Interorganizational Sensemaking of the Transition Toward a Circular Value Chain.

Abstract

The transition toward the circular economy requires stakeholders to collaborate along value chains. Yet, such collaborations are considerably challenging. Given the paradigmatic change, stakeholders face high levels of uncertainty and also need to align on a common way forward. We extend research on interorganizational sensemaking and the circular economy by exploring the process of interorganizational alignment in a European consortium of over 150 companies representing the value chain for flexible packaging with the objective to transform the value chain from linear to circular. We find that the interorganizational sensemaking process unfolds across three levels-organization, value chain, and ecosystem-which provide different reference frames for the process. We provide insights into how these frames, power dynamics, and identity considerations influence this process. Our findings highlight the importance of considering interdependencies between stakeholders and a collective reconceptualization of the established value chain to successfully transition toward a circular one.