Turning Vision into Action: Advancing Circular Manufacturing
To open this masterclass, Gruber and Dillman presented a bold perspective on circular economy strategies, using a case study that compared the environmental and economic impacts of reusable and linear semiconductor chip designs. With sustainability leaders from companies like Amazon, IKEA, and Cisco in attendance, the discussion emphasized integrated, data-driven decision-making as a critical enabler for meeting today’s sustainability standards.
Contrasting scenarios included:
A linear model, where the chip is manufactured, used, and discarded.
A circular model, where the chip is recovered, re-balled, and reused.
The circular model demonstrated slightly higher emissions for the reprocessing step (2.36 kg CO₂e vs. 1.94 kg CO₂e for linear disposal), but by extending the lifetime of the initial chip in the circular model, where the linear would now be replaced by a new chip (1.94 x 2 = 3.88 kg CO₂e) the benefits of the circular approach is shown. By eliminatingthe need to manufacture new chips for future production cycles, the circular process reduces total, system-wide emissions while also drastically minimizing raw material extraction, water usage, and land use.
Circular manufacturing offers a transformative solution for reducing environmental impact and building long-term economic resilience. Forward-thinking companies like Jabil are already operationalizing these principles, turning what was once considered waste into valuable resources through systematic recovery and reuse programs that can also deliver significant cost savings.
Gruber and Dillman’s data-driven example underscores how this model can cut resource consumption, support compliance with evolving sustainability regulations, and drive progress toward a fully circular economy. Businesses adopting these strategies position themselves as sustainability leaders, strengthening their operations against resource scarcity and climate challenges. By embracing circular innovation, companies unlock a powerful pathway to sustainable growth and competitive advantage.
“Circularity isn’t just about recycling—it’s about smarter design, sourcing, and evaluating trade-offs,” said Dillman. “To close the loop, we must assess impacts beyond carbon.”
Designing for Circularity: Key Insights from the Session
Key takeaways included:
Sustainability Requires System Thinking: Achieving a circular economy demands cross-functional collaboration across design, procurement, logistics, and recovery. A unified data foundation is critical to driving these efforts effectively.
Data-Driven Decisions Over Assumptions: The circular chip example scenario underscores the importance of high-fidelity modeling in evaluating circular strategies. Circular initiatives often lack granular emissions and cost data, making it difficult to assess trade-offs or justify actions internally. Digital tools that enable engineers and sustainability teams to quantify carbon impacts and material costs at the component level provide the analytical rigor needed to support data-backed circularity decisions.
Leadership Focuses on Actionable Insights: The strong participation of executives and senior managers in the session underscores growing C-level commitment to sustainable innovation and responsible driven business models.
Scalable Platforms Are the New Standard: Fragmented tools fall short in today’s complex landscape, creating new data silos and preventing transparency. Forward-thinking sustainability leaders are turning to scalable platforms and digital tools to seamlessly integrate sustainability, cost efficiency, and product compliance into their operations.
Driving Circularity with Actionable Product Intelligence
As manufacturers push toward circular economy goals, decision-makers are increasingly turning to digital tools that provide high-resolution insights across the product lifecycle. These platforms are enabling sustainability, procurement, and design teams to move beyond assumptions by modeling the environmental and economic implications of circular strategies in real time.
By bringing together lifecycle data, cost metrics, and supply chain considerations, these tools support:
Comparative analysis of linear vs. circular models
Identification of trade-offs across environmental categories
Alignment across teams through shared, data-driven insight.
In a rapidly shifting regulatory and market landscape, the ability to simulate design choices at scale — grounded in real-world data — is essential. Organizations that invest in this type of intelligence aren’t just improving products; they’re reshaping how sustainability is operationalized across the enterprise.
Turning Circular Strategies into Scalable Impact
For manufacturers, achieving sustainability success requires integrating data-driven insights and lifecycle thinking into design and procurement processes. This approach empowers teams to scale effective strategies such as reducing product carbon footprints, ensuring regulatory compliance, and driving operational efficiencies. With data and cross-functional alignment at the core, circularity evolves from a lofty goal to a measurable competitive advantage, positioning businesses as leaders in innovation and sustainability.
The EPD landscape has shifted. It’s no longer optional – it’s a competitive battleground where speed and verifiable proof now dictate market access and credibility. Are your EPDs truly enabling sustainable choices, or just checking a box?
Months-long verification bottlenecks, crippling costs per EPD, and—let’s be frank—a reliance on generic ‘family’ averages often chosen less for true efficiency and more to conveniently obscure performance variability across sites or products.
This ebook cuts through the noise. Your EPDs Are Holding You Back exposes the limitations of outdated EPD practices and shows how leveraging EPDs at scale with automation transforms this liability into your competitive advantage.
Download the ebook to uncover how to:
✅ Win more tenders: Instantly verified, product-specific EPDs ready on demand.
✅ Stop hiding behind product families: Differentiate with credible, granular LCA data and expose the limitations of blended data.
✅ Unlock the real power of EPDs: Go beyond marketing to use specific EPD data as an engine for genuine internal innovation, R&D, procurement optimization, and robust decarbonization planning.
✅ Slash crippling cost, time, and verification bottlenecks: Leave manual LCA modeling and never-ending verification loops behind.
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Manufacturers today are navigating an increasingly challenging compliance landscape. Global regulations are evolving faster than ever, supply chains are more complex, and regulatory expectations demand far more than just ticking boxes. Modern product compliance now requires robust data management, seamless supplier collaboration, and continuous process optimization to keep pace.
Recognizing these challenges, Makersite’s material & substance compliance experts take a deep dive in our most recent online masterclass to walk through proven strategies to help North American manufacturers not only stay compliant, but scale their compliance operations efficiently, strengthen supplier engagement, and protect product availability.
Here’s what you need to know to build a scalable, resilient product compliance approach, and turn regulatory complexity into a competitive advantage.
The Evolving Compliance Landscape
Regulatory requirements are accelerating at an unprecedented pace, creating new challenges and complexities for manufacturers across every industry. Staying compliant is no longer just about keeping up, it’s about staying ahead.
Here’s a look at the biggest hurdles North American companies are facing right now.
Key Challenges for Manufacturers
Complex and Expanding Regulations: Regulations like REACH, TSCA’s PFAS reporting rules, and RoHS exemptions are adding thousands of new substances to watch, often at an accelerating pace.
Disjointed and Isolated Data Systems: Traditional tools like spreadsheets, ERP, and PLM platforms often operate in silos, making it challenging for organizations to establish seamless communication between systems. This lack of cohesion leads to disjointed, unstructured data that is difficult to integrate, analyze, and leverage effectively for decision-making. As a result, teams may experience inefficiencies, errors, and missed opportunities for growth and innovation.
Fragmented Supplier Communication: Relying on emails and forms, without a centralized platform for managing supplier responses, approvals, and escalations, leads to confusion, delays, and errors. On top of that, suppliers are overwhelmed with requests from hundreds of different customer portals, making engagement and data collection even harder to scale.
Compliance Addressed Too Late:Reactive compliance approaches don’t just risk shipment delays, costly redesigns, and regulatory fines. They also limit strategic options. Staying ahead of evolving legislation, like monitoring the SVHC Candidate List, enables companies to substitute risky materials early. New regulations like PFAS reporting in the US require companies to trace product data backwards, in some cases as far as January 2011.
The consequences of non-compliance are becoming more severe, and increasingly business critical. Without robust processes in place, manufacturers risk facing shipment holds, financial penalties, loss of customer trust, and even market bans. In some cases, a single missing declaration or outdated material can block product access to entire regions, leading to lost revenue, disrupted supply chains, and strained customer relationships.
The Exploding Regulatory Horizon
The challenge isn’t static; it’s expanding. Manufacturers must keep pace with key regulatory deadlines such as:
California & New York PFAS Bans: Taking effect in 2025. These bans have significant implications for industries like Automotive, where PFAS are commonly used in coatings, upholstery, and other vehicle parts. Additionally, New Mexico’s HB 212, signed into law on April 8, 2025, makes it the third U.S. state, following Maine and Minnesota, to enact a broad PFAS ban.
REACH Updates: Universal PFAS restrictions are currently under review, but what makes this regulation unique is that it doesn’t target specific substances, but an entire group of chemicals. This presents a particular challenge for industries like medical devices, where certain products can’t currently be manufactured without PFAS.
Current discussions at ECHA indicate two possible directions: Industry may continue to use fluoropolymers only where no alternatives exist. Meaning if a competitor can produce a similar product without PFAS, you may be required to do the same. Secondly, consumer uses of fluoropolymers are still being considered for a complete ban.
RoHS Lead Exemption Phaseouts: Changes expected in the next 12–18 months. The EU’s Restriction of Hazardous Substances (RoHS) directive has historically allowed certain exemptions for the use of lead in specific applications, particularly in complex electronics and medical devices where no viable alternatives existed. However, many of these exemptions are now under review and expected to be phased out in the coming 12–18 months. This presents a significant challenge for manufacturers, especially in sectors like electronics, automotive, and industrial equipment, where lead has been critical for soldering and high-reliability components. Companies relying on these exemptions need to act now to identify alternative materials, redesign components, or prepare for requalification processes, all of which can be costly and time-consuming if left too late.
The overlaps in these regulations—such as varying thresholds and contradictory rules between federal and state mandates (e.g., TSCA vs. California PFAS disclosures)—add further complexity.
Pro Tip
To remain competitive and compliant, manufacturers need scalable systems that enable centralized compliance tracking, cross-functional regulatory reviews, and ongoing horizon scans.
Supplier Engagement & Data Collection
Effective compliance starts with obtaining the right input data from suppliers. Without this, meeting regulatory requirements becomes an uphill battle. Leading organizations are overcoming this challenge by leveraging a centralized supplier portal, a single source of truth that not only streamlines data collection but also provides built-in escalation paths and approval workflows.
By equipping suppliers with a central portal that offers escalation and approval functionalities, companies can ensure faster response times, better data accuracy, and improved collaboration. This approach reduces confusion, minimizes back-and-forth emails, and provides full traceability across supplier communications, a critical advantage when managing complex global supply chains.
Minimum Data Requirements
Ensure seamless and comprehensive compliance by securing access to:
Bills of Materials (BOMs): A detailed breakdown of all materials and components used in your products, essential for accurate regulatory reporting.
Supplier-Provided Files: Full Material Declarations (FMDs) and Certificates of Compliance (CoCs) to ensure traceability and adherence to standards.
SCIP and Regulatory IDs: Streamline automated submissions and maintain efficiency in meeting regulatory demands.
FMDs vs. CoCs: Understanding the Difference
FMDs provide complete transparency, offering a robust framework for long-term compliance that evolves with regulatory advancements.
CoCs, while suitable for immediate needs, require frequent updates to align with changing regulations—making them less sustainable for future-proof compliance strategies.
Pro Tip
Revolutionize your compliance approach with a focus on innovation, efficiency, and sustainability. By leveraging advanced data strategies, your business can stay ahead of regulatory demands while building a foundation for long-term success.
Simplify Supplier Collaboration
Simplifying supplier collaboration isn’t just about sending standardized forms. It requires the right technology to scale effectively. Equip your suppliers with intuitive, standardized formats like IPC 1752 to prevent fatigue and reduce friction. But to truly streamline the process, companies need a software solution that enables automated workflows for collecting, validating, and managing supplier data at scale.
Automation not only saves time for everyone involved but also reduces error rates and ensures data consistency, something manual processes simply can’t deliver when dealing with complex supply chains and evolving regulatory demands.
Compliance demands transparency at every level. Here’s how automation transforms reporting processes.
Drill into the details: Analyze BOMs at a granular level to pinpoint components and assess compliance risks with precision.
Big-picture monitoring: Gain complete visibility across your portfolio with real-time dashboards tracking product status, supplier responsiveness, and key compliance metrics.
External Stakeholder Reporting
Streamline compliance management with automation that eliminates manual processes, delivering:
Ready-to-submit regulatory documents (e.g., SCIP or ECHA submissions).
Customizable dossiers tailored to meet customer and market-specific requirements.
Manufacturing enterprises need a centralized platform seamlessly integrates with ERP and PLM systems, ensuring stakeholders always have access to accurate, up-to-date compliance data.
Scaling Compliance Efforts-Why it Matters
With growing product lines and expanding global markets, manual compliance efforts no longer cut it. They fail to keep up with evolving regulations, hamper market readiness, and increase operational costs.
Next-Generation Solutions for Scalable Compliance
Leverage Automation: Automate workflows and data flows to reduce manual errors and accelerate compliance efforts.
Adopt Standardization: Use globally accepted data formats (e.g., IPC), enabling smoother communication across teams.
Adapt to Change: Implement systems that not only flex with new regulatory requirements but also enable companies to proactively identify and substitute substances or materials, even before new regulations come into force. This future-proofing approach helps avoid costly redesigns, reduce risk, and accelerate market entry.
By investing in digital tools, companies can significantly reduce time-to-market while managing the growing complexity of product compliance. You can accelerate data processing, automate regulatory checks, and helps identify potential product compliance risks early, even across large, fragmented supply chains. This not only speeds up supplier data validation but also enables smarter decision-making when it comes to material substitutions, regulatory reporting, and risk mitigation.
Looking Beyond Compliance
Compliance isn’t just a legal mandate; it’s a strategic advantage and an untapped opportunity to drive sustainability and innovation.
Product Compliance Managers sit on a gold mine of product and material data, often without realizing its full potential. The detailed supplier, material, and substance information collected for compliance purposes forms the perfect foundation for conducting Product Carbon Footprints (PCFs) and Life Cycle Assessments (LCAs) at scale.
This creates a unique opportunity to break down organizational silos between product compliance and product sustainability teams. By leveraging compliance data more strategically, companies can accelerate sustainability initiatives, reduce Scope 3 emissions, and design greener products — all without starting data collection from scratch.
Driving Sustainability Through Innovation
Enhancing BOM data with material insights empowers manufacturers to:
Conduct precise Life Cycle Assessments (LCA) and calculate accurate Product Carbon Footprints (PCF).
Monitor and report Scope 3 emissions for comprehensive corporate sustainability strategies.
Implement Eco-design Scenarios to replace non-compliant materials with greener, cost-efficient alternatives.
Strategic Recommendations
Adopt a proactive, scalable compliance strategy designed to drive efficiency and ensure sustainability.
Leverage Supplier Data: Analyze existing data to map compliance gaps and address deficiencies with targeted outreach.
Minimize Supplier Fatigue: Implement long-term data solutions like FMDs to reduce repetitive requests and build stronger, collaborative supplier relationships.
Bring Compliance In-House: Enhance transparency, reduce reliance on external consultants, and stay agile in adapting to regulatory changes.
Automate Reporting Processes: Deliver precise, real-time reports that integrate seamlessly with external systems, ensuring compliance with ease.
Future-Proof Your Strategy: Build scalable systems that adapt to evolving regulations, emerging markets, and sustainability requirements, keeping your business ahead of the curve.
With these steps, you can transform compliance from a challenge into a strategic advantage, driving innovation and fostering sustainable growth.
What to Do Tomorrow — Whether You Have a System in Place or Not
Have:
Grade your existing BOMs for compliance gaps and missing data points. This helps prioritize where action is needed most.
Set up dashboards to provide live updates to stakeholders on product compliance status, supplier responsiveness, and upcoming regulatory risks.
Evaluate supplier alternatives early to avoid costly, last-minute substitutions, especially for materials flagged by upcoming regulations like PFAS or RoHS.
Have Not:
Start by mapping what data you have today, often in spreadsheets, ERP, or PLM tools, and identify gaps.
Engage with suppliers to begin collecting material declarations in standardized formats like IPC 1752.
Explore solutions like Makersite to centralize your compliance data and automate reporting, laying the foundation for scalable, future-ready compliance processes.
Compliance doesn’t have to be a burden. With the right tools and approach, it becomes a competitive advantage, helping you enter new markets faster, reduce operational risk, and design more sustainable, innovative products.
Writing an effective RFP can be a challenge. Your company will have specific goals and objectives, and you’ll need to be able to put together a logical yet thorough question set that enables you to identify the best vendor for the project. With that in mind, we’ve worked to build out what we consider to be the ideal RFP template – and, given that we’ve seen a fair few, we like to think we know what we’re talking about.
Our rationale was as follows:
The RFP template should be simple in format and execution, but adequately thorough
It should help your company to ask qualified questions that unlock the right answers, rather than relying on generic question sets that more often than not produce inadequate answers
The question set should always consider the fact that the customer has a specific goal in mind
Wherever possible, questions should be open rather than closed, allowing for more detail. If closed questions are deemed necessary, they should be at the bottom of the list
We’ll use our expertise as a company to accurately reflect what top tier manufacturers are asking. The RFP template is designed to replicate the RFP processes of leaders in their respective fields
To create a template that negates the need for external consultants, who don’t necessarily know what the company needs or how to articulate those needs
There are 123 questions across 13 separate sections that represent an ideal baseline. The template does not have to be set in stone. Certain manufacturers or users will have other questions they may wish to add, or will find questions in this template that they don’t consider necessary. However, its purpose is to help anyone struggling with putting together an RFP to ask the necessary questions rather than relying on a generic question set that any supplier can fulfil.
This is what the best in their fields seek to create when it comes to building an RFP. In creating this template, our aim was straightforward: make it simple, and help users to design their solution based on what leaders are doing.
You can view the template for reference in the embed at the bottom of this page, or you can download the Excel version to use and edit for yourself at the link at the top.
What makes a ‘best in class’ RFP?
What does the ideal RFP (Request for Prospoal) look like? It’s a common question, but one without a definitive answer. No two are the same and many manufacturers remain unsure of what they need, relying on basic templates to communicate often complex needs and requirements. Often, unfortunately, those templates are not up to scratch. But that’s not to say that the perfect example doesn’t exist.
RFPs, without doubt, remain an important part of the manufacturing process – an essential tool when it comes to completing a project that you need outside help with. An RFP done correctly not only enables your organization to find the best solution to the task (given that different companies might have different ideas or ways to tackle it), but also helps you to compare the costs of different providers and find the right option for your budget.
RFPs also help to negate an element of risk early on in the manufacturing process, allowing you to be sure that the company you choose to do the work knows what they’re doing and can deliver what you need.
For many, the process of putting together an RFP can be a challenge – a drain on both time and resources. From a lack of initial clarity (meaning that proposals may come back incomplete or unaligned with company needs) to scope creep (where the scope of the project changes during the RFP process due to a lack of forward thinking and due diligence), initial hurdles can make the desired outcome significantly harder to achieve for all concerned.
Companies also struggle to find the right balance of information. Too much detail can overwhelm potential bidders, while too little may leave vendors guessing. From writing the requirements to reviewing proposals, building out an RFP is a time-consuming process, one often further hindered by vendor management issues (where keeping track of questions, updates, and proposal submissions requires careful organization), budgetary concerns (where companies may have a hard time estimating the right budget for the project, and sometimes don’t include budget information in the RFP) and a lack of defined evaluation criteria (where companies may not have a structured approach for comparing different aspects like price, experience, and quality.)
When these challenges are made clear and are proactively addressed, companies can begin to streamline the RFP process and increase the chances of selecting the best partner for their project.
“An RFP done correctly not only enables your organization to find the best solution to the task (given that different companies might have different ideas or ways to tackle it), but also helps you to compare the costs of different providers and find the right option for your budget.”
Why getting it right matters
A good RFP template helps to tick a number of boxes. It saves time, facilitating a faster turnaround in creating and distributing RFPs, reducing delays in project timelines. It ensures consistency, making it easier for vendors to understand what’s required, regardless of the project. Done correctly, it reduces the risk of missing critical information, ensuring vendors have all the details needed to create a thorough proposal. It helps to avoid miscommunication or confusion, leading to proposals that better align with the company’s needs, whilst also simplifying the evaluation process, as the company can quickly compare key factors like costs, timelines, and experience side by side.
Furthermore, it helps to prevent scope changes and misunderstandings that could arise during the project and has the added benefit of making sure that vendors know exactly what to address in their proposals, reducing back-and-forth and ensuring more complete responses.
Ultimately, the organization issuing the RFP is seeking help because they need expertise or resources they don’t have internally. The RFP process allows them to gather multiple solutions, ensure fairness, manage costs, and reduce risks, thereby helping them choose the best provider to achieve their project goals.
What does the ‘Age of the Engineer’ – the term I use to describe our need to empower better product design and manufacturing – look like in reality, and how do we make it possible? I see three first steps:
Getting engineers back into the boardroom
I’ve talked before about entrepreneurs as the ‘villain’ of this narrative because it simplifies the framing. However, it might be better in this instance to specify that I’m talking about a non-founding CEO. As a company grows the need for a generalist – a safe pair of hands – arises. There are many benefits to that approach, of course, but too often the spark is lost – the company stops building great things, and the focus shifts to managing what it does well. We’re in need of something else now – we need to rebuild our products and the infrastructure we use to make and utilize them. We need builders. The founders and early engineers of some of our greatest companies were – and still are – engineers by trade and I think it’s time we put them back in the boardroom. For those starting out, my recommendation is to give their technology leader a seat at the board.
Why? My contention is that businesses who want to succeed in a future likely to be defined by seismic change need to spend more time on innovation-led growth than most large enterprises do now. This requires a different mindset towards risk and reward and one can only achieve that through a voice being present at the highest levels of decision making. A overarching vision of what is possible and the technical understanding of how to achieve it results in speed of execution and that combination is often found with engineering leaders. In business, speed is everything and businesses that do this will innovate out of their current situation faster and more successfully.
Adding sustainability as a core metric to product design
A company is its products. If we want to build more successful companies of the future, we’ll need them to have great products that are sustainable. That is not possible unless we embed sustainability into design, just as we do performance, risk and cost.
Every company is different and even within a company, different product lines may cater to different market segments with different preferences. There are no perfect products because there are no perfect customers or infrastructure to build or use these products, so there will always be trade-offs. I do believe, however, that unless these trade-offs are made consciously, products will continue to diverge from sustainability. This will create a widening gap to market requirements.
I’m already seeing advanced organizations who are most of the way there. They’re what we might call ‘mature’ in their approach, set apart from the ‘novices’ because they have made sustainability a design parameter. For them it is another metric, defined by a series of non-negotiable targets that must be hit in order to unlock the rewards – from growth in new markets to better productivity and efficiency to how people are compensated.
Integrating data and enriching operational systems with it
When it comes to engineering, we don’t need to be doing the same things faster. We need to be doing them better. And to do things better, we don’t need more data – we need smarter data.
Our observations show that up to 90% of the data required to understand how to make and sell products doesn’t sit within a company’s systems. The reason for that is that most products are increasingly becoming “assemblies” with large portions being built in complex upstream supply chains. An average car for example has 70% of its components built in this way. Use and End-of-Life data also typically do not sit in company systems. How could one understand the cost, risk or sustainability impacts from these stages? The solution is to collect and combine this “value chain” information from external sources with company data about the product and operations to allow for full-life-cycle view of the implications of design across all the key design criteria. I call this product lifecycle intelligence.
But it doesn’t stop there. This enriched information needs to be available not in data lakes, expert systems and BI tools, but in operational systems like CAD, PLM and ERP so that engineers can use this information in trade-off analysis, within their existing workflows. This “shifting left” of data and insight, to have it available early on and at every stage of the development process, has long been known to reduce development time and avoid costly mistakes. Technology now allows for this.
Conclusion
The ‘Age of the Engineer’ signifies a pivotal transformation in how we approach innovation and sustainability in business. By reinstating engineers into the boardroom, we leverage their unique expertise to drive not just technological advancements but strategic decisions that prioritize long-term value over short-term gains. By integrating comprehensive data into operational systems to enhance decision-making and efficiency, we will empower businesses to build smarter, more sustainable products that meet the demands of a rapidly changing world.
The ‘Age of the Engineer’ is not just an ideal; it is an imperative, charting a course towards a future where technological prowess and sustainability go hand in hand. By giving engineers the spotlight, and by doubling down on sustainable practices, we’re no longer dreaming about a better tomorrow – we’re actively creating it.
In today’s business landscape, sustainability is no longer a buzzword — it’s a necessity. Companies are increasingly under pressure from consumers, investors, and regulatory bodies to adopt more sustainable practices. One critical solution to this is Life Cycle Assessment (LCA) software, a tool that transforms complex data into actionable insights, driving sustainable growth and operational efficiency. Let’s explore how LCA software addresses common pain points and empowers businesses to make informed, sustainable decisions.
Automating Life Cycle Assessments
One of the primary challenges companies face is the labor-intensive nature of conducting life cycle assessments. Manual LCA processes involve collecting data from various sources, analyzing it, and then interpreting the results — a time-consuming and often error-prone undertaking. LCA software (as seen in Makersite’s work with Microsoft), however, automates these processes, significantly reducing the workload, accelerating the data assessment process and enhancing accuracy by minimizing human error. This allows businesses to conduct LCAs more frequently and efficiently, ensuring that sustainability is able to remain a continuous, integrated part of their operations.
Example:
A consumer goods manufacturer can use LCA software to automate the assessment of thousands of products across different regions. This not only speeds up the process but also provides more reliable data for making strategic decisions on product design and material sourcing.
Enhancing Sustainability Reporting
Sustainability reporting is critical for transparency and compliance with an ever-growing slate of regulations. However, compiling comprehensive and accurate reports manually can be daunting. LCA software simplifies sustainability reporting by providing a centralized platform for data collection and analysis. The software can automatically generate reports that comply with various standards and frameworks, not only saving time but also ensuring that reports are accurate and consistent, bolstering both the company’s credibility and compliance.
Example:
A large retailer can use LCA software to streamline its annual sustainability report, ensuring that data from all departments is consistent and compliant with international standards. This has the added benefit of enhancing the retailer’s reputation among environmentally conscious consumers and investors.
Scaling Sustainable Business Practices
For businesses looking to scale their sustainability efforts, LCA software is indispensable. As companies grow, so do the complexities of their supply chains and operations. Manual approaches to LCA are almost impossible to scale accurately, often leading to fragmented and inconsistent sustainability practices. LCA software, on the other hand, provides a scalable solution that can handle large volumes of data across multiple sites and products. This scalability ensures that sustainability efforts are uniform across the organization, facilitating broader and more impactful environmental initiatives.
Example:
An automotive company can use LCA software to evaluate the environmental impact of its product lineup across multiple markets. This allows the company to implement standardized sustainability practices globally, ensuring that all operations contribute to the company’s overall environmental goals.
Making Sustainable Manufacturing More Efficient
Manufacturing is a resource-intensive process (research shows that approximately 80% of a product’s environmental impact is determined during the design phase), and making it sustainable is a significant challenge.
LCA software helps manufacturers identify inefficiencies and areas for improvement by providing detailed insights into the environmental impacts of their processes. By analyzing data on energy use, waste generation, and emissions, companies can implement targeted strategies to reduce their environmental footprint. This not only helps in achieving sustainability goals but also often results in cost savings through improved efficiency and resource management.
Example:
A packaging company can use LCA software to analyze the lifecycle of its products, identifying opportunities to reduce material waste and energy consumption in production. This leads to both cost savings and a reduced environmental footprint.
Overcoming the Limitations of Manual LCA
Manual life cycle assessments are fraught with limitations. They are time-consuming, prone to errors, and often lack the granularity needed for precise decision-making. Furthermore, different business units operating in siloes can lead to inconsistent data and fragmented sustainability efforts. LCA software addresses these issues by providing a unified platform for data integration and analysis. This ensures that all business units are aligned and working with the same accurate, up-to-date information. The result is a more cohesive and effective approach to sustainability.
Example:
A multinational corporation can use LCA software to integrate data from various departments, ensuring that sustainability metrics are consistent across all regions and product lines. This unified approach facilitates better strategic planning and resource allocation.
Assisting with Scope 3 Calculations
Scope 3 emissions, which include all indirect emissions that occur in the value chain of the reporting company, are notoriously difficult to measure and manage. Traditional methods of calculating these emissions are complex and often inaccurate due to the vast amount of data required. LCA software simplifies scope 3 calculations by automating data collection from suppliers and other value chain partners. This leads to more accurate and comprehensive assessments of a company’s total carbon footprint, enabling more effective strategies to reduce emissions.
Example:
A food and beverage company can use LCA software to track emissions across its supply chain, including agricultural practices, transportation, and packaging. This comprehensive view helps the company identify and target high-emission areas for improvement.
Addressing Issues with Manual Data Processing
Manually processing the vast amounts of data required for LCA is not only tedious but also increases the likelihood of errors. Data discrepancies, incomplete information, and the sheer volume of data can overwhelm sustainability teams. LCA software mitigates these issues by automating data processing, ensuring that data is accurate, complete, and consistent. This automation allows sustainability teams to focus on interpreting the data and making strategic decisions rather than getting sidelined by data entry and verification.
Example:
A technology company can use LCA software to automate the processing of data from its global supply chain, ensuring that all environmental impacts are accurately recorded and analyzed. This allows the company to quickly respond to sustainability challenges and opportunities.
Scaling Accurate and Granular Data
Accurate and granular data is crucial for effective sustainability initiatives. Without precise data, companies cannot accurately measure their environmental impacts or the effectiveness of their sustainability strategies. LCA software provides the tools needed to collect, process, and analyze detailed data on a large scale. This granularity enables companies to pinpoint specific areas for improvement and track the progress of their sustainability efforts with a high degree of accuracy.
Example:
A chemical company can use LCA software to gather detailed data on the environmental impacts of each stage of its product lifecycle, from raw material extraction to disposal. This level of detail enables the company to implement more precise and effective sustainability measures.
Common Problems Faced Without the Right LCA Software
Businesses that do not use the right LCA software often face a myriad of challenges. As discussed above, these include inefficient and error-prone manual processes, inconsistent data across different business units, difficulty in scaling sustainability efforts, and challenges in meeting regulatory compliance. Without LCA software, companies struggle to conduct comprehensive and accurate life cycle assessments, leading to missed opportunities for improvement and potential reputational damage.
Let’s recap the most common problems:
Inefficient Manual Processes
Manual LCA processes are labor-intensive and slow, often resulting in delays and increased costs. The time and resources required to collect and analyze data manually can be prohibitive, especially for large companies with complex supply chains.
Inconsistent Data
Different business units operating in siloes often lead to inconsistent data collection and reporting. This fragmentation hampers the ability to get a clear, unified view of the company’s overall environmental impact, making it difficult to implement cohesive sustainability strategies.
Difficulty in Scaling
As businesses grow, so do the complexities of their operations. Without the right LCA software, scaling sustainability efforts becomes challenging. Manual processes simply cannot keep up with the increased data volume and complexity, leading to inefficiencies and gaps in sustainability initiatives that will only increase and become harder to tackle effectively with time.
Regulatory Compliance Challenges
Meeting regulatory requirements for sustainability reporting is critical but can be difficult without the right tools. Manual processes increase the risk of errors and non-compliance, potentially resulting in fines and reputational damage. LCA software ensures that all data is accurately collected and reported, helping companies stay compliant with environmental regulations.
Missed Opportunities for Improvement
Without accurate and comprehensive data, companies may miss opportunities to improve their sustainability practices. LCA software provides the detailed insights needed to identify inefficiencies and areas for improvement, enabling more effective and impactful sustainability strategies.
Driving Growth Through Sustainable Practices
LCA software is not just a tool for compliance; it’s a strategic asset that drives growth through sustainable practices. By providing detailed insights into every aspect of the product lifecycle, LCA software helps businesses innovate and improve their products and processes. This leads to the development of more sustainable products that meet consumer demand and regulatory standards, opening new market opportunities and enhancing brand reputation.
Innovation and Product Development
LCA software enables companies to explore different materials and production methods, assessing their environmental impacts before implementation. This fosters innovation in product development, leading to more sustainable products that can attract eco-conscious consumers and differentiate the company in the market.
Market Differentiation
Companies that can demonstrate their commitment to sustainability through rigorous LCA practices can differentiate themselves in the marketplace. This not only attracts environmentally conscious consumers but also appeals to investors looking for responsible and future-oriented businesses.
Cost Savings and Efficiency
Sustainable practices often lead to cost savings through improved resource efficiency and waste reduction. LCA software helps identify these opportunities, ensuring that sustainability initiatives are also financially beneficial.
Regulatory and Compliance Benefits
Proactively managing sustainability through LCA software helps companies stay ahead of regulatory changes and avoid potential fines or sanctions. It also enhances the company’s reputation with regulators and stakeholders.
Conclusion
LCA software is a powerful tool that transforms data into actionable insights, driving sustainable growth and enhancing operational efficiency. By automating life cycle assessments, better facilitating sustainability reporting, and enabling the scaling of sustainable business practices, LCA software addresses many of the common pain points faced by companies today.
It makes sustainable manufacturing more efficient, assists with scope 3 calculations, and ensures accurate and granular data processing. In an era where sustainability is paramount, investing in the right LCA software is essential for businesses looking to thrive while minimizing their environmental impact.
The right LCA software not only simplifies and streamlines sustainability efforts but also provides a competitive edge by enabling companies to operate more efficiently and transparently. As the demand for sustainable practices continues to grow, leveraging LCA software will be crucial in helping businesses make informed decisions that benefit both the planet and their bottom line.
In recent years, legislators have passed down a glut of regulations that organizations have had to figure out how to deal with. While all have their merits, it’s almost a given that some get a little lost in the noise. However, every now and then a regulatory development occurs that has the power to change the design and manufacturing landscape as we know it, and for good.
That happened on 23rd April 2024. The European Parliament approved a new Ecodesign Regulation to make products sold in the EU more reusable, repairable, upgradeable, and recyclable.
Let’s take a look at what it means, who it will impact, and the actions you need to take.
What is the new Ecodesign Regulation?
After a somewhat tumultuous journey through the legislative corridors of the European Parliament, the version of the Ecodesign Regulation for Sustainable Products (ESPR) that passed on 23rd April was both final and unanimously agreed upon. It is a framework that will significantly alter how goods are introduced and sold in the EU.
The intention behind it is clear. As Italian lawmaker Alessandra Moretti said, it is “time to put an end to the ‘take, make, throw away’ model that is so harmful to our planet, our health and our economy”.
The new rules will update the current 2009 directive, which exclusively concerned energy-related products, in terms of efficiency and circularity. They call on the Commission to give priority to resource-intensive sectors such as iron, steel, aluminium, textiles, furniture, tyres, detergents, paints, lubricants, and chemicals. It’ll also enforce a Digital Product Passport to aid informed consumer choices.
A key element of the Green Deal, ESPR is part of the broader circular economy package, which aims for the EU to use and reuse materials far more efficiently. The package also contributes towards the EU’s goal of having net zero greenhouse gas emissions by 2050 and should reduce harm to the environment.
As Moretti summarized: “Sustainable products will become the norm, allowing consumers to save energy, repair and make smart environmental choices when they are shopping.”
The text now needs the final approval from national governments to enter into EU law.
Monique Goyens, director general of BEUC, the European consumer organisation, concluded that “the framework needs to be implemented quickly. It is essential that the European Commission and member state market surveillance authorities allocate resources to the development and application of the new rules.”
What happens next?
ESPR is due to be published in the Official Journal of the EU and enter into force by July 2024. The first delegated acts spelling out specific ecodesign requirements may not come into force until the second half of 2025. The first ecodesign requirements are expected to apply to textiles and steel, and are likely to enter into force by mid-2027.
In addition, the EU is expected to publish a three-year working plan prioritising ecodesign requirements per product in March 2025, providing further guidance as to when products will come under increased scrutiny.
However, given design and production cycles, manufacturers of products, especially those on the European Commission’s priority list, should begin to familiarise themselves with the ESPR’s requirements now and assess what needs to be done to ensure their products are compliant. If they don’t, they could risk losing access to the EU market as well as losing significant ground to better prepared competitors.
Without doubt, these requirements represent a pivotal moment for the manufacturing industry, challenging stakeholders across businesses to rethink their production methods. Those companies who are able to adopt a proactive approach to ecodesign will be ahead of the curve. Companies who leave it leave to the last minute – those who lack urgency until the regulation is live – will find it hard to catch up.
Indeed, at Makersite, we’re already seeing mature companies like Microsoft taking the necessary steps. For the last two years they’ve worked to rebuild and refine their Surface Pro 10, using Makersite’s automated LCA models to identify and evaluate hotspots in their supply chain. In doing so, they reduced its carbon footprints by up to 28% within a 24-month timespan.
This is the gold standard. It is what all businesses should be aiming for. It takes a long time to get to where you need to be. If we look back at similar regulatory developments that went on to facilitate a sea change in manufacturing approaches and consumer awareness (like nutrition labels in the early 1970s, for example), it’s obvious that it won’t take long for something like ESPR to reach critical mass.
Within a decade, it’s extremely likely that it will have reached mass adoption in Europe. It’s a plan as ambitious as it is comprehensive. And it’s one where a forward-thinking approach – utilizing a solution where environmental impacts can be determined in just minutes – will make all the difference.
What actions should you take – and when?
Now is not the time to hold back. Those organizations who wait for final approval will find themselves firmly on the back foot. Businesses who seek to get their houses in order immediately will reap the rewards further down the line.
The impact of ESPR on companies’ core operations will be significant. Beyond specific traceability elements, the requirements will directly affect products at all stages in the value chain, including recyclability, the use of recycled contents, and durability.
ESPR will require that companies look at products and their value chains, create transparency and evaluate impacts at that level, and report on that – all on a regular basis. It’s not something that can be done one product at a time. It needs a different approach.
Today, most organizations are not set up to deal with reporting on that scale. But in order to succeed, they need to equip their engineers and designers with tools that offer instantaneous feedback on the environmental impact of design alterations in order for them to ensure that sustainable products not only adhere to the new regulations but become the norm.
In order to comply with the regulation, businesses now need to take the proper steps to collect realistic data and create the necessary infrastructure to drive innovation, all while obtaining real-time insights into the impact of changes on the environmental impact of products.
In order align with ESPR and reduce a product’s environmental impact quickly, organizations need to be able to immediately see how material, manufacturing processes or supplier changes impact a product’s sustainability. Outdated methods – like manually conducted LCAs – will invariably fall short of providing those essential real-time insights which are critical when it comes to making efficient and significant progress in product sustainability.
As we stated earlier, ESPR aims to improve products by emphasising durability, energy efficiency, recyclability, and more. With access to immediate insights, design teams can align their efforts with ESPR objectives, in turn enabling them to test and discover a significantly higher number of possible solutions to improve their products. Those who do so are likely to dramatically outpace peers yet to embrace a new approach, with those lagging behind likely to find themselves waiting weeks or even months to find out if their new ideas positively affect their products’ environmental impact.
The journey to sustainable product design is paved with challenges, but each obstacle is an opportunity to innovate. Whilst new regulations might seem daunting, time consuming and even frustrating they also represent a chance to make meaningful change and to take alead over competitors not ready or aware enough to act quickly.
Don’t let poor data, slow LCA execution speeds and external dependencies stop you from discovering the most sustainable version of your product.
Makersite CEO Neil D’Souza recently sat down with The Scope 3 Podcast’sTom Idle and Oliver Hurrey to discuss the key supply chain challenges facing organizations today – and how Makersite can help to solve them. You can listen to the full episode below or using the link here.
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Five key takeaways on product sustainability and scope 3
The real impact comes from products
It might sound simple, but when it comes to Scope 3 we need to take things back to the source. As Neil notes, “100 % of the impact that we see in the world today comes from the products we make and use. If you really think about it, whether you’re a service company and you’re flying around, well, it’s the plane that’s creating the impact, right? If you’re on your desk, then it’s the laptop and the electricity you use to run it.”
Just reporting isn’t enough. If you truly want to fix something and resolve the problem of the impact that’s being created, then you need to do your homework and properly understand the implications of designing a product in a certain way – from the raw materials you use to where you source them from to the end of life of that product.
Sustainability isn’t about ‘being green’
It’s all very well for a company to want to flex its green credentials. But if you want to properly affect the product you make, then you need to go deeper. “Out of 250 odd projects that I’ve worked on,” Neil says, “there is not a single project that was implemented just because it was green.”
So what is it about? Business is about making trade-offs. It’s about asking yourself the right questions. “What will I get if I were to reduce its impact by 30%? What will I get in terms of, ‘will I be able to sell more in more jurisdictions?’ Would it address a different market? What would be the cost implication of it? Would I still be able to sell it given compliance problems that I may have? Would it still be safe?”
The design must be separated from the implication or the understanding of the implication.
Facilitating the demand for better products
Now more than ever, manufacturers in a variety of markets are facing an increasing pressure to make better, more sustainable products. But not only is there a greater demand from consumers and stakeholders for this approach – there’s also a greater propensity to pay higher premiums for better design.
However, these markets (from building and construction to automotive to chemicals) generally have very complex supply chains and products, and traditional tools and traditional approaches can’t solve the hurdles they need to overcome in order to meet those demands.
Makersite powers the systems used by the people (from engineers to procurement) in organizations who can make the difference – the CAD tools, the PLM tools, the ERP tools, the procurement tools.
With that help, they can ensure that the product that is being designed follows the rules of the region in which they’re trying to sell it.
2030 is too soon
Many companies have positioned ambitious Scope 3 and Net Zero targets for 2030. But, says Neil, that’s not giving anyone enough time. “In reality, if you think of this from an engineering standpoint, an average technical product takes five to seven years to go to market. 2030 is six, seven years away. You’ll be able to make one product change. That’s about it. There’s not a lot you can do with one product iteration.”
For Makersite, it’s about the bigger picture. The longer term. And it’s about stopping the same mistakes being made over and over again: “What we want to do is every iteration from now until 2050, every iteration of every product that is new, that is innovative runs through Makersite. If we do that, then we’re not making the mistakes that we’ve continuously made over time.”
The tools we have now are smart – but not smart enough
In order to properly service the market and the demand from consumers, the tools we have now need to be refined. They are good, but they could be better.
Neil D’Souza: “The first is engineering tools. Engineering tools need to become smarter in order that we make the right decisions during design. The second is procurement tools. Procurement tools themselves also need to become smarter. We need to be able to not just quantify what are the impacts of the products that we’re buying, but identify where are the low carbon products that we can buy. And the connection of these two tools is important for that to happen.”
Ultimately, if organizations want to decarbonize, then they must provide their procurement teams with the flexibility to look at the market for low carbon solutions, as well as the level of information to not buy the wrong thing. This is a connection that can only happen when you connect product development tools with procurement tools.
With that, there will then be an understanding of the material constraints and the production constraints that you need to have to make that product successfully.
In today’s fast-paced corporate landscape, the harmony between sustainability and regulatory compliance is paramount, with an intricate web of regulations and sustainability reports creating an unprecedented imperative for enterprises to align their operational models. Leaping into the heart of these challenges, analyzing a data driven perspective is crucial for supply chain leaders and sustainability champions. It’s time to truly understand the collage of complexity emerging within the regulatory and sustainability spheres and harness this understanding to steer our enterprises toward a greener, more compliant future.
The current state – and what could be
The trajectory of manufacturing organization’s capabilities in environmental sustainability and lifecycle assessment (LCA) showcases a profound evolution. Currently, in 2024, most processes are labor-intensive, with approximately two weeks required for conducting a simple LCA, and up to 50-man days for more complex assessments. This inefficiency spans across hundreds of thousands of products, involving millions of unique components annually. The absence of ecodesign capabilities and the challenge of managing Scope 3 data accuracy are the most common gaps in present-day manufacturing enterprises. However, the outlook for the future of sustainable product manufacturing is promising and positions enterprises on the cusp of a sustainable innovation breakthrough.
The automated LCA process heralds a revolution, transforming a cumbersome task into an instantaneous, automated, and scalable operation. This leap has facilitated the assessment of an expanded portfolio of more than 500,000 products with over a million unique components, just in Makersite’s realm, shifting the frequency of Environmental Product Declarations (EPD) and Product Carbon Footprints (PCF) from an annual to an ongoing (and on demand) basis. The integration of digitized, granular data is the centerpiece of this transformation, significantly accelerating ecodesign capabilities through the precision and accessibility of the data we are able to harness.
However, pushing the start button of this transition for any enterprise can be daunting, with scattered process, strategies, and stakeholders. Nevertheless, standardizing and automating data collection, analysis, reporting, and unifying fragmented systems and data silos is a little less intimidating to take on with the right data solution.
The challenge of environmental data compliance and the competitive advantage
Today, businesses function in a global market increasingly focused on sustainability and the environmental impact of products. Those businesses must operate within a complex landscape of regulations and frameworks that demand detailed environmental data. With growing complexities in the regulatory landscape surrounding sustainability reporting, there is a clear need for the better governance of upstream environmental data, which currently faces challenges such as incomplete Bills of Materials (BOMs), unidentified sources for supplier and factory data, and the daunting task of aligning data for energy consumption calculations.
The significance of these challenges cannot be overstated, as failure to comply carries the risk of substantial penalties. However, the demand for meticulous environmental data is not just a matter of regulatory adherence — it’s also a crucial driver for achieving ambitious sustainability targets to which many businesses are now committed. Consumers, partners, and the broader market are more informed and more concerned about the environmental impact of their consumption than ever before. They require comprehensive environmental data to evaluate the sustainability attributes of products. This data empowers them to make informed choices, differentiate products, and ultimately promote environmentally friendly options over their less sustainable counterparts. The visibility of environmental credentials has become a key factor in purchasing decisions, thereby influencing sales and brand loyalty.
Additionally, market leaders and competitors are not sitting idle. There is a palpable acceleration towards the integration of sustainability data into products and corporate value propositions. This trend underscores a shift in how sustainability data is perceived — from a regulatory requirement to a strategic asset that enhances competitive advantage. Companies that successfully incorporate high-quality environmental data into their products not only meet regulatory demands but also position themselves as leaders in the transition to a greener economy.
“Product design and sourcing leaders respond to external demands by prioritizing sustainability in product development. Changing customer expectations, an emphasis on the circular economy, and supply chain transparency drive their organization’s product initiatives. Product design and sourcing leaders are addressing the intersection of sustainability, resilience, and business performance; they’re prioritizing initiatives like enhancing sustainability reporting for compliance and to support sales or optimizing reliability and efficiency when sourcing materials.”
From: Makersite and Forrester’s ‘Transform Product Sustainability into Performance Initiatives with Product Lifecycle Intelligence’ [Download]
The challenge of granular visibility in supply chains
In the wake of escalating demands for sustainability and compliance, Original Equipment Manufacturers (OEMs) and Tier 1 suppliers are at a crucial juncture. The imperative to empower a specialized team of cross-functional experts has never been more pressing. Their mission? To achieve real-time visibility into the labyrinth of their intricate supply chains. A monumental shift — from annual to monthly to real-time reporting — is required. However, this demands a seismic change in strategy and execution. With portfolios encompassing hundreds of thousands of unique products and millions of unique component parts, the scale of this challenge cannot be overstated. The objective for many is clear: to automate, scale, and future-proof the capabilities of OEMs and Tier 1 suppliers, enabling them to adeptly respond to an exponentially growing number of demands. It is conceptually simple, but operationally complex.
Furthermore, these demands are coming multiple angles: customers, industry standards, and regulatory bodies, each requiring detailed attention at the product level. The key to navigating this lies in successfully implementing an integrated data layer that not only streamlines operations but also injects carbon management and other critical upstream environmental data across various domains. By bridging the chasm between engineering, compliance, sustainability, and procurement, this strategic integration shatters longstanding data and organizational silos, paving the way for fluid decision-making processes inclusive of and informed by both data-driven insights and human expertise. Fostering this connectivity consequently positions OEMs and Tier 1 suppliers at the cutting edge of competitive advantage, fortifying their standing for the decade ahead.
Progressing towards a more integrated and responsive framework is not just about survival; it’s about seizing the opportunity to lead in the realm of sustainability and regulatory compliance. Through this visionary approach, OEMs and Tier 1 suppliers are not only adhering to the current landscape of expectations but are also shaping the future of environmental stewardship within the industry. At first glance, the proposed transformation may appear overly optimistic and deceptively simple; however, it’s important to acknowledge the complexity of the undertaking for the organization. For many, a multi-faceted strategy is essential when addressing intricate challenges in order to ensure success in sustainability endeavors, but the question remains: is extensive, manual effort truly necessary? Could there be a more streamlined approach?
The challenge of quality environmental product data
While the demand for sustainability and compliance to merge into a single force very much still exists, the Request for Proposal (RFX) process so much of the industry grapples with is undergoing a significant transformation. This change is spurred by the necessity for quality environmental product data to future-proof carbon decision-making initiatives. However, the integration of sustainability within compliance frameworks is no longer optional. With 64 countries and 12 U.S. states now imposing mandatory carbon pricing and planning, the landscape of Environmental, Social, and Governance (ESG) reporting is expected to see a 527% upsurge in Key Performance Indicators (KPIs). These developments underscore evolving global compliance dynamics, with stringent regulations on substances and materials spanning multiple continents. The consequences of non-compliance are severe, ranging from stop-orders to hefty fines — a reality many businesses are scrambling to avoid.
In sectors like electronics, automotive, and oil & gas, ecodesign is not just a trend — it’s a requirement. The push for greater transparency, especially in Scope 3 Category 1 emissions, is compelling Tier 1 suppliers to adopt a more transparent approach in the RFX process. OEMs are demanding a deeper insight across the value chain, necessitating a shift from spend-based assessments to a hybrid model fortified with defensible data from suppliers. The high-quality emissions and sustainability data needed from suppliers would be pivotal for enhancing Life Cycle Assessments (LCAs), Product Carbon Footprints (PCFs), and Environmental Product Declarations (EPDs), thereby enabling informed ecodesign decisions.
The challenge of an aging, siloed and unintegrated tech stack
OEMs and Tier 1 suppliers face three primary challenges in leveraging market opportunities effectively: the need for data aggregation, harmonization, and contextualization; reliance on obsolete digital architectures, outdated tools and processes; and the poorly governed business use cases for integrated carbon decision-making. Both OEM & Tier 1 suppliers have invested in legacy tech stacks creeping upwards of dozens to hundreds of unique tools and systems over 25-plus years.
On top of the market evolving rapidly and demanding new flexibility for ever changing requirements on data granularity and availability, and without the right tech stack set up to respond to the demand for integrated carbon decision making, market leadership and winning business is at risk. Overcoming these obstacles is not just crucial for meeting current demands but is instrumental in shaping the future of responsible manufacturing and sustainable industry practices. Companies at the forefront of prioritizing data quality, overcoming technological limitations, and mastering integrated carbon decision-making will not only align with global compliance and sustainability mandates but will also secure a leading position in the green economy of tomorrow. In the absence of that option, what alternative course of action should we pursue?
“Cross-functional collaboration, and a single source of truth is critical in enhancing product design and sourcing as well as gaining a competitive edge. Respondents agree that adopting product lifecycle intelligence drives sustainability improvements by enhancing data quality and supporting collaboration among stakeholders. They expect the solution’s business value to be reflected in a faster time to market, higher profits, and operational enhancements.”
From: Makersite and Forrester’s ‘Transform Product Sustainability into Performance Initiatives with Product Lifecycle Intelligence’ [Download]
Aggregate. Contextualize. Harmonize.
The process requires a deep understanding and application of essential steps to harness environmental data effectively by ways of data aggregation, contextualization, and harmonization. The foundation of robust carbon decision-making lies in the meticulous collection and consolidation of upstream data. This crucial first step is about securing a diverse stream of data inputs that are integral to understanding the environmental impact of products or services. The variability and complexity of these data sources necessitate a systematic approach to ensure accuracy and relevance. Companies looking to optimize their carbon footprint calculations must prioritize this data collection as a critical input to their sustainability efforts.
Once the upstream data is collected, it’s time to translate this information into actionable environmental data for products. This stage is where the carbon, cost, and compliance figures are derived. However, it’s not just about gathering data; it’s about making sense of it in a way that aligns with business goals and sustainability objectives. By aggregating upstream data effectively, companies can shed light on the environmental footprint of their offerings, enabling informed decision-making. In the digital age, the value of data is greatly enhanced by its accessibility. Focusing on the digitization and publication of consolidated environmental data involves pushing the data to platforms and repositories where it can be easily accessed by customers and stakeholders. Such transparency is not only a marker of a company’s commitment to sustainability but also serves as a differentiator in the marketplace, showcasing the environmental credentials of their products.
To elevate the integrity and market value of products, it is crucial to not only generate but also consolidate product environmental data and rigorously validate sustainability claims. This consolidation involves synthesizing collected and upstream data into coherent, actionable insights that accurately represent a product’s environmental footprint. By doing so, businesses can ensure that their sustainability claims are not merely aspirational but are firmly rooted in empirical data.
But how do we validate? Validation should be conducted through third-party audits or by employing recognized sustainability frameworks and standards. This thorough vetting process not only fortifies the credibility of a company’s sustainability assertions but also amplifies consumer trust. In aligning closely with the data-driven methodologies outlined previously, businesses can assert their sustainability claims with confidence, offering tangible proof of their commitment to environmental stewardship. This not only meets the growing demand for transparency in the green market but also positions companies at the forefront of sustainable innovation, distinguishing them in a competitive landscape.
With the strategic use of Life Cycle Assessment (LCA) methodologies, businesses are able to calculate and understand the comprehensive environmental impact of their products, from CO2 emissions to broader sustainability metrics. The digital era demands that this rich environmental data be made accessible through digitization and publication, enhancing transparency, and distinguishing a company’s products in the competitive marketplace by their environmental credentials.
A meaningful, holistic approach
Generating compliance data is not just about avoiding penalties but also about upholding a commitment to environmental stewardship. This extends to leveraging Life Cycle Assessment (LCA) methodologies to calculate the impact of products on the environment comprehensively. By employing LCA, organizations can generate CO2 emissions data and other quantitative indicators that offer insights into the overall environmental footprint of their products or services. The implications for the EHS&S professionals are manifold, involving an enhanced capacity for instant automated LCA calculation, on-demand automation and scalability for assessing the environmental impact of vast product portfolios, and the fast-tracking of ecodesign driven by accurate, digitized, and granular data.
Enterprises pursuing a holistic approach encompassing compliance with environmental regulations, the adoption of ecodesign principles to minimize lifecycle impacts, and the pursuit of decarbonization efforts to reduce greenhouse gas emissions meaningfully can enhance their market value proposition through clear communication of their product’s environmental credentials. These objectives will serve as guiding principles for utilizing environmental data to support decisive action across the spectrum of sustainability practices, empowering businesses to not just participate in the green economy, but to lead and innovate within it.
So how can change be enacted? By empowering and enabling the right people. Product engineers want to create great, well-functioning products that have a low environmental impact. But they have historically lacked the required tools and support from the organisations they work for.
To achieve the sustainability goals businesses, consumers and regulators have put before us, the focus should be on making it better rather than making it faster. But to do that, the negative environmental impacts from the design and production process have to be removed.
The solution? New machinery. A tool that enables engineers to see the impact of material choices during the design phase of a product – a phase where, currently, some 80 per cent of the ecological impact of a product happens. A tool that enables speed, experience, performance and costs to be optimised and environmental impact to be removed. A tool that enables faster, smarter, greener decisions powered by the deepest understanding of your supply chain. A tool 50 times faster than traditional methods. That tool is a new piece of software – Product Lifecycle Intelligence, or PLI for short.
Product design led by an informed consideration of materials and the environmental footprint of our choices is a logical progression. This places the engineer in the spotlight. They not only understand the intricacies of design and manufacturing but also the broader ecological and socio-economic context in which they operate. However, there are challenges to overcome.
With projections indicating that the sustainability market could be worth $2 billion by 2030, there’s an evident rush among companies to gather necessary ESG and sustainability data and to meet regulatory benchmarks. But this often leads to a short-sightedness, with a disproportionate focus on reporting and little tangible improvement in actual practices.
We find ourselves at a moment where sustainability has crossed the chasm from afterthought to imperative. But in five years’ time, reporting will mean very little if no actual action is taken. Product development teams will be measured and held accountable for the changes they are able to systematically implement to drive the transition to a sustainable economy. To succeed, there needs to be a way to power this transformation at scale.
As it stands, the current machinery for product design is inherently rigid and not fit for purpose. Siloed data systems, an array of disconnected experts, a reliance on legacy systems, slow information exchange and a lack of proper strategy or understanding at board and executive level all result in poor product choices where the negative cost and supply chain impacts are not understood until it’s too late.
Far from facilitating rapid innovation, this situation inhibits inter-departmental collaboration and access to critical, real-time data – ultimately hindering informed decision-making.
However, we are standing on the edge of something new. Companies that embrace this new approach to product development will have a significant advantage over others. Adaptability is essential. The future belongs to an ecosystem of integrated systems that allow a seamless flow of data and an outcome where all relevant information is gathered in one place, informing decisions and enabling rapid course corrections.
If we present engineers with the data they need, they will use it – and use it well. No one wants to make a “bad” product, but “good” products can only be made with the right decisions informed by the right data. That is what will make the difference.
By placing engineers and product developers at the core of a data-centric approach, organisations can ensure that the products they design not only meet market demands but are also firmly anchored in sustainability. Combined with AI, a harmonised approach to data will provide full visibility into the manufacturing process, materials and supply chain during the design phase, enabling speed, experience, performance and costs to be optimised and negative environmental impacts to be limited.
But the product engineer cannot operate in isolation. Their perspective must be comprehensive, encompassing environmental, socio-economic and commercial considerations. To succeed in this mission, teams – from procurement and sustainability to supply chain management – must align.
Emerging platforms will play a pivotal role here. New solutions like PLI act as bridges that span knowledge gaps, fostering a culture of collaborative innovation and allowing easy access for all. PLI is a tool that not only helps the business to adhere to its core principles, but ensures visibility and transparency at every step, leading to better design choices and the creation of products that will stand the test of time.
Organisations need to rally their diverse teams – be they procurement, sustainability, engineering, or IT – under a shared, compelling vision, bringing about a dynamic ecosystem that is agile, adaptable and geared toward ethical, criteria-driven innovation.
The market is ready and waiting for a better approach. Some may argue that this is wishful thinking or is not worth the effort. However, a Bain & Company study found that, while only 40 per cent of businesses are on track to meet their sustainability goals, companies have an increasingly conscious and proactive base of consumers willing to pay 11 per cent more for sustainable products and employees that will help.
It’s not just blue-sky thinking for a greener future either. The most significant driver for companies to do anything has always been growing revenue. A 2022 report, the Sustainable Market Share Index by NYU Stern’s Center for Sustainable Business, examined what actually happened in the past decade. It found that the share of CPG products marketed as sustainable grew twice as fast as conventional products and accounted for one-third of the total revenue growth in the industry. Customers paid 27 per cent more for those products.
With a massive demographic shift bringing more environmentally conscious buyers into the market already well underway, the time never has been better to build better products.
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