Is digitalisation a driver for sustainability?

Organisations worldwide are transitioning to a digital-first mindset, deploying technologies like machine learning, artificial intelligence (AI), and the Internet of Things, or IoT. For example, companies in the manufacturing industry are shifting to process automation, augmented reality, 3D printing, and other digital solutions. We’re also witnessing the rise of smart manufacturing, which creates opportunities for energy optimisation, process improvement, and predictive maintenance.

These technologies can help businesses address their sustainability challenges, paving the way to a greener future. They also align with the European Union’s commitment to net-zero greenhouse gas (GHG) emissions by 2050. Even basic solutions, such as industrial IoT sensors, can reduce emissions from transportation and lead to more sustainable supply chains.

The interplay between digital technologies and sustainability is referred to as the “twin transition.” Basically, digitalisation and sustainability go hand-in-hand, and we should focus equally on both areas to drive transformation at scale.

The digital route to sustainable manufacturing

Nowadays, everyone is discussing climate change, globalisation, and digitalisation, the megatrends shaping our world. About 70 countries, including the U.S., the UK, Russia, China, and other top polluting economies, have set a net-zero emissions target to mitigate climate change. More than 5,170 organisations worldwide have already joined the Science Based Targets Initiative, a project to reduce GHG emissions.

Sustainability has become a value driver for business over the past decades—and it makes sense, considering that 75% of all pollution comes from just 20 countries. As far as the EU goes, nearly one-third of GHG emissions come from transportation. Industrial operations are responsible for 26% of emissions, whereas electricity and heat production contribute to another 23%.

One way to address these challenges is to embrace digital transformation. With this approach, your business could become greener and more efficient, which translates into higher revenue.

Digitalisation, or digital transformation, can be defined as the integration of digital technologies into business operations. Its role in the manufacturing industry is to remove inefficiencies while limiting production and supply chain waste.

Sustainability practices, on the other hand, aim to halt climate change and protect natural resources. In a business context, this approach involves using only those products, services, data sets, and platforms perceived as essential for operational efficiency and innovation.

For example, IoT devices allow companies to allocate resources more efficiently by collecting data during the product lifecycle. Along with AI and machine learning, this technology enables manufacturers to create digital twins or virtual copies of equipment, parts, and other physical objects.

The result? A lower carbon footprint, reduced costs, and increased performance across the board.

Conversely, robots can facilitate recycling, product disassembly, and other remanufacturing processes, decreasing GHG emissions. AI-powered systems, machine learning, and 5G technologies can optimise network management, helping companies save energy.

Another example is additive manufacturing (AM), which uses 3D printing to build three-dimensional objects. Not only does this technology reduce material and energy usage, but it also allows for faster prototyping and, hence, a shorter time to market. Plus, it makes creating highly customised products and components easier, resulting in less waste at the design and use stages.

Additive manufacturing will transform the concept of production engineering from removing materials and creating waste to using only the necessary materials to create the product. In the future, these production principles will be applied to digitalisation where only the essential data and process are added to the digital platform. As a result, they will improve the sustainability of digitalisation.

Why sustainable manufacturing makes sense

A more sustainable approach to manufacturing can benefit companies, consumers, and the environment.

Manufacturing operations are energy intensive, accounting for one-fifth of CO2 emissions. For example, producing electronic devices and hardware contributes to about 10% of global energy consumption.

Sustainable manufacturing practices can help reduce waste while optimising energy and resource usage. This would allow companies to cut operational costs, avoid regulatory fines, and operate more efficiently. At the same time, it would mitigate the legal, financial, and reputational risks associated with environmental harm.

Remember that consumers are also concerned about environmental issues and often favour sustainable companies and brands. Therefore, achieving a “green” brand image can set your business apart and drive revenue growth. But that’s not all.

As sustainability becomes a global priority, many governments and organisations are switching to environmentally responsible suppliers. This allows “green” companies to access new markets, secure more clients, and gain a competitive edge.

Sustainability also drives innovation and operational efficiency. Take Tesla, for example. Its electric vehicles are not fully sustainable yet, but their production requires less water than traditional cars. The company also leverages AI to reduce energy consumption in its factories.

Last but not least, sustainable companies often report higher employee retention rates and find it easier to attract talent. In a recent survey, more than half of employees cited sustainability as a key factor when searching for work. This number was even higher among young professionals.

Achieving sustainability through digitalisation

Transitioning to more sustainable manufacturing processes can lead to cost savings, operational efficiency, and higher profits. But while all this sounds promising, there are significant trade-offs between digital transformation and sustainability.

Although digitisation has brought significant benefits, it continues to carry a significant carbon footprint. The conflicting strategic priorities within organisations and the lack of a consistent approach pose additional barriers.

Business leaders can address these challenges by taking a strategic approach to the twin transition. A good starting point is to set clear goals for digitalisation and sustainability, with a focus on advanced business areas. These may require more sustainable production processes and sourcing practices, shifting to a closed-loop supply chain, identifying environmental KPIs, and more.

After that, you’ll want to invest in technologies that can drive ecological, social, and economic sustainability, such as robotics and additive manufacturing.

At the same time, it’s crucial to set objectives for each area, secure the skills needed for a successful transition, and aim for digital sufficiency. This requires a circular approach to adopting digital and green initiatives, allowing for industry, knowledge, and technology transfer.

What matters most is having a well-defined twin transition roadmap before getting started. Don’t expect to change things overnight. This process takes time and requires a fundamental shift in business strategy, but the results will be worth it.

By leveraging Salesforce Net Zero Cloud, Fluido can support your business’s sustainability journey. This innovative solution enables companies to analyse, manage, and optimise their carbon data to achieve their net-zero emissions targets. Its end goal is to drive sustainable digitalisation and offset climate change. The transition can be extended across the whole supply chain and the customer network, allowing companies to partner with suppliers who share their sustainability goals and values.