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ABSTRACT Circular innovations (CI), defined as the redesign of products, services or practices to minimise waste, reduce resource use and regenerate natural systems, are essential for advancing the circular economy. Despite growing recognition, their deployment in systems of linked parts with unpredictable interactions (complex systems) remains limited due to knowledge fragmentation and structural interdependencies. This study investigates how firms develop and integrate CI in such contexts. Drawing on a multi‐case study of nine CI in the Swiss construction industry, we identify two key dimensions (distance of knowledge and system coupling) that shape innovation designs. Based on these two dimensions, we propose four archetypical innovation designs: foundation first, core shift, easy fit and flexible add‐ons. Each archetype is defined by distinct configurations of components, material flows, resource intensity, application scope, system‐level alignment and learning phase. We derive six propositions linking the distance of knowledge to innovation development and system coupling to integration. This study introduces a framework for CI in complex systems and offers practical guidance for firms to design and evaluate such innovations.
Führer et al. (Wed,) studied this question.