Int J Performability Eng ›› 2005, Vol. 1 ›› Issue (2): 121-130.doi: 10.23940/ijpe.05.2.p121.mag

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The Functional Economy: Cultural & Organizational Change

Walter R. Stahel   

  1. Founder Director
    The Product Life Cycle Institute
    Geneva, Switzerland


A functional economy, as defined in this paper, is one that optimizes the use (or function) of goods and services and thus the management of existing wealth (goods. knowledge, and nature). The economic objective of the functional economy is to create the highest possible use value for the longest possible time while consuming as few material resources and energy as possible. This functional economy is therefore considerably more sustainable, or dematerialized, than the present economy, which is focused on production and related material flows as its principal means to create wealth.One aim of this paper is to sketch out a functional economy. The other is to show the social, cultural, and organizational change that may arise in shifting from a production-oriented economy toward a functional or service-oriented economy.
Received on June 12, 2005