Sustainability & Digital Transformation - a match made in heaven?

Sustainability & Digital Transformation - a match made in heaven?

With awareness of climate change now widespread, sustainability is now a central issue for forward thinking businesses. Those organisations taking the right steps to incorporate sustainable measures into their business model today are setting the standard for how all companies will operate in the future, while benefiting greatly in the present.

The UK Government’s Industrial Strategy names Clean Growth as one of the four Grand Challenges and the country has already seen its carbon emissions reduced by 42%. Alongside renewable power, this shift is partly due to the rise of lower carbon technologies and the efforts of companies to implement more efficient systems and services. Embracing technological advancement and innovation is not only essential to promote a more environmentally friendly approach to business, but done correctly, it can also cut costs, drive profits, and promote growth.

A new global mentality

Technology can already be seen transforming the way businesses approach sustainability. The consensus amongst shareholders of multinationals has shifted in the last decade, with environmental, social and governance issues which were once barely considered relevant to financial performance, now materialising into key drives of an organisation’s success. The annual Global 100 index of the world’s most sustainable companies published by the Canadian research firm Corporate Knights, reveals just how profitable a company can become from taking sustainability seriously. Claiming the top position in 2020 was the Danish power company Ørsted, which has transformed its business and has seen its green energy production shift from 17% to 80% in the last 15 years. Ørsted now project to be internally carbon neutral by 2025, and are looking ahead to tougher challenges, decarbonising their whole supply chain by 2040.

Greener supply chains

According to a study by McKinsey, the average supply chain for most consumer companies accounts for more than 80% of its greenhouse-gas emissions. It is promising to know that renewable energy will power the future, and with the advancement of electric vehicles, the decarbonisation of logistics in supply chains is already in the works. Cleaner energy, however, is not the only change that needs to be implemented. Focusing on the right digital transformation strategy will also aid cleaner environmental ambitions.

With e-commerce on a continuous upward trend, an estimated 3.9 Million vans are on the road in the UK alone, with a further 493,600 HGVs covering over 19.2 billion kilometers in the country each year. Vehicles that, for the time being, are vastly dependent on petroleum-based fuels. Electric vehicles are on the way to widespread adoption, but logistics companies cannot simply wait for automotive manufacturers and renewable energy to solve their emissions problems - the model 21st century organization should champion technological advancement now, investing in the right technology to make their existing operations more efficient and less wasteful, rather than waiting for technology to advance around them. With the right scheduling and auto allocation software, logistics and other automotive-reliant industries do not need to transform their whole fleet overnight to become greener, rather, they can begin to let technology aid reduction of their fleet’s carbon-footprint in the present - whilst cutting costs and improving service.

Advances in artificial intelligence, IoT and data analytics have made the potential to build sustainability-friendly software for logistics a reality right now. Addison Lee experienced that change first hand, reducing emissions by 33% by adopting algorithm-based fleet management technology that managed drivers’ allocation through real-time data and analysis. At the same time as emissions dropped, driver earnings increased and waiting times were reduced. Across the wider logistics industry, with almost 50% of trucks allocated to transporting goods travelling empty, the room for improving efficiency and eliminating wasted journeys is vast.

With the right technology, companies of all sizes mustn’t wait to start their green transition, the potential to stay ahead of the curve is already available - adopting it will ensure a smoother transition into our inevitable carbon neutral future.

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