How SAP Supports Sustainability Efforts

SAP offers diverse solutions for challenges like improving sustainability efforts and the platform’s customizability for firms in any industry is a significant advantage. Any firm can thus utilize SAP to streamline and expand their initiatives, especially given the modern importance of ESG. 

Below, we discuss how SAP supports sustainability, notable solutions and offerings, and a few challenges for firms to be aware of with implementation and maintenance. 

Supporting SAP Sustainability

Almost 80% of consumers take sustainability into consideration when choosing products or brands. Consequently, firms should constantly be searching for means to make their own Environmental, Social, and Governance (ESG) practices better, more efficient, and more manageable.  

With 92% of the Fortune Global 2000 Companies list already using SAP in some form, it can be the catalyst for many firms that won’t need to transition to new systems. Instead, employees can simply access new SAP modules and dashboards utilizing the same skillset that they already possess. This can save time, training costs, and implementation fees.  

Key SAP Solutions

Tracking

The creation of circular economies is paramount to ESG initiatives. This means that resources, products, and manufacturing byproducts can oftentimes be reused to lower a company’s footprint. Creating circular economies relies on a few key pillars. 

First, firms need to optimize product lifecycles from start to end with sustainability in mind. This means initially designing products that create the least waste and the best chance of reusability. SAP offers a module specifically targeting this called SAP Responsible Design and Production. It essentially helps firms quickly calculate important ESG figures and provide analytical insights that help better decisions be implemented. 

Another key solution that SAP offers to build circular economies is Product Lifecycle Management. Accurately understanding a product’s lifecycle and potential barriers can help firms mitigate challenges that reduce a product’s lifespan. Consequently, firms can lengthen the time that a product survives which creates less waste and manufacturing byproducts.  

Finally, firms must effectively handle returns of products so that excess waste is not generated. Both the Returnable Packaging Management and Intelligent Returns Management modules are tools which can be used to optimize returns. Ultimately, returns should not be the end of a product’s life. Instead, firms with circular economies can reuse and reinvigorate items that otherwise would have gone to waste. 

Alignment

Understanding exactly where a firm stands on ESG metrics is extremely important to properly evaluate whether more action needs to be taken. Firms should have real time access to data that accurately updates progress on goals.  

Firms can use the SAP Sustainability Control Tower to view all performance metrics, data, insights, and ongoing goals in one place. This is crucial to avoid silos on various aspects of sustainability initiatives. Instead, firms can holistically understand exactly where they are and what they should do going forward.  

The Sustainability Control Tower also allows firms to build models in order to view trends and patterns that may have been missed initially. This can be the difference between meeting a firm’s goals on sustainability or not. 

Finally, a holistic understanding of all data and metrics for a firm’s goals makes reporting and governance much easier. Internal or external audits are more streamlined and easily complied with due to the efficient presentation of data by this SAP solution.  

Impact Management

Last but certainly not least, firms must be able to track the full environmental impact of products and services so that more informed decisions can be made in the future. Consequently, SAP offers the Product Footprint Management module which performs a host of important functions.  

This solution utilizes existing firm data to accurately calculate the environmental impact of products. Firms can use this to fully understand their emissions and thus recognize decisions that can lead to severe increases in output. Ultimately, understanding exactly how a firm contributes to global emissions and waste is the first step to reevaluating decisions that can be made more sustainable. 

SAP and Sustainability

The primary challenge that firms will face in utilizing SAP offerings for sustainability is the cost of modules and potential implementation. Additional modules, like those listed above, may add to a firm’s recurring operating costs; however, it’s important to first evaluate other financial impacts. 

Consistently having access to a firm’s data about sustainability means that tasks can be optimized. As a result, costs may fall as processes become more efficient. Additionally, lengthy recurring undertakings such as audits, goal mapping, and progress monitoring are essentially done instantaneously whenever a firm needs. This means that time and labor costs are reduced or eliminated entirely.  

At the end of the day, sustainability and ESG are core components to modern businesses. Firms can use SAP as a catalyst for understanding and improving their own initiatives. Companies, however, should take the time to properly evaluate whether the additional modules are worthwhile for what they hope to accomplish. Firms may also be served best by industry leading SAP implementation partners who can ensure systems are fully optimized.