Gardetti and Muthu Textiles and Clothing Sustainability (2015) 1:2

DOI 10.1186/s40689-015-0003-0

RESEARCH Open Access

Sustainable apparel? Is the innovation in the

business model? - The case of IOU Project
Miguel Angel Gardetti1* and Subramanian Senthilkannan Muthu2

Abstract
Since sustainability approaches to the apparel industry are based on incremental rather than transformative
solutions, the prevailing business models need to be changed.
This paper will introduce the IOU Project as an example about disruptive business model in the apparel and fashion
sectors. This case was selected since disruptive innovation requires an entrepreneurial mindset and spirit with close
coordination and cooperation among all participants (JAMA 352:24-28, 2004). The analysis - which is based on the Clark,
Osterwalder, and Pigneur’s (2012) business model (personal) ‘canvas’ - puts special emphasis on the supply chain
development and on the relationship developed between the initiative and its customers, as well as on whether or
not it fostered a relationship between the customer and the artisans who were part of the supply chain.
To develop this case, the authors collected background and qualitative and quantitative information of the
company from its participation in the Best Performance in Sustainable Luxury in Latin America Award, getting this
award in the category ‘Best Fashion and Accessories Enterprise of Sustainable Luxury’ in the 2011 edition. This
source was supplemented with the chapter written by Kavita Parmar (2014) in the book entitled Sustainable Luxury
and Social Entrepreneurship - Stories from the Pioneers, whose editors were Miguel Angel Gardetti and María
Eugenia Girón (2014). Moreover, the authors considered the e-mails exchanged with Ms. Parmar within the
framework of the above award.
Using a disruptive business model, the IOU Project manages to develop a value chain based on craftsmanship.
Craftsmanship breathes humanity into objects, allowing the individual to create for the individual. In doing so, it
translates the principles of knowledge, purpose, and timelessness into products that represent unique achievements
(Ricca and Robins, 2012:53). Within this framework, supply chain management became a strong driver of value, for the
IOU but for artisans and customers as well (Kell, 2010).
Finally, the IOU business model helps develop a strong relationship with consumers and artisans which dignifies
the latter and appreciates their work.
Keywords: Social impacts; Environmental impacts; Supply chain; Disruptive; Sustainability; Innovation; Business
models

Background critiques, as there were not many issues in the 80’s which
Any literature related to sustainable development refers or we are facing now; and we must say that if this report were
begins with the definition of sustainable development, written today, sustainable development would most likely
which was defined as, ‘development that meets the needs of be defined in a different way to portray the current situ-
the present without compromising the ability of future ation. To define what sustainable development is all about
generations to meet their own needs’ in Our Common is quite a common, though difficult, issue (Sneddon and
Future, also known as the Brundtland Report, which was Howarth 2006) and from the entrepreneurial point of
written in 1987 (World Commission on Environment and view the elements under the umbrella of sustainability -
Development 1987). This definition has undergone many pollution prevention, resource productivity, environmental
management, sustainable technology, social entrepreneur-
* Correspondence: mag@sustentabilidad.org.ar ship, corporate social responsibility, human and labor
1
Sustainable Textile Center, Av. San Isidro 4166 PB A, C1429ADP Buenos
Aires, Argentina rights, transparency, stakeholder management, among
Full list of author information is available at the end of the article others - are increasing day by day.
© 2015 Gardetti and Muthu; licensee Springer. This is an Open Access article distributed under the terms of the Creative
Commons Attribution License (http://creativecommons.org/licenses/by/4.0), which permits unrestricted use, distribution, and
reproduction in any medium, provided the original work is properly credited.
Gardetti and Muthu Textiles and Clothing Sustainability (2015) 1:2 Page 2 of 9

This same ambiguity of defining sustainable develop- This work explores the potentials for building business
ment prevails in the clothing and apparel sector, and it models for sustainability through innovation or radical
becomes more difficult to define what a sustainable ap- innovation through the analysis of the case called the IOU
parel/clothing product is about, especially when it comes Project, created by the young entrepreneur Kavita Parmar,
to the apparel sector. In the global economy, the role an e-commerce initiative that offers fashion-conscious
played by the world’s garment and textile industry is sig- consumers a very distinct platform. Clothes sold on the
nificant, and the global turnover of this industry in 2011 Web are designed and manufactured by European artisans.
was almost USD 3 trillion (including clothing, textiles, These clothes are based on hand-woven fabric typical of
footwear, and luxury goods). This sector has significant India -madras- made by Indian artisan knitters. Kavita
levels of environmental and social impact, and it has not Parmar’s project was selected for the analysis since the
yet developed an overall vision to achieve sustainability disruptive innovation requires an entrepreneurial mindset
up to the mark (Maximilian Martin, 2013; Muthu, 2014). and spirit with close coordination and cooperation among
The textiles and apparel sector comprises a lengthy sup- all participants (Rainey, 2004).
ply chain, which is subject to mass environmental and
social impacts. Methods
Most of the current innovations in the apparel industry To develop this case, the authors collected background
intended to achieve sustainability focus on raw materials and qualitative and quantitative information of the com-
(that is to say, eco-friendly raw materials) and products. pany from its participation in the Best Performance in
Nevertheless, innovations are also being carried out in the Sustainable Luxury in Latin America Award, getting this
process, logistics, recycling, and upcycling. Along this line, award in the category ‘Best Fashion and Accessories
the World Economic Forum (2010) summarizes the limi- Enterprise of Sustainable Luxury’ in the 2011 edition.
tations of current sustainability initiatives as follows: The criteria needed to be met to receive the award are:

current trends towards sustainability are welcome but -social aspects: the strategies carried out by the
inefficient. The shifts … are focused on incremental, company underscoring positive impacts;
rather than transformative, change. While they may -environmental aspects: the strategies carried out by the
improve sustainability at the margins, they are rooted company underscoring positive impacts;
in a model of consumption that is itself unsustainable. -economic aspects: upfront investment; sales volume,
profits (as a percentage of revenues), future growth
But very few innovations only focus on the total busi- expectations based on company performance, average
ness model, which is the havoc of sustainable innova- price of product/s that your company sells, and
tions of the current apparel sector. distribution or sales channel
There is a need to redefine dominant approaches to
business in the apparel sector. Most industries are still This source was supplemented with the chapter written
characterized by a ‘dig it up-use it-throw it away’ pro- by Kavita Parmar (2014) in the book titled Sustainable
duction system which prevents the achievement of sus- Luxury and Social Entrepreneurship - Stories from the
tainable development in any meaningful way (Wells Pioneers, whose editors were Miguel Angel Gardetti and
2008: 85). Decades of talk about corporate social respon- María Eugenia Girón (2014). Moreover, the authors con-
sibility (CSR), corporate citizenship, corporate sustain- sidered the e-mails exchanged with Ms. Parmar within the
ability, and other related buzzwords have not radically framework of the above award.
changed this picture. The analysis of the collected information focused on
A transformation of dominant business models is there- the business model based on the canvas presented by
fore needed in order to achieve systemic changes toward Clark et al. (2010). Even though this model not only
sustainability. Rather than perceiving sustainability solely applies to the clothing industry, it puts special emphasis
as compliance and risk management, businesses have to on the supply chain development and on the relation-
recognize the value-creating potential of sustainable busi- ship developed between the initiative and its customers.
ness models. However, so far, literature that bridges busi- It was also analyzed if within the framework of the
ness model and sustainability thinking is relatively scarce. canvas the initiative fostered a relationship between the
Stubbs and Cocklin (2008: 103) argue that ‘understanding customer and the artisans who were part of the supply
of sustainable business models and how sustainable develop- chain.
ment is operationalized in firms is weak’, and Schaltegger
et al. (2011: 12) argues that ‘Neither theoretical nor em- (Disruptive) innovation and business models
pirical research offers sufficient answers to the question Innovation provides the means to create a new reality. It
what a sustainable business model might be’. involves converting knowledge, learning, capabilities,
Gardetti and Muthu Textiles and Clothing Sustainability (2015) 1:2 Page 3 of 9

and insights into value and creative new perspectives, employed in the context of sustainable innovation (Boons
products, productive outcomes, and business models. and Lüdeke-Freund, 2013, Wüstenhagen and Boehnke,
Innovation is more than change: it is making incremen- 2008, Wells, 2008, Hannon et al., 2013).
tal and/or radical improvements to systems, technologies, A frequently used approach from Osterwalder and
products, processes, and practices (business models) Pigneur (2010) deconstructs the business model into nine
(Rainey, 2004). inter-related ‘building blocks.’ These blocks require:
There are different types of innovation, namely sustain-
ing, evolutionary, revolutionary, and finally disruptive -Customer segments: customers comprise the heart of
(Christensen, 1997) innovation. Out of all of them, disrup- any business model. An organization must take a
tive innovation is very much interesting and quite applic- conscious decision about which segments to serve and
able to apparel industry. It is rather the need of the hour which segments to ignore. Once this decision is made,
for today’s apparel sector. Disruptive innovation is defined a business model can be carefully designed around a
as innovation which helps creating a new market (and strong understanding of specific customer’s needs.
eventually disrupts an existing market) by implementing -Specification of the value proposition: the value
different value sets (Christensen, 1997; Christensen and proposition is the reason why customers turn to one
Raynor, 2003; Christensen and Overdorf, 2004). Disruptive company over another. The value proposition consists of
innovation refers not to the incremental improvement but a selected bundle of products and/or services that caters
rather to innovation that leapfrogs standard routines and to the requirements of a specific customer segment.
knowledge (Hart and Milstein 1999). It is what Quinn -Channels: are customers’ touch points that play an
(1996) called a much focused process - discontinuous with important role in the customer’s experience.
the past and generally irreversible. Thus, rather than sim- -Customer relationships: a company should clarify the
ply seeking to reduce the negative impacts of their opera- type of relationship it wants to establish with customer
tions, firms can strive to solve social and environmental segment. This relationship may be driven by customer
problems through the internal development or acquisition acquisition, customer retention, and boosting sales.
of new capabilities that address the sustainability challenge -Revenue streams: represents the cash a company
directly (Hart, 1997, 2005a, 2007 and Hart, 2003). It is generates from each ‘customer segment’.
what Rainey (2004) defined as moving from thought to -Key resources: these resources allow an enterprise to
action. create an offer a ‘value proposition’, reach markets,
Disruptive technologies can bring to the marketplace a maintain relationship with ‘customer segments’, and
very different value proposition than previously available, earn revenues.
and, most importantly, products based on disruptive -Key activities: these are the most important actions a
technologies can be cheaper, simpler, and smaller and company must take to operate successfully.
can be more frequently made and very convenient to use -Key partnerships: companies create alliances to optimize
(Christensen, 1997; Aneja, 2010). their business models, reduce risk, or acquire resources.
The business model concept has become increasingly -Cost structure: this is the most important cost incurred
used to provide explanations and tools for studying the while operating under a particular business model.
dynamics of businesses (Amit and Zott, 2001; Zott et al.,
2011). Several authors have proposed varying definitions Figure 1 shows the CANVAS model developed by
and theoretical frameworks to explain business models. Osterwalder and Pigneur (2010). It should be noted that
See for example the works of Perkmann and Spicer (2010), since Osterwalder and Pigneur (2010) defined customers
Osterwalder (2004), Osterwalder et al. (2005), and Teece as the heart of any business model, we adjusted the
(2010). Osterwalder and Pigneur (2010) have applied a original version, putting customers in the first place.
pragmatic perspective to the concept that helps to under- In 2012, Clark - with the cooperation of Osterwalder
stand how a firm does business, for analyses, comparison, and Pigneur- adapted the concepts of the 2010 CANVAS
performance assessment, management, and communi- to business models where the key resources are, basic-
cation, and to assist firms in their innovation. Given ally, individuals (entrepreneurs), their skills and abilities,
this provenance, some concepts prioritize the creation and the assets they own and control (Clark et al. 2012).
of economic value for business (Chesbrough and Based on this adjustment, Figure 1 would be as follows
Rosenbloom, 2002). (Figure 2).
Lüdeke-Freund (2010) describes a sustainable business
model as a business model that creates a competitive The IOU Projecta
advantage through superior customer value and contrib- Kavita Parmar and Iñigo J. Puente Henales (her husband)
utes to a sustainable development of the company and created the IOU Project. With an investment of USD 2.5
society. The business model concept has recently been million - between the founders and financial funders - and
Gardetti and Muthu Textiles and Clothing Sustainability (2015) 1:2 Page 4 of 9

of things; once they see who makes the product they use,
Customer Key there is an emotional value attached to knowing its true
Relation- Activities worth. This makes the product less disposable.
ship
IOU is wholesaling the product directly to their
Customer Value Key consumers, which means that IOU can make the highest
Segments Proposit- Partner- quality product paying the craftsman in India and Europe
ion ships their fair share and still sell it at the same price as most
Customer Key
Relation- Resources ‘high street retailers’ so that the consumer gets great value
ship
at an affordable price tag. A comparable shirt made in
Italy with handmade fabric would cost at least twice the
price at the IOU’s site. Prices range from USD 30 to
Revenue Streams Cost Structure 170.00. Thus, consumer’s purchases are allowing these
weavers and artisans in India and Europe to self-sustain
Figure 1 CANVAS model developed by Osterwalder and and not have to migrate hundreds of miles to work in
Pigneur (2010). Source: prepared and adapted by the authors factories as laborers.
(based on Osterwalder and Pigneur (2010)). But, most importantly, IOU’s impact is that it gives back
‘pride’ to the artisan’s work; to date, these artisans have
never had a chance to speak, let alone get connected with
profits of USD 1.5 million (in 2012)b, IOU is a new disrup- end consumers. In this relationship, the consumer can
tive e-commerce initiative that offers fashion-conscious learn some things from the artisans and have access to
consumers a very distinct platformc. This platform not only a video that introduces them as well. For example, the
enhances the online experience by linking end buyers with weaver artisan R. Ramanathand belongs to a coope-
artisan producers but also draws upon the most compelling rative called Kanjamanathanpettai Handloom Weavers
aspects of social media to construct a community around Cooperative and has been a member of IOU since 26
its core brand values: authenticity, transparency, unique- September 2010. The website also shows some charac-
ness, and both social and environmental responsibility. teristics of the cooperative to which this artisan be-
Born from the need to empower both the artisan and the longs. For instance, the year it was founded, how many
consumer, it uses the full scope of modern technology and artisans it employs and how many looms they have, etc.
the social web by creating a new supply chain that we call In turn, the weavers who are the members of the IOU
the ‘prosperity chain’, and IOU expects a 100% growth in Project - who have agreed to work with higher quality
the coming years based on the past years’ performance. standards - receive economic compensation which is
The IOU’s mission is to promote responsible consump- equal to 100% of their usual salary for each lungie they
tion, whereby the consumer engagement is fundamental. knit. An interesting testimonial that shows the possibil-
People are already very much interested in the provenance ities this relationship entails is that of Jessica Adams, a

Customer
Relation-ship Key Activities
Value
Proposition
Customer Key Partner-
Segments ships

Customer Key
Relation-ship Resources

Revenue Streams Cost Structure

Figure 2 Personal CANVAS model developed by Clark et al. (2012). Source: prepared and adapted by the authors (based on Clark et al. (2010)).
Gardetti and Muthu Textiles and Clothing Sustainability (2015) 1:2 Page 5 of 9

consumer and textile design student from the University crafts is built on a consumer ideology that contrasts manu-
College Falmouth (England), who visited Karaikadu factured, mass-produced, modern objects with handmade,
Handloom Weavers Cooperative. On the last day of her authentic, and local crafts, which means that these arti-
visit, she said: ‘It was a lovely day, the set up here seems to sans and traders do not necessarily have to adopt the
be working well and the weavers seem to be content. The norms of capitalist relations to operate in these markets
atmosphere is so wonderful. I really hope to return one (Lockwood 1993).
day, and wish all these wonderful people the best for the Here, the purchase goes beyond the object itself;
future…Hopefully this weaving way of life can continue’. excellence and devotion give both life and a sense of
The IOWEYOU label has taken beautiful hand-woven deep connection between individuals.
‘Madras’ plaid fabrics made for centuries by artisans in
India and turned them over to artisans in Europe who
How do you relate?
create one-of-a-kind apparel items to be sold online via
According to the founder - Kavita Parmar: ‘Each
the IOU specialized social e-commerce tools, the ‘trunk
IOWEYOU Madras piece is unique and has an IOU code
show host.’ The affordable, easy-to-wear apparel items
(QR Code) that takes you to its story simply by scanning
found on the site are handmade and unique, in every
it with a Smartphone or just entering the number on our
sense of the word.
website. On the site you can see the weaver who hand
On the IOU website, buyers can shop for unique items
wove that particular fabric in India and then the artisan
and have access to a wealth of audiovisual material that
in Europe who turned that fabric into a beautifully
chronicles the process whereby an item was produced.
handcrafted piece. We encourage the customer to take
End buyers also have the opportunity to ‘become part of
their picture and upload it to complete the story so that
the story’ of each item by using a unique QR code on
the weaver in India and the artisan in Europe can also
the items which electronically links them to the specific
see who bought that piece.’ The founder of the IOU
artisans that created their unique piece. IOU has already
Project encourages consumers to ‘become part of the
expanded into other authentic fabric sources and artisan
story.’ This is possible because consumers are not ignor-
groups: the real indigo plant-dyed denim from Japan,
ing the price/quality ratio but are applying and prioritiz-
real cashmere wool from Northern India/Nepal, and yak
ing other criteria in their purchase decision process
wool from Tibet, among others. All of them sourced
(Harrison et al., 2010:2).
from artisan communities with full traceability and
transparency. The IOU big dream is to create a Wikipedia
of artisans worldwide. How do they know you and what media do you use?
The IOU Project also offers partner retailers, and others Iñigo J. Puente Henales - Kavitas’ husband - is an engin-
brand the possibility of using the platform and the IOU’s eer from MIT and has always had the belief that with
MAAP (mass aggregated artisan produced) system to the current technology, IOU could have the tools to
produce their designs. truly disrupt the fashion industry. Kavita explains it like
this, ‘the consumer does care and the proof is in the pud-
Results and Discussion ding. Being a self-funded start up and this being a new
The IOU Project analysis through Clark, Osterwalder, and idea that took a lot of time and resources to develop,
Pigneur’s personal CANVAS (2012) when we went live we had no money left for marketing or
Below, we will analyze the case of the IOU Project based PR. But people spread the word like wild fire. We con-
on Clark et al. (2012) CANVAS structure: tinue to receive emails from people around the globe who
love the idea and want to support us. Also we added the
Who is satisfied? very consumer engaging trunk show host feature. Since as
IOU knew that there was a small part of the audience a company we were being disruptive with the current
that cared about the ideas of traceability and transpar- supply chain, why not take that one step further and do
ency, but it is intended to reach out a larger audience. In the same experiment with distribution of the brand. On
Kavita’s word: ‘I was obsessed with the idea of addressing our website people who are truly interested in the project
a larger market, that you could buy a piece at a reason- can have their own trunk show.’ This evidences that the
able price point and that it was truly unique felt like im- IOU Project moved from the traditional ‘brand-centric’
portant sales arguments.’ However, in order to increase concept to focus on a consumer wanting more direct
its market share and promote craftsmanship, the IOU communication and dialogue with the company. Ac-
Project might consider the ideas stated by Lynn Stephen cording to Rinaldi and Testa (2014), this revolution was
in her paper ‘Export Markets and their Effects on Indigen- inevitable given social networks and increasing transpar-
ous Craft Production: the Case of the Weavers of Teotitlán ency, thanks to the online presence of company informa-
del Valle, México’ (1996:382). The international market for tion which might be of interest to the end consumer.
Gardetti and Muthu Textiles and Clothing Sustainability (2015) 1:2 Page 6 of 9

How can I help you? Fletcher and Grose (2012) analyzed the roles that
A ‘story’ as Kavita said, ‘I wanted the first collection to be should be played by designers within the sustainability
around an authentic story and what could be more framework, among which we find that of communicator,
authentic than Gandhi’s non-violent revolution? He in- facilitator, and activist. Throughout the development of
spired millions of Indians to buy local handmade fabrics this project, Kavita Parmar is playing all of these roles.
to fight against the cheaper machine-made imports from Moreover, she regard this as a ‘cultural’ project that gives
imperialistic 19th century England to give back work to a sustainable answer to artisans’ employment and con-
the local craftsman.’ Sustainability is redefining the tributes to artistic preservation (Liebl, 2005).
world of textiles and fashion. Therefore, the IOU Project
offers a ‘story’ instead of a garment. That was precisely Who helps you?
one of the seven demands addressed by young (under- Focusing on what was most important to Kavita, the
graduate and postgraduate) students (from all over the artisan who helped to make IOU designs a reality and the
world) during the Youth Fashion Summit, which were in customer who bought them. So IOU worked on the first
turn submitted to the industry at the Copenhagen collection with handloom weavers from Tamil Nadu,
Fashion Summit, 2014. which were founded in 1927 inspired by Mahatma Gandhi.
But, in addition to this, IOU wanted to produce the cloth-
What do you do? ing with the best makers and Europe with its artisanal
Kavita explains it like this, ‘In the last 20 years the focus tradition.
of all factories and ateliers has been to increase product- For the IOU Project, craftsmanship is an essential
ivity, as they had to compete with global sourcing. We principle (while for its ‘fans’, it is an essential driver for
had to go back to how things were made before when a their purchase decision). Craftsmanship is an essential
very small, reduced group made the entire piece. This part of the IOU Project’s rationale. It is a value-creating
gave us better quality and traceability. What was differentiator. That is the reason why IOU features its
magical was that it also gave back authorship and products as ‘unique’ (each garment is presented as a
brought back pride to the artisan. Creating the online one-of-a-kind creation). It is the world of unique tailor-
and offline traceability system was one of the most chal- made products and limited editions. This concept brings
lenging tasks but it has also been the most rewarding. customers closer to artisans.
Making people aware of each other in the chain has been
one of the true successes of the project, something that I What do you get and what do you give?
cannot describe on a balance sheet but have witnessed Using transparency and traceability, the IOU Project
repeatedly in the proud smiles of the artisans when they aims to turn the supply chain into what we call a pros-
see the Prosperity Chain on the web. Our focus is on perity chain: IOU buys from weavers and artisans at the
value and quality. There is a huge imbalance in people’s fair price they ask and works on low mark-ups compared
perception of value. The industry has convinced the con- to the normal industry standards to ensure that the final
sumer to accept low quality for a cheaper price point price is competitive. Table 1 includes a summary of the
and turned everything into a disposable product’. main aspects of the IOU Project.
By creating this prosperity chain, the IOU Project is
sustaining artisans’ deeply held beliefs about their social Table 1 The main aspects of the IOU Project
relations and their relationships to the environment
The IOU Project
(Grimes and Milgram, 2000: 7). This is so because their
Size (sales) $ 1,500,000.00
legitimacy as craft items hinges on the circumstances of
their production as they are made using traditional craft Profit Break even 2013/2014
techniques (Stephen 1996:393). Expect growth based on 100%
previous years

Who are you and what do you have? Average price $ 30 - 170
Kavita Parmar is a self-taught designer and a serial Distribution B2C
entrepreneur. The IOU Project was born out of Kavita Investment $ 2,500,000.00
Parmar’s frustration as a designer with the current Investors Founders + FF
fashion system. It is all about faster and cheaper; it has
Social impact Building prosperity chains, where products
become a race to the bottom and does not nurture big are embedded with full traceability from
design (not just making things pretty but truly designing artisan to consumer. Pride and higher
the ecosystem around their production to make it sus- prices for craftspeople.
tainable) nor value provenance, excellent craftsmanship, Environmental impact Locally grown cotton
or artisanship. Source: prepared by the authors.
Gardetti and Muthu Textiles and Clothing Sustainability (2015) 1:2 Page 7 of 9

Conclusions searching and finding, and preserving and challenging -

Most organizations - whether start-ups or established and developing unique expertise in the process. It is, just
companies - take very defensive postures that protect as importantly, about the constant flow of such expertise
and nurture all that which has served them well in the from one generation to the next, across decades and
past, even in the face of change (Teece et al. 1997; centuries (Ricca and Robins, 2012: 53). Craftsmanship
Christensen, 1997). That is to say, they react by increas- breathes humanity into objects, allowing the individual to
ing their commitment to the ‘existing’ products, processes, create for the individual. In doing so, it translates the
and markets. However - according to Hart and Milstein principles of knowledge, purpose, and timelessness into
(1999) - successful surviving companies or start-ups products that represent unique achievements (Ricca and
have been able to invest or partner in order to achieve Robins, 2012: 53). Within this framework, supply chain
new competencies and experience in new untapped mar- management became a strong driver of value, for the
kets. That is the difference between continuity and dis- IOU but for artisans and customers as well (Kell, 2010).
continuity as pointed out by Hart (2005b). The former is The IOU Project’s approach includes associating with
illustrated by concepts such as: efficiency, operations, artisans to innovate and provide for sustainable win-win
control, resource allocation, and convergent thinking. scenarios (Hammond, 2001; Prahalad and Hammond,
The latter is illustrated by: imagination, innovation, cre- 2002; Prahalad and Hart, 2002; Hammond 2004a, b; Hart,
ative destruction, resource attraction, divergent thinking. 2005a; Prahalad, 2005). Limitation of the analysis presented
It is also what Milstein, Hart, and London (2007) called in this paper with the aid of IOU Project, this analysis is
the ‘revolutionary routines.’ It is what Kavita Parmar based on the perspective of the business owners without
understood by ‘breaking’ with the dominant system in much reference to the artisans’ perspective of how it works
the textile and fashion industries. for them.
As a business model describes the rationale of how The IOU Project’s business model helps to develop a
an organization creates, delivers, and captures value strong relationship with consumers and artisans which
(Osterwalder and Pigneur, 2010: 14), a transformation of dignifies the later and appreciates their work. Figure 3
dominant business models is, therefore, needed in order shows these relationships within the framework of Clark
to achieve systemic changes toward sustainability. Rather et al. (2012) CANVAS: the blue arrow with number 1
than perceiving sustainability solely as compliance and risk shows the relationship that the IOU Project developed
management, businesses have to recognize the value- with its clients. The blue arrow with number 2 shows
creating potential of sustainable business models. Using a the relationship with consumers that share the same
disruptive business model, the IOU Project manages to values that the IOU Project fosters. The light blue ar-
develop a value chain based on craftsmanship. The dawn rows with number 3 show the close relationship with
of this shift makes individual savoir-faire more important artisans. And the arrows with number 4 show the relation-
and valuable than ever. Craftsmanship is about women ship built between consumers and artisans through the
and men imagining and creating, failing and succeeding, IOU Project website.

SHOW

2 3

3
1

4
4

Figure 3 Relationships established by the IOU Project through the personal CANVAS model developed by Clark et al. (2012). Source:
prepared and adapted by the authors (based on Clark et al. (2010)).
Gardetti and Muthu Textiles and Clothing Sustainability (2015) 1:2 Page 8 of 9

Endnotes Hammond, A. (2004a). Unleashing entrepreneurship among the poor. Sustainable

a Development International, 12(1), 1–3.
This portion is based on Gardetti and Girón (2014)
Hammond, A. (2004b). Technology, globalization and the poor. Washington: World
Sustainable Luxury and Social Entrepreneurship - Stories Resources Institute, Washington.
from the Pioneers; and information during the process of Hannon, MJ, Foxon, TJ, & Gale, WF. (2013). The co-evolutionary relationship
the second edition of ‘Best Performance in Sustainable between energy service companies and the UK energy system: implications
for a low-carbon transition. Energy Policy, 61, 1031–1045.
Luxury in Latin America Award’ (at present IE Award on Harrison, R, Newholm, T, & Deirdre, S. (2010). Introduction. In R Harrison, T
Sustainability in the Luxury and Premium Sectors at Newholm, & S Deirdre (Eds.), The ethical consumer (pp. 1–8). London: Sage.
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