Unleashing the potential of engaging customers in circular economy ecosystems: A managerial sensemaking perspective

The circular economy has gained prominence among academics, practitioners, and policymakers, yet existing research largely adopts a firm-centric view, emphasizing business models and strategies, with limited attention to ecosystem-level dynamics. In particular, the role of customers within circular economy ecosystems (CEEs) remains underexplored; while many studies have considered CEEs’ structural aspects, few have examined underlying cognitive processes. Our study focuses on the managerial construction of ecosystems, and specifically on how managers of small- and medium-sized enterprises (SMEs) interpret customer engagement signals. While existing literature recommends an ecosystem-level approach, we propose that ecosystem dynamics initially emerge through individual sensemaking. Through interviewing several SME managers in Finland, we suggest a typology comprising four approaches: co-creative sensemaking, opportunity-harvesting, engagement-delegating, and linear legacy firms. By applying the theoretical lens of the supply-side interpretation of demand-side signals, our findings show why firms exhibiting the same ecosystem context tend to diverge in terms of circularity.