Manufacturing organisations are setting ambitious sustainability targets for the coming decade, with 20% aiming for carbon-neutral operations and two in five (40%) setting their sights on 100% renewable operations by 2030.
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These are key findings of a recent report from the Capgemini Research Institute entitled, Sustainable operations: A comprehensive guide for manufacturers. Most manufacturers today also appreciate that far from mitigating against profitability, sustainability is increasingly directly linked to it.
With the advent of environmental social and governance (ESG), investors are concentrating more on organisations with green credentials. Many manufacturers today, therefore, understand the logic of shifting to more sustainable practices.
Michael Ouissi is the Chief Customer Officer of IFS. Credit: IFS via White Oaks International
As part of this, manufacturers are focusing on building a more circular economy by reusing raw materials, creating more sustainable products and helping to extend the building lifecycle.
The manufacturing sector has made real progress. However, it needs to deliver even greater change to remain competitive, compliant and successful.
Ambitions could certainly be scaled up. The Capgemini report reveals that only 51% of manufacturing organisations globally are aiming to align with the temperature contribution target of the Paris Agreement.
For manufacturers, the crucial question is: do they have all the right tools in place to achieve their sustainability goals? That’s a critical part of the journey.
Capgemini found that more than half (56%) of organisations are currently prioritising the deployment of digital technologies for sustainability. Manufacturers may want to become more sustainable, but they also need to be equipped to do so, not just from a software standpoint but also regarding their broader technological approach, processes and workflow.
Technology is key to sustainable manufacturing. Digital solutions help support lean manufacturing processes which are more environmentally efficient and generate less waste. Digital technology can also provide manufacturers with greater visibility into their operational workflows, allowing them to identify and remove excess water or materials usage and reduce carbon emissions, as well as streamline and enhance production processes.
Engaging around sustainability: dialogue and partnership
A vital first step for manufacturers to take when selecting technology vendors, or reviewing existing vendors and partners, is to make certain that those businesses are on the same sustainability journey or have a similar ‘green first’ mindset as themselves.
Increasingly, we see manufacturers concentrating on the environmental maturity of prospective candidates; because they understand the value of a greener, more sustainable approach. This demonstrates why it is absolutely crucial technology providers engage closely with manufacturers from the outset to identify and quantify the sustainability value they are seeking.
Here, the onus should be on the manufacturer to crystallise their strategy and articulate their objectives. Explaining their ideas and examining how providers could potentially support them will lead to a partnership dialogue around their goals and the capability of the vendor to help achieve them.
Technology providers, for their part, need to recognise the urgency of the move manufacturers are making to achieve more sustainable operations, and the value sustainability can deliver.
Demonstrating the potential benefit technology solutions will bring, and how vendors can advance manufacturers’ sustainability goals, comes next. Often, it works to start small with a clearly defined goal and steadily build on that. Getting the sustainability journey underway is what matters.
We’ve seen many examples of how technology solutions delivered by providers that share their customers’ vision of sustainability can yield compelling value in this area. For example, IFS has played a vital role in realising Rolls-Royce’s ‘Intelligent Engine’ vision.
The Blue Data Thread enabled by the partnership between Rolls-Royce and IFS provides the data connectivity between airlines and Rolls-Royce that allows businesses to significantly increase the time between engine overhauls and therefore reduce emissions.
Silvermill Group has also seen great value by engaging with a provider with sustainability at their heart. Benefits reaped included the ability to control factors such as electricity and water, cut down on wastage and be more environmentally efficient.
Steadily adding more value
Delivering on sustainability can’t just be a ‘once and done thing’ either. Manufacturers need to be continuously focusing on sustainability efforts across their entire business to make a significant impact.
Naturally, the technology partners they choose need to be on board with that journey to facilitate the technology changes needed. There has to be two-way discussion and open, transparent, continuous engagement so that, in turn, providers can continue to deliver sustainable value.
That value shifts over time, especially as consumers and customers become increasingly demanding, and it, therefore, needs to be tracked and measured. Providers must do this on an ongoing basis rather than just paying lip service to it. This transparency, together with a common mindset and a shared, positive vision will lead to genuine joint value creation.
Action is needed now
It is crucial that manufacturers and their technology provider partners alike realise that action on sustainability is now an urgent requirement. Starting small with a defined objective gets the journey started. To build on the momentum already achieved, manufacturers should not hesitate to move forward positively on the road to sustainability by finding a technology partner that is right for them, and creating that proactive, forward-looking team.
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