Circular Economic Business Model for Australian Post

Managing Sustainably
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Managing Sustainability 2
Introduction
Osterwalder et al (2014) defines a business model as the tool that describes the rationale
of how a company or organization creates delivers and captures value creation. A circular
economic business model therefore refers to business strategy that allows enables the
regeneration of raw materials and other production components while at the same time
minimizing waste and enhancing value creation. This paper seeks to identify how Australian Post
business model can become circular and give a recommendation why the organization needs to
shift to a circular economic business model.
1. Determine how can the organisation become more circular? Create and justify a circular
economy business model for your selected organisation. Your justification should include the
key sources of internal and external value creation.
Australian post is an Australian government owned company that deals with providing
postal services to both local and international clients. The organization offer postal services
ranging from; Mail delivery, parcels and logistics, Digital services, Agency services and retail
merchandise among others. A quick look at the performance of Australian post in the financial
markets reveals a worrying trend in revenue outcomes. For instance in 2015 the company
recorded a loss of A$381 million on the mail delivery side alone. We therefore recommend the
circular economic business model as the best business strategy to bring Australian post back to
profit. This model will assist the organization to improve its financial performance by reducing
its dependence on raw materials. Examples of circular business models include;
 Circular design model – In this model products , systems and the entire operating
function is designed to last longer. A higher residual value will in turn cut cost on
repair , upgrade or refurbishment of this systems since they have been built to last