Making industrial operations more sustainable has become an increasingly important endeavour and if you’re seeking avenues to accelerate your organisation’s sustainability efforts, you’re not alone. Rockwell Automation’s 9th Annual State of Smart Manufacturing Report shows a significant increase in the adoption of sustainability and ESG policies.
A staggering 98% of organisations have some sort of ESG policy in place and half of those have company-wide formalised policies. At the same time, 95% of organisations are using smart manufacturing technology and increasingly looking into new technologies to become more productive and more sustainable.
This article explains the top sustainability trends and key actions that you can leverage to become a more sustainable organisation.
Companies are facing increasing pressures from stakeholders
Why is it critical for a sustainable industrial organisation to take swift action? Because industrial sectors account for nearly 40% of global energy consumption and more than 30% of global greenhouse gas emissions. Given their impact, industrial companies are facing ESG-related pressure from major stakeholders. Investors are pushing companies to take more aggressive action to meet Net Zero goals, while regulatory bodies are mandating changes to ensure sustainability is prioritised.
Geopolitical tensions are also changing the landscape. Finally, pressure from customers is growing. More choices are made with sustainability in mind. Consumers expect companies to operate in sustainable ways and to offer sustainably made products. In one study, 32% of consumers reported they paid significantly more for a sustainable product or service.
These are some of the key sustainability trends:
Emerging technology is indispensable
Emerging technology − AI, robotics, digital twins, IIoT and AR/VR to name a few − is a non-negotiable part of becoming a more sustainable industrial organisation. If you’re not already exploring or using this technology, you will not make meaningful progress in your sustainability goals. Why? Because emerging technology makes manual processes like plant operations, workforce training and raw materials sourcing more efficient and more effective in producing high quality output.
Sustainable industrial organisations agree that adopting smart manufacturing practices, which use emerging technology, is extremely or very important. In fact, 85% of them have currently invested or plan to invest in advanced technology such as AI and ML.
Action item: Initiate a small pilot program around one advanced technology. For example, you could use a digital twin to identify how to optimise operations for a single assembly line. Or you could use an AI tool for one piece of equipment to help you determine opportunities for energy savings. Alternately, you could experiment with AR/VR glasses to train a group of remote workers.
In other words, start small. Applying emerging tech to a targeted initiative will give your team time to learn and gain early wins that can secure wider organisational buy-in. But be sure to increase your use of technology over time. Becoming a sustainable industrial organisation requires scaling the automation and digitisation of your processes.
Human workers are still your greatest asset
The Smart Manufacturing Report found that 94% of organisations expect to maintain or grow their workforce as a result of manufacturing technology adoption. Supplementing and amplifying workforce with cobots, autonomous mobile robots (AMRs), automated guided vehicles (AGVs) and wearables all ranked as top investments areas.
Labour challenges continue to be one of the top cited struggles facing sustainable industrial organisations. The report found that “respondents plan to use new and emerging technology to amplify their workforce, fill the skills gap and maintain quality against a backdrop of employee turnover.”
Action item: Leverage automation to do the repetitive tasks in your facility and free up your workforce to perform high-impact tasks that require skill. As the report says, “manufacturers have cited a lack of skilled workforce as the top reason they will struggle to outpace the competition.”
As an example, you can assign an AI tool to analyse large datasets faster and more accurately than your workers. That frees up your workers to do the more impactful work of making outcome-driven decisions based on that data.
Plus, the well-being of your workers is critical in advancing your sustainability efforts and improving your ESG performance.
Action item: Sustainable industrial organisations encourage employees to voice their opinions. Consider developing anonymous surveys, focus groups, online forums and/or an open-door policy with managers. Enable employees to speak openly and safely about their level of well-being and what the organisation could improve.
Stay ahead of regulatory changes
Today, manufacturers are not only concerned with their own sustainability efforts but also those of stakeholders across the entire supply chain. Manufacturers are increasingly adopting a holistic approach, collaborating with suppliers and partners to achieve sustainability goals and move to Net Zero. For companies with global operations especially, staying ahead of ESG regulations in different countries can be a challenge, which is why adopting the right technology and partnering with the right companies is crucial.
Manufacturers cannot afford to fall behind on ESG policies. Sustainability efforts must be taken early on and therefore extend across the entire supply chain and leverage cooperation across companies. Regulatory changes and government incentives have been instrumental in shaping this new landscape and motivating manufacturers to incorporate sustainability into their operations.
Action item: Be proactive in incorporating sustainability within and across your operations. Expand your sustainability committee to include suppliers, product designers, customers, investors and any other key sustainability stakeholder. Stay up to date with changes in the landscape and consult thought leadership resources such as those from the World Economic Forum.
Continue to equate sustainable industrial organisation practices with productivity
There is no question that improved sustainability leads to improved productivity. The main reason that industrial organisations pursue sustainability is because it will increase efficiencies.
The link between sustainability and productivity is apparent on the world stage, as well. For Cyril Perducat, SVP and chief technology officer at Rockwell Automation, sustainability must be translated into something highly doable and ROI-focused for organisations. “We need to make sustainability even more practical and actionable so that people understand, ‘If I invest in this way, here are the benefits I’m going to get, the time I need to implement and the return on investment I’m going to get.”
In other words, when sustainability efforts are practical, connected directly to ROI and have a clear timeline, organisations will be more willing to commit.
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