The Triple Layered Business Model Canvas: A Tool to Design More Sustainable Business Models

This article proposes the Triple Layer Business Model Canvas (TLBMC) as a practical tool for coherently integrating economic, environmental, and social concerns into a holistic view of an organization's business model. The TLBMC builds on Osterwalder and Pigneur (2010) original business model canvas by explicitly integrating environmental and social impacts through additional business model layers that align directly with the original economic-oriented canvas. The TLBMC is a practical and easy to use tool which supports creatively developing, visualizing, and communicating sustainable business model innovation.

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The triple layered business model canvas: A tool to design more sustainable
business models
Article in Journal of Cleaner Production · June 2016
DOI: 10.1016/j.jclepro.2016.06.067
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Alexandre Joyce
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Raymond L. Paquin
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The triple layered business model canvas: A tool to design more
sustainable business models
Alexandre Joycea, *
, Raymond L.Paquin b
a Institut de developpement de produits,4805 Molson,Montreal,Quebec H1Y0A2 Canada
b Concordia University,John Molson School of Business,MB 13.125 e Dept.of Management, 1455 De Maisonneuve Blvd.W.,Montreal,Quebec H3G 1M8
Canada
a r t i c l e i n f o
Article history:
Received 5 August 2015
Received in revised form
30 May 2016
Accepted 11 June 2016
Available online xxx
Keywords:
Business model innovation
Sustainable business models
Business models for sustainability
Triple layered business model canvas
Triple bottom line
a b s t r a c t
The Triple Layered Business Model Canvas is a tool for exploring sustainability-oriented business model
innovation.It extends the original business model canvas by adding two layers: an environmental layer
based on a lifecycle perspective and a sociallayer based on a stakeholder perspective.When taken
together,the three layers of the business modelmake more explicit how an organization generates
multiple types of value e economic,environmental and social.Visually representing a business model
through this canvas tool supports developing and communicating a more holistic and integrated view of
a business model; which also supports creatively innovating towards more sustainable business models.
This paper presents the triple layer business model canvas tool and describes its key features through a
re-analysis of the Nestle Nespresso business model.This new tool contributes to sustainable business
model research by providing a design toolwhich structures sustainability issues in business model
innovation. Also, it creates two new dynamics for analysis: horizontal coherence and vertical coherence.
© 2016 Elsevier Ltd.All rights reserved.
1. Introduction
The pressure for businesses to respond to sustainability con-
cerns is increasing.Organizations are expected to more actively
address issues such as financialcrises,economic and socialin-
equalities, environmental events, material resource scarcity, energy
demands and technological development as part of their focus. On
the one hand,those challenges can be seen as an increase in risk
(Tennberg, 1995; Paterson,2001).On the other,those same chal-
lenges can be seen as opportunities for organizations to engage in
sustainability-oriented innovation (Adams et al., 2015; Hart, 2005;
McDonough and Braungart,2002). For organizations to succeed,
they must respond to such challenges by creatively integrating eco-
efficient and eco-effective innovations which help conserve and
improve natural, social and financial resourcesinto their core
business (Castello and Lozano,2011; Rifkin,2014; Jackson,2009).
Yet for sustainability-oriented innovation to be truly impactful,it
needs to move beyond incremental,compartmentalized changes
within an organization and towards integrated and integral
changes which reach across the organization and beyond itits
larger stakeholder environment(Adams et al., 2015; Nidumolu
et al.,2009).
For the past 25 years,businesses have been looking at sustain-
ability issues from a far (Dyllick and Hockerts, 2002) without
meaningfully reducing their aggregate resource and energy use.
Most organizationalapproaches have failed to create necessary
reductions in impact at least, in part, because business thinking has
failed to integrate a more natural sciences-based awareness of
sustainability and the ecological limits to our planetary boundaries
(Pain, 2014; Rockstr€om et al.,2009; Whiteman et al., 2013).
This article proposes the Triple Layer Business ModelCanvas
(TLBMC) as a practicaltool for coherently integrating economic,
environmental,and socialconcerns into a holistic view of an or-
ganization's business model. The TLBMC builds on Osterwalder and
Pigneur (2010) originalbusiness modelcanvas e a popular and
widely adopted tool for supporting business model innovation e by
explicitly integrating environmentaland social impacts through
additional business model layers that align directly with the orig-
inal economic-oriented canvas. The TLBMC is a practical and easy to
use tool which supports creatively developing,visualizing,and
communicating sustainable business model innovation (Stubbs and
Cocklin, 2008). The TLBMC follows a triple-bottom line approach to
* Corresponding author.
E-mail addresses:[e-mail] (A.Joyce), Raymond.paquin@
concordia.ca (R.L.Paquin).
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Journal of Cleaner Production xxx (2016) 1e13
Please cite this article in press as: Joyce, A., Paquin, R.L., The triple layered business model canvas: A tool to design more sustainable busi
models, Journal of Cleaner Production (2016),http://dx.doi.org/10.1016/j.jclepro.2016.06.067

organizationalsustainability (Elkington,1994),explicitly address-
ing and integrating economic,environmental,and social value
creation as core to an organization's business model. In particular, it
leverages life-cycle analysisand stakeholder managementper-
spectives within newly created environmental and social canvases
to conceptualize and connectmultiple types of value creation
within a business model perspective.
As a tool,the TLBMC bridges business modelinnovation (Zott
et al., 2011;Spieth et al.,2014) and sustainable business model
development(Boons and Lüdeke-Freund,2013) to support in-
dividuals and organizations in creatively and holistically seeking
competitive sustainability-oriented change as a way to address the
challenges facing us today (Azapagic, 2003; Shrivastava and Statler,
2012). The TLBMC can help users overcome barriers to
sustainability-oriented change within organizations (Lozano, 2013)
by creatively re-conceptualizing their current business models and
communicating potential innovations. Sustainability is argued to be
the key driver of creative innovation for many firms and im-
provements towards sustainability requires innovating on existing
business models to create “new ways of delivering and capturing
value, which will change the basis of competition” (Nidumolu et al.,
2009, p.9). While this point is not new, relatively little work sheds
light on tools which may support the creative conceptual phase of
innovating business models towards organizational sustainability.
Through private consulting, organizational workshops, and
university courses, the TLBMC has been found to help users quickly
visualize and communicate existing business models, make explicit
data and information gaps,and creatively explore potential busi-
ness model innovations which were more explicitly sustainability-
oriented.The TLBMC's layered format helped users better under-
stand and representthe interconnections and relationships be-
tween organizations' current actions and its economic,
environmentaland socialimpacts.By developing environmental
and socialcanvas layers as direct extensions of Osterwalder and
Pigneur (2010) original economic-oriented business model
canvas,each canvas layer provides a horizontal coherence within
itself which also connects across layers, providing a vertical
coherence or more holistic perspective on value creation,which
integrates a view of economic,environmental,and social value
creation throughoutthe business model.Thus, the TLBMC may
enable users to creativity develop broader perspectives and in-
sights into their organizations' actions.
The TLBMC contributes to this specialissue on organizational
creativity and sustainability by proposing a user-friendly toolto
support sustainability-oriented business model innovation. First, as
a multi-layer business model canvas,the TLBMC offers a clear and
relatively easy way to visualize and discuss a business model's
multiple and diverse impacts.Instead of attempting to reduce
multiple types of value into a single canvas,the TLBMC allows
economic,environmentaland social value to be explored hori-
zontally within their own layer and in relationship to each other
through the verticalintegration ofthese layers together.This, in
turn, supports richer discussion and more creative exploration of
sustainability-oriented innovations as a way to explore how action
in one aspect of an organization may ripple through other parts of
the organization.
Second,the TLBMC provides a concise framework to support
visualization, communication and collaboration around innovating
more sustainable businessmodels (Boons and Lüdeke-Freund,
2013).As a relatively easy to understand approach to conceptual-
izing organizations,the TLBMC is as a boundary object (Carlile,
2002) to communicate change to diverse audiences.At its core,
the TLBMC may support transitioning from incrementaland iso-
lated innovations to more integrated and systemic sustainability-
oriented innovations which are likely better suited to meeting
ongoing global crises, and energy and material constraints (Adams
et al.,2015; Shrivastava and Paquin,2011; von Weizsacker et al.,
2009). To support future research and practice around
sustainability-oriented business modelinnovation,the TLBMC is
reproduced in Annex 1 and is available for use under a creative
commons licence.
2. Business models and business model canvases
While the concept of a business model as a“theory of a busi-
ness” is not new (Drucker, 1955), business model research has only
relatively recently gained the attention of many scholars. In fact, as
one recent review noted, scholars “do not [readily] agree on what a
business modelis” (Zott et al., 2011,p.1020).However,for this
article a business model is defined as “the rationale of how an or-
ganization creates,delivers and captures value” (Osterwalder and
Pigneur,2010,p.14).In particular,it is a conceptualization ofan
organization which includes 3 key aspects (Chesbrough,2010;
Osterwalder, 2004):
(1) How key components and functions, or parts, are integrated
to deliver value to the customer;
(2) How those parts are interconnected within the organization
and throughout its supply chain and stakeholder networks;
and
(3) How the organization generatesvalue, or createsprofit,
through those interconnections.
When clearly understood, an organization's business model can
provide insight into the alignment of high level strategies and un-
derlying actions in an organization,which in turn supports stra-
tegic competitiveness (Casadesus-Masanell and Ricart, 2010). Given
that such connections are often only tacitly understood within or-
ganizations (Teece,2010),scholars and practitioners have increas-
ingly turned to business models as a way to make these
connections more explicit(Chesbrough and Rosenbloom,2002;
Amit and Zott, 2010; Schaltegger etal., 2012).Making explicit
these connections through an organization's business modelcan
also support business model innovation through the discovery of
previously unseen opportunities for value creation through trans-
forming existing actions and interconnections in new ways
(Johnson et al.,2008).
2.1.A canvas as a creative tool for business model innovation
Business modeltools can be used to support sustainability
through outside-in or inside-out approaches (Baden-Fuller,1995;
Simanis and Hart, 2009; Chesbrough and Garman,2009). An
outside-in approach involves exploring opportunities for innova-
tion by looking at an organization through different types of
idealized business models,or business model archetypes (Bocken
et al.,2014).This allows firms to explore innovations which may
result from adapting their current business model towards a
particular archetype.Put another way,
“Firms can use one or a selection of business model archetypes for
shaping their own transformation, which are envisaged to provide
assistance in exploring new ways to create and deliver sustainable
value and developing the business modelstructure by providing
guidance to realise the new opportunities” (Bocken et al.,2014,
p.13).
As an outside-in approach,Business modelarchetypes allow
users a relatively easy way to explore the potentialimpacts of
innovating towards different types of business models,inspiring a
A. Joyce,R.L.Paquin / Journal of Cleaner Production xxx (2016) 1e132
Please cite this article in press as: Joyce, A., Paquin, R.L., The triple layered business model canvas: A tool to design more sustainable busine
models, Journal of Cleaner Production (2016), http://dx.doi.org/10.1016/j.jclepro.2016.06.067

form of creative confrontation or cross-pollination of diverse ideas
(Fleming,2004). The cross-pollination ofbusiness models ideas
happens when an archetype from one context or industry is rein-
terpreted or applied in another. The term outside-in applies
because an ‘outside’business model archetype is adapted or
translated to the organization.
Inversly,an inside-out approach to business model innovation
involves starting with the current elements in the organization.
First, one details an organization's existing business modelthen
explores the potentialchanges to the model.A business model
canvas (BMC), such as that developed by Osterwalder and Pigneur
(2010) tool can be quite effective here in helping users understand
an organization's business model. The BMC can help users visually
represent of the elements of a business modeland the potential
interconnections and impacts on value creation. As a visual tool, the
BMC can facilitate discussion,debate,and exploration of potential
innovations to the underlying business modelitself; with users
developing a more systemic perspective ofan organization and
highlighting its value creating impacts (Wallin et al., 2013; Bocken
et al., 2014). Osterwalder and Pigneur (2010) BMC, in particular, was
developed following design science methods and theory underly-
ing business model development (Osterwalder, 2004) with a focus
on providing accessible, visual representation of a business system
to guide the creative phase of prototyping, gathering feedback, and
revising iterations on business modelinnovation.Their BMC has
been widely adopted by practitioners (Nordic Innovation,2012;
OECD et al.,2012; Kaplan,2012) and researchers (Abraham,2013;
Massa & Tucci,2013).Given its wide adoption and ease of use for
multiple types of users, the business modelcanvas is an ideal
foundation to expand upon by integrating sustainability.
As an example,Fig. 1 shows an interpretation of the Nestle
Nespresso business modelthrough the nine components which
make up Osterwalder and Pigneur (2010) original BMC. As discussed
below,their BMC forms the economic layer of the proposed Triple
Layered Business Model Canvas. This is discussed more in section 4.
2.2. Building on the original canvas
The business modelcanvas,as proposed by Osterwalder and
Pigneur (2010),distills an organization's business model into nine
interconnected components e customer value proposition,
segments,customer relationships,channels,key resources,key
activities,partners,costs and revenues.While using it may help
users align profit and purpose to support more sustainability-
oriented value creation on its own (Osterwalder and Pigneur,
2011),in practice environmental and social value is implicitly de-
emphasized behind the canvas's more explicit ‘profit first’or eco-
nomic value orientation (Upward, 2013; Coes, 2014). This has led to
the criticism that developing more sustainability-oriented business
models likely either requires an expert facilitator to support this
orientation or a different tool altogether(Bocken et al., 2013;
Marrewijk and Werre, 2003). A new tool would need to more
explicitly integrate economic, environmental, and social value into
a holistic view of corporate sustainability. As a way to put this into
practice,the TLBMC offers the opportunity for users to explicitly
address a triple bottom line where each canvas layer is dedicated to
a single dimension and together they provide a means to integrate
the relationships and impacts across layers.
The triple bottom line (TBL) perspective,advocating organiza-
tions consider and formally account for their economic,environ-
mental, and social impacts (Savitz,2012),is useful here. While
criticized for simplifying sustainability's complexity (Norman and
MacDonald,2004; Vanclay,2004; Mitchell, 2007), many organi-
zations have adopted TBL thinking, implicitly or explicitly, through
corporate social responsibility reporting and initiatives such as the
Global Report Initiative, Carbon Disclosure Project,and others.
Thus,despite its potential flaws,TBL is a relatively widely under-
stood perspective for considering an organization'seconomic,
environmental,and social and as a conceptual framework for
designing business models to support more sustainable action.
Innovating towards more sustainable business models requires
developing new business models which go beyond an economic
focus to one which generates and integrates economic,environ-
mental and social value through an organization's actions (Bocken
et al., 2013; Willard, 2012). Therefore the structure of the tool leads
to clearly understand and align an organization's actions towards
sustainability at a strategic business model level.
3. Presentation of the triple layered business model canvas
tool
The wide adoption and use of Osterwalder and Pigneur (2010)
Fig. 1.An analysis of Nespresso through Osterwalder and Pigneur (2010) original Business Model Canvas, which forms the economic layer of the Triple Layer Business Model
A. Joyce,R.L.Paquin / Journal of Cleaner Production xxx (2016) 1e13 3
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business modelcanvas suggests it is valuable for understanding
and communicating an organization's business modeland crea-
tively supporting business innovation (Abraham,2013).Yet, as
noted above, for organizations seeking sustainability-oriented
innovation,new creative tools are likely needed (Lozano,2014).
The Triple Layer Business ModelCanvas (TLBMC) is a toolto
support the creative exploration ofsustainable business models
and sustainability-oriented innovation more broadly.The TLBMC
complements and extends Osterwalder and Pigneur (2010) original
economically-oriented business modelcanvas concept with new
canvas layers exploring environmentaland socialvalue creation.
These additionallayers both parallelthe original business model
canvas by highlighting the interconnections which support envi-
ronmental and social impacts separately, and extend it by drawing
connections across the three layers to support an integrated triple
bottom line perspective oforganizationalimpact (Glaser,2006;
Hubbard,2009; Sherman,2012).In other words,the TLBMC pro-
vides ‘horizontal’ coherence within each canvas layer for exploring
economic,environmental and social value individually and ‘verti-
cal’ coherence integrating value creation across the three canvas
layers; which supports developing a deeper understanding of an
organization's value creation (Lozano,2008).Thus, the TLBMC is
proposed to creatively explore sustainability-driven product,pro-
cess,and business modelinnovation in support of organizations
better addressing sustainability challenges. As the original business
model canvas is treated at length by the original authors
(Osterwalder and Pigneur,2010),the next section focuses only on
the new environmental and social canvas layers proposed as part of
the TLBMC.
3.1. Foundation of the environmental layer of the TLBMC
The environmentallayer of the TLBMC builds on a life cycle
perspective of environmental impact. This stems from research and
practice on Life Cycle Assessments (LCA), which is a formal
approach for measuring a product's orservice's environmental
impacts across all stages of the its life (Svoboda, 1995). A formal LCA
provides an evaluation of environmental impacts across multiple
types of indicators (e.g.,CO2e,eco-systems quality,human health,
resource depletion, water use cf., Hendrickson et al., 2006;
Pennington etal., 2004) over the full life-cycle of a product or
service (e.g.,raw material extraction,manufacturing,distribution,
use and end of life cf., Svoboda, 1995; Guinee, 2002). Coupling LCA
with business innovation can support competitive product, service
and business model innovations with enhanced environmental
characteristics vis-v-vis traditionalbusiness innovations (FORA,
2010) and support ongoing impactmeasurementand improve-
ment of sustainability-oriented innovations over time (Chun and
Lee,2013).While the TLBMC does not integrate a formal LCA into
the canvas, it does ensure a life cycle perspective when considering
a business modeland its environmentalimpacts.Section 4.1 de-
scribes the components of the environmental canvas layer.
3.2. Foundation of the social layer of the TLBMC
The social layer of the TLBMC builds on a stakeholder manage-
ment approach to explore an organization's social impact
(Freeman,1984).A stakeholder managementapproach seeks to
balance the interests of an organization's stakeholders rather than
simply seeking maximum gain for the organization itself.Stake-
holders are considered those groups of individuals or organizations
which can influence or is influenced by the actions of an organi-
zation. Typical stakeholders include employees,shareholders,
community,customers,suppliers,governmentalbodies, interest
groups, though others advocate expanding stakeholders to include
groups such as media,the poor,terrorist groups,and even non-
human actors such as natural ecosystems (Miles,2011; Post et al.,
2002; Hart and Sharma,2004).While there are a number of ap-
proaches for addressing social impacts in business such as social life
cycle assessments (Jørgensen et al.,2008),ISO 26000 and other
common standards (Pojasek, 2011; Moratis, 2011), and social
impact factors (Benoît et al., 2010); they all build from a stakeholder
perspective; thus our decision. Similar to the environmental canvas
layer,the social canvas layer extends the original business model
canvas by filtering an organization's business model and impacts
through a stakeholder perspective.Given that an organization's
particular stakeholders may vary based on context and salience
(Mitchell et al., 1997), the stakeholder layer is intendedly broad and
flexible in use.Section 4.2 describes the components of the social
canvas layer.
4. Elements of the TLBMC layers through Nespresso's business
model
The economic aspects of Nespresso's business model,as illus-
trated in Fig.1, begin with the quest to sellhigh-end restaurant
quality espresso at home and is elaborated elsewhere (cf.,
Osterwalder and Pigneur,2010).In summary,however,Nespresso,
at this time,sold high-margin coffee pods for making coffee and
lower-margin machines manufactured by partners.Costs associ-
ated with these activities include marketing,production and lo-
gistics and include resources such as distribution channels,brand,
production plants and patents.Nespresso targeted the office mar-
ket and affluent consumers through a membership club,devel-
oping longer term relationships with these customer segments.
They distributed machines through retailshops but coffee pods
were ordered online, by mail, by phone and in boutiques. Nespresso
offers a clear example of creatively innovating a business model
around coffee as “it changed the face ofthe coffee industry by
turning a transactional business (selling coffee through retail) into
one with recurring revenues (selling proprietary pods through
direct channels)” Osterwalder (2013, p.1).
In the following section,the ensuing environmental and social
canvas layers are presented and they are exemplified by expanding
on Nespresso's business model.For this Nespresso case,the addi-
tional canvas layers share public information,such as company
reports, press releases,and articles and other public data. In
particular,the environmentaldata comes from Nespresso (2014)
and Nestle (2015) which extracts the carbon footprint LCA data
from a third party report (Quantis,2011).The social layer data
comes from their report on creating shared value (Nestle, 2014).
4.1.Environmental layer of the TLBMC
Much in the same way the originalbusiness modelcanvas is
used to understand how revenues outweigh costs, the main
objective of the environmentallayer of the TLBMC is to appraise
how the organization generates more environmental benefits than
environmental impacts. Doing so allows users to better understand
where the organization's biggest environmental impacts lie within
the business model; and provide insights for where the organiza-
tion may focus its attention when creating environmentally-
oriented innovations.As mentioned above,environmentalim-
pacts can be tracked with multiple indicators.However,in this
Nespresso case,environmentalimpacts are tracked in terms of
carbon impact due to data availability.Leveraging the life cycle
approach discussed above,each of the nine components ofthe
environmental layer are defined below. The TLBMC elements were
elaborated using the Nespresso business model.
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4.1.1.Functional value
The functional value describes the focal outputs of a service (or
product) by the organization under examination.It emulates the
functional unit in a life cycle assessment,which is a quantitative
description of either the service performance or the needs fulfilled
in the investigated product system (Rebitzer et al.,2004).The dif-
ference between a LCA's functional unit and the functional value
can be seen as one of usage. For example, the functional unit of the
Nespresso LCA is a 40 ml espresso pod, while the functional value is
the total of these pods consumed by customers in a given time-
frame such as a year.The point of defining the functional value is
first to clarify what is being examined in the environmental layer;
and second,to serve as a baseline for exploring the impacts of
alternative potential business models.
4.1.2.Materials
The materials component is the environmental extension of the
key resources component from the original business model canvas.
Materials refer to the bio-physical stocks used to render the func-
tional value.For example manufacturers purchase and transform
large amounts of physical materials, whereas service organizations
tend to require materials in the form of building infrastructure and
information technology. These service organizations also consume
significant materialresources in the form of assets such as com-
puters,vehicles and office buildings.While introducing allmate-
rials into the canvas is not practical,it is important to note an
organization's key materials and their environmental impact.For
Nespresso, materials are first and foremost the coffee beans which
represent 19.9% of its carbon footprint. The aluminum used for the
capsules is also to be included in the materials of the life cycle as it
represents 6% of the carbon footprint.
4.1.3.Production
The production component extends the key activities compo-
nent from the original business model canvas to the environmental
layer and captures the actions that the organization undertakes to
create value.Production for a manufacturer may involve trans-
forming raw or unfinished materials into higher value outputs.
Production for a service provider can involve running an IT infra-
structure, transporting people or other logistics, using office spaces
and hosting service points. As with materials, the focus here is not
on all activities but rather those which are core to the organization
and which have high environmentalimpact.For Nespresso,the
industrial processes to prepare the coffee beans represent 4.5% of
the carbon impact and the manufacturing of the packaging capsules
represents 13.3%.
4.1.4.Supplies and outsourcing
Supplies and out-sourcing represent all the other various ma-
terial and production activities that are necessary for the functional
value but not considered ‘core’to the organization.Similar to the
original business model canvas,the distinction here is between is
considered core versusnon-core to support the organization's
value creation. This can be considered in terms of actions which are
unique to the organization and support its competitive advantage
and those actions which are necessary but not unique (Porter, 1985)
and may also be conceived of as those actions which are kept in-
house versus those which are outsourced,though this can be not
strictly accurate. Within the environmental layer, examples of may
include water or energy which,while they could come from in-
house sources (localwells and on-site energy production); they
are likely to be supplied by local utility companies.As such,many
organizations have little influence in these areas unless they are
willing to take more control over these actions through, for
example, creating on-site energy and utility services. In the
available carbon footprintdata of the coffee pod manufacturer,
most of the impacts of supplies and outsourcing such as the ma-
chines and pods were included in the use phase.
4.1.5.Distribution
As with the originalbusiness model,distribution involves the
transportation ofgoods. In the case of a service provider or a
product manufacturer,the distribution representsthe physical
means by which the organization ensures access to its functional
value. Thus within the environmental layer, it is the combination of
the transportation modes,the distances travelled and the weights
of what is shipped which is to be considered.As well, issues of
packaging and delivery logistics may become important here.For
Nespresso, distribution involves the shipment of coffee beans and,
subsequently manufactured,coffee pods over thousands ofkilo-
metres with the total effect of representing only 4.6% of Nespresso's
carbon footprint. Their distribution practicesfavour train over
trucks.In addition,the products are packaged in cardboard boxes
which represent 3.6% of their carbon footprint.
4.1.6.Use phase
The use phase focuses on the impact of the client's partaking in
the organization's functional value, or core service and/or product.
This would include maintenance and repair of products when
relevant;and should include some consideration ofthe client's
material resource and energy requirements through use.Many
electronic products incur use phase impacts when charging a de-
vice and using an infrastructure needed to support the network of
users. This can outweigh production impacts (Nokia, 2005). As well,
the line between production and use phase may not be clear,
especially as organizations increasingly offer co-creation of services
(e.g., user created content) and product sharing (e.g., car sharing) in
lieu of more traditional product and service business models
(Prahalad and Ramaswamy,2004). For Nespresso,the use phase
consists of three elements. First, a client's energy and water needs
to prepare coffee add up to 10.9%.Second,the machine use and
production represents 7.8%.And lastly,the coffee pod production
and washing is the largest single element of the entire life cycle
with 28% of Nespresso's carbon impact.
4.1.7.End-of-life
End-of-life is when the client chooses to end the consumption of
the functional value and often entails issues of material reuse such
as remanufacturing,repurposing,recycling,disassembly,incinera-
tion or disposal of a product.From an environmental perspective,
this component supports the organization exploring ways to
manage its impact through extending its responsibility beyond the
initially conceived value of its products.Increasingly governments
are forcing organizations to address this through various substance
restrictions (European Commission, 2012) and recycling re-
quirements (Environment Agency,2012).This can also be an op-
portunity for organizations to creatively explore new business
models such as product service systems (Mont and Tukker,2006;
Bey and McAloone,2006) and industrial symbiosis (Paquin et al.,
2013).For Nespresso,end-of-life means addressing the impacts of
its spent expresso pods consisting of spent coffee and aluminum.
The capsules, the packaging and the machine in a mix of end of life
scenarios that includes landfilland recycling adds up to 5.5% of
Nespresso's totalcarbon impact.However,the pods can only be
recycled if taken back to one of the 14 000 Nespresso dedicated
collection points (Nespresso, 2014).
4.1.8.Environmental impacts
The environmental impacts component addresses the ecological
costs of the organization's actions.While a traditional business
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model often summarizes organizational impacts primarily as
financial costs,the environmentalimpacts components extends
that to include the organization's ecologicalcosts.Based on LCA
research (Jolliet et al., 2003), these performance indicators may be
related to bio-physical measures such as CO2e emissions,human
health,ecosystem impact,natural resource depletion,water con-
sumption.Some environmentalindicators can take the form of
traditional business metrics still related to LCA (De Benedetto and
Klemes, 2009) such as energy consumption,water use and emis-
sions. And,as with exploring an organization's financial costs, this
provides an opportunity to explore where,in the organization's
actions,are its biggest environmentalimpacts.For Nespresso,its
environmental impacts can point to its largest contributor, the use
stage with 46.6% of the carbon footprint.
4.1.9.Environmental benefits
Similar to the relationship between environmental impacts and
costs, environmental benefits extends the concept of value creation
beyond purely financial value.It encompasses the ecological value
the organization creates through environmental impact reductions
and even regenerative positive ecologicalvalue.From a sustain-
ability perspective,this component provides space for an organi-
zation to explicitly explore product,service,and business model
innovations which may reduce negative and/or increase positive
environmentalthrough its actions.For Nespresso,an example of
this would be the 20.7% reduction in carbon emissions they ach-
ieved by redesigning the machines to be energy efficient.By eval-
uating environmentalimpacts with a life cycle approach in the
business model canvas,the description of impacts can move
beyond generalizations and intuitions to establish a firmer even
quantitative basis upon which to design more sustainable business
models.
In Fig. 2, a life cycle approach informs the environmental layer as
projected through the original business model canvas. The content
provided inside the canvas framework has been extracted from the
report available on the company's website (Nespresso, 2014) which
recounts the third party life cycle assessment (see Fig.3).
4.2. Social layer of the TLBMC
A key point of using the social layer of the TLBMC is to extend
the original business model canvas through a stakeholder approach
to both capture the mutualinfluences between stakeholders and
the organization.Also, this layer seeks to capture the key social
impacts of the organization that derive from those relationships.
Doing so provides a better understanding of where are an organi-
zation's primary social impacts and provides insight for exploring
ways to innovate the organization's actions and business model to
improve its socialvalue creation potential.Leveraging the stake-
holder approach discussed above,the nine components of the so-
cial layer make up the third layer of the TLBMC. Again, the
Nespresso business model case serves as an example of it use.
4.2.1.Social value
Socialvalue speaks to the aspect of an organization's mission
which focuses on creating benefit for its stakeholders and society
more broadly. For sustainability-oriented firms,creating social
value is likely a clear part of their mission. However, even the most
profit-oriented organizations likely consider their value creating
potential beyond simply financial gain (Collins and Porras,1996).
For Nespresso, they use the term creating shared value (Porter and
Kramer, 2011).Their intended social value can be interpreted
through their “roadmap for sustainable growth” (Nespresso, 2015)
where one of their core competencies is developing long term value
from mutually beneficial relationships with coffee farmers. A
broader understanding of the company's social value can be
extrapolated from its corporate business principles “to enhance the
quality of consumers'lives every day, everywhere,by offering
tastier and healthier food and beverage choices and encouraging a
healthy lifestyle” (Nestle, 2014,p44).
4.2.2.Employee
The employees' component provides a space to consider the role
of employees as a core organizationalstakeholder.A number of
elements may be included here such as amounts and types of
employees,salient demographics such as variations pay,gender,
ethnicity,and education (to name a few) within the organization.
As well, it provides a space for discussing how an organization's
employee-oriented programs e e.g.training, professionaldevel-
opment,additional support programs e contribute to the organi-
zation's long term viability and success. Due to the diverse aspects
of employees,this component does risk overflowing with many
Fig. 2. The environmental life cycle layer of the triple layered business model canvas demonstrates the Nespresso case.
A. Joyce,R.L.Paquin / Journal of Cleaner Production xxx (2016) 1e136
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data points of varying relevance for exploring an organization's
business model. Thus, it is suggested to focus only on those aspects
which are most relevant for supporting the organization's business
model. While data on this component it is not as explicit here,
among the issues worth considering based on Nespresso's goals are
its rapid employee growth since its founding,that some 70% of its
employees are customer-facing,its employees work in over 60
countries and themselves representmore than 90 nationalities
(Nespresso,2015). Given Nespresso's global reach and rapid
growth, maintaining a positive workplace and strong customer
relationships likely need to be considered a core part of its business.
4.2.3.Governance
The governance component captures the organizational struc-
ture and decision-making policies of an organization.In many
ways, governance defines which stakeholders an organization is
likely to identify and engage with and how the organization is likely
to do so (Mitchell et al., 1997). Organizations can vary widely based
on several aspects of governance including ownership (e.g.,coop-
erative,not-for profit, privately owned for-profit,publicly traded
for-profit) (Young,2013),internal organizationalstructures (e.g.,
organizational hierarchy, functional v. unit specialization)
(Williamson, 1991) and decision-making policies (e.g., trans-
parency, consultation, non-financial criteria, profit sharing)
(Turskis and Zavadskas,2011) and each of these points can influ-
ence how an organization may engage stakeholders in creating
social value. As an autonomous business unit within Nestl e,
Nespresso hasmade a point of being transparentin decision
making and actively engaging stakeholders to create value
(Nespresso,2014,p.1).
4.2.4.Communities
While economic relationships are built with business partners,
there are socialrelationships built with suppliers and their local
communities.These two stakeholders come together as commu-
nities when aligning the three layers of the TBLMC.When inter-
acting with communities,an organization's success can be greatly
influenced through developing and maintaining mutually benefi-
cial relationships.If an organization has only one or multiple fa-
cilities located in the same geographical area,then there may be
only one local community. However, if an organization has facilities
in different countries,it is important to consider each community
as a different stakeholder with different culturalneeds and re-
alities. While organizations have tended to focus more on the
community where they are headquartered (Landier et al.,2009),
organizations should consider all communities where it has facil-
ities as important.
Though individualsuppliers may have more or less influence
over an organization (Pfeffer and Salancik, 1978),as a group,sup-
pliers are also critical as they provide the organization with critical
resources necessary to support its success. For those organizations
sourcing materials locally (say, for instance, a restaurant focused on
the local food movement),suppliers are also part of the local
community. For Nespresso,developing successfulsupplier re-
lationships within coffee farmers is particularly important as
Nespresso requires large quantities of high quality coffee. As a way
to meet its coffee demands, Nespresso has partnered with the NGO
Rainforest Alliance to train and support over 62 000 farmers in
ways to sustainably improve their coffee quality and yields,which
in turn increase their incomes (Nespresso,2014,p.3).
4.2.5.Societal culture
The societal culture component recognizes the potential impact
of an organization on society as a whole. Returning to the point that
business cannot succeed when society fails,this component le-
verages the concept of sustainable value (Laszlo, 2008) to
acknowledge an organization potential impact on society and how,
though its actions, it can positively influence society (Steurer et al.,
2005). Non-governmental organizations (NGOs) represent another
element that can be included in the societal culture space as they
carry social agendas through their influence on businesses.For
Nespresso, one could argue that individual cup servings of restau-
rant quality points to a culture of individualism. On the other hand,
Nespresso's strong corporate socialresponsibility practices and
programs can be interpreted as a culture of accountability and pro-
activeness.
4.2.6.Scale of outreach
Scale ofthe outreach describes the depth and breadth ofthe
relationships an organization builds with its stakeholders through
Fig. 3. The social stakeholder layer of the triple layered business model canvas demonstrates the Nespresso case.
A. Joyce,R.L.Paquin / Journal of Cleaner Production xxx (2016) 1e13 7
Please cite this article in press as: Joyce, A., Paquin, R.L., The triple layered business model canvas: A tool to design more sustainable busi
models, Journal of Cleaner Production (2016),http://dx.doi.org/10.1016/j.jclepro.2016.06.067

its actions over time. This may include the idea of developing long
term, integrative relationships and the outreach of impact
geographically e e.g.local,regional,or global focus; as well as an
organization's impact in how and whether itaddresses societal
differences such as locally interpreting ethical and or cultural ac-
tions across different cultures and countries.For Nespresso,the
scale of outreach is represented by a growing company operating in
over 60 countries with over 320 storefronts.Its outreach is also
deep and diversified when creating additional social programs such
as language education and micro-credit programs for its supply
chain.
4.2.7.End-users
The end-user is the person who ‘consumes’the value proposi-
tion. This space is concerned with how the value proposition ad-
dresses the needs of the end-user, contributing to his/her quality of
life. Users with similar needs have typically been segmented based
on relevant demographics e e.g., age, income, ethnicity,education
level,etc.Importantly,the end-user is not always the customer as
defined in the economic layer of the business modelcanvas.For
instance, textbook publishers historically consider course in-
structors as customers though students are the end-users.For
Nespresso,the end-user often happens to be the customer who
seeks high-quality/low-effort coffee on demand in the economic
canvas.In the social canvas,Nespresso seeks to provide value by
meeting the user's need in terms of taste,warmth and a caffeine
boost.
4.2.8.Social impacts
The social impacts component addresses the social costs of an
organization. It complements and extends the financial costs of the
economic layer and the bio-physical impacts of the environmental
layer.Although there is a growing body of work on social impact
measures (UNEP, 2009), there is not yet a consensus on what social
impacts to consider,nor how to quantify them.Some of the more
common indicators as provided by Benoît-Norris et al. (2011)
include working hours,cultural heritage,health and safety,com-
munity engagement,fair competition, respect of intellectual
property rights; though which ones to focus on likely depends on
the nature of the organization and an organization may find the
need to create its own indicators here.For Nespresso,negative
social impacts could stem from its engagement with local farmers,
potentially disrupting or displacing existing culturalfarming and
social practices;or potentially the impact of caffeine addiction
should perceptions change to consider caffeine a social ill as with
tobacco,alcohol,and junk food.
4.2.9.Social benefits
Social benefits are the positive social value creating aspects of
the organization's action.This component is for explicitly consid-
ering the socialbenefits which come from an organization's ac-
tions. As with social costs, social benefits can be measured using a
broad range of indicators. For Nespresso,social benefits may
include the personaldevelopmentand community engagement
impacts of providing training opportunities for its employees
directly and indirectly with its coffee suppliers through its part-
nership with the Rainforest Alliance.
5. Discussion
This section explores the field testing,including feedback and
iteration on the TLBMC with innovation professionals and under-
graduate and graduate-levelbusiness majors.This sections also
discusses how the TLBMC can support business model analysis and
innovating towards more sustainable business models through
providing a horizontal coherence within each canvas layerby
developing a deeper understanding of and organization'seco-
nomic,environmental,and social impacts; and vertical coherence
by providing clear connections across the layers supporting a more
holistic and integrating perspective of sustainable-oriented value
creation potential.
5.1.Field testing the TLBMC
The TLBMC concept stems from the authors'professionalex-
periences in design innovation and sustainability in business and
from their desire to develop a practical tool to support those
interested in pursuing sustainability-oriented innovation.Given
that the details of an organization's business model is often only
implicitly understood (Teece,2010),the authors took a participa-
tory action research approach (Stringer,2013) to work with par-
ticipants to jointly develop a tool which could uncover the “latent
dynamics” of their organizations (Argyris, 1993) and innovate to-
wards more sustainable organizationalaction. In particular, the
TLBMC evolved through three interrelated cycles of action between
the authors and interested participants (Winter and Zuber-Skerritt,
1996). First, their experience and expertise in sustainability-
oriented innovation,the authors developed a TLBMC prototype as
a practice-derived toolto support uncovering an organization's
business model and sustainability-oriented innovation.Second,
seven sustainability and innovation professionals,including prac-
titioners and academics,reviewed and gave feedback on the pro-
totype and subsequent iterations as the authors refined it. Third, a
revised TLBMC was used and further refined through a series of
consulting engagements with managementand product teams
from 13 North American-based manufacturers actively seeking
sustainability-oriented innovations, and 17 university- and
organization-based workshopsinvolving over 400 participants,
including undergraduate and graduate business students,entre-
preneurs and industry professionals.
Through these experiences,the TLBMC seems well suited to
support creatively developing more sustainable business models
through a two-step approach. First, the TLBMC can be used
collaboratively among smallgroups to analyze and communicate
an organization's currentbusiness model,providing a baseline
understanding ofthe organization's positive and negative eco-
nomic,social and environmental impacts.Second,the TLBMC can
then be used to creatively explore possible innovations on the
existing business model and the potential value creating impact of
such innovations. In other words, the TLBMC can be used as a tool to
help users reimagine the organization through changesto its
business model. By using the same tool to both analyze an existing
business model and create potential new ones, users seemed more
readily able to discuss and give feedback to new ideas. As the R&D
director of a large manufacturer stated:
“We were able to use the triple layered canvas to discover unex-
pected opportunities for innovation in areas ofour business we
hadn't explored. This new vision, brought by this tool, is extremely
usefultoday in a contextwhere everything is accelerating and
where businesses must continually adapt and innovate.”
Feedback from each action cycle suggests the TLBMC sup-
ported users in creatively exploring sustainability-oriented busi-
ness model innovation at least three ways.First, it provided a
visual representation of an organization's business model.Users
can make explicit otherwise implicit or only informally under-
stood elements ofa business model.This greater clarity better
informed how an organization may create value,supporting a
more holistic view of the organizatio. Doing so also helped
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highlight some of the more intangible and tacit connections
within an organization, supported conversations among users,
which in turn, may support a more collaborative and creative
approach across the functional and departmental perspectives of
different team members.
Second,the TLBMC is a creation tool.Users explored the con-
sequences ofchanging individualelements ofa business model
through the cascading impacts of such change within and across
the canvas layers.The ‘visualized’business modelthrough the
TLBMC can facilitate the understanding and creation of new busi-
ness models ideas by highlighting the interconnections of key el-
ements within the business model.The various uses for colour in
workshops was one demonstration of this creative process as par-
ticipants assigned one colour to ‘fixed’elements of their business
model and another colour to elements which may be altered.This
allowed users to more readily communicate and explore changes
and impacts across the business model.
Third, the TLBMC is a validation tool. Users tried to balance the
costs and benefits of their business model idea in a more holistic
manner with economic, environmentaland social perspectives.
Validation also came from a broader systems perspective as the
TLBMC was used to explore and weigh the potentialstakeholder
consequences of particular ideas.For example,an environmental
decision to switch to water-based wood finishes comes with an
economic cost on materials, but it is outweighed by reducing
health-related measures and costs to ensure worker's well being.
5.2. New dynamics in a layered approach to a business model
canvas
The Triple Layer Business ModelCanvas (TLBMC) provides an
integrative approach to support those seeking to understand
existing business models and creatively explore potential
sustainability-oriented business modelinnovations.In particular,
the TLBMC layers support horizontaland verticalcoherence (see
Fig. 4). Each layer supports a horizontal coherence, or an integrated
approach to exploring an organization's economic,environmental
or social impact, by highlighting key actions and relationships
within the nine components ofeach layer.Combined,the three
layers provide a vertical coherences through connecting the com-
ponents of each layer to their analogs in the other layers,further
elucidating key actions and connections and their impacts across
layers.Integrating the economic,environmental,and social layers
supports a more robust and holistic view of an organization's
business modelthrough its actions and relationships,which can
support a more systems-level perspective of sustainability-
oriented innovation (Zott and Amit,2009).Horizontal and verti-
cal coherence are discussed more below.
5.2.1.Horizontal coherence
Each layer allows some level of depth in making explicit
different types of value creation,which may facilitate broader
systems thinking towards a more holistic view of the entire
business model. For Nespresso, its business model is built on two
main vectors.First, they sell a machine,made by partners,that
runs proprietary technology. Second, they offer single coffee pods
as a branded consumable. At the economic level, this model
thrives because it locks customers into a “razors and blades”
business modelthrough recurring coffee pod sales.At the envi-
ronmentallevel, this model distributes the impact between the
machine and pods but Nespresso excludes the impacts ofthe
machine production.At the social level, Nespresso actively sup-
ports farmers/suppliers but says little of the socialimpact of its
product on its users. A simple analysis of these two vectors
demonstratesopportunities for improving environmental and
social inefficiencies of the business model.Using the TLBMC,one
may then begin exploring issues beyond the organization itself,
potentially including discussions with stakeholders to collabora-
tively innovate new business models with stronger environmental
and social benefits.
5.2.2.Vertical coherence
The alignment of each layer component across the canvas layers
provides a verticalcoherence.This supports exploring the align-
ment of actions and interconnections across the different types of
value. With Nespresso,one may see a lack of alignment across the
canvas layers in terms ofthe connection between its customer
relationship,end-of-life actions,and socialimpact.The customer
Fig. 4. The triple layered business model canvas creates two new dynamics: horizontal and vertical coherence.
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Annex 1. Triple layered business model canvas (TLBMC)
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relationship stems from a long-term relationship founded on
membership and exclusivity,yet over time Nespresso capsules
became a grocery store commodity.Its products are one-time
consumableswhich seem to promote individual consumption
rather than a community experience such as a local cafe. And, even
with an active product take-back and recycling program, its coffee
pods are landfilled in many countries.Opportunities here may
include leveraging its customer relationship to develop stronger
product take-back and recycling programs, perhaps through
refundable depositcharges,and/or through community-focused
activities with customers in stores,both of which may impact
environmental and social value. These potential actions show how
environmental and social concerns,seen through the TLBMC,can
lead to a more active and creative exploration ofsustainability-
oriented innovations in organizations.
5.3. Limits and future research
While the TLBMC offers a novel approach for analyzing and
conceptualizing sustainability-oriented innovation and sustainable
business models,there are also some clear limitations to consider.
One, the TLBMC is simply a tool. It does not do the work of exploring
and assessing potentialinnovations.Some users have found the
‘blank page’ of the TLBMC a bit overwhelming at first. To overcome
this, users may consider starting offwith sample cases ofother
organizations,considering more focused and probing questions of
their own organization,or drawing comparisons with other orga-
nizations as a way to familiarize themselves with the tooland
business model analysis process. As well, the TLBMC provides only
a high-level summary analysis, it lacks the often necessary detailed
analysis one may find in other ways. Yet, this is not the point of the
TLBMC. The TLBMC is meant for developing a high-level, integrated
and holistic perspective of the entire business model, which may, in
turn, shed light on where deeper and more focused analysis may
need to be done.Lastly,the TLBMC provides an integration of the
specialized analyses back into the high-levelviewpoint of the
business model.Here are two examples of the new dynamics and
analyses that the TLBMC offers.
The TLBMC toolsupports users seeking to creatively innovate
towards more sustainable business models in a number of ways.
First, building directly from the widely adopted business model
canvas (Osterwalder and Pigneur,2011),the TLBMC provides an
easy to use, enhanced canvas to explore and innovate towards
economic, environmental, and social value creation in an integrated
manner. Though not the only tool designed to support
sustainability-oriented innovation through business model change
(Upward, 2013; Bocken et al., 2013), the TLBMC's inside-out
approach supports users leveraging their understanding of the or-
ganization's existing business model for innovation opportunities
to emerge rather than attempting to translate or reinterpret
externalideals or archetypes for their business.The TLBMC also
provides an intuitive visualization ofthe organization and value
creation which may be used to provoke conversations around
particular changes in an organization.As such,a number of ques-
tions may be worth considering such as how do different concep-
tualizations ofbusiness models influence how users conceive of
and communicate sustainability-oriented innovations in support of
creating change? How might such tools be used to support more
sustainable action? Would such tools provoke the deep-level
changes the naturalsciences suggest are likely needed for busi-
ness to adapt to more globally sustainable outcomes (Rockstr€om
et al.,2009; von Weizsacker et al.,2009) or merely create incre-
mental change?
Second,the TLBMC is offered through creative commons to
supports those interested in developing sustainability-oriented
changes through business model innovating. A key aspect of
meaningful change is sparking the collaborative conversations
often necessary to support the change process (Quinn,2010) and
the TLBMC seems to be an effective tool for just that. Yet, the use-
fulness of any tool or activity is its usefulness to the group using it
(Sch€on, 1983).Future work may explore whether and how the
TLBMC might support organizational users as they collaboratively
develop and validate their own business model innovations.Over
time,it would be interesting to see whether and how actual orga-
nizational impacts (economic,environmental,and social) align
with the anticipated changes in impacts conceptualized through
business model changes.
Third, the TLBMC proposes to make more explicit the often tacit
and informal dynamics within organizations through vertical and
horizontal coherence. The three layers of the TLBMC seems to help
elucidate opportunities for developing deeper and more integrated
views of the economic,environmental,and social value of an or-
ganization's business model.Yet, this is supported on client and
workshop participant feedback and not from objective organiza-
tional changes in actions or outcomes.Future work may consider
exploring how the TLBMC and other tools may best help users
conceptualize,understand,and communicate an organization's
impacts through its business model as a way to more clearly sup-
port meaningful sustainability-oriented innovations with demon-
strable impacts.
6. Conclusion
This paper contributes to the existing research on sustainable
business models by providing a framework in the form of the triple
layer business model canvas (TLBMC) to enable a triple bottom line
perspective to sustainability e that ofeconomic,environmental
and socialimpact - applied to a business model.The TLBMC ex-
pands the economic-centred approach to a standard business
model by developing and integrating environmentaland social
canvas layers built from lifecycle and stakeholder perspectives into
an extended business model canvas. This expanded canvas support
developing more robust and holistic perspectives on sustainability-
oriented business modelinnovation.As such,the TLBMC has the
potential to support those seeking ways to transform organizations
for sustainability.
Acknowledgements
The authors would like to thank Yves Pigneur,Martin Racine,
Carmella Cucuzella,Florian Lüdeke-Freund for their thoughtful
feedback on earlier versions of this work; the editors Rodrigo
Lonzano,Ralph Kerle and Nuno Guiamaraes Da Costa and anony-
mous reviewers for their support and insightful feedback;the
participants of the 2015 ARTEM OCC conference in Nancy,France
where an earlier version of this paper was presented;and the
colleagues and members ofthe Institut de developpementde
produits for their participation.
Appendix A. Supplementary data
Supplementary data related to this article can be found at http://
dx.doi.org/10.1016/j.jclepro.2016.06.067.
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