There was a time when the sole motive of businesses was to make a quick buck. But now, when the climate crisis is receiving significant attention from governments, media, and the public, businesses are making efforts to be sustainable.
And how are they doing it? Through the use of data analytics. Businesses are analyzing data to find patterns and trends to decarbonize their operations and to make informed decisions.
Here, we’ll discuss how data analytics is making businesses more sustainable.
#1 Supply Chain Optimization
A staggering 80% of each company’s emissions originate from their supply chains—were you aware of that? That highlights the importance of optimizing supply chains and making them sustainable.
Supply chain optimization is basically the process of improving the performance of a supply chain by adjusting inventory and reducing costs in an eco-friendly way.
Data analytics is helping businesses spot pathways to a more sustainable supply chain.
It offers valuable insights into supplier delivery times, product quality, regulatory compliance, and sustainability of potential partners. This helps them choose suppliers that align with their goals.
Data analytics also improves demand forecasting. Advanced analytics uses pattern recognition within extensive data to forecast product demand. That optimizes sourcing, inventory, and logistics planning.
Predictive analytics further helps with inventory management. Through statistical algorithms, historical data, and machine learning techniques, it predicts future events and trends, so businesses can forecast potential outcomes.
#2 Carbon Footprint Reduction
The World Resources Institute reports that global greenhouse gas emissions rose by 51% from 1990 to 2021.
Data analytics can help cut emissions across all sectors. Companies can install smart sensors to monitor electricity, fuel, and water usage. With analytics, they can identify wasteful practices and adjust operations accordingly.
Once businesses understand their carbon footprint, they can take big steps toward sustainability. That is, shift to sustainable and environmentally-friendly fuels like hydrogen.
Hydrogen is gaining traction as a clean energy alternative because it produces zero emissions when used in fuel cells.
Take manufacturing, for example. Factories with high energy demands can use hydrogen-powered systems instead of relying on coal or natural gas.
For the widespread adoption of hydrogen as an energy source, efficient hydrogen storage technology is important.
The good news? Reticular materials are offering a way forward. Materials such as Metal-Organic Frameworks (MOFs) offer a promising solution for hydrogen storage in solid state, due to their ability to attract and securely hold hydrogen molecules within their nanoscale pores, allowing for efficient release when needed.
According to H2MOF, the high storage efficiency makes it possible to store the same amount of hydrogen in the same space of a 700-bar tank, but at a significantly lower pressure and with reduced overall weight.
#3 Better Waste Management
Businesses generate a ton of waste. Whether it’s excess materials, packaging, food waste, or just inefficient processes, all that junk doesn’t just disappear. It ends up in the landfill and hurts the planet.
Integrating data analytics has been a game-changer in waste management. It can help waste management professionals pinpoint high-waste generation areas. That way, they can create focused and effective intervention strategies.
Businesses can install smart sensors to track waste levels in real time, such as overflowing dumpsters, food spoilage, or manufacturing scraps. With that data, they can pinpoint wasteful practices and find ways to cut down.
Take the retail and food industries, for example. Grocery stores use AI-powered tracking to analyze large amounts of data like sales history, customer behavior, and seasonal trends. This helps them predict future demand while allowing them to minimize the amount of food that expires on the shelves. That helps reduce food wastage.
2 Real-World Examples of Businesses That Use Data Analytics
Here are two real-life applications for data analytics:
1. Microsoft
Microsoft used data analytics to solve a collaboration challenge.
Its Workplace Analytics team leveraged data to analyze office layouts to boost collaboration and performance. They determined that consolidating 1,200 employees from 5 offices to 4 would reduce travel distance for meetings and improve face-to-face interactions.
The results? A 100-hour reduction in workweek time and an impressive $520,000 in annual savings on employee time.
2. Nestle
This consumer goods company is also using data analytics to drive sustainable business practices.
It has set a goal to achieve zero environmental impact by 2030. And for that, Nestle has implemented a data analytics tool that tracks its energy use as well as pinpoint areas where the company can reduce consumption.
Companies that embrace this approach aren’t just doing good. They are also setting themselves up for long-term success in a world where resources are finite and stakeholders demand responsibility. That, of course, will make them more successful in the long run.
So, if your business isn’t already leveraging data for sustainability, now is the time to start. That is because, in the long run, smarter choices lead to better profits and a healthier planet.