Four ways digital transformation can help achieve sustainability goals IBM Supply Chain and Blockchain Blog

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Cargo ship in the shipyardEvents related to the pandemic of the past two years have caused people to rethink their sustainability priorities. Governments are setting regulatory standards. Investors and financial managers are increasingly incorporating sustainability criteria into their investment decisions. And customers and employees have become more environmentally conscious, looking for brands and employers who share their values. Together, these forces are shaping a new corporate agenda. Sustainability has planted itself squarely in the heart of boardroom and operational management discourse.

Despite this rising tide of influence, a new report by the IBM Business Value Institute, “Sustainability as a Transformational Catalyst: Pathfinders Turn Aspirations into Action,” shows that only 35% of companies have taken action on their sustainability strategies. 4 in 10 companies have identified sustainability drivers for closing their sustainability gaps or for change. And only a third have integrated sustainability objectives and metrics into business processes.

Businesses seek actionable environmental insights to achieve sustainability goals. But current methods are often difficult and complex, requiring intensive manual labor, climate and data science skills, and computing power to fully exploit their data.

The good news is that digital transformation can help organizations stay resilient, adaptable and profitable in this new era. Here are four ways that big data and AI strategy can play a key role in shaping businesses around the sustainability agenda.

Creating a stronger infrastructure

The effects of climate change and dwindling natural resources require companies to extend the lives of their buildings, bridges and waterways. By embarking on digital transformation to meet their sustainability commitments, companies can find new opportunities to improve their processes, reduce costs, reduce waste, attract new customers, increase brand loyalty and adopt new business models.

AI-powered remote monitoring and computer vision can help organizations spot, predict and prevent issues. You can also perform condition-based maintenance based on operational data and analytics to reduce downtime and maintenance costs. Improved asset management helps companies reduce inventory of spare parts. And a company can save energy costs by identifying a small problem before it becomes a bigger and more energy draining issue.

Building a transparent, trusted supply chain

Supply chain leaders need visibility. When you fail to accurately track the amount and location of your inventory and where it is, you can over-order, tie up a lot of working capital. And if supply chain leaders lack transparency and data sharing with their deep-level suppliers, it’s incredibly difficult to track products from origin to delivery in a reliable and controlled manner. This makes it difficult to identify the supplier’s risk and protect the brand.

Achieving supply chain sustainability goals requires a global, accurate, real-time view of inventory as well as the ability to share information across the supply chain ecosystem that organizations trust. AI can help companies eliminate obsolete and unsalable products, reduce carbon emissions from logistics activities, improve decision-making, and reduce waste in raw materials, finished goods, and spare parts.

Gaining business insights from environmental intelligence

Companies that are exposed to various external factors especially need advanced forecasting tools. Consumer companies like Unilever need information to help them predict environmental impact and make sustainable choices. Insurance companies like Canada’s Desjardins Insurance want to better predict disruptions to policyholders—for example, advanced notice of snowstorms can help customers take action to avoid damage. Location data capabilities enable companies to plan and respond to weather events with AI-based predictions derived from a combination of proprietary and third-party geospatial, weather and IoT data. This facilitates and automates the management of environmental risks and implements basic processes to achieve environmental goals, including carbon accounting and mitigation.

Cleaning up the world economy

In the coming years, utilities will continue to play a central role in the energy transition, accelerating global decarbonisation through clean electrification – the process of replacing fossil fuels with electricity produced from renewable sources such as wind, solar and water. And they need a comprehensive asset management strategy for operation, maintenance and life cycle of these renewable energy plants. Digital transformation will be key to decarbonization, and help electric ecosystems deliver clean energy to connected consumers in safe and reliable ways.

Businesses everywhere have entered a new era of digital reinvention fueled by innovations in hybrid cloud and AI. IBM is uniquely positioned to help our clients advance the Sustainable Development Goals (SDGs).

In this radically changed business landscape, IBM is partnering with organizations to deliver five digital advantages designed to: Predict and formulating results based on data; Automation For productivity and efficiency balance, Reliable All touch points are always, Modernization infrastructure and turn into Technology-enabled digital business models.

Learn how AI can help you plan a sustainable and profitable way forward.

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