Manufacturers are working hard to upskill and strategise, taking advantage of the circular economy's golden opportunity for return on investment. Manufacturing business and tech leaders are paying greater attention to the benefits of the circular economy - according to the 'State of the Circular Economy' report created in partnership with Sage and CIO, 84% say that they have a role in their company's circular economy and sustainability strategy, and 32% say it's central to their job.
32% of manufacturers and distributors have experienced significant benefits from the circular economy.
They picked out:
- Improved brand image and reputation (50%)
- Energy efficiency (47%)
- Increased productivity, efficiency, and resiliency (46%)
- Improved long-term profitability (45%)
- Improved competitiveness (44%)
The circular economy could attract new customers
- Digitising manufacturing processes to support the circular economy could make your business more robust, resilient, and profitable in the long term.
- Sustainable business practices are now a critical concern for customers, employees, shareholders, and supply chain partners who want to take responsibility and action around sustainability.
- Customers will expect your business to conscientiously control and limit your damage to the environment through an environment, social and governance (ESG) strategy.
How to start your circular economy strategy
Building a circular economy business model is challenging from a standing start. There’s the cost of digital transformation, potential supply chain disruption, and cultural challenges like getting your team onside.
Where do you begin? Let’s start with people and technology.
Hire or upskill manufacturing workers with data and analytics skills
Manufacturers and distributors need workers trained in advanced data-rich technologies to take full advantage of the circular economy.
It’s vital to have a team that can forecast how a circular model will affect manufacturing costs and consider the associated risks beyond quality and cost.
Six Sigma is a quality control program that uses statistical control measures to show and remove the causes of defects. It minimises variability in business processes—which cuts waste. Having employees with a Six Sigma background is helpful as they can improve manufacturing quality by managing, collecting, and analysing large data sets.
Use the right technologies
In our research, respondents ranked four digital transformation technologies in order of importance for chasing your circular economy goals.
1) Cloud applications and infrastructure (74%)
The cloud drives digital transformation, impacting every aspect of modern manufacturing. Think of Enterprise Resource Planning (ERP), workforce training, or apps to monitor machines.
With the circular economy, cloud software helps research, design and develop products more efficiently and cost-effectively.
The cloud also transforms physical processes. You can fabricate, manufacture, and analyse products by innovating with processes that drive sustainability, such as 3D printing and digital twin solutions.
2) Data analytics (68%)
Data analytics can support your circular economy strategy by speeding up product development and quality control while reducing manufacturing costs. You can more easily monitor your machinery and make the best use of resources, eliminating waste as much as possible.
Data analytics can also strengthen your supply chain to help with logistics, distribution, and product scheduling.
3) Automation (67%)
Automated processes speed workflows, boost productivity and reduce human error. You’ll also yield analysable data that can improve circular economy production performance.
4) Internet of Things (IoT) (48%)
By adopting IoT technology for machinery, endpoints in the field, or products and parts, you can carry out predictive monitoring and maintenance, increasing efficiency in support of greater circular economy sustainability.
To find out more about how digital transformation can support your circular economy goals, view the full report.