Keywords

1 Introduction

In response to the sustainability crisis and driven by student demand, many higher education institutions have implemented sustainability elements into their teaching and training activities to educate participants as responsible future professionals and change agents for sustainable development (Karahan et al., 2022; Lozano et al., 2013). Specifically, entrepreneurship education has seen a recent surge in social or sustainable entrepreneurship offerings. Sustainable entrepreneurship education (SEE) provides participants with skills, knowledge, and attitudes to assess and exploit business opportunities concerning environmental and social needs (Sharma et al., 2020). Among the most popular SEE teaching approaches is experiential learning, in which participants are guided through the entrepreneurial journey, essentially placing them in the position of would-be entrepreneurs (Mindt & Rieckmann, 2017). Given the complexity of the tasks that (would-be) sustainable entrepreneurs need to perform, educators require adequate tools and methods to support the learning experience and to ensure knowledge uptake.

However, most of the current tools for sustainable entrepreneurship (for an overview, see (Hope, 2018)) are either ill-suited to the educational context or detrimental to its overall purpose. On the one hand, they tend to be inherently complex, and their application thus requires extensive guidance (Geissdoerfer, 2019), which is constrained by the limited time and personnel resources of SEE. On the other hand, even if current tools are accustomed to the SEE context, they often neglect a direct contribution to sustainable entrepreneurship competencies (Lans et al., 2014; Ploum et al., 2018). For instance, (Bocken et al., 2013; Geissdoerfer et al., 2016) suggested a comprehensive value mapping tool. By assessing the positive and negative impacts of venturing activities on diverse stakeholders, it enables users to generate novel ideas for mitigating or leveraging these effects and advancing the underlying business model. However, while the value mapping tool provides a systematic and convenient approach for sustainable business model (SBM) innovation, it neglects to foster sustainable thinking throughout the entire application. Notably, during the idea generation, the tool’s current design nudges users to add new elements to the underlying business model instead of reflecting the value creation logic. Business sustainability, hence, becomes a mere “saddlebag or bolt-on” (Sharma & Hardt, 2014; Wyness & Jones, 2019). This additive bias is persistent among various SEE tools and sustainable entrepreneurship in general (Sharma et al., 2020). In this regard, (Dean & McMullen, 2007) criticizes “sustainability-orientation in the development of a new business model is not a matter of simply adding new sustainability components and questions to merely profit-oriented business model frameworks.” To effectively facilitate sustainable entrepreneurship, SEE must overcome the dominant additive approach.

We address this gap by developing a new method that (1) enables entrepreneurs to assess the impacts of business models and (2) comprehensively supports the discovery of more integrated, sustainable business ideas, while (3) being suitable to the SEE context. Hence, we ask the following research question: How can we assist entrepreneurs in considering sustainability as an integrated concept in business model innovation? The resulting method, called the Impact Circle, was developed based on a 2-year iterative design process including multiple scientific methods, such as interviews, surveys, observations, and expert feedback. We continuously applied the Impact Circle in 8 workshops with 164 participants from various backgrounds.

2 Theoretical Foundations

2.1 SBM as a Theoretical Lens for Sustainable Entrepreneurial Impacts

SBM theory offers a valuable theoretical perspective for understanding entrepreneurial contributions to sustainable development. It dissects business impacts as multidirectional value creation logic for diverse stakeholders (Freudenreich et al., 2019). On the one hand, SBM theory describes what stakeholders are relevant in the sustainable entrepreneurship. These include financial stakeholders, customers, business partners, employees, and societal stakeholders (Freudenreich et al., 2019). In addition, (Bocken et al., 2014) emphasizes the role of the natural environment by suggesting them as a separate stakeholder category. On the other hand, SBM theory analyzes how those stakeholders relate to entrepreneurial activities. According to (Freudenreich et al., 2019), stakeholders and start-ups engage in reciprocal relationships, such as production and consumption of goods and services, supply and co-creation, and contribution to sustainable issues and appreciation of related activities. In conclusion, the SBM theoretical lens suggests that educators enable the discovery and design of sustainable business ideas by facilitating a broad stakeholder identification and an assessment of the relationship between entrepreneurial activities and stakeholder consequences.

2.2 Conflicting Stakeholder Interests as Sustainable Entrepreneurial Opportunities

Stakeholder theory amplifies the suggestions of SBM theory. Accordingly, it views business processes as “how customers, suppliers, employees, financiers […], communities and managers interact and create value” (Edward Freeman, 2010). In capitalism, it is the entrepreneur’s duty to manage and shape the relationships between stakeholders so that all win in the long run (Edward Freeman, 2010). This often proves challenging in reality. In sustainable entrepreneurship, founders frequently need to balance conflicting demands between stakeholders, e.g., building a new production facility versus protecting the local forest or improving data algorithms versus ensuring data protection (Freudenreich et al., 2019). It is the nature of entrepreneurship to respond to this dissonance with creative problem-solving rather than a trade-off mindset. To put it differently, if entrepreneurs “look for trade-offs among stakeholders, then they will create trade-offs, and they may never find the ‘sweet spot’ that signifies the joint interest of all key stakeholders” (Edward Freeman, 2010). Therefore, conflicting stakeholder interests may yet entail another entrepreneurial opportunity. Thus, educators may enrich stakeholder identification and relational assessment by leveraging the entrepreneur’s creative problem-solving ability to develop novel solutions that address conflicting stakeholder demands.

2.3 Generating Sustainable Entrepreneurial Ideas through Bisociation

Creativity, defined as the production of novel and useful ideas, is a profound characteristic of entrepreneurs (Hennessey & Amabile, 2010). According to (Weinberger et al., 2018), “the nature of entrepreneurs’ jobs means that their business’s success depends on the entrepreneur’s capacity to generate creative ideas not merely occasionally, but on a daily basis.” When exploring and exploiting entrepreneurial opportunities, they engage in a continuous iterative process of idea generation, refinement, and redevelopment (Dimov, 2007). Entrepreneurs combine information from multiple unrelated domains to generate original ideas during this process. Particularly, the diversity of information is a strong moderator during idea generation (Gielnik et al., 2012). We argue that various stakeholder interests, as described above, constitute such diverse information. Compared to traditional entrepreneurship, sustainable entrepreneurship not only involves industry or business information but extends to social and environmental considerations (Dean & McMullen, 2007). Idea generation thus includes highly heterogeneous information domains, making sustainable entrepreneurship a fertile ground for entrepreneurial creativity.

However, the exposure to diverse information, i.e., conflicting stakeholder interests, does not readily translate into sustainable business ideas. Therefore, it is necessary to position relevant information at the center of the entrepreneur’s idea generation. We argue that if business ideas resolve conflicting stakeholder interests, they integrate diverse values and hence may be considered more sustainable. To identify such ideas in the SEE context, we draw on the concept of bisociation (Koestler, 1964), which has attracted some scholarly attention in entrepreneurship, creativity, and education research (Pettersen et al., 2019). Bisociation implies joining seemingly unrelated or conflicting information from different domains. It facilitates “the mixture of concepts from two contexts or categories of objects that are unconnected by the normal processes of the mind” (Pettersen et al., 2019). As opposed to associative thinking, which is more common in everyday life decisions and arguably the additive approach in tools for sustainable entrepreneurship, in bisociation, “individuals combine information to identify an opportunity or to help shape competitive advantages” (Ireland et al., 2003). For instance, (Koestler, 1964) uses the invention of the printing press as a historic illustration for bisociation. The author described how Gutenberg combined observations on the coin punching process (domain A) and the application of steady pressure during the wine harvest (domain B) to invent the process of printing with movable types. Concluding, by applying the concept of bisociation to sustainable entrepreneurial tasks, we propose a positive contribution to identifying sustainable business opportunities.

2.4 The Need for a New Method

SEE practitioners are responsible for equipping (would-be) entrepreneurs with hands-on tools for developing sustainable business ideas (Pettersen et al., 2019). Albeit creative ideas require consecutive action to be considered entrepreneurial opportunities, they are nevertheless an integral part of the entrepreneurial journey and thus an essential element of SEE. Given the absence of adequate tools, educators need a method that facilitates entrepreneurial creativity for exploring novel value-integrating solutions that meet conflicting stakeholder interests.

3 Methodology

Our research methodology was based on six stages displayed in Fig. 1 and comprised various qualitative and quantitative scientific methods. Its overall strategy and approach to results reporting were inspired by (Geissdoerfer et al., 2016).

Fig. 1
A framework specifies three developmental stages and six activities. The first impact circle prototype, the second impact circle prototype, and the final impact circle prototype are all in developmental stages. The activities are analysis, design, first test, redesign, second test, and refine.

Overview of the Impact Circle’s development process

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Following our research question, in stage 1, we first defined the requirements for tools in the SEE context. We focused on three types of data, (1) recent scientific publications on SEE and SBM, (2) interviews with three SEE practitioners, and (3) our own experiences as lectures and designers for sustainable entrepreneurship formats. Subsequently, we analyzed to what extent existing tools fulfill the requirements. First, we performed a keyword-guided desktop research in scientific and public databases and manually reviewed the websites of relevant institutions to identify current tools for sustainable entrepreneurship. Second, the research team rated the identified tools according to the predefined requirements and discussed the results until a consensus was reached.

Informed by recent insights on sustainable business model innovation (e.g., Breuer et al., 2018), we collaborated with two design experts to develop the first Impact Circle prototype in stage 2. Both have more than 10 years of professional experience in developing design-based tools, and one holds a PhD in design sciences. Upon development, we then tested the Impact Circle's main components and functionalities iteratively with several students as representative users. We observed how they used the Impact Circle and interviewed them about their experience. Based on these insights, we revised the prototype.

In stage 3, two student teams applied the prototype as a homework exercise during a sustainable entrepreneurship seminar at the Technische Universität Berlin. They used the Impact Circle to reflect the impacts of a previously developed business opportunity and subsequently ideated sustainable business ideas. We evaluated the method’s effectiveness and general user experience using surveys and participant interviews. In addition, we presented the prototype to industry representatives and researchers at a scientific conference to obtain further feedback and improvement suggestions.

While the first application generally supported the Impact Circle’s methodology, the results indicated that it required a redesign (stage 4). We discussed the findings with the design experts and realized several improvements within a second prototype. Furthermore, we enhanced the application review process by collecting additional and more systematic data.

The second Impact Circle prototype was applied in 2 online workshops with 50 students in total (stage 5). Twelve moderators supported the application by providing methodological guidance and collecting dense observational data on each participating team. We reviewed the workshops using extensive quantitative and qualitative data, encompassing (1) participant survey results, (2) +140 participant feedback notes, and (3) moderator observation forms. Moreover, we presented the Impact Circle to practitioners from university incubators to receive additional feedback. A data clustering enabled us to identify 132 insights containing improvement suggestions, praise, and general feedback, leading to some (minor) methodological enhancements.

In stage 6, we conducted additional five workshops with 107 participants to validate the adjustments to the Impact Circle’s methodology. We deliberately applied the method in different contexts, including a university business incubation program and an offline workshop, to better understand its benefits for practice. We continued our data extraction strategy throughout the applications and hence gathered additional insights. As the results confirmed the Impact Circle’s methodology and yielded only minor improvement suggestions, we concluded its maturity. Furthermore, we started dissemination activities using a website, meetings with practitioners, and conference presentations. Table 1 outlines the workshops performed during the method development process.

Table 1 Overview of Impact Circle workshops
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Given the few clear assessment measures in SBM tool development (Geissdoerfer et al., 2016), we employed various qualitative and quantitative indicators to assess the Impact Circle during its development, summarized in Table 2. Following the Impact Circle’s main goal to trigger more integrated, sustainable business ideas, we developed the “high-impact ideas” indicator as a quantitative measure in addition to the qualitative participant feedback. It accounts for those ideas that the teams rated with high societal impact and high feasibility scores. An alternative approach could have been ratings by external experts. However, we decided to use team assessments instead because they (1) lower the bias of individual subjectivity, (2) entail a more informed evaluation as the teams can better judge the new idea related to their existing business model, and (3) are more convenient to implement in SEE. Nevertheless, adding expert ratings can mean a valuable extension, as they enable to control for potential biases, such as industry inexperience or overconfidence.

Table 2 Overview of assessment indicators during the Impact Circle’s development
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4 Results

In stage 1, our methodology enabled us to identify seven criteria for SEE tools, such as ease of use, creative capacity, integrated sustainable thinking, and system perspective. Our desktop research identified 25 existing sustainable entrepreneurship tools. However, only a few met the predefined requirements and are thus relevant to the SEE context. Among them, the value mapping approach of (Bocken et al., 2013) stood out as it satisfied most of the predefined requirements. However, even though it enables users to identify diverse stakeholder value effects, it falls short in exploring novel conflict-resolving ideas. Thus, we decided to build upon the value mapping approach and extend it.

The discussion with design experts in stage 2 suggested bisociation as the central mechanism for identifying sustainable business ideas. We conceptualized the first prototype as a stand-alone tool that builds on two steps. First, users reflect the sustainability of an existing business model by identifying its positive and negative impacts on different stakeholder categories along the value chain. Second, users develop sustainable business ideas by randomly combining the identified value effects using bisociation. During the initial testing, the research team observed first confirming evidence. The participants could quickly identify various and diverse stakeholders for a given case start-up in the last mile logistic sector, such as drone manufacturers, senior citizens, local policy-makers, and post offices. Moreover, their bisociation ability generated multiple novel ideas that entailed more sustainable business ideas, e.g., realizing the B2C approach within a sharing business model. Most importantly, during the interviews, the participants reported that they enjoyed the bisociation exercise as it enabled them to apply a creative perspective on business model innovation.

The prototype application in stage 3 provided mixed evidence. Albeit the participants confirmed the overall usability of the tool, the survey yielded an average overall rating of 4.14 and an average bisociation rating of 4.42 on a 7-point Likert-type scale (see Table 3), thus indicating a need for improvement. In addition, the participant interviews revealed that team- and idea-related issues impacted the team performance. For instance, the team members missed a common understanding of the initial business model, which deteriorated the stakeholder identification process. Furthermore, the teams were overwhelmed by group discussions on stakeholder value effects and novel ideas. Some members reported that they contributed only little to the overall team performance due to opinion leaders. We realized that the Impact Circle’s effectiveness is dependent on contextual conditions, such as the readiness of the initial idea or team commitment. Thus, we searched for a novel application case to better control the contextual conditions during the subsequent development process.

Table 3 Overview of the Impact Circle’s survey and workshop results
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The research team discussed the findings with the design experts (stage 4) and revised the first prototype. First, we reconceptualized the Impact Circle as a workshop with guiding moderators to improve the teamwork. Second, we divided the value mapping and ideation steps into an individual task performed separated from the other team members to enable individual creativity and a subsequent team discussion. Third, we expanded the methodology by introducing two new steps, the Impact Draft and the Impact Matrix (described below) to account for contextual conditions. Fourth, we modified the stakeholder categories to enable a more nuanced identification of stakeholder value effects as suggested by the experts. For instance, we added “staff and shareholder” as a new stakeholder category to account for an internal organizational perspective. Moreover, we developed several inspirational questions for each stakeholder category to support the participants’ stakeholder identification process.

The revised prototype and extended data extraction enabled several findings during the second pilot application (stage 5). As shown in Table 3, the participants rated the overall method and the bisociation better than the first pilot. Moreover, the data showed that the Impact Circle enabled the teams in workshop 2 to generate approximately 21 ideas on average, with approximately four high-impact ideas per team. The participant feedback and moderator observations enabled us to identify some (minor) method improvements. Most feedback focused on the workshop design rather than its methodology, which showed the increasing maturity of the Impact Circle. Major revisions comprised updated moderator guidelines, a simplified visual design, and more precise preparatory communication. Moreover, as suggested by the expert consultations, we extended the workshop introduction with some sustainable entrepreneurship theories, i.e., impact logical models and theories of changes.

Continuous applications (stage 6) provided further methodological confirmation. While the overall workshop and bisociation ratings varied per workshop, which might be explained by individual, group, or contextual factors, they generally remained high. After conducting 8 workshops, the weighted average rating for bisociation was 5.82 out of 7 and for the overall workshop 5.5 out of 7 (N = 153). On average, the teams generated between 6 to 17.2 ideas per team, with approximately 18 to 22 percent of them considered high impact and high feasibility. Furthermore, on average, approximately 38.7 percent of all stakeholders generated belong to the civil society and politics or natural environment category, thus indicating the Impact Circle’s effectiveness in emphasizing holistic reflection. The qualitative participant feedback provided additional insights. For instance, in workshop 7, we received 131 feedback comments, of which 72 percent contained positive feedback. Throughout the applications, the number of methodological improvement suggestions decreased to only four in workshop 7. Hence, our adjustments were only minor and focused on the workshop facilitation, such as rescheduling the breaks or an inspiration board with exemplary stakeholders. Given the supporting evidence, we concluded methodological maturity and initiated its dissemination.

5 Discussion and Conclusions

This chapter’s goal was to develop a new SEE method that supports the discovery of sustainable business ideas. In the following, we answer our research question by elaborating the Impact Circle’s application and outlining how bisociation contributes to SBM development.

5.1 The Impact Circle Method

The extensive method development process resulted in the final Impact Circle, displayed in Fig. 2. While it may also be a stand-alone tool, we developed the Impact Circle method as an interactive workshop. Given the time indications in Table 4, we experienced an optimal team size of three to four people with one moderator for every three teams. The final methodology contains six steps, whereby two are recommended but optional depending on the available time and overall context. Corresponding to our first research goal of facilitating impact assessments, the Impact Circle’s steps 1 to 3 enable teams to understand their business model’s various impacts. The first step is to elaborate on the value creation logic of an initial business model (1). This step enables the team members to systemize existing outcomes and impacts and prepares for the subsequent steps. Then, each team member brainstorms how the business model affects stakeholders (value effects) (2). The Impact Circle’s visual design nudges its users to consider five stakeholder categories and describe both positive and negative effects. The value effect mapping thus spurs a holistic understanding of business model impacts (Bocken et al., 2013). The team then discusses and expands upon the identified effects (3). This step fosters a mutual comprehension of the value effects, triggers creativity for identifying additional effects, and ensures overall clarity and coherence.

Fig. 2
A schematic represents the impact of the circle method. It defines how stakeholder value effect ideas from customers and partners, civil society and politics, the natural environment, industry and competition, and staff, and shareholders contribute to a new idea.

Visualization of the Impact Circle method

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Table 4 Overview of the Impact Circle method
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Steps 4 to 6 correspond to our second outlined research goal of supporting the entrepreneurial discovery of more integrated, sustainable business ideas. In step 4, the teams build upon the value effects identified in steps 2 and 3 and use them as ideation inputs. Each team member chooses two (or more) effects and engages in bisociation thinking for generating ideas that integrate the effects (4). By creatively ideating solutions that address two negative effects or combining negative and positive effects, the team may resolve the negative consequences of their initial business model, enhancing its sustainable impacts and transforming it into an SBM. In turn, by combining various positive effects, the teams may identify synergies and thus scale sustainable impacts. Ultimately, the emerging new ideas typically involve extensions and variations of the initial business model but also entirely novel business opportunities. Subsequently, as in step 3, the novel ideas are discussed and expanded within the team (5). Given that a team identifies approximately 15 ideas on average, the final step contains an optional rating exercise (6). The team members jointly assess the identified ideas concerning their feasibility and impact potential from “low” to “high” on a simplified 5 × 5 matrix. This step enables them to identify the most promising ideas, quick wins, and strategic opportunities and provides an informed basis for the next steps.

To support educators and other practitioners in applying the Impact Circle, we provide detailed instructions in Table 4, corresponding to our third research goal of developing a suitable method for the SEE context. More information for practitioners can be accessed on the Impact Circle website: www.impact-circle.com or www.impact-circle.de

5.2 Bisociation and Sustainable Business Ideas

We developed the Impact Circle to expand the value mapping approach of (Bocken et al., 2013) with bisociation as a means for identifying sustainable business ideas. It is beyond the scope of this paper to validate the proposed relationship between the sustainability of a business idea and bisociation thinking, which constitutes a promising avenue for future research. However, despite their limited explanatory power, our results indicate that bisociation contributes to SBM innovation.

First, throughout the workshops, the participants praised the “effect-combination approach” and the ideas it generated. In total, we received 34 positive feedback statements on bisociation, which account for 44 percent of the positive feedback statements and 9 percent of all comments. For instance, the participants commented, “[the method] triggers idea generation and causes you to take an alternative approach” (workshop 2) or “[the method is a] useful mental model to think solutions for sustainability-related problems” (workshop 4). Second, across the cases, the participants rated the statement “I believe the combination of different stakeholder value effects is a promising approach in generating sustainable ideas” with 5.82 out of 7 on average (N = 153). Third, we observed that many participants described how and which stakeholder value effects they combined during the fifth process stage instead of simply outlining the new idea. We interpret this observation as an individual urge to display their subjective creativity in coming up with sustainable business ideas and their overall satisfaction with the methodology. Fourth, the various experts consulted during the development process recognized the “innovative” approach to SBM innovation, further supporting the potential of bisociation in sustainable entrepreneurship.

5.3 Contributions

Our chapter contributes to research and practice in three regards. First, we developed a novel method for SBM innovation that educators and other practitioners can apply using our instructions in Table 4. Second, our methodology illustrates a systematic process for developing a design-based innovation method for SEE. Various data types, research methods, contexts, and iterations exemplified a rigorous approach to designing SBM tools. Our findings may inspire future research to build upon our methodology. Third, we foster interdisciplinary research by integrating design science within sustainable entrepreneurship research. Finally, although previous research has largely neglected the topic, our findings illustrate bisociation as a promising phenomenon for understanding entrepreneurial cognition and creativity.

6 Acknowledgments

We thank Florian Paschke for his valuable contributions to designing the Impact Circle.