Sustainability: Leverage Digital Technology to Reach Your Goal

Contributed by: Jan Burian

Just a few years ago, the term "sustainability" was something that many manufacturing companies either merely acknowledged or outright ignored. Of course, companies often dealt with sustainability issues primarily in response to regulatory requirements or the need to increase economic benefits, especially in areas such as waste management, water conservation, or material recycling.

However, in the past decade, sustainability has risen to the forefront of public interest, business, and government agendas as a key strategic imperative for further growth—a sustainable growth. Manufacturing companies must, therefore, develop and produce in a more sustainable manner. This is driven not only by regulations and standards but also by end customers and even investors, particularly financial institutions providing funding for strategic development. In short, the time to focus on sustainable principles is here, and with increasing market pressure and regulatory demands, every manufacturing company must not only accept but actively embrace these requirements.

Companies face a range of challenges, including economic factors such as inflation and recession, the consequences of political influences—especially in energy prices—and market-geopolitical factors, primarily the instability of supply chains. All of these factors ultimately impact how companies are managed and operated. Therefore, it is necessary to consider sustainability in a way that it is not seen as an obstacle in daily operations or as a necessary cost that does not otherwise bring additional value.

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Approaches to Implementing Sustainability in Industrial Practice

The so-called "sustainability operationalization," or integrating sustainability into daily practice, has several dimensions: strategic, process-oriented, and technological. For the purposes of this article, we will primarily focus on the technological dimension.

However, before delving into the technological aspect, it's essential to consider goals and data management. A global study by an unnamed consulting firm predicts that by 2026, 60% of manufacturing companies in the Global 2000 index will use sustainability indicators as relevant control parameters for their production operations. For comparison, in 2021, only 20% of companies did so.

The absolute foundation for setting up a sustainability system is defining key sustainability goals, translating them into parameters and specific targets. Subsequently, you must define the relevant data, establish their format, method of collection, processing, and evaluation.

To achieve this, you need to create architecture both at the operational technology (OT) level and at the corporate IT level. It is crucial to establish a transparent data environment, particularly for subsequent data processing using artificial intelligence algorithms or neural networks. In this regard, the ability to contextualize data is essential—connecting data from various systems to discover new, previously hidden correlations. In addition to using cloud platforms for data collection and processing, digital twin technology or digital thread technology can also be utilized. A digital twin is defined as a virtual representation of a product or process. In the context of sustainability, a digital twin carries information about a specific product or manufacturing technology. By using data from the real environment in combination with master data, it is possible to monitor and evaluate information throughout the entire lifecycle and use it for designing a more sustainable future version of the product. The digital twin also enables simulations of product or technology behavior in a real environment, reducing the need for prototyping or testing in a real-world environment.

To actively manage the carbon footprint, a wide range of tools, especially various specialized emission calculators and reporting applications, can be used. However, in a complex manufacturing and logistics environment, finding a system that can effectively provide the user with information to influence the level of the carbon footprint is crucial. This is where digital tools based on artificial intelligence come into play, allowing the prediction of carbon emission trends based on production data, logistics, machine settings, weather, and more.

READ: 8 Ways Artificial Intelligence Can Drive Decarbonization

This is just a brief overview of the use of digital technologies to ensure sustainability in a genuinely sustainable way. By the way, it's not a typo, but rather a realization that sustainability has multiple meanings!

In Conclusion: Don't Boil the Ocean

While the term "boiling the ocean" may sound amusing, it holds a lot of truth. Just like in any other project or major transformation, introducing sustainability into a company's DNA requires a structured approach. Don't forget about vision, goals, communication, and the strategy for involving the necessary resources and technologies.

A final tip – of course, regulatory or customer requirements come first. However, why not use them to increase your company's profitability? Goals to reduce carbon dioxide emissions can be combined with optimizing energy consumption. Goals to increase the use of recyclable materials can be used to design lighter or less resource-intensive products. Your company's surroundings, customers, and employees will surely appreciate it.

READ: The Making of a Successful Decarbonization Strategy with ARC Advisory