Digital sustainable business models: Using digital technology to integrate ecological sustainability into the core of business models

Abstract

When presented with the latest statistics on global warming, it becomes evident that ecological sustainability will be equally important as economic sustainability for companies. A new wave of start-ups shows that ecological sustainability can be integral to a business model (BM) without compromising economic success. Like start-ups that designed their BMs to be ecologically and economically sustainable, incumbents also need to undergo two fundamental transformations in parallel: digital and sustainable BM transformation. While each transformation alone is considered demanding, we examined 31 start-ups to develop a taxonomy of digital sustainable BMs to understand how companies can master these complementary challenges and provide guidelines on achieving ecological and economic sustainability by implementing digital BMs. We use this taxonomy to derive four distinct archetypes of how sustainability can be an integral part of the BM: Sustainable Software Solutions, Sustainable Product-Service Systems, Sustainability Intelligence, and Digital Sustainable Platforms. For each archetype, we reveal the role of digital technology in creating ecological BMs and how these BMs create sustainable value from an ecological, economic, and technological perspective. Therefore, we go beyond using digital technology to optimise production or logistics or enable remote work and implement sustainability as an integral part of the core logic of the organisation and its identity. For practice, our strategy guidelines contribute to creating a sustainable reality based on digital technology implemented in the BMs.