Practically every company is now forced to think about the world's environmental challenges and the potential impact to the bottom line, especially when it comes to developing new products. What worked in the past will not meet new industry standards. Leaders must be granular in their thinking and evaluate every point in the supply chain to identify sustainable opportunities.
Sustainable production processes are critical for maintaining healthy revenue and a strong record of corporate citizenship. To meet the demands of an evolving marketplace, enterprises must create innovative processes to reduce their environmental impact when developing high-quality, revenue-generating products.
To do this effectively, a combination of technology, vendor and resource management, and efficient production processes must be applied. With this approach, both enterprises and manufacturers can create sustainable products and solutions that not only reduce their impact on the environment, but also provide an economic advantage.
What Does Sustainable Design and Production Look Like?
In short, sustainable production is a process of producing goods that minimizes resources and energy used, waste generated, and incorporates renewable, sustainably sourced resources to create a more efficient and cost-effective production process throughout the supply chain. This approach requires executives to account for the environmental, social, and economic aspects of production from the design phase all the way to a launch.
When looking to create new and innovative products, weaving in sustainability at the design phase can help produce higher-quality products faster as they use fewer resources and create less waste. Finally, this “eco-design” approach actually saves money in the long run, as it's often more efficient and cost-effective than traditional production processes.
Strategies for Eco-Design and Production
Considering that 80% of a company’s emissions come from its supply chain, a business that wants to create a sustainable production process with real impact must focus on technology that enables them to measure the environmental costs of its entire supply chain instead of restricting its efforts to its own four walls. As stated earlier, a combination of technology, vendor and resource management, and efficient production processes must be applied. Let’s explore each one:
Technologies for Eco-Design and Production
Sustainability begins at the design phase; however, fewer than 1% of products have sustainability as a design parameter. Technological advancements that allow designers to work independently of experts or consultants and instantly calculate environmental and cost impacts of their design are essential for creating a sustainable production process. Technologies such as advanced analytics, 3D printing, artificial intelligence, and automation can help businesses reduce their energy consumption and create more efficient design and production plans.
When developing an eco-design approach, advanced analytics and AI may have the most immediate impact. Certain kinds of AI are good at automating data analysis tasks and model creation to reduce the amount of time for calculating environmental impacts. Another area where AI is immensely useful is finding patterns in data to identify opportunities for improvement. The manual process of research, data modeling and the reliance on experts to help identify these insights can often take weeks before a proper decision is made. By automating this process, leaders can reduce the number of opportunities missed and reduce exposure to regulatory violations.
Vendor and Resource Management
Vendor and resource management is also an essential part of creating a sustainable design and production process. This includes identifying and aligning with suppliers on objectives and sustainability targets from the very beginning. If your business has invested resources to design a new product in a sustainable way, then why partner with a vendor that is driven by using only the most cost-efficient materials or methods?
Partner manufacturers must be able to use their own material masters and procurement data to work toward sustainability goals led by design. On the other side, enterprises must invest in solutions that allow them to engage with the partners that share the same values.
Procurement’s Role in Creating Efficient Production Processes
Common efficient production processes can include utilizing renewable energy sources and leveraging eco-friendly materials for production. However, one process that is not discussed as often, but is just as essential, is collaboration between product development and procurement teams. Procurement teams often have little insight into why they’re buying a specific thing. They typically get specifications and try to get the best price and quality with the shortest delivery time.
Businesses need solutions that enable the trade-off decisions that need to happen between product development and procurement. These trade-offs involve understanding how technical specifications affect the cost, environmental performance, regulatory compliance, and other aspects of the final product. It is crucial to do so in real time and without the need for sustainability experts to drive these conversations forward. A digital solution that enables sustainable procurement can not only drive down costs by 5–10%, but companies that are successful in this also typically experience revenue growth 10–20 % faster than competitors, according to Data by McKinsey.
Sustainable design and production processes are essential for reducing environmental impacts and creating the next generation of products. By embracing sustainability principles from the very beginning, businesses can balance their environmental impact with the need to innovate, providing both economic and environmental benefits.