In a rapidly changing world, manufacturing as a process has gone beyond turning raw materials into finished products. With the advent of smart products, changing consumer demands, along with ever-changing economic factors in manufacturing and the supply chain, it is evident that the only constant in manufacturing is change. These dynamic factors have encouraged manufacturers to innovate their existing business models and explore new ways of creating and capturing business efficiencies and value.
As they set the right course for truly comprehensive transformation, manufacturers must manifest a business imperative: sustainability. In light of market and regulatory forces and climate change, sustainability thinking must permeate all levels of production. From the zero-sum struggle between economic sustainability and environmental considerations to the core of business manufacturing strategy, sustainability as a concept has come a long way in addressing cost pressures, natural resource depletion, aggressive market competition, and consumer and investor demands. Today, the arguments for sustainability are strong.
Keeping the German Sustainable Development Strategy (GSDS) as their compass, manufacturing companies in Germany have set out on their path to achieving sustainable growth and modernization through innovation. Businesses are committed to accelerated action that will transform their impact on the circular economy, climate protection, biodiversity, sustainable mobility and other issues in equal measure. However, it is important to note that sustainability is more than just dominant forces such as regulations; it is necessary to work, compete, survive and thrive in today’s economy.
Sustainability as a competitive advantage
In the words of Peter Drucker, “Profit is like oxygen. You need it to survive, but if you think oxygen is the purpose of your life, then you’re missing something.” By the same token, if manufacturing companies are implementing sustainability programs only to comply with regulations, then they are missing something significant.
Launching sustainability initiatives to address environmental, social and governance (ESG) challenges is not the final destination. Businesses need to understand the benefits of sustainable production beyond conventional sustainability reporting and circularity initiatives that reveal their ESG performance. Manufacturers can outperform market competition, strengthen/revive their brand image and significantly improve their products and services through sustainable production. In doing so, businesses should use a well-defined strategy to achieve higher performance and market valuation of sustainable products, improved brand image and returns, and increased investor interest. Once businesses achieve a more nuanced understanding of the benefits of sustainable manufacturing, they need to dive into the “how” aspect of the equation. Here’s what they have to do:
- Align your circular business model with the relevant Sustainable Development Goals (SDGs) to create significant environmental, social and financial value for every stakeholder.
- Implement programs and practices to achieve sustainable development goals.
- Establish a connected enterprise with collaborative industry as well as cross-sector partnerships and ecosystems.
- Monitor and report on progress towards sustainable development goals.
- Invest in radical innovations driven by advanced technologies.
- Creating an organizational culture that supports sustainable innovation.
Sustainability Powered by Technology
To achieve sustainable results, businesses must adopt a stronger framework based on advanced technologies for a sustainable future in Germany. Through data-driven solutions that leverage digital technologies such as the Internet of Things (IoT), artificial intelligence (AI), and industrial IoT (IIoT), businesses can overcome the challenges and inefficiencies that continue to stifle business growth. In addition, manufacturers increasingly rely on IT and cloud computing to host, store and analyze real-time data, thereby improving business intelligence, management and collaboration. While achieving the net-zero goal across Germany requires a complex technological transformation, manufacturers must focus on restructuring their value chains and building and adapting critical infrastructure. Significant investments in new technologies pave the way for drastic improvements in operational, energy and maintenance costs in the manufacturing business. For manufacturers starting their sustainable efforts, the challenges come from adopting and investing in technology that supports sustainability.
This is where Tech Mahindra moves the needle. Following ‘Purpose Above Profit’, Tech Mahindra empowers manufacturers to incorporate ESG principles into their core strategy and maintain a balance between sustainability and overall business profitability. Our differentiated thought leadership, in-depth knowledge and industry, product and enterprise expertise have been instrumental in establishing business models and technology solutions that are comparable to industry standards.
About the author
Vice President and Head of Country – Germany and Austria, Enterprise Business, Tech Mahindra
Fares is currently Vice President and Country Head – Germany & Austria, Enterprise Business, Tech Mahindra, and is responsible for nurturing and handling relationships at the CKSO level, P&L ownership, strategy, sales, delivery, operational, M&A of major clients and enterprises. as penetration into new clients. With over 20 years of business and IT industry experience leading sales teams, delivery, managing CKSO relationships across Europe, he has a proven track record of delivering results that exceed internal targets and customer expectations.