Product-service system business models in the building sector: barriers and solutions for companies

Abstract

The construction sector's reliance on raw materials and the generation of waste necessitate a shift from the unsustainable linear economy to a circular economy (CE). Adopting Product-Service System (PSS) business models is crucial for achieving this transition. However, contractor companies in the building sector face barriers to implementing PSS, and there is limited knowledge about PSS in this context. This study aims to understand the state-of-the-art in PSS, assess barriers, and propose potential solutions specifically for contractor companies in the building sector.
A qualitative research method was employed, including a literature review and semi-structured interviews. The literature review encompassed 774 studies, with 45 meeting the inclusion criteria. Semi-structured interviews were conducted with professionals in the building construction sector to supplement the literature findings. This study highlighted that PSS in the building sector has the potential to enhance sustainability and circular economy efforts by promoting economic growth, reducing resource consumption, and minimizing waste.
The practical implementation of PSS in the building sector is hindered by challenges such as technological and supply chain changes, lack of financial support, organizational restructuring, establishing new customer relationships, developing new contracts, and adopting new economic models. Insufficient policies and regulations further impede PSS adoption. Nonetheless, this study highlights that sustainability, circularity, and CO2 reduction can drive the adoption and implementation of PSS.
The research identified 41 barriers to PSS adoption through the literature review and 20 barriers through interviews grouped into ten categories. These barriers encompass customers, supply chain financial, organizational, resource, knowledge, regulation or policy, environmental, social, and technology-related challenges. To overcome these barriers, nine potential solutions were proposed, including effective leadership, separated business units, training existing personnel, hiring additional personnel, cultivating long-term relationships, horizontal and vertical integration, leveraging knowledge and experience from other sectors, and learning by doing.
This study contributes to understanding PSS in the building sector and provides recommendations for practice and further research. By implementing these solutions, contractor companies in the building sector can overcome barriers to PSS adoption and increase their chances of successful implementation. The study offers guidance for efficient resource allocation and prioritization of solutions based on their effectiveness in addressing specific barrier categories. Future studies can explore customers' perspectives, conduct in-depth research on specific barrier categories, and focus on specific building systems or products to investigate potential barriers and solutions.