Here are four ways digital transformation can help you reach your sustainability goals
People are rethinking sustainability priorities after the pandemic-related events in the last two years. The government is enforcing regulations. Financial managers and investors are now considering sustainability criteria when making investment decisions. Customers and employees are becoming more conscious about the environment and seeking out brands and employers that share their values. These forces together are creating a new corporate agenda. Sustainability is rightfully at the center of operational and boardroom management discussions.
A new report from IBM’s Institute for Business Value , “Sustainability is a transformation catalyst: Trailblazers transform aspiration into actions,” shows that only 35% have taken action on their sustainability strategy. Only 4 out of 10 companies have identified the sustainability drivers or initiatives that will close their sustainability gaps. Only one-third of companies have integrated sustainability metrics and objectives into their business processes.
To achieve sustainability goals, businesses need to have actionable environmental insights. However, current methods can be cumbersome and complicated, which requires intensive manual labor, climate- and data science skills, as well as computing power to fully exploit their data.
Digital transformation can help companies remain resilient, adaptive, and profitable in the new era. These are just four of the ways that a comprehensive data- and AI strategy can help you reshape your business around a sustainability agenda.
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A resilient infrastructure is created
Companies must extend the lives of their buildings, bridges, and water lines to meet the challenges of climate change and diminishing natural resources. Companies can use digital transformation to fulfill sustainability commitments to find new ways to improve their processes, reduce costs, reduce waste, attract new clients, build brand loyalty and adopt new business models.
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AI-powered remote monitoring can help organizations predict and avoid problems. They can also conduct condition-based maintenance using operational data and analytics to reduce downtime as well as maintenance costs. Companies can reduce their spare parts stock by having a better asset management. A company can cut down on energy costs by identifying small problems before they become bigger and more costly.
A transparent and trusted supply chain is built
Visibility is essential for supply chain leaders. They need visibility to track exactly how much inventory they have, where they are located, and what it’s worth. This can cause them to over-order and tie up too much capital. It’s also difficult for supply chain leaders to share data and transparency with their suppliers of deep tier. This makes it extremely difficult to track products from origin to delivery in a safe and controlled manner. This makes it more difficult to identify and protect brand reputations from supplier risk.
To achieve supply chain sustainability goals, organizations need a global, accurate and real-time inventory view. They also need to be able to trust each other’s data. AI can help companies reduce inventory that is not being sold, cut carbon emissions from logistics moves, optimize fulfillment decisions-making and minimize waste.
Get business insights from the environment
Highly developed predictive tools are needed for companies that are exposed to many external factors. Unilever, a consumer goods company, needs data to predict the impact of environmental factors and make sustainable decisions. Desjardins Insurance, a Canadian insurance company, wants to be able to predict the impact of disruptions on policyholders. For example, clients could receive advanced warnings about hailstorms in order to take preventive action. Companies can use AI-driven prediction to plan for and respond in the event of weather events. This is done using a mix of third-party and proprietary geo-spatial, weather, and IoT data. This automates and streamlines management of environmental risk and operationalizes the underlying processes to achieve environmental goals, such as carbon accounting and reduction.
Global economy decarbonization
Utilities will play an important role in the energy transition over the next few years by helping to accelerate global decarbonization via clean electrification. This is the process of replacing fossil fuels and producing electricity from renewable sources like solar, wind, and hydro. They will also need to have a comprehensive asset management plan for the operation, maintenance, and life cycle of these renewable energy plants. Digital transformation is key to decarbonization. It will allow electricity ecosystems to deliver clean energy in safe and reliable ways to consumers.
All businesses are now entering a new era in digital reinvention thanks to innovations in AI and hybrid cloud. IBM is uniquely placed to assist our clients in achieving Sustainable Development Goals.
IBM partners with companies to provide five levers for digital advantage in this rapidly changing business environment. These levers include the ability to predict and shape data-driven outcomes and automate at scale to productivity and efficiency. They also secure all touchpoints, modernize infrastructures, and transform businesses with new technology-driven digital models.