Sustainable Manufacturing

Since the beginning of the industrial age, the manufacturing industry has been constantly evolving and adjusting to respond to new technological innovations and changing market demands. Currently, the industry is going through another change, one with sustainability at its core.

This report explores the opportunities sustainable manufacturing presents for the manufacturing industry, and shares real-world examples of how manufacturers are leading the sustainable manufacturing transformation and the strategies they are adopting to embark on a sustainable manufacturing journey.

Sustainable Manufacturing – From Vision to Action

Focusing on five key areas of impact where sustainable manufacturing can significantly improve the entire manufacturing value chain

Engineering: During the product design process, both small modifications and large-scale modifications can reduce costs and reduce waste.

Source: The ethical selection and sourcing of sustainable and/or alternative materials has become increasingly important.

Production: Building the factory of the future by improving operational efficiency, leveraging smart technologies, and using green energy.

Transport: In transport and delivery, supply chain restructuring and decarbonisation efforts are rationalising trade routes and helping to reduce carbon emissions.

Post-market: The transition to a circular economy model is expected to change the way products are designed, produced, sold, used and disposed of.

Advantages and barriers of sustainable manufacturing

A variety of factors are driving the manufacturing industry’s slow but steady evolution towards sustainable manufacturing, such as the desire for returns; the need to offset risks and costs; and increasing pressure to meet the needs of stakeholders, shareholders and customers.

Advantages: Manufacturers of all types are leveraging sustainable manufacturing practices to reduce costs and waste, improve operational efficiency, gain a competitive advantage, and enhance regulatory compliance.

Barriers: Businesses are also turning to sustainable manufacturing to mitigate increasingly complex regulatory and compliance risks. In addition, there is increasing external pressure from investors who want companies to make progress on the SDGs year by year. This could ultimately require a transformation of entire manufacturing and industrial systems, forcing manufacturers to rethink how they design, source, manufacture, deliver and service all of their products.

1. Sustainable product design

In the transition to sustainable manufacturing, it has to be acknowledged that sustainability starts at the product design stage. With rapid prototyping and additive manufacturing (AM) greatly enhancing R&D capabilities, companies can often realize sustainability benefits by modifying existing products. In addition to reducing material waste, additive manufacturing can also help manufacturers reduce their reliance on environmentally harmful materials, such as corrosive cutting fluids. Many additive manufacturing produces parts that are lighter in weight, which also helps save fuel and energy.

Many manufacturers are also reducing product disposal by considering the full life cycle of product use, and they use the product for lease or rental rather than outright sale in order to ensure proper product maintenance and extend product life. In addition to incentivizing manufacturers to improve production quality to extend product life, this approach can synergistically create new revenue streams through service and support.

A key to realizing these benefits is designing products with sustainability in mind, involving redesigning individual elements of a given product to improve environmental performance, finding ways to reduce disposal costs, improve raw material utilization, extend product life cycles, or refurbished or remanufactured to design for final purpose.

2. Material selection and ethical sourcing

An important factor driving sustainable manufacturing is material selection and sourcing. At the most basic level, it starts with reducing input of raw materials, replacing potentially toxic materials with materials that are less harmful to the environment, and using processes such as additive manufacturing to shorten supply chains and reduce the amount of material needed to produce parts. To meet environmental, social and governance (ESG) requirements and avoid backlash from consumers, investors and regulators, manufacturers may increasingly need to prove the origin of their raw materials.

Immutable proof

One way to achieve transparency in procurement is to employ immutable ledger technology such as blockchain. These technological advancements have impacted how many manufacturers select and source materials. By tracking individual raw materials, components, and even finished products, immutable ledgers can help manufacturers improve product quality, speed product recalls, and reduce record revisions.

3. Forging the factory of the future

Another key area of focus when considering how to achieve sustainable returns within manufacturing is on the factory floor. This usually starts with automation and integration. In recent years, manufacturers have implemented lean processes and digital technologies to increase productivity, create safer workplaces and reduce costs. Integrated and complementary technologies not only allow manufacturers to better understand their production processes, equipment wear and energy usage, but also enhance predictive maintenance and minimize material waste.

Alternative energy options

Energy often represents a huge cost that will only rise as global energy prices rise. By reducing waste and water use, adjusting energy loads, reducing heat requirements, and even adopting carbon-neutral manufacturing, factories of the future have the potential to achieve huge sustainability gains while reducing costs. One way to achieve this is to use more competitive renewable energy.

4. Simplify shipping and distribution

In addition to product development and production, manufacturers serious about achieving their sustainability goals should focus on the impact of their distribution practices. This is especially critical given the manufacturing industry’s heavy reliance on shipping and road transport.

Act wisely

One way to transform transport and distribution is through long-term cooperation to implement initiatives that support “green transport,” committing transport volumes on selected routes and incorporating emissions targets into tender criteria. Industries facing regulatory pressure (such as automotives) or industries with high consumer profile (such as FMCG or apparel) are potential key players in such schemes. To be effective, however, both fleets and fleet operators need to share emissions data more openly or improve monitoring technology to help manufacturers make informed decisions and check performance.

5. Circular economy

In the transition to sustainable manufacturing, the consumer side of the product also needs to be considered. There is no doubt that reducing waste is becoming more and more necessary. The market is increasingly holding companies accountable for their emissions across the life cycle of all their products.

Think circularly

Roughly defined, a circular economy is a closed-loop system that aims to replace end-of-life waste disposal with material reduction, reuse, recycling and reuse. Its purpose is to keep resources as long as possible within the product life cycle by:

Closing the loop: reintegrating waste or by-products into the production of new products;

Slowing the cycle: Extending product life and slowing the transition of resources to waste or resource reuse;

Reducing the cycle: Reducing resource and material usage requirements during production, use or disposal.

6. Towards Sustainable Development

Whether driven by stakeholder requirements, regulatory requirements, environmental concerns, or purely financial motives, the need for sustainability is growing. To make the necessary progress and turn the tide, manufacturers need to commit to taking clear action.

· Get started

· Assess the status quo

· Update strategy

· Set goals and prioritize theme

· Consider financing and tax implications

· Get top-level support

· Clarify necessary roles and responsibilities

· Improve investment decision making

· Build a structured ecosystem to overcome potential pitfalls

· Measure progress and create a clear market story

· Take an active role and move towards a desired future