Life and Death of Industrial Ecosystems

Self-organized industrial ecosystems (SOIEs) refer to communities of firms in diverse industries that spontaneously engage in Industrial Symbiosis (IS); that is, firms independently develop bilateral and multi-lateral interactions involving material, energy, and knowledge sharing for individual and collective benefit. Like biological ecosystems, self-organized industrial ecosystems must constantly respond to external perturbations. Resilience of SOIEs, or the ability of systems to maintain structure and function in response to perturbations, has been the focus of a few recent studies. However, these studies have only examined the network characteristics for resilience of IS in a static manner. The current study contributes to this emerging literature by examining the dynamics associated with growth (life) and demise (death) of self-organized industrial ecosystems in light of changing network dynamics and external perturbations, with emphasis on material and socio-economic aspects of connectivity between firms. This research is grounded in real world cases, but expands beyond these through hypothetical network models in order to ascertain the network characteristics that lead to more resilient structures and outcomes. A key distinction is made between SOIEs that include an anchor firm versus scavenger firms. The former typically involve a scale-free network structure where new member firms preferentially connect to actors with the most connections, while the latter involve more random, fully-connected networks where new member firms connect with multiple existing actors. The results imply that resilience of SOIEs do not arise from intrinsic properties of the system alone, but from the interplay of network topology with external social and ecological constraints.