industry 4.0-driven operations and supply chains for the circular economy: a bibliometric analysis," Operations Management Research, Springer, vol. 15(3), pages 858-878, December.
    17. Zerbino, Pierluigi & Stefanini, Alessandro & Aloini, Davide & Dulmin, Riccardo & Mininno, Valeria, 2021. "Curling linearity into circularity: The benefits of formal scavenging in closed-loop settings," International Journal of Production Economics, Elsevier, vol. 240(C).
    18. Adriana Neligan & Rupert J. Baumgartner & Martin Geissdoerfer & Josef‐Peter Schöggl, 2023. "Circular disruption: Digitalisation as a driver of circular economy business models," Business Strategy and the Environment, Wiley Blackwell, vol. 32(3), pages 1175-1188, March.
    19. Lopes de Sousa Jabbour, Ana Beatriz & Chiappetta Jabbour, Charbel Jose & Choi, Tsan-Ming & Latan, Hengky, 2022. "‘Better together’: Evidence on the joint adoption of circular economy and industry 4.0 technologies," International Journal of Production Economics, Elsevier, vol. 252(C).
    20. Manavalan Ethirajan & Thanigai Arasu M & Jayakrishna Kandasamy & Vimal K.E.K & Simon Peter Nadeem & Anil Kumar, 2021. "Analysing the risks of adopting circular economy initiatives in manufacturing supply chains," Business Strategy and the Environment, Wiley Blackwell, vol. 30(1), pages 204-236, January.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:bstrat:v:30:y:2021:i:4:p:2038-2060. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://onlinelibrary.wiley.com/journal/10.1002/(ISSN)1099-0836 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.