Your path to sustainability goes through digital transformation
Can companies have the best of both worlds by combining sustainability and digital transformation initiatives? Discover how the “Genius of the And” approach can help organizations achieve multiple benefits that positively impact the bottom line, the environment, and society.
When faced with tough choices – starter or dessert, Beatles or Stones, beach or mountains – it’s so satisfying to be able to say “both.” And yet in business and technology decisions, we often feel compelled to sacrifice one very deserving and valuable course of action for another. Sometimes the pathway to having the best of both is shrouded with uncertainty. Business writer Jim Collins talks about “the Genius of the And” as a way of resolving this conflict by turning difficult decisions into great combinations.
Of course, when faced with the very challenging macroeconomic conditions of the moment, it seems imperative to cut costs and find new efficiencies. What that means in practice is that things that don’t have a clear and rapid connection to revenue fall into the “cost reduction” bucket and are cut. Unfortunately, this is what’s happening with sustainability. In our recent survey, 84% of technology leaders felt that sustainability takes a back seat to commercial goals.
That’s not to say that it’s not a priority – in fact 95% would say it’s a top or high priority – but sometimes looking at a year of challenges and uncertainty leads to the conclusion that something has to give. However, in exploring the Genius of the And, there are some ways in which organizations can make progress in multiple areas through the same initiatives.
A blueprint for greater value
The first misconception to correct is that sustainability isn’t good for business. On the contrary, the ethical and responsible approach that factors sustainability into an organization’s DNA is the mark of many a successful company. Whether it’s talking about responsible business practices at Davos, or committing to your employees (and the rest of the world) on sustainability guidelines, there are great benefits to be had.
In fact, our research revealed the real risks of not having a transparent sustainability strategy. The loss of investors (87%) and employees (84%) could be the more costly impacts for failing to pull through on sustainability. While a risk to investment has clear financial implications, the value of retaining employees is also huge. In a constant battle for the top talent, if poor or opaque sustainability policy stops you from hiring and/or keeping the skills you need to operate and innovate, then financial trouble is only a step away.
Even with these real benefits to sustainability, there can still be barriers to committing significant resources to it. The good news is that you don’t have to … at least not as a standalone. Despite 84% of companies treating digital and sustainability transformation initiatives as separate, there are significant benefits to combining the two.
Sustainability considerations should be built into technology and digital plans, because many of those technology solutions that have a significant impact on sustainability. A third of companies (32%) feel like they don’t have the right tools in place to address sustainability and nearly half (47%) say that while they have the tools, they’re not properly used or implemented. These tools include data collection and analysis, monitoring and reporting. In addition, cloud, data integration and edge computing are all seen as highly beneficial.
If you look at that collection of technologies, they are all foundational steps in most digital transformation initiatives. If organizations can find ways to combine on-going digital transformation – which we know remains a high priority – with sustainability goals, then these technologies can be used for multiple benefits.
Part of this combination comes down to planning and process. Most companies draw a stark contrast between the process, incentives and tools that exist for commercial and sustainability targets. Copying and modelling some commercial processes for sustainability could be a quick win. Adding sustainability projects into the technology roadmap could be another.
The value of cultural change shouldn’t be over-estimated, however. Just as acceptance of digital change has been essential for transformation in that area, sustainability requires buy-in from employees. Most will recognize the broader global requirements to reduce emissions, single-use plastics and waste more broadly. However, how many understand your individual company strategy? Half of organizations (47%) don’t feel that all employees understand theirs. Without this level of awareness, factoring sustainability goals into established processes and target setting is incredibly difficult.
Digital and sustainability – the bottom line
There will be harsh consequences for those who ditch sustainability for the next few years because of economic concerns. Employees, stakeholders and shareholders expect action on environmental and societal issues. Digital transformation maturity helps understanding and decision-making, why can’t that apply to sustainability? The standardization, analytics and reporting that characterize digital efforts can bring sustainability as well as economic benefits.
Dipping your toe into the plastic-free ocean of sustainability is far from easy, but also essential. Navigating these waters doesn’t have to be on a mission of compromise. Sustainability should be a discussion about using the right tools and resources to achieve more meaningful impact. With this mindset, every organization will be able to invest in initiatives that bring multiple benefits. The upside to technology can be economic, social and environmental all at the same time. And that’s the genius that we’re all looking to tap into.