By Mariana Costa, Marketing Specialist at PackIOT
Sustainability is based on the idea that the activities performed should “meet the needs of the present without compromising the ability of future generations to meet their own needs”. On an industrial level, this basically means growing the manufacturing industry making sure that we keep the environmental, social and economic impacts at a sustainable level.
On the other hand, resource efficiency means improving efficiency and effectiveness of how we use resources (materials but also land, soil, air, water, biodiversity and ecosystems). This might be using less to produce more and causing less impact from the resources we are using.
Measuring the levels of sustainability and (resource) efficiency are a first step to really understand where we stand and where we have come from. Only this way can we understand progress, its speed and direction. Consequently, we will be in the right place to adopt effective management strategies.
In the manufacturing world we can all agree that AI is a big impulse to sustainable development, paving the way to a more eco-friendly, less waste and energy-efficient sector. This includes diminishing the impact of the industry’s main problems such as:
- Excessive use of certain materials
- Redundant production scrap waste/rates
- Inefficient supply chain management
- Unequal distribution of energy resources
Artificial intelligence alone can solve all the aforementioned problems. By analyzing specific data and accurately predicting the expected output it is possible to adopt measures to eliminate excessive material use or waste. Additionally, through this technology it is possible to get recommendations to balance energy in use and to benefit the supply chain management and logistics with demand forecasting, better communications and real-time decision making solutions.
But the real questions remain: can sustainability and improved efficiency go hand-in-hand? And can you achieve that using today’s technologies and know-how?
These are very important questions we need to ask about industrial sustainability and efficiency. What is especially important to notice, in the first place, is that solutions are not just about technical capabilities but mainly about organizational strategy, culture and behavior.
Basic economic principles will always suggest that, in order to find the most efficient ways to operate, businesses will seek to drive down costs – and that doesn’t happen alone without resource efficiency. When we talk about an efficient use of resources we are questioning the way we use energy, water and materials and, consequently, how to minimize waste and pollution.
Still, most companies do not prioritize the efficient use of resources. More important even, they are often unaware of where their inefficiencies are or if they can immediately act on it without relying on heavy investments.
Immediately we can tell you three big strategies to start evaluating your business and optimize this symbiotic relation between sustainability and resource efficiency which will lead to cost reduction:
1_Understand Value Opportunities
It’s important to start by identifying where resources are being wasted and where opportunities are being lost for creating value. Observing the image below, it’s clear that a better use of resources is frequently connected to improved profit margins.
Through the visual approach of the Cambridge Value Mapping it is possible to help you identify and recognize where value is being captured and where is not (“uncamptured” – missed, destroyed, surplus or absent value).
Image 1: Cambridge Value Mapping Tool
With this tool, it is possible to analyze the exchange of value through each stakeholder in the business ecosystem, with the natural environment and society.
Besides identifying where resources are going to waste and where value is not being captured, it is also important to understand how to scale the findings across the industry.
To achieve industry sustainability, we shouldn’t be focusing only on isolated solutions where one company works out a clever trick and considers the job is done. It is imperative to understand how to scale these solutions. Scalability is also about cooperation across the industry. Change towards sustainability and resource efficiency can be achieved more effectively if organizations collaborate and learn from each other to achieve key goals, both on the collective and individual interest. A great way to pave this path is to get the support and engagement from policymakers.
3_Deploy Simple Tools
In order to make efficiency improvements more realistic and achievable for manufacturers it is necessary to have access to scalable, practical and easy-to-use tools. The usage of resources needs to be more visible and tangible so we need ways to address it in a more measurable and straightforward way.
Cloud-based platforms can be viable solutions as they will help manufacturers to have a clear idea of how the factory is working and where they are wasting resources or overspending at other levels on the shop floor and across the supply chain.
In real-time it will be possible to reduce scrap rates, use less energy, water and materials and consequently cut on operational costs and environmental impact. This is a type of approach which well implemented will make a valuable difference to your business and achieve both goals: a more sustainable approach aligned with resource efficiency and profit optimization.