How to make your digital transformation sustainable
With all eyes firmly fixed on the COP26 climate change conference in Glasgow in recent weeks, sustainability has never been such a crucial issue, nor captured public attention more.
Aiming to secure global net zero emissions by the middle of this century and limiting global warming to 1.5 degrees, world leaders have called on industry to limit emissions and act in a more sustainable way. However, according to the Royal Society, digital technology accounts for between 1.4% and 5.9% of global emissions. That’s much the same as the airline industry – and the figure has been steadily rising.
John Frey is chief technologist, sustainable transformation at Hewlett Packard Enterprise and a lead contributor to the World Economic Forum’s (WEF’s) Bridging Digital and Environmental Goals playbook. He estimates that by 2025, 61% of the world’s population and 41.6 billion internet of things devices will be online.
“The expansion is improving livelihoods and driving productivity, but we can’t ignore a fundamental issue: the rapid growth of the digital universe and its energy consumption is contributing to climate change,” he says.
So how can organisations carry out a digital transformation while keeping sustainability in mind?
Frey believes digital transformation and sustainability can often be complementary. “Sustainable innovation often results in solutions that save money, have a lower environmental and social impact, improve employee attraction and retention, and generate little to no waste,” he says.
That’s what Paolo Taticchi found when consulting on a digital transformation project for pharmaceutical company Consilient Health. The company hoped to secure important partnerships with major manufacturers and customers in the pharma industry, while also wishing to retain its relationship with the NHS, itself implementing new sustainable supply chain and procurement strategies.
According to Taticchi, a professor who teaches strategy and sustainability at UCL’s School of Management, it became very clear that digital transformation projects would enable the sustainability strategy by providing real-time information and measurement of processes, along with greater transparency for internal and external stakeholders. These projects included distributed ledger technology in the management of supply chains and the implementation of a new ERP system.
“The sustainability objectives have become a true source of innovation in the context of the digital transformation agenda,” Taticchi says.
Similarly, the European Farm to Fork strategy aims to improve traceability in food supply chains, but also intrinsically works to reduce waste. For example, the SecQuAL (Secure Quality Assured Logistics for Digital Food Ecosystems) project, funded by the Industrial Strategy Challenge Fund, introduces smart labels to monitor cold chain conditions, predict shelf-life more accurately and identify bottlenecks and inefficiencies in supply chains.
The programme will help reduce waste throughout the supply chain says Clive Stephens, head of research and development at food producer Cranswick. “Our vision is to be the world’s most sustainable meat business,” he says.
The EU has found that participants in farm-to-fork smart farming initiatives have shown reductions in water use, pesticide use and NO2 emissions. Meanwhile, the WEF suggests that using artificial intelligence to design out waste for food, keep products and materials in use for longer and regenerate natural systems could represent savings of up to $127bn (about £93bn) a year in 2030.
However, a sustainable digital transformation creates challenges because digital technology itself is a significant contributor to global climate change. While improvements in energy efficiency have helped to limit the growth of energy demand from data centres and data transmission networks, each accounted for around 1% of global electricity use in 2019, according to the International Energy Agency.
