The Role of Technology In Helping Businesses Do More With Less
Close to a billion people around the world are getting ready to celebrate Earth Day on April 22. The movement started in 1970, when millions of people marched to protest the impact of industrial development on the environment. Despite many achievements since then, and almost 2.7 billion acts of green registered by the Earth Day network, the need for action is more acute than ever.
As the famed scientist and Nobel prize winner Stephen Hawking noted Our population and our use of the finite resources of planet Earth are growing exponentially, along with our technical ability to change the environment for good or ill.
We have reason for concern, but also hope. New technologies could be the urgently needed accelerator to address climate change, transition to clean energy, and reduce negative environmental impacts “ if we apply these wisely as a force for good instead of evil.
While all of us have a role to play in this, businesses, like SAP, have a unique one due to their reach and power to make a positive impact. We have the responsibility to stand for a higher purpose that goes beyond economic success. For SAP, it is to help the world run better and improve people’s lives. Together with our customers and numerous other organizations, we are working to bring this vision and purpose to life and to address the United Nations 17 Sustainable Development Goals (SDGs).
Let me pick just one example: UN Sustainable Development Goal (SDG) #12, which focuses on initiatives that ensure sustainable consumption and production patterns. Put simply, this means managing the world’s people and natural resources better and mitigating harm to people and the environment. Isn’t this also what enterprise resource planning (ERP) should be about?
Why does this matter?
The demand of already-constrained and finite resources is expected to rise exponentially: If the global population reaches 9.6 billion by 2050, the equivalent of almost three planets will be required to sustain current lifestyles according to the UN. Business as usual is no option in this scenario. New ways of doing more and better with less are required.
Digital solutions that drive efficiency and resource optimization are already helping to achieve the UN’s call to increase net welfare gains from economic activities by reducing resource use, degradation, and pollution along the whole lifecycle while increasing quality of life. Companies, such as Vestas and Kaiserwetter, are leveraging SAP technology to enhance access to renewable and affordable energy. Meanwhile, Vectus, for instance, applies it to conserve precious water in India.
Take food as another example. Each year about one-third of all produced food ends up in the garbage or spoils due to poor transportation and harvesting practices. That’s equivalent to 1.3 billion tons of food at a value of US$1 trillion. Which business or government cannot afford to address this?
Acting as enabler and exemplar
For many companies like SAP, it starts with leading by example through our own business practices. For example, we have established sustainable, end-to-end lifecycle management of our IT equipment, which encompass sustainable procurement practices, energy efficient operations, and IT reuse and recycling.
However, the scale comes from enabling a base of 378,000 customers through our technology and solutions. Together, they produce 76% of the world’s transaction revenue and 78% of the world’s food.
The potential is huge. Precision farming solutions, such as the one for Stara, can help to maximize crop yields while minimizing the application of fertilizer, pesticides, water, and other costly resources and decreasing their environmental impact. Better forecasting of demand through the use of Big Data and next-generation ERP can help deliver perishable foods to the right markets. Our transportation management solutions can help optimize loads and routes to make food products available at the right time with minimal environmental impact. Business network, cloud procurement solutions, and the product stewardship network[vii] can help retailers, including Walmart, and consumers gain insight into food supply chains and make sustainable buying decisions. And the list goes on.
Are we done?
Definitely not. We need more purpose-driven innovation and partnerships that connect the dots and enable a truly circular economy in the future. It is not just about responsible sourcing or about recycling “ it’s about thinking it the full product lifecycle from design to end of life.
Dame Ellen MacArthur, who holds the record for circumnavigating the world alone, once said: If we could build an economy that would use things rather than use them up, we could build a future that really could work in the long term.
This Earth Day, I encourage everyone to step up and be part in shaping this future. SAP CEO Bill McDermott, announced today, that as part of our commitment to address SDG #13 Climate Action and become carbon neutral by 2025, SAP is teaming up with partners including Livelihoods Fund, Climate Partner, Plant for the Planet to plant 5 million new trees in the next seven years all over the world.
And there is even more we can do. According to the research SMARTer2030 conducted by Global e-Sustainability Initiative (GeSI) and Accenture Strategy, digitizing business processes and using data to make better decisions about resource usage are essential to reduce carbon emissions. Based on the study results, as well as its own calculations and analysis, SAP came to the conclusion, that digitization in six major industries could help to save up to 7.6 gigatons emissions. That is 63% of the total of 12.1 gigatons emissions identified by the research that could be cut by 2030. An equivalent to approximately 750 billion trees. Just imagine how many more this could be if applied to all industries.
