Manufacturing smarter and greener isn't just a trend, it's essential. New legislation is pushing sustainability to the forefront, while increasingly conscious consumers are demanding eco-friendly options. Yet, despite the importance of the topic, many manufacturers struggle with the ‘’how to’’.
Here, at AlisQI, sustainability is one of our core values. We're passionate about helping manufacturers to amplify their positive impact and achieve sustainable growth. Our recent Customer Day event delved into the heart of these issues. We explored the key sustainability goals of leading manufacturers and the challenges they face in achieving them. This article highlights the insights gained at the event, once again demonstrating why sustainability is a burning issue for the manufacturing industry.
Sustainability: a regulatory imperative
Sustainability is no longer a "nice to have" but a regulatory imperative. Governments across the globe are enacting stricter environmental laws to curb pollution, conserve resources, and address climate change. These regulations touch every facet of manufacturing, from energy usage and waste disposal to supply chain transparency and product lifecycles. Initiatives like the ISO standards for environmental management, Science Based Targets initiatives (SBTI) for setting ambitious emissions reduction goals, and the Paris Agreement's global framework for climate action are all driving a more sustainable future.
Additionally, regulations like the Corporate Sustainability Reporting Directive (CSRD) in the European Union require greater transparency and accountability in a company's environmental, social, and governance practices. More specifically, CSRD's main goal is to reduce greenhouse gas emissions, and progress is measured within three mandatory different scopes. Many organizations still struggle or haven't started with scope 1 (reporting on direct emissions) and scope 2 (reporting on indirect emissions from the energy it uses and purchases), let alone scope 3 (emissions created by an organization's supply chain).
Manufacturers who fail to adapt to this evolving regulatory landscape risk facing hefty fines, operational disruptions, and even exclusion from key markets. By prioritizing sustainability, companies can not only ensure regulatory compliance but also operate with greater certainty and avoid legal roadblocks.
Sustainability goals and main barriers to achieve them
During the Customer Day, AlisQI’s CEO Otto de Graaf led a thought-provoking workshop exploring the topic of sustainability and supply chain management. The session began by highlighting key macro-economic concerns as well as emerging legislation impacting manufacturers. Then, our valued customers took center stage by actively participating in a short, live poll.
The first question delved into their main goals for sustainability. Waste reduction, environmental impact minimization and CO2 reduction emerged as top objectives. Interestingly, supply chain monitoring, logistics improvement, and cost reduction showed less focus. Four of the 57 respondents indicated uncertainty regarding their main sustainability goals.
A deeper dive into the scope of sustainability goals revealed that most respondents associated this primarily with operations and direct supply emissions. Notably, the second most frequent response indicated uncertainty about the scope. The remaining responses were relatively evenly distributed between cradle-to-gate, cradle-to-grave or cradle-to-cradle.
The question on barriers to achieving sustainability goals yielded surprising results. Data gathering emerged as the most significant hurdle. A lack of focus and cost followed as the second and third most common challenges, respectively. Conversely, a lack of knowledge and clear legislation were the least frequently cited barriers.
Results regarding Quality's potential leadership role in sustainability were mixed. While 9 respondents agreed to Quality's involvement, they did not consider it a top priority. Similarly, 8 respondents expressed opposition, while another 8 showed their support. Four participants remained unsure about Quality's suitability for this role.
7 important take-aways
There is no doubt that sustainability is emerging as a paramount goal for manufacturing. By minimizing waste, optimizing resource usage, and reducing pollution, sustainable manufacturing benefits businesses and the environment. Companies implementing sustainability strategies experience cost savings, enhanced investor confidence, and a boost in innovation and competitiveness, ultimately ensuring the industry's long-term viability.
Achieving sustainability goals can feel overwhelming, but a strategic approach can lead to significant progress. So, where to start? How can you approach this topic? We believe that it’s important to first cover the bases. Here is a breakdown of key steps to consider:
- Start looking at operational level first. This lays a strong foundation for broader sustainability initiatives.
- Measurement and tracking. Remember to measure everything, track progress and connect your data to clear KPIs. This will allow you to see your progress and identify areas for optimization.
- Dare to make assumptions. For example measuring exact CO2 emissions or energy consumption per production line may not always be feasible, but making assumptions will enable you to identify bottlenecks and focus areas.
- Communicate with your supply chain. Sustainability efforts require collaboration. Communicate your goals and encourage your supply chain partners to prioritize operational efficiency as well.
- Quality Management is a great place to start. If data gathering is one of the biggest barriers, prioritize quality data from readily available sources like your Quality Management System (QMS). In addition to using existing data, you can use your QMS to track sustainability metrics and provide sustainability reporting on an Operations level.
- Maximizing gains. When implementing changes, prioritize initiatives with multiple benefits. For example, if reducing CO2 emissions also leads to cost savings, it offers a double win and can be a strong starting point.
- Continuous improvement. Once you’ve covered your bases, you can expand your sustainability efforts and explore further.
Want to know how AlisQI can help you create a positive impact and achieve sustainable growth?
Have a chat with one of our experts.
