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As we move into the home stretch of 2021, I reflect on how much the industry has changed even in just the last two years, and what critical trends are impacting our customers’ organizations most like the need for a sustainable future.
This is especially a good time prior to our annual user conference, Innovation Talks: 2021 Foxboro and Triconex User Group, which kicked off virtually September 14th.
It is evident to me that—without diminishing the impact of COVID in the least—many of our customers are affected by three mega-trends: sustainability; the changing industrial workforce; and a move toward open, standards-based automation technology.
While I intend to explore and comment on each of these mega-trends in future blog posts, for now I want to focus on the urgency of sustainability and its relationship to improving business performance.
To do that, we have to acknowledge that our most pressing challenge is probably climate change. But no one should have to choose between sustainability and profitability. They are two sides of the same coin. Sustainability isn’t just about pursuing a social good or protecting a brand. Nor should it be a drag on financial performance. In fact, I will argue that a good sustainability strategy enables better financial performance. That’s because it forces an organization to be resilient, agile and innovative, which is the legacy of our Schneider Electric EcoStruxure™ process automation offers.
Industry’s role in sustainable practices and a sustainable future
With the world’s population expected to crest 9 billion within 20 years, the demand for energy is continually increasing, and it is having a tremendous consequence on our global climate. To combat that, as an industry and society at large, we need to reduce carbon emissions within that same time span via a massive shift toward green and renewable energy.
For example, today electricity is only 20% of the energy we consume, but in the next 20 years, electricity will become at least 40% of consumable energy, and it will be profoundly more renewable. This progression will have far-reaching effects on the global supply chain and therefore on our customers’ operations and business models.
Related to the issue of climate change, there is a stronger focus on sustainability among consumers. With everyone rightly more concerned about the environment, conversations around sustainability have fundamentally changed.
People more frequently consider sustainability and other social responsibility factors when making buying decisions. There are all kinds of studies out there, including this one from the World Wide Fund for Nature, the sustainable product market is growing fast, and it crosses every sector from manufacturing to finance and even personal banking. One study from 2019 showed that 48% of U.S. consumers, and 75% of millennials, said they will definitely or probably change their buying habits to reduce their impact on the environment.
This whole new perspective is driving pressure into industrial markets. Manufacturers need to consider how they can change their operations to get in front of these buyers and their ethics-based buying decisions.
This is especially true in the energy and oil & gas industries, where, in response to growing concerns over climate change, utilities are rapidly transitioning away from coal and many oil majors are accelerating spending on and diversifying into renewable and low-carbon energy. In fact, in a study from a couple years ago, The International Energy Agency forecasted the world’s total renewable-based power capacity to increase 50% between 2019 and 2024.
Another market pressure is related to regulations and compliance, meaning industrial manufacturers are now or soon will be required to meet stronger, more stringent sustainability goals. This includes new pressures from shareholders, who leverage their holdings to push new corporate visions and sustainability strategies.
Meet sustainability goals with business agility
As we learned through the pandemic, your ability to respond to changing market dynamics is directly related to your ability to make yourself more agile, more resilient and more efficient through a strong digital strategy.
And digitize we must. We’re using almost two times the amount of natural resources than the earth can regenerate in a given year, and at this point, we absolutely have to reduce carbon emissions.
That is why Schneider Electric is always looking for better ways to help our customers reimagine and improve sustainability. One part of our vision is to deliver digital solutions and strategies for sustainability that consider resiliency, energy efficiency and process efficiency together.
Our customers can already use Schneider Electric EcoStruxure offers to push forward their sustainability and digital strategies. For example, our EcoStruxure Foxboro DCS, EcoStruxure Triconex safety systems and other process automation technology already help our customers control their most critical operating variables: safety, efficiency, reliability and so forth, all of which are instrumental to achieving sustainability targets and to driving shareholder value.
But when the goodness of these offers is combined with the strength of Schneider Electric’s entire EcoStruxure portfolio and AVEVA software, our customers can really begin to pursue net-zero via better process and energy efficiency, without sacrificing profitable performance.
At the end of the day, Schneider Electric connects people to sustainability and other ethics-based outcomes, while helping them meet their bottom lines. It’s what we call responsible profitability. It’s not just about saving the environment: the reality is that you can create a sustainable future that is socially conscious and profitable all at the same time.
Attend our user conference for more business insights and discussions
To learn how you can leverage your EcoStruxure Foxboro, EcoStruxure Triconex and other EcoStruxure technology to pursue new responsible profitability strategies, please watch our Innovation Talks: 2021 Foxboro and Triconex User Group sessions on demand. The event offers exceptional technical content that is intended to help you address real problems, including how to become more efficient, more profitable and more sustainable in the face of the climate crisis.
Thank you for reading and stay tuned for future posts where I will explore the changing nature of the industrial workforce and ongoing initiatives to make open, standards-based industrial automation a reality.
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