Group Chief Operating Officer at IFS. Passionate about accelerating time-to-value through technology and transforming customers’ businesses.
While the high-profile COP26 summit in November 2021 may have struggled to achieve its goals, it was likely to leave a long-term legacy for manufacturing. The U.S., for example, chose the event as the launchpad for the First Movers Coalition, which aims to accelerate decarbonization in “hard to abate” industries such as steel, aluminum, chemicals and concrete. The initial emphasis is on emerging technologies, and it expanded its scope and scale in November 2022.
For manufacturing, ESG goals are becoming of increasing importance, with investors such as Blackrock (and regulators including the U.S. Federal Reserve) pressing for disclosure of supply chain emissions by major companies. Green credentials and sustainable practices are becoming a necessity for manufacturers as pressure builds on all sides, including consumers.
Moving On From Circularity
The consequence of this is that the standard focus on circularity, while still vital, is no longer sufficient. Ensuring buildings and products are more sustainable through circular supply chains and the reuse of raw materials is critical and has yielded significant achievements, but the manufacturing industry must now do more to remain competitive and compliant—and attract investment.
The question now is whether companies have the right tools to move closer to the next summit in the sustainability chain. Manufacturers committed to greater sustainability must equip themselves for this demanding journey not just in terms of software but also right across their technologies, processes and workflows.
Technology is critical to sustainability in manufacturing. Digital solutions can enable leaner processes that can lead to more environmental efficiency and reduced waste. Digital technology also renders operational workflows far more visible. This helps manufacturers determine areas in which they might eliminate materials usage, reduce their carbon footprint, surface even more efficient process solutions and more.
What Both Sides Need To Be Effective
Yet it has become apparent that not all technologies or their suppliers can deliver what they promise on sustainability. This is why manufacturers must critically examine the environmental commitment of potential partners in order to ensure they have the same “green-first” mindset.
Technology providers must work closely throughout the development process with a manufacturing partner in order to monitor for a sustainable foundation from the beginning of a project. These are new kinds of relationships based on green goals, requiring a manufacturer to crystallize its strategy and be upfront about what it ultimately wants to achieve. The technology provider, for its part, may have to respond with greater-than-normal urgency and be ready to demonstrate the potential sustainability benefits it will deliver.
As with many projects, it is often best to begin with a clearly defined first step and then apply lessons from this initial deployment. What is important is to embark on the sustainability journey with a technology partner fully committed to the long haul, as well as quick successes.
The Value Of Green Partnerships
As an example, aircraft engine-maker Rolls-Royce recently partnered with my company IFS on a program called The Blue Data Thread, in accordance with its “Intelligent Engine” initiative. My own company provided the data connectivity, which allowed for greater sustainability and longer periods between engine overhauls—significantly reducing emissions in the process.
In an entirely different area of the manufacturing supply chain, IFS also recently partnered with coconut ingredient supplier Silvermill Group. This partnership allowed for a greater focus on more sustainable solutions by allowing our partner to better control materials usage in a number of ways in order to create better environmental efficiency.
Keeping Pace With The Evolving Nature Of Sustainability
Organizations must not forget that it is crucial to maintain a close dialogue with partners in order to continue surfacing even more sustainable process solutions.
According to a recent report from PwC, 83% of consumers consider it the role of companies to shape ESG best practices, and 86% of employees indicate a preference to work for companies that care about the same core issues. The technology companies that promise to deliver green value must therefore track and measure these changes over time.
Although governments and international organizations are increasing the pressure for greater sustainability in industry, businesses should not wait to be told what to do. They should start by selecting a technology partner with a genuine commitment to environmental efficiency and proven skill in design and implementation. In partnership with technology providers, manufacturers can enable more sustainable solutions, bolster their reputation and better deliver upon their bottom line. They just need to make the right choices and act quickly.