BACK SCHEME IN THE SWEDISH FASHION INDUSTRY I MPLEMENTING A TAKE -

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MPLEMENTING A TAKE

-BACK SCHEME IN THE

SWEDISH FASHION

INDUSTRY

–

A

DYNAMIC CAPABILITY PERSPECTIVE

2020.7.01

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Title: Implementing a Take-back Scheme in the Swedish Fashion Industry – a Dynamic

Capability Perspective

Publication year: 2020

Author: Louisa Svensson and Sara Biondani Supervisor: Rudrajeet Pal

Acknowledgments

We would like to express our deepest gratitude to all interview participants, who reserved precious time from their busy workday under these strange circumstances to contribute to the writing of this thesis. Likewise, we would like to show our sincere appreciation to our supervisor Rudy, for his guidance, time, and wise words throughout this journey.

A big thank you to our family and friends around the world, who have been forced to put up with us during this crazy and hectic time and for always being there whether to offer support or love whenever possible and for cheering us on from the sidelines.

Lastly, the biggest thanks is devoted to my partner-in-crime, who has been there every step of the way, whether by phone, video, or face-to-face, and helped undertake this new endeavor we set out on. We have had the best and probably faced the worst of times during this thesis, but we made it out on the other side together.

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Abstract

Background - As of today the textile and fashion industry mainly relies on a linear production

model, also referred to as the take-make-waste system. This economy depends solely on the single use of raw materials leaving space for an open-ended production and no intention of salvaging or recovering resources. Such a system cannot be supported by the environment in the future; therefore, several stakeholders are starting to embrace circular production systems and a closed-loop economy. One example of these efforts is take-back schemes (TBS) which strive to make the fashion industry more regenerative and restorative by narrowing, slowing, and closing the resource loops. Nonetheless, practitioners and academia have found adversities during the implementation stage which instead require competent knowledge, skills, and unique capabilities to achieve a successful performance.

Purpose - To achieve a successful implementation of a TBS, companies require unique

capabilities that allow them to adapt and adopt a sustainable innovation. Therefore, this study investigates the dynamic capabilities (DCs) needed to implement a TBS in order to provide practitioners and academia with a guide that eases the application, overcomes the known adversities as well as explores the relationship between these and the relevant DCs.

Methodology - The research was based on a multiple case study method embracing abductive

reasoning by extending the theory of DCs for circular business model implementation to TBS within the fashion industry. Semi-structured interviews were conducted with three companies applying different types of take-back schemes; the primary data was strengthened by document research and a validation round of interviews. The data was analyzed through qualitative thematic content analysis. Further, the characteristics of the study lend themselves well to be represented through a qualitative causal loop diagram appropriate for developing novel solution strategies such as the DCs.

Findings - The results show, through the use of two maps, that several DCs have to be

developed when implementing a TBS in order to reach a substantial competitive advantage in the form of a cost leadership, differentiation or focus strategy. Further, the causal loop maps also shed light on the different relationships between DCs and how these can be exploited to overcome the difficulties or utilizing the possibilities in implementing a TBS.

Practical implications and research limitations - The thesis creates new insights on TBS

implementation through the use of DCs by presenting two causal loop maps. Thus, aiding practitioners and allowing them to quickly recognize their current situation against the maps as well as what changes need to be made following the suggested capabilities. The study is limited by the choice of interviewed companies, which represent only retailers with TBS in Sweden.

Keywords: Take-back Scheme Implementation, Dynamic Capabilities, Circular Business

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4 METHODOLOGY ... 19 4.1 SCIENTIFIC REASONING ... 19 4.2 RESEARCH STRATEGY ... 20 4.3 DATA COLLECTION: ... 21 4.3.1 Sampling ... 21 4.3.2 Primary data ... 22 4.3.3 Secondary data ... 23 4.4 DATA ANALYSIS ... 24 4.4.1 Visualization of data ... 25 4.5 RESEARCH QUALITY ... 26 4.5.1 Construct validity ... 26 4.5.2 Internal validity ... 26 4.5.3 External validity ... 26 4.5.4 Reliability ... 26 4.5.5 Ethics ... 27 5 RESULTS ... 28

5.1 CAPABILITIES NEEDED WHEN IMPLEMENTING A COLLABORATIVE TAKE-BACK SCHEME ... 30

5.2 CAPABILITIES NEEDED WHEN IMPLEMENTING A TAKE-BACK SCHEME INDEPENDENTLY ... 33

5.3 COMPARISON OF COLLABORATIVE AND INDEPENDENT TAKE-BACK SCHEMES ... 37

6 DISCUSSION ... 40

6.1 COORDINATION AND INTEGRATION ... 40

6.2 LEARNING ... 42

6.3 RECONFIGURATION AND TRANSFORMATION ... 44

7 CONCLUSION ... 45

7.1 THEORETICAL IMPLICATIONS ... 45

7.2 PRACTICAL IMPLICATIONS ... 46

7.3 RESEARCH LIMITATIONS AND SCOPE FOR FUTURE RESEARCH ... 46

8 REFERENCES ... 48

9 APPENDIX ... 54

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Description of figures

FIGURE 1:MAP 1–DYNAMIC CAPABILITIES FOR A COLLABORATIVE TAKE-BACK SCHEME ... 30

FIGURE 2:MAP 2–DYNAMIC CAPABILITIES FOR AN INDEPENDENT TAKE-BACK SCHEME ... 33

FIGURE 3:PRELIMINARY MAP 1–DCS FOR A COLLABORATIVE TBS ... 61

FIGURE 4:PRELIMINARY MAP 2–DCS FOR AN INDEPENDENT TBS ... 61

Description of tables

TABLE 1:COMPANY INFORMATION ... 21

TABLE 2:SECONDARY DATA SOURCES ... 24

TABLE 3:PRELIMINARY DCS INFORMATION SOURCES AND VALIDATION COMMENTARIES ... 28

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1 Introduction

1.1 Background

Within the consumer goods industries, the Fashion and Textile sector is currently ranking as one of the most influential; by accounting for more than 37% of economic activity in Europe (Euratex 2020). The industry currently employs 1.7 million people in the EU, with the latest turnover averaging around 178 billion €. The fashion industry is one of the biggest producers in the consumer market, but it is also one of the industries for which households consume the most; as a matter of fact, families in Europe have spent a total of 520 billion € only last year (Euratex 2020).

As of today, the Fashion and Textile industry adopts the linear production system which has been in place since the industrial revolution (Patwa & Seetharaman 2019). The linear model, also referred to as the “take-make-waste” system, depends solely on the single use of raw materials (Patwa & Seetharaman 2019); some of which may not be renewable. This economy assumes that companies extract raw materials, employ energy to make them into finished products, retail them to end consumers; and finally throw them in the landfill or incinerator (Urbinati, Chiaroni & Chiesa 2017), when they have gone out of fashion, have been surpassed in technology or style, or consumers have simply grown accustomed to them and desire something new (Khan, Mittal, West & Wuest 2018).

The “take-make-waste” economy leaves space for an open-ended production; with no intention for salvaging and recovering resources (Urbinati, Chiaroni & Chiesa 2017). While the linear economy is present in many consumer goods industries; it is of great importance and consequence when applied and carried out by the fashion industry because of its world influence, its economic weight and its impact across people and connecting sectors. In the textile industry, the linear economy is best represented by fast fashion companies and their production systems. These systems are characterized by short lead times and cycles (Muthu 2014), high volatility, low predictability, consumer purchases being dictated by high impulse levels (Pal 2016), increasing availability of clothes for the general public (Hvass & Pedersen 2019), low price points, and a higher buying power of consumers. The products developed under this fast and linear economy have a significantly shorter lifecycle; resulting in garments being disposed of by the consumer while still being wearable (Muthu 2014). These short cycles of production and consumption are mainly due to the ever-changing trends (Muthu 2014) and increasing consumer demand; paired with cheap prices and constant turnover in stores.

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environmental burden than before (Khan et al. 2018). In general, more than half of the garments produced by fast fashion companies are disposed of by consumers in under a year from their purchase date (EMF 2017). Overall, the current linear production system adopted by the fashion industry cannot be supported by the environment in the future. If not regenerated, the resources will get scarcer; while the pollution and the waste issues will get more pressing and crucial to deal with. Nevertheless, some change is starting to develop, mainly through circular production systems and the closed-loop economy.

One direct way for the industry to shift towards the circular system is through the collection of textile waste. For example, groundbreaking efforts have been made in Germany where 75% of discarded clothing is collected instead of being disposed of in landfills (EMF 2017). Globally, 25% of textile waste is collected; however, many countries are not equipped with a collection system (EMF 2017). While the collection of textile waste can be an efficient method for countries and companies to approach the shift towards a circular economy (Hvass & Pedersen 2019); this can only be a stepping stone to reach a more sustainable production (Stål & Corvellec 2018). What constitutes an appropriate shift to a circular economy is the adoption of a holistic view of the company itself and the system around it (Hvass 2014). This shift requires a new, more comprehensive outlook than just one method; for example, considering the whole supply chain, its actors and its routes (Hvass 2014) to acknowledge the complete life cycle of products, while later using this outlook to prolong the life cycle, the longevity and the utilization of the garments (Pal, Shen & Sandberg 2019).

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the circular economy, waste is considered a valuable resource; therefore making any business model, such as take-back schemes, that recovers waste an important strategy to achieve a circular supply chain (Sandvik & Stubbs 2019). However, as Stål and Corvellec (2018) state, their successful adoption is not as widespread as hoped. Moreover, Hvass and Pedersen (2019) indicate that in general, the adoption of take-back schemes is slow and lagging especially in the fashion industry. Overall, many roadblocks have been identified which hinder the implementation of take-back schemes such as shortcomings concerning the garments themselves, the organizational structure and the broader external network (Hvass & Pedersen 2019). In many cases, practitioners encounter these adversities during the full implementation of take-back schemes; while drawing attention to a lack of comprehensive aids from the literature that could instead ease the adoption process (Stål & Corvellec 2018).

1.2 Problem and gap

Currently, the main problem faced by companies is how to practically implement take-back schemes of recycling, reusing, repairing and remanufacturing; and in general, on how to extend the life cycles of the garments (Sandvik & Stubbs 2019). This is mainly due to the definition of what a take-back scheme is. Take-back schemes can span across the whole value chain or consider only a small part. Several issues that have been identified by practitioners when starting to implement a take-back scheme have also been widely identified by the literature. One of the main challenges analyzed by various authors is the uncertainty when it comes to collecting garments. Hvass (2014) highlights how, when implementing a take-back scheme, the quantity, quality and timing of collected stock depend entirely on the customer; who decides which clothes to give and when (Hvass 2014). Quality, quantity, and timeliness of collected products have been recognized as one of the first challenges that companies face (Bukhari, Carrasco-Gallego & Ponce-Cueto 2018; Lewis 2015; Pal 2017b; Pal, Shen & Sandberg 2019; Paras, Ekwall & Pal 2019; Stål & Jansson 2017). Several other issues identified by research regards the lacking of a collecting or recycling infrastructure (Becker-Leifhold & Iran 2018; Hvass & Pedersen 2019; Pal, Shen & Sandberg 2019; Paras, Curteza & Varshneya 2019; Stål & Corvellec 2018) the low consumer awareness (Bukhari, Carrasco-Gallego & Ponce-Cueto 2018; Pal, Shen & Sandberg 2019; Stål & Corvellec 2018), and the controversy of vouchers (Hvass 2014; Hvass & Pedersen 2019; Stål & Corvellec 2018). Additional papers in the literature focus on either the opportunities in implementing a take-back scheme, such as: capturing the value of returned garments, increasing the competitive advantage and innovating the current business model (Hvass 2014); or on describing and analyzing the meaning of “take-back scheme” and its current systems in place (Bukhari, Carrasco-Gallego & Ponce-Cueto 2018; Stål & Jansson 2017; Urbinati, Chiaroni & Chiesa 2017; Watson, Gylling, Andersson & Heikkilä 2017).

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1.3 Purpose and research question

In order to implement a successful business model innovation, such as a take-back scheme in the fashion industry, companies require particular capabilities that will allow them to integrate new processes, learn new routines and transform existing processes and operations (Teece, Pisano & Shuen 1997). As mentioned, only companies who can establish these dynamic capabilities will later be able to exploit them during the implementation of the new business model and finally gain a competitive advantage from it (Ashby 2018). Therefore, the purpose of this study is to investigate the capabilities needed for the implementation of a take-back scheme; to provide practitioners and academia within the field of fashion with a comprehensive best practice guide for implementation and integration. As a first step, this will be carried out through the examination of the challenges, barriers, enablers, and opportunities identified by the literature. Later, these elements will act as a basis for identifying the necessary capabilities in order to overcome or exploit them and for developing a best-practices approach to the implementation of take-back schemes. Take-back schemes have been recognized as an important and efficient tool to implement circularity practices. Some evidence of successful take-back systems can be found in the fashion industry, yet not many companies have embraced this solution. Further, the available literature has not yet shifted its focus to the implementation and the capabilities needed of the entire system; rather has the available literature mainly researched specific activities and the consequences of such existing systems.

It is therefore important to further develop the knowledge on take-back schemes and mainly shed light on what capabilities are required when implementing this system; to overcome the identified challenges and barriers and take advantage of the enablers and opportunities. To achieve this, the following tentative research question(s) were established:

1. What dynamic capabilities are needed for fashion retailers to implement a successful take-back scheme?

A. How do the different dynamic capabilities influence/affect each other and how are they related to the difficulties and possibilities of the TBS implementation dilemma?

1.4 Delimitations

As mentioned, this study focuses on developing a best-practice approach derived from the dynamic capabilities needed for the implementation of clothing take-back schemes; however, to carry out research of quality some delimitations are needed.

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has been delimited to Swedish based companies, where examples of clothing take-back schemes can already be found.

Further, the definition of take-back schemes, the activities involved, and the processes analyzed are the second point of delimitations for this study. Since the literature does not provide a unanimous description of take-back schemes, it was judged necessary to present a clarification of the term and its breadth relevant for this study. Therefore, take-back schemes are hereafter referred to as a voluntary system involving the collection of used garments (Sandberg, Pal & Hemilä 2018), the dynamic recovery of their value over time (Ashby 2018) through several reverse logistics stages, i.e. sorting and reprocessing, carried out by the retailer and assorted specialized partners (Pal, Sandberg & Paras 2019) and finally the redistribution of said repurposed garments.

The study at hand is delimited according to which actor is implementing said take-back scheme. Even though, especially with regards to Sweden, the take-back value chain traditionally revolves around charitable organizations and non-profit institutions; in the last few years, single brands and retailers have gained a more central role in the implementation of take-back schemes (Hvass & Pedersen 2019). Therefore, considering the now more distinguished role of retailers and the already extensive research regarding the more traditional actors; this study investigates take-back schemes from a retailers’ perspective. In other words, the study and in particular its data is based on the opinions and experiences collected from Swedish retailers, thus excluding those of other actors even when these are currently collaborating with said retailers. This retailers’ perspective has also been recognized as decisive by past studies because these actors can balance the sustainable as well as the economic aspects of implementing a take-back scheme (Hedegård, Gustafsson & Paras 2019). Furthermore, retailers have been identified as key components when establishing sustainable fashion supply chains and retail along with having the necessary experience and knowledge to integrate the take-back scheme (Hedegård, Gustafsson & Paras 2019).

Lastly, this study is delimited through the exclusion of Key Performance Indicators (KPIs), meaning this research does not focus on such indicators since the finding and development of a strategy based on dynamic capabilities is placed at the strategic level of implementing an innovation; while KPIs are part of the tactical activities and therefore not relevant at the current stage.

2 Literature Review

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resources (Webster 2015). In practice, this would entail garments, fabrics, and fibers to be kept at the highest value during use, and re-enter the production flows after use; therefore, never-ending up in landfill or incinerator (EMF 2017).

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Overall, several changes within the circular economy have started to be implemented by practitioners; mainly in the utilization area and its connecting activities. On the other hand, these initial improvements can only lay the groundwork for a future transition; which requires the involvement of all actors and all stages in the value chain, working towards a common goal.

2.2 Take-Back Schemes

2.2.1 Take-back scheme – definition

As mentioned before, clothing utilization is one of the main areas where the circular economy in fashion has started to be developed. One method to achieve this is to introduce the extended producer responsibility strategy. Extended producer responsibility (EPR) arose in the 90s and aims at making producers accountable for reusing, recycling and eventually disposing of their manufactured products (Singh & Ordoñez 2016). Through EPR the responsibility for post-consumer waste is shifted upstream, back to the producers and manufacturers (Hvass 2014); while at the same time driving changes within design and material selection to make the future collection and disposal more straightforward (Hvass 2014). Within the textile industry, EPR constitutes a fairly new phenomenon; especially at the policy level, where few legislations have been issued regarding producer responsibility for garments (Hvass 2014).

One of the methods available to apply the EPR strategy is implementing a take-back scheme (Hvass 2014). While take-back schemes have been recognized as an efficient tool for dealing with post-consumer waste (Stål & Corvellec 2018); the literature does not provide a clear definition of what a take-back scheme is. Several authors propose contrasting definitions, however, one that can be embraced by the majority of the literature has not yet emerged. For this reason, a collection of the main defining concepts was judged to be more appropriate. Therefore, take-back schemes can be defined as a voluntary system involving the collection of used garments (Sandberg, Pal & Hemilä 2018), the dynamic recovery of their value over time (Ashby 2018) through several reverse logistics stages, i.e. sorting and reprocessing, carried out by the retailer and assorted specialized partners (Pal, Sandberg & Paras 2019) and finally the redistribution of said repurposed garments. In general, take-back schemes aim at achieving a higher resource efficiency, lower consumption of raw materials and a higher end of life collection (Pal 2016). In particular, a take-back scheme involves collecting, sorting and grading garments to re-introduce them at different points within the value chain; and after the necessary re-work, redistribute them on the market, or re-direct them to other industries when the output quality is lower (Corvellec & Stål 2019).

2.2.2 Take-back scheme – activities/steps or processes

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understanding of them (Pal 2016). The generic tasks proposed by the literature span across the whole reverse value chain, highlighting the main efforts that should be undertaken during the implementation. First, acquisition or collection entails the initial collection of garments from consumers; then grading, also known as disposition or inspection, refers to the sorting of the products into different categories based on their quality, and to the allocation to the different take-back activities (Fleischmann, Van Nunen, Gräve & Gapp 2005). The next step is reprocessing, which includes all various transformation processes; such as washing, repairing, remanufacturing and recycling (Fleischmann et al. 2005). Finally, redistribution aims at delivering the reprocessed garments to the market (Fleischmann et al. 2005).

Acquisition

In the first stage of acquisition, two aspects have been highlighted as decisive for the future successful implementation of a take-back scheme. The choice of collection system has been identified as essential and should be based on a few main metrics such as initial investment made, return volume, operating costs and levels of customer satisfaction (Pal 2017b). In closed-loop supply chains, collection irregularities regarding the timing of returns have considerable influence on the choice of method for collection (Ashby 2018). Irregularities are present not only in the timing of returns but also in the availability of methods that could be implemented (Hvass 2014). As Hvass (2014) highlights, one point of collection; such as in-store, could hinder the total volume of garments collected. This emphasizes the inconsistency in the choice of collection method, as well as the possible need for multiple points and multiple partners to run the acquisition of garments (Hvass 2014).

This leads to the second aspect stressed in the literature, namely the collaboration with third parties during the collection process. In many cases, the literature points out how the current infrastructure and capabilities of fashion companies alone are not enough to support a successful reverse supply chain; thus making the choice of whether or not collaboration is needed crucial (Pal, Shen & Sandberg 2019). Hvass and Pedersen (2019) indicate that additional capabilities, competences and specialized skills are needed for collection; and suggest establishing key partnerships with either charity organizations or professional garment collectors to organize the collection and sorting processes (Hvass & Pedersen 2019).

Grading

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criteria has also been found to be essential to further improve the efficiency of the process, and is indeed the first opportunity in the value chain to determine the conditions of the garment and its possible re-distribution routes (Kumar et al. 2016).

Reprocessing

After acquisition and grading, garments undergo several reprocess stages. In this case, the main aspect regards which reprocessing activity should be chosen; based on the grading score and the future use of the garment. In particular, the choice of the most appropriate route has been identified as a crucial aspect to ensure the garments can retain the most value (Pal, Shen & Sandberg 2019). In reverse fashion supply chains, four disposition alternatives are available for companies: reuse, repair, remanufacture and recycle.

Reuse aims at increasing the usage of garments and extending their life cycle by repeating their consumption without altering them (Choi, Lo, Wong, Yee & Ho 2012). An essential prerequisite for reuse is a good quality and good conditions of garments; thus, implicating that the only processing required before being resold is washing (Stål & Corvellec 2018).

Repair is the activity performed in order to restore damaged, faulty or worn garments to their proper conditions (Khan et al. 2018). The repair service can result in its closed-loop downstream supply chain (Ashby 2018) by replacing or fixing parts (Khan et al. 2018); thus, guaranteeing a longer life cycle for garments (Ashby 2018).

Remanufacture aims at disassembling used products until the fabric stage and reworking the reclaimed fabrics in the manufacturing process to create a new product (Dissanayake & Sinha 2015). Remanufactured garments commonly have a quality judged to be equal or higher than brand new clothing (Dissanayake & Sinha 2015).

Recycle is the activity performed by recovering textile waste and processing it back into yarn for new products (Sandvik & Stubbs 2019). Recycling is carried out by disassembling, dissolving or shredding the reclaimed fabrics, based on the material contained in them (Sandvik & Stubbs 2019). The resulting reclaimed fibers are later regenerated into new yarn and finally into new materials and products (Sandvik & Stubbs 2019). In some cases, fabrics undergoing the recycling process result in being downcycled; meaning that instead of being re-processed into new garments, they are made into products for industries other than the fashion field (Franco 2017). In general, recycling is regarded as a last resort option, due to the process having less environmental benefits than any of the other strategies (Sandvik & Stubbs 2019).

Overall, the authors concentrate on the choice of disposition, rather than explaining each disposition itself. As the literature highlights, this is due to the lack of coherent definitions of the dispositions and current absence of commercial scope (Pal 2017b).

Redistribution

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been found to be challenging for companies, who then face another choice: whether to collaborate with an external partner or not (Hvass 2014). As a matter of fact, brands either collaborate with charities to sell their reused garments as secondhand; or directly set up their brand secondhand shop (Stål & Corvellec 2018). Due to the several options available and the limited decision-making skills, few goals have been set on what should be done with collected garments and the volumes that should be resold (Stål & Corvellec 2018).

As mentioned, the literature has started to focus on the activities within the generic tasks for take-back schemes. However, the majority of the seminal works concentrate instead on the challenges, barriers, enablers, and opportunities connected to the implementation of take-back schemes rather than what capabilities are needed to implement such a system. This following section will, therefore, present the main difficulties and possibilities analyzed in the literature.

2.2.3 Take-back challenges, barriers, enablers and opportunities

Challenges

One of the first and main challenges identified by the literature regards the collection process, in particular the quality, quantity, and timing of collected garments (Hvass 2014). Stock availability has posed a significant challenge for a continuous and coherent collection; due to the responsibility of stock lying with the end-consumers themselves (Hvass 2014). Uncertainties of quality and quantity of collected garments have also been linked to the lack of an adequate collection system (Pal 2017b). The post-consumer waste stream is made challenging by the collection itself, as well as the number of times the garment was used in its lifetime, its initial quality (Franco 2017), the low consumer awareness and their knowledge of garment quality and impacts (Hvass 2014; Pal, Shen & Sandberg 2019).

If enough garments of good quality are collected, the next main challenge identified by the literature involves capturing value from the used clothes (Stål & Corvellec 2018). Retaining value and achieving an advantageous value proposition through take-back schemes have been highlighted as considerable issues for companies; especially when in competition with the still prevalent linear fashion business (Stål & Corvellec 2018).

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how in several cases, companies are indecisive on which activities to implement; resulting in garments being incinerated instead (Paras, Curteza & Varshneya 2019).

Given the several challenges found in collection, integration and other connecting negative effects; some companies decide to outsource the collection and further processes to a third party (Stål & Corvellec 2018). However, outsourcing brings challenges of its own. As highlighted by the literature, contracting out the activities to external actors prevents the companies from capturing the possible value (Stål & Corvellec 2018). Outsourcing further leads to loss of control over the performance of the outsourced activities; contributing to the lower predictability and reliability of the take-back scheme (Stål & Corvellec 2018). Further, when entering partnerships with third parties, the literature highlights the possible lack of transparency as a challenge to the implementation of the take-back scheme (Stål & Jansson 2017). Evidence has shown that third parties do not disclose the activities involved after collection; therefore leaving unclear what happens to the garments (Pal 2016).

Regarding the garments themselves, the literature emphasizes how the material components of the garments might pose a challenge for future disposition (Sandvik & Stubbs 2019). The separation of blends, additives, and trims complicates the sorting process since each should be treated separately (Sandvik & Stubbs 2019). Further, especially in the case of recycling, the successful restoration of garments has proved to be problematic; mainly due to the low quality of the garments at their end-of-life stage (Sandvik & Stubbs 2019). Finally, the literature has shown how clothing undergoing reprocessing through a take-back scheme result in being retailed at a higher price than those made with virgin raw material; making the whole system not economically viable (Pedersen, Earley & Andersen 2019).

In conclusion, the literature has also emphasized the role of vouchers as an incentive to increase clothing collection. These have been found to incentivize donations, as well as new consumption; thus increasing the turn-over and material usage (Stål & Jansson 2017).

Barriers

In the case of possible barriers to the implementation of take-back schemes, the literature has identified several; most in connection to the previous challenges.

Continuing with the recycling, a major barrier identified is the current technology (Sandvik & Stubbs 2019). As of now, the technology for recycling is inhibited by the difficult separation of fiber blends; resulting in the process being not economically beneficial (Sandvik & Stubbs 2019).

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the current lack of legislation and policies for take-back schemes. At present, there are no best practices and legislations available to guide companies in their implementation of take-back schemes, leaving them to their own devices when developing a fitting system (Hvass 2014). Enablers

Moving on to the enablers, the predominant one highlighted by the literature concerns the policies; and is a direct evolution of the previously discussed barrier. Developing an EPR policy, based on the already existing one in France, would aid companies to address the textile waste problem (Hvass & Pedersen 2019) and ease the adoption of take-back schemes. Policies themselves would be able to lessen some of the previously mentioned challenges, such as improving the collection rates, facilitate collaborations and support R&D (Bukhari, Carrasco-Gallego & Ponce-Cueto 2018).

Regarding R&D, the literature has evidenced further enablers that would help improve the implementation of take-back schemes. Digitalization has been found to help companies in tracking the materials and chemicals used in garments, thus making the subsequent recycling easier and more transparent (Sandvik & Stubbs 2019). Adopting digitalization systems for take-back schemes, such as RFID or digital receipts, would help to address the aforementioned challenges regarding the lack of knowledge; by making the information flow more transparent and more accessible (Sandvik & Stubbs 2019). A final enabler connected to R&D concerns future technology; in particular when applied to recycling. As the literature highlights, a technological improvement would enhance the recycling process (Sandvik & Stubbs 2019); including the prior sorting process, which could be automated and would then help create a more stable demand for recycled fibers (Sandvik & Stubbs 2019).

An additional enabler emphasized by the literature regards collaboration with third parties; thus identifying how key partners with a dedicated reverse logistics infrastructure are needed to set up a successful take-back scheme, especially when dealing with the collection process (Pal, Shen & Sandberg 2019). Collaboration has further been highlighted as an enabler for an industry-wide implementation of take-back schemes; by creating an organized reverse logistics, enabling easy access to materials (Pal, Shen & Sandberg 2019), minimizing transaction costs (Hvass & Pedersen 2019) and finally creating a sufficient level of demand for recycled products (Pal, Shen & Sandberg 2019). Collaboration across industries has also been advocated as an enabler by the literature, by asserting its central role in solving sustainability issues (Hvass 2014). By encouraging cross-industry collaboration, different actors would be able to bolster their regional presence, customer access, market share, infrastructure competencies and know-how (Pal 2017a). The literature stresses considerably the role of collaboration across organizations, departments, and professions as an enabler for a successful implementation of take-back schemes (Pedersen, Earley & Andersen 2019).

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commitment, through the use of cross-functional teams, is a requirement for effective planning, implementation, and communication of value proposition (Hvass & Pedersen 2019).

Opportunities

While evidence of successful implementation of take-back schemes is scarce, the literature has highlighted several possible opportunities that would originate from it. As indicated by Hvass and Pedersen (2019), waste streams can become an opportunity for value innovation, by giving the companies the possibility of capturing missed value through take-back activities and its connecting relationships (Hvass & Pedersen 2019). Regenerated garments are able to open new alternative markets, enabling brands to create a value renewal utility; meaning that the utility of the garments is extended through a secondary market, even when value consumption in the primary market might decrease (Kumar et al. 2016). In addition to increased economic value, the literature has emphasized several other business opportunities for take-back schemes, such as cost minimization, new consumer segments, increased revenues, higher profitability and naturally, improving the environmental performance of the company (Hvass 2014).

Finally, from the customer perspective, take-back scheme initiatives can enhance customer satisfaction, and customer loyalty; while at the same time increasing the brand image (Pal 2017b). Overall, product reprocessing can improve the relationship with customers and other stakeholders through an image-building operation and improved corporate goodwill (Pal 2017b).

3 Theoretical framework

To investigate the dynamic capabilities needed for the implementation of take-back schemes, the theoretical framework will highlight first, the concept of dynamic capabilities and later how these are used in the implementation of sustainable business models. This has been judged to be an appropriate theoretical lens to organize the research and the results because the literature suggests that dynamic capabilities are necessary to achieve a successful implementation of a business model.

3.1 Dynamic Capabilities

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discover and integrate new opportunities or processes, to transform their organizational culture through learning processes, and to reconstruct their current operations (Teece 2018). In other words, the strength and relevance of a company’s dynamic capabilities determine the speed and degree of implementing the innovation and the connected business model (Teece 2018). The dynamic capabilities theory has similarities with the critical success factors (CSF) theory, defined as a number of variables which impact profitability and if able to reach satisfactory levels will ensure a competitive performance for the company (Leidecker & Bruno 1984). While the concept has similar aspects as dynamic capabilities, this theory is traditionally employed to assess threats and opportunities as well as determining organizational success or failure (Leidecker & Bruno 1984); therefore it is more suitable as a theoretical lens for projects whose implementation has reached a tactical and operational stage or for which trials are being carried out. On the contrary, dynamic capabilities lay the foundations for the future successful implementation and are, thus, more relevant as a theoretical lens for take-back schemes whose implementation has yet to be studied.

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Higher order capabilities enable the reconfiguration of the currently available resources, the modification of activities, and the disruption of strategies (Ferreira et al. 2013). Therefore, when companies are active in hypercompetitive sectors and dynamic environments, the literature suggests a need for the development of higher order organizational capabilities to effectively manage the environments (Ferreira et al. 2013). This role of dynamic capabilities is further supported by the hierarchy of capabilities developed by Winter (2003). The author divided the capabilities of a company into zero-level, first-level, and higher-level. Zero-level refers to the capabilities needed for the day-to-day operations, first-level refers to the capabilities able to change and reconfigure the zero-level ones, and finally, the higher level refers to the capabilities that change the way a company changes its capabilities (Winter 2003). In this hierarchy, the dynamic capabilities are located in the first-level, since they are able to create and reconfigure the ordinary capabilities (Winter 2003).

3.1.1 Dynamic capabilities – integration, learning and reconfiguration

In order to create a competitive advantage for an organization, three categories for dynamic capabilities have been identified by the literature: coordination and integration, learning and reconfiguration, and transformation; these can also be referred to as routines and patterns of practice (Teece, Pisano & Shuen 1997).

First, coordination and integration refer to the efficient integration and coordination of both external and internal assets, activities, and technology (Teece, Pisano & Shuen 1997). In this case, the capability lies in the distinct ways of coordinating and integrating adopted by the company (Teece, Pisano & Shuen 1997). Secondly, learning is defined as the repetition and experimentation which enables activities to be carried out faster and better and to identify new business opportunities (Teece, Pisano & Shuen 1997). Learning also includes knowledge creation routines and further encompasses alliance and acquisition processes with external sources to create new resources (Eisenhardt & Martin 2000). Within the literature, there is a general agreement that learning is a key element to dynamic capabilities (Mohamud & Sarpong 2016). Learning itself needs to be updated and exercised, therefore in several cases, the literature found learning to be the origin of the dynamic capabilities themselves (Mohamud & Sarpong 2016). One point of struggle within learning is represented by the tacit knowledge, which according to Teece can be problematic for dynamic capabilities since it is not written or captured and therefore cannot be coded in a learning routine (Mohamud & Sarpong 2016). Lastly, reconfiguration and transformation refer to the ability of a company to sense the need to reconfigure its assets and structure, and to achieve the necessary internal and external transformation; based on how the environment is changing or will change in the future (Teece, Pisano & Shuen 1997). This capacity has been recognized as a learned skill in itself (Teece, Pisano & Shuen 1997), thus reinforcing the view of learning as the origin of dynamic capabilities. Transforming can further include processes for replication and brokering to copy, transfer, and reconfigure resources (Eisenhardt & Martin 2000).

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discussed in the literature review. Through this categorization, it will be possible to identify the relevant dynamic capabilities needed to overcome the difficulties and exploit the possibilities during the implementation. Moreover, the dynamic capabilities will also be arranged according to these categories in order to relate them to the literature, structure them and better understand their contribution to the competitive advantage. The display of this categorization can be found in Table 4 at the end of the result chapter.

Overall, dynamic capabilities are characterized by the literature as unique and idiosyncratic processes that stem from path dependencies of a company and can in some cases exhibit common elements with other processes across the company (Eisenhardt & Martin 2000). Therefore, the potential for a sustainable competitive advantage has been highlighted to be in the usage of dynamic capabilities sooner, more logically, and more favorably than competitors; to create configurations with an advantage (Eisenhardt & Martin 2000). Currently, the literature regarding take-back schemes is focusing on the difficulties and possibilities, the activities, and the aspects of implementing take-back schemes. However, according to the hierarchy of the capabilities, these efforts can be classified only as ordinary capabilities or zero-level capabilities (Winter 2003). As a matter of fact, Winter (2003) classifies the day-to-day activities and the connecting challenges as either ordinary capabilities or zero-level capabilities; meaning that these do not have the potential to implement a change such as a new business model innovation (Winter 2003). Nonetheless, to be able to implement a business model innovation such as a take-back scheme; it is necessary to move towards the dynamic capabilities, find them in the organization and apply them effectively (Gebauer, Haldimann & Saul 2017; Mustafa 2014).

3.1.2 Dynamic Capabilities and Business Model implementation

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Implementation of sustainable and circular business models

In order to develop and implement a business model aimed at either sustainable or circular goals, companies must be able to exploit their way of working and establish new services and technologies (Holtström, Bjellerup & Eriksson 2019). Indeed, the literature states that a business model can be an instrument for a sustainable change only when it applies a dynamic approach over time and in relation to its environment (Holtström, Bjellerup & Eriksson 2019). Without the appropriate dynamic capabilities to achieve a sustainable transformation, the current and aspired business models come into conflict, therefore preventing a successful implementation (Geissdoerfer, Vladimirova & Evans 2018). As of now, a considerable amount of seminal works have focused on the reasons for implementing sustainable business models and more importantly on the capabilities needed for their implementation (Gebauer, Haldimann & Saul 2017). Still, several authors nonetheless claim that a deeper understanding of the capabilities needed to develop and implement sustainable and circular business models is required and recommended as future research (Sousa-Zomer et al. 2018). In particular, regarding the implementation of circular business models, such as product-life extension, product as services and material recovery, further investigations are needed into the necessary capabilities for their technical, and strategic implementation (De Los Rios & Charnley 2017). According to the literature, in order to implement sustainable innovations within established business models, several dynamic capabilities are needed throughout the company and its value chain to search, plan and to commercialize the sustainable implementation (Weissbrod & Bocken 2017). Indeed, dynamic capabilities for circular business model implementation require both tangible and intangible resources from the company itself but also its organizational culture, knowledge, and procedures (Sousa-Zomer et al. 2018). As a matter of fact, dynamic capabilities for circular economy can be found and developed in product design, forward/reverse supply chain, and relationships with external partners and consumers (Sousa-Zomer et al. 2018). When established, these dynamic capabilities are able to slow, narrow, and close the loops within all of these functions (Sousa-Zomer et al. 2018). Specifically, when discussing the application of dynamic capabilities for sustainable supply chain models and system, such as take-back schemes, authors have found that the dynamic capabilities are instrumental when implementing eco-friendly approaches and can further identify insights and possible opportunities to manage and develop the supply chain in a sustainable manner (Amui, Jabbour, de Sousa Jabbour & Kannan 2017).

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Therefore, while this literature can be useful as a frame of reference for this study, a theory extension effort is needed to include the fashion industry.

Sustainable business models and their implementations have been included in this theoretical framework because the literature itself identified take-back schemes as sustainable business models since they aim at closing, slowing, and narrowing the resource loops (Geissdoerfer, Vladimirova & Evans 2018). In conclusion, as mentioned before, capabilities and in particular dynamic capabilities are regarded as a central source for business model innovation (Mustafa 2014). Dynamic capabilities have been recognized as elements that help govern and shape the business environment (Teece, Pisano & Shuen 1997). Furthermore, BMs are mainly based on the dynamic perspective of conducting business and on the dynamic capabilities of a company (Gebauer, Haldimann & Saul 2017); which enable them to successfully implement a business model and to adapt and change it according to the business environment (Teece, Pisano & Shuen 1997).

4 Methodology

4.1 Scientific reasoning

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forth between the collected data and the pre-existing theory, making comparisons and interpretations, and searching for patterns and explanations (Kennedy 2018).

In particular, this study adheres to the abductive reasoning and theory extending approach because it explores the dynamic capabilities theory within a new context which has not been covered by the current literature available. Authors within the dynamic capabilities theory state that the specific aspects of the context of which a company finds itself have an effect on the dynamic capability strategy developed for the implementation of the chosen circular business model (Sousa-Zomer et al. 2018). Therefore, authors claim that an alignment between the context characteristics and dynamic capabilities is essential for the successful implementation of a circular business model (Sousa-Zomer et al. 2018). Since, as mentioned before, neither the literature in dynamic capabilities theory nor that in take-back schemes has proposed such combination of the two and because of the central role of the context; the current literature on dynamic capabilities for the implementation of circular business models cannot successfully address the context characteristics of a take-back scheme and develop an implementation strategy built on dynamic capabilities. Therefore, a theory extending effort adopting an exploratory approach, is necessary in order to include the new context of take-back scheme pertaining to the fashion industry which cannot be assimilated to any of those investigated until now, due to its particular characteristics and its infancy state among other circular economy practices (Sousa-Zomer et al. 2018). This theory extending effort is further illustrated by the representation of the results, which in this study take the form of a causal map; which is instrumental for the portrayal of the dynamic capabilities within the context of take-back schemes since these have aspects found to be more pragmatic when represented in a connecting manner.

4.2 Research strategy

This research follows the case study method, in particular, the qualitative case study method, which is a research strategy aiming at understanding the progression of events within single settings (Eisenhardt 1989). Case study research examines past or current phenomena, by interrogating multiple sources of evidence such as systematic interviewing, observation (Voss, Tsikriktsis & Frohlich 2002), questionnaires and archives either qualitative or quantitative (Eisenhardt 1989).

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the holistic multiple case study method; meaning that the design comprises a number of separate cases each characterized by a distinct but comparable unique context (Yin 2009). The unit of analysis also referred to as cases, for this study are represented by take-back schemes implemented either through collaboration or independently. The context for these separated cases is fashion retail. These two cases belong to the multiple case study design because they display contrasting characteristics and their results are expected to be distinctive, but at the same time allow a comparative analysis between the two.

Below is relevant information on the companies examined in the multiple case study. Company Type Company Size Type of TBS

COMPANY A Fast fashion brand Large Collaborative COMPANY B Premium fashion brand Medium Independent COMPANY C Premium outdoor brand Medium Independent

Table 1: Company information

While the case study method is widespread within both the social sciences and business research, several authors have also pointed out a number of critiques against case study research, which should be taken into consideration when applying this method (Farquhar 2012) such as a lack of objectivity and rigidity, the low generalizability (Farquhar 2012), and challenging and time-consuming large quantities of data (Yin 2009). On the other hand, case study research has been recognized and praised for being a major source for theoretical innovation (Blatter 2012). Further, case studies lend themselves well to finding the mechanisms and pathways of the causes and effects within the phenomenon studied (Blatter 2012). Finally, case studies have been found to have higher theoretical consistency and conceptual richness due to the greater depth of the analysis (Blatter 2012).

4.3 Data collection:

4.3.1 Sampling

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technique, the elements of variation should first be identified (Daniel 2012); which in the case of this research are represented by degree of development of the take-back scheme, size of the company, collaboration with external partners, and self-sufficient implementation of said scheme. These guidelines for sampling and the companies resulting from their application are representative of the greater amount of fashion companies implementing a take-back scheme because, as indicated by several authors, companies within this industry have commonly chosen to implement take-back schemes by either collaborating with charitable organizations and third parties or by self-governing them without outside support (Stål & Corvellec 2018). Therefore, following these guidelines, the three aforementioned companies were selected which are able to moderately exhaust and represent the population selected. However, it should be noted that when selecting the participants to include in the sample, the sampling error due to the non-response occurring when members of the population refused to cooperate or could not be reached was also considered as a determining factor for the selection (Bryman 2012).

4.3.2 Primary data

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A total number of three interviews were conducted over two weeks. On average the interviews lasted between 30-45 minutes and were all conducted online via different telecommunications applications such as Skype and Microsoft Teams. All interviews were recorded with the consent of the participants; a transcription was later developed and provided to the participants for review. The recording and transcriptions of the interviews were judged to be beneficial to this study because they allow a more thorough examination, repeated analysis of the answers, and a less biased collection and analysis over time (Bryman 2012). However, it should also be recognized that recording and transcribing can be time-consuming, it requires reliable equipment and the entire process may be objectionable by interviewees (Bryman 2012). In order to minimize the objections from the interviewees for this process, a consent form was developed regarding recording, transcribing, and anonymity issues.

Finally, with the objective of verifying the maps developed from the interviews and the document search the interviewees were contacted for a second round of written commentary. Formal questions were not developed by the interviewers for this commentary, however, several points of discussion and subject matters centered around the maps were suggested to the interviewees to help them provide useful observations. These suggested subject matters dealt with whether each interviewee agreed or disagreed with maps presented and with their opinions on the conclusions drawn from the previously conducted interviews.

4.3.3 Secondary data

The second form of data collected for the research was secondary data, defined as pre-existing data that has been produced and collected by someone other than the researcher (McGinn 2012). Secondary data is generally available through government agencies, research databases, public, or private archives, institutional records or particular agreements with the researcher (McGinn 2012). In the instance of case study research, secondary data may regard the cases themselves or can be from external sources (Farquhar 2012). Regarding the research at hand, the secondary data collected consists of either public documents pertaining to the single cases obtained through the company websites or internal documents shared between the authors and company based on an agreed-upon privacy clause. When relying on secondary data, several advantages and disadvantages need to be considered. First of all, when including secondary data, the feasibility and the breadth of the research increases substantially (Sindin 2018). Further, secondary data requires less time and a lower effort, although it is possible to maintain its high quality and the usage of sophisticated analysis techniques (Farquhar 2012). Finally, using secondary data in case study research provides a basis for triangulation and possible new insights from the primary data (Farquhar 2012). On the other hand, when relying on secondary data, it is necessary to assert its appropriateness based on its ability to answer the research questions and its obsolescence (Sindin 2018). Lastly, when dealing with secondary data, there is a lack of control over its quality which should instead be verified beforehand (Sindin 2018).

Title Document Type Source

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Company Report Company Website Annual Report 2018 - Operations, Sustainability and Earnings (Company A) Company Report Company Website Company C CSR Report 2019 Company Report Company Website How to Repair Your Gear (Company C) Website Company Website Company B Sustainability Report 2018 Company Report Company Website Company B Repair Guidelines Internal Document Supplied by

Interviewee Handling the Machine (Company B) Internal Document Supplied by Interviewee Re-Use in Store (Company B) Internal Document Supplied by Interviewee

Table 2: Secondary data sources

4.4 Data analysis

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According to the two layers of analysis and the sequential manner in which the coding frame was applied, the resulting dynamic capabilities were further refined and improved in order for them to be placed at the same level, thus avoiding problems of some capabilities being too specific or too general and being not comparable between each other or between the cases. For example, referring to the dynamic capability of Collaboration illustrated before, this was modified to be Cooperation with Third-party due to the early version being too general and not informing enough on the competitive advantage. The starting point for the refinement were the two maps developed according to the interviews, the document search and the validation. Further, the refinement also included the theme used in the map to organize the dynamic capabilities which were renamed and improved to become key aspects of the implementation of a take-back scheme.

4.4.1 Visualization of data

Once the initial analysis of both primary and secondary data was completed, the resulting themes were linked with each other as well as with the findings from the literature review in order to develop a causal loop diagram (CLD). The CLD represents the reasoning and process of the data analysis in the form of two maps with the links being the drawn representation of the sorting process explained previously. A CLD is a system modeling technique that enables either a quantitative or qualitative exploration and representation of the variables and their relationships in a system (Singh, Sung, Cooper, West & Mont 2019). A CLD aims at evaluating the problems in a system and identifying their possible solutions based on their causal and feedback mechanisms in the diagram (Singh et al. 2019). The study at hand employs a qualitative CLD, therefore excluding any mathematical modeling. This approach has been judged appropriate for the study and its theory extending characteristics because it eases the identification and representation of the connecting elements between the dynamic capabilities and the challenges, barriers, enablers, and opportunities. As mentioned, the results of the study are represented in a qualitative CLD, which has been recognized as the necessary first step when evaluating a problem and developing response strategies for it (Laurenti, Singh, Sinha, Potting & Frostell 2016). Further, the dynamics in the model can be analyzed in a quantitative manner (Laurenti et al. 2016), however, due to the characteristics of this study a qualitative approach was judged to be more fitting. As a matter of fact, studies suggest that a qualitative CLD is appropriate when developing novel solution strategies, the dynamic capabilities in the case of this study; while a quantitative model technique is more pertinent when developing the details of said solutions strategies (Laurenti et al. 2016). Therefore, the quantitative version can instead be considered as possible future research (Laurenti et al. 2016).

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4.5 Research Quality

The research quality for this study is determined based on the criteria developed by Yin adapted specifically for case study research. The author proposes that the quality of a case study research should be judged for the construct, internal and external validity, and reliability (Farquhar 2012).

4.5.1 Construct validity

In the study at hand construct validity, meaning the degree to which the study investigates what it proposed to investigate at the beginning (Farquhar 2012), was established partly by triangulation since data on the topic was collected both through primary data: the semi-structured interviews and secondary data: company-related documents as well as by creating and following a logical flow throughout the study, in other words assuring a chain of evidence and thus investigate indeed what was proposed at the beginning (Farquhar 2012). The logic of this study was tested and updated through periodic group supervisions and discussions with the supervisor as well as the opposition group. Although conducting more interviews would increase the construct validity of the study and in particular the triangulation argument presented, a compromise had to be taken into consideration between the richness of the data and timing as well as availability issues of the participants.

4.5.2 Internal validity

Internal validity deals with the presence of causal relationships between the variables and results and should be considered during both the data collection as well as the analysis stages (Farquhar 2012). Therefore, internal validity is an important quality criterion for this study due to its purpose and the planned results, which are themselves based on the causal relationships between the finding of the literature and the dynamic capabilities. However, pattern matching and the usage of logic models are two practices that can increase internal validity (Yin 2009). Both of these tactics have been employed during this study, in particular throughout the data analysis stage when possible patterns within the emerging results were found common to the three case studies and when the final results were organized in the causal loop diagram.

4.5.3 External validity

Several authors claim that a multiple case study design, such as the study at hand, aids external validity, meaning whether the finding of a study is generalizable beyond the proposed cases (Yin 2009). By contrasting and comparing several cases and the results of their investigation it can be stated that the research can be generalized to other contexts (Farquhar 2012).

4.5.4 Reliability

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Tsikriktsis & Frohlich 2002). The case study database is stored in the students’ Google Drive and non-sensitive information is made available in the appendix section of this report.

4.5.5 Ethics

The research and particularly the interview process were conducted while keeping into consideration professional ethical codes and ethical guidelines such as informed consent, confidentiality, consequences of precipitation, and the researchers’ role in the study (Kvale 2007). First of all, regarding informed consent, the participants should be made aware of the purpose of the study, its design, and the possible risks and benefits of participating (Kvale 2007). Therefore, a consent form was developed prior to the interviews, made available to the participants, and signed by both the authors and the interviewees. The form detailed anonymity issues for the company, direct quoting liberty, and recording approval. Further, regarding confidentiality, private data through which the interviewees might be identified should be protected and not be reported (Kvale 2007). The data collection effort did not include any private or personal data, therefore the GDPR requirements were not deemed relevant, however, some interviewees opted for a confidentiality clause in the consent form regarding some of the stages of the data collection, for example, the sharing of private documents. Therefore, appropriate measures were taken to ensure specific confidentiality. The consent form is available in the appendix section.

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5 Results

As mentioned in the methodology, the preliminary maps, which can be found in the appendix section, represent the results from the interviews, the document search, and the validation round. The possible dynamic capabilities as highlighted by the interviewees and the documents were organized by themes, emergent from the TBS literature as well. Therefore, the maps depict the opinions of the interviewees and the impressions from the documents as they were collected and preliminarily analyzed. The maps aim to lay the groundwork for the later refinement of the dynamic capabilities; as a matter of fact, such refinement could not be achieved unless these initial activities were reworked, generalized, and limited to include only those fundamental for achieving a competitive advantage. Accordingly, a second round of analysis was carried out resulting in Table 4 at the end of the chapter and Figure 1 and 2. Moreover, the first round of analysis is displayed in Table 3 below by highlighting the different sources of the preliminary dynamic capabilities. The sources are divided between interviews and documents for each company selected, and validation commentaries from two participants.

Preliminary Dynamic Capabilities

Interview Company A Company Documents Company A Interview Company B Company Documents Company B Interview Company C Company Documents Company C Validation of DCs

Communication with Customers X X X X X X XX

Relationship with Government and NGOs

X X X X X XX

Collaboration X X X X

Transforming of Business Model X X X X X XX

Choice of Partner X

Maintaining and Improving Collaboration

X

Communication with Partner X X

Learning/Knowledge X X X XX

Transforming of Past Strategies X X X XX

Ability to Educate and Cope in a Changing Environment

X X X X XX

Transformation of Brand Positioning X X XX

Repairing Expertise and Knowledge of Material

X X X X XX

Ability to Design Inimitably X X XX

Ability to Mechanically Recycle X X X XX

Learning by Doing X X X XX

Ability to Creatively Think Outside the Box

X XX

Ability to Expertly and Creatively Rework Garments

X XX

Sorting and Grading Knowledge X X XX

BACK SCHEME IN THE SWEDISH FASHION INDUSTRY I MPLEMENTING A TAKE -

I

MPLEMENTING A TAKE