Highlights
- Sustainability has become a business imperative due to market and regulatory forces and climate change.
- Besides evolving regulations, cost pressures due to depleting natural resources, a competitive landscape because of early movers, and consumer and investor demands are critical to shaping up manufacturers’ sustainability journey.
- Based on Neural Manufacturing™, TCS’ Sustainable by Design suite of offerings helps manufacturers embed sustainability and circular economy principles.
Insights in this article
Insights in this articleinpage
Overview
- Sustainability has become the core strategic driver and competitive advantage for manufacturing organizations as traditional linear business models continue to get disrupted due to market and regulatory forces and the increasingly visible effects of climate change. Changing consumer sentiments and financial implications are making sustainability the default license to operate. New circular business models are data-driven and require a connected enterprise with purpose-driven ecosystems that can sense, perceive, and act.
- The Sustainable by Design offering suite from Tata Consultancy Services (TCS) helps manufacturers unlock significant economic, social, and environmental value that enables sustainable processes, products, and services design, connected value chain operations, and purpose-centric ecosystems, which drive new circular business models. These data and digital technology-led solutions foster sustainability innovation in an organization while effectively addressing associated risks.
Business context
- Sustainability entails a multi-horizon journey with an ecosystem-based approach.
Four horizons on the road to sustainability
The pace of shift across the sustainability horizons, as depicted in Figure 1, is increasing because of fast-depleting natural resources, evolving regulations, a competitive landscape change forced by early movers, and consumer and investor demands. We believe that the future manufacturing enterprise must be sustainable by design to thrive in this changing paradigm.
How can such an enterprise be designed?
Sustainability at the core of the future manufacturing enterprise: To address the demands of regulatory and market forces, manufacturers need to take measures towards:
- Value chain decarbonization, sustainable and ethical sourcing, and resource optimization
- Product design according to circular principles such as ease of repair, remanufacture, recover, end-of-life treatment, and recycle
- Extended producer responsibility, product environment footprint, and climate-related risks disclosures
- A siloed organizational function of sustainability will not be able to drive these outcomes. Manufacturers need to revisit their operations, processes, and products to embed sustainability and circular economy principles. Effectively including these elements in the business models can positively impact a manufacturer’s brand and financial performance.
- Governance and transparency: Enterprises will need efficient reporting across multiple reporting standards and will need to include sustainability key performance indicators (KPIs) across organizational levels to address internal and external stakeholder needs effectively. This can improve access to capital, ensure higher valuations, and provide competitive edge by sustainable innovation.
- To achieve this, organizations need to have a robust data fabric, sustainability performance metrics visibility, insights-driven business decisions, and proactive risk management.
- Sustainable ecosystems: Manufacturers need extended value chain and cross-industry partnerships to achieve sustainability goals such as value chain decarbonization and adoption of new circular business models.
Our solution
- TCS’ Sustainable by Design solution suite has been structured on our foundational framework of Neural Manufacturing™. It enables manufacturers to orchestrate connected, cognitive, and collaborative ecosystems. By building value chains with an intelligent edge, it ensures organizational agility and creates new business and operating models.
- The Sustainable by Design suite enables outcomes across key sustainability aspects, as depicted in Figure 2, satisfying the needs of various stakeholders.
Key aspects of sustainability addressed by TCS’ Sustainable by Design solution
To progress on all six levers above, organizations need to invest in data and a contemporary, scalable digital core. TCS enables this journey with a phased roadmap:
Phase 1: Envision a sustainable by design strategy and define target operating models for sustainable ecosystems
Phase 2: Design and build a digital core, including a neural information fabric. Enable the orchestration of connected ecosystems through data-driven platforms
Phase 3: Scale and operate the sustainability platforms. Enable automated cognitive business operations and risk management.
Listed below are our solutions that enable sustainability:
- Sustainable by design strategy: This advisory service helps manufacturers across different sustainability maturity levels by offering target operating models and an actionable roadmap. Such digital technology interventions can help them achieve their sustainability goals and build circular business models.
- Sustainability analytics: An increasing amount of sustainability-related data on materials, products, services, and operations now traverses across enterprise boundaries. Manufacturers need to collect, process, and report data for various regulatory and reporting requirements. TCS’ sustainability analytics offers a robust data fabric with a single view of sustainability data and metrics. Apart from managing reporting across multiple frameworks efficiently, analytics lends cognitive capability to enterprises. The insights enable business decisions driven by sustainability considerations and ensure effective risk management. The ability to associate organizational sustainability goals to KPIs across different organizational levels fosters sustainability innovation.
- Sustainable operations and sourcing: For effective reduction of greenhouse gas (GHG) emissions across scope 1, 2, and 3 categories, manufacturers need to act on:
- Operational efficiency improvement
- Sustainable energy, raw materials, and components sourcing
TCS’ proven solutions provide extensive track-and-trace, supplier sustainability benchmarking, and operational efficiency improvement capabilities to accelerate the organizational goal towards extended value chain decarbonization.
- Closed-loop ecosystem: To adopt circular business models, enterprises need extensive capabilities around product use-dispose-collect-recycle. A closed-loop ecosystem is a digital platform enabling material visibility and new data-led services for sustainability ecosystem partners. It has built-in features for enabling consumer participation in collection and incentivization mechanisms.
- Marketplace for circularity: This offering provides firms an online marketplace to buy, sell, or offer new data-led services for waste, recycled, or remanufactured materials and products to promote the adoption of circular business models.
Business benefits
Economic value:
- Additional revenue streams through new service models led by data and technology
- Cost savings through resource optimization, operational efficiency improvement, and reduced capital rates
- Non-compliance cost avoidance
- Potential premium for sustainable products/services
Environmental and social value:
- Ability to drive value chain decarbonization, which can reduce GHG emissions and optimize resources
- Product provenance leading to inclusion of the rightful stakeholders in the value chain
Enhanced brand value:
- Superior brand value and social image, providing higher market valuation and access to green investments
- Ability to attract and retain top talent
Dynamic risk management:
- Contain exposure to employee health and safety risks and contribute to ensuring a safe, healthy, and productive workforce
- Improved organizational resilience to climate and business model risks
TCS advantage
- TCS walks the sustainability talk: As a purpose-led services business, TCS sees environmental stewardship as core to its sustainability strategy. Its vision is to decouple business growth and ecological footprint from its operations to address the environmental bottom line. TCS now targets net-zero emissions by 2030. The green approach is embedded in its internal processes and services offerings.
- Cross-industry experience: Apart from an extensive body of work in the manufacturing and utilities industries, TCS has vast experience in building and orchestrating products and services for customers across industries such as travel and transportation, retail and consumer products, insurance, and more.
- Deep domain and technical expertise: Leveraging product and enterprise knowledge and technological expertise across the manufacturing value chain to create operating business models and technology applications that are benchmarked against industry standards.
- Assets and frameworks: TCS’ differentiated thought leadership on sustainability, accelerators such as neural data fabric, the sustainability risk and maturity assessment model, the value chain decarbonization framework, experienced consultants backed by mature best practices, and data- and analytics-centric platforms and solutions enable faster deployments.
- Global presence: A well-established global footprint helps TCS achieve smoother rollouts and deliver robust post-implementation support.
- Co-innovation: Accelerating enterprises’ path to value through a network of start-ups, academic partners, and facilities such as the TCS Neural Automotive and Industrial Experience Center, TCS Pace Port™, and TCS Rapid Labs.
