Consumer interest in sustainable goods and services is much more than buying reusable or following a trend. It's now part of everyday life, from the packages we buy, to the food we eat, and the homes in which we live. The same is true for midsize businesses – especially in their supply chain operations. In a survey of companies with annual revenues of less than $1 billion across 41 markets and 28 industries, the SAP Insights research center discovered that most supply chain organizations are incorporating sustainability directly into their strategies for increasing efficiency and driving revenue growth. This mindset influences everything from the location of plants, warehouses, and suppliers to the distance goods travel and the selection and onboarding of eco-friendly and socially ethical vendors.

This finding underscores the massive transformation supply chains must undergo to be competitive. While important to brand reputation, sustainability should be part of a balanced trifecta with operational efficiency and revenue growth. Doing so yields the lowest-possible cost with the greatest customer satisfaction while optimizing environmental, social, and governance (ESG) performance.

The SAP Insights report states, "Midsize companies with supply chains that quickly incorporate sustainability and the circular economy into their plans for growing revenue, increasing efficiency, and mitigating risk are well-positioned to differentiate themselves and gain a competitive advantage."

Increasing regulations are driving the need to act

Supply chains – as well as the rest of their business – are no strangers to sustainability-related government regulations and industry requirements. Packaging companies must demonstrate that every tier of their supplier network, for example, meets plastics recycling standards, doesn't use banned and dangerous substances, and is free from illegal, unsafe, and unfair employment practices.

Although they may initially incur higher costs, suppress efficiency, or limit growth, those mandates can kick off a series of competitive advantages in the long run. Consider the UK Plastics Pact, implemented to eliminate problematic or unnecessary single-use packaging and help ensure 100% of plastic packaging is reusable, recyclable, or compostable and contains 30% recycled content on average.

Compliance with the plastics pact resonates with a growing customer base that prefers sustainable brands and a workforce that wants to work for companies that drive results with ESG initiatives. In addition, investors – from the stock market to venture capitalists and industry-adjacent businesses – are influenced by the company's overall sustainability performance index. Plus, companies can consider more-efficient approaches to producing and shipping products through different materials, new manufacturing processes, or alternative suppliers.

In most cases, the desire to optimize the positive impacts of these sustainability initiatives has driven most supply chain organizations to further their digital transformation as a means to improve profitability and competitiveness. Based on the SAP Insights findings, the most sought-after technologies include cloud computing, employee collaboration tools, cybersecurity infrastructure, automated business intelligence dashboards, and business process intelligence.

All these technologies enable midsize businesses to view sustainability holistically and within the context of their operational efficiency and revenue growth. For instance, a combination of cloud solutions, collaboration platforms, process automation, and AI can help supply chain participants produce sustainable products and deliver them to customers with little impact on the environment and society.

Henkel: Digital approach to ease tax compliance 

Henkel AG is dedicated to reimagining and improving life every day through innovative and sustainable consumer products brands and technologies. To deliver to or sell its products in Spain and the United Kingdom, the company and its customers must comply with tax laws on plastics. It also needs to provide customers with sustainability data on its products, so they can comply with the law and gauge the environmental impact of choosing Henkel brands. To this end, Henkel is using a digital approach that is supporting the company to:

• Create compliant and efficient tax reports for business users using an accurate database

• Reduce manual and time-consuming work when validating data and performing tax reports

• Increase the accuracy of sustainability data through intelligent processing and integration

• Gain insight on the design and production of products and packaging to increase efficiency

• Improve collaboration, analytics, forecasting, and simulations on sustainable packaging

Balance is the key to a competitive supply chain

Sustainability alone cannot solve every supply chain challenge. However, it can direct, complement, and amplify the outcomes of efficiency and revenue growth strategies. And by making changes now, midsize organizations will see a substantial ROI on those initiatives later – an intelligent and sustainable supply chain that fuels ongoing business competitiveness.

Register here to listen to this webinar on the Future of Packaging: From Policy to Impact or Request a demo: Paper and Mill Products

Now that we have built level 1 of our I4 system, it is time to start building level 2. This is the level that relies upon the digital data and logic running in devices in the field. The first place to start is the Human Machine Interface (HMI). This is also commonly referred to as the User Interface (UI). This consists of any visual presentation of data and interaction with operations. Process graphics that illustrate process flows and equipment are a very common component of industrial HMI.

An attribute of I4 is the proliferation of data. It isn’t necessarily more instrumentation, but more data from that instrumentation. This is causing an explosion in data, that often goes to a landfill because nobody looks at it and it gets thrown away.

Realtime process data ends up in front of operators. Obviously, no user can absorb thousands of sensor readings simultaneously. The manner in which data is displayed matters. That is why ISA created the ISA 101 standards.

Control systems, like all technology, grow in capability continually. Distributed Control Systems (DCS) and Supervisory Control and Data Acquisition systems (SCADA) can make it possible to make very impressive and fancy process graphics. Such complex HMI displays were the common way of presenting data to operators prior to ISA 101. Typically, these include a lot of colors and numbers on the screen. The issue is when a human looks at this screen, it calls attention to everything on the screen. The manner of presentation does not suggest what should attract focused attention.

The creators of ISA 101 recognized that making displays flashier and fancier didn’t make them better. That is why the best-in-class operations have an HMI that may be less entertaining but more effective. In the ISA 101 standard, everything on the display is gray scale unless there is a reason to call attention to data.  In grayscale, the red or yellow icons next to valves stand out. This helps the operator focus on the highest priority concerns.

I4 is fundamentally about connectivity. For an HMI, this means a comprehensive capability to present anything that may be useful for operations. Not only does data come up from Level 1, but it can come down from higher levels to present information such as batch schedules, financial information, and integration from other process areas. This becomes difficult when each subsystem has its own communication protocol and name space. MQTT with SparkPlug B is the way this problem is being solved in I4. This technology provides a unified name space to facilitate an HMI with comprehensive capability.

This connectivity also aids engineering. Instead of developing an HMI independently in each workstation, centralized management allows HMI development to efficiently occur and be easily deployed. An example I highlighted in the January article “Room in the Inn” told the story of over 200 engineers around the world developing an HMI for a homeless shelter in Nashville TN. Deployment is aided by the design of thin clients being centrally managed so that hardware can be inexpensive and easily replaced while providing central management of authentication and functionality.

A bad HMI is going to be a hindrance to any effort to achieve the benefits of I4. There is nothing more important to operations than getting good information and facilitating interaction with the process. HMI work matters.

The SAP leading article this month caused me to reflect on how far we have come during my career. Starting out at a small machinery manufacturer in 1970, we had no computing power. When I had been there a year or two, Texas Instrument debuted a desktop calculator for $159.95 (equivalent to about $1,100 today). We had worked on main frame computers at the university, but a small company like my employer--the simplest machine IBM made was out of reach (not even considering the special room that was need to be built to house it).

When I went to work for a major consumer goods company a few years later, our engineering department used a time share system provided by McDonald Douglas out of their St. Louis offices. This was reached with a modem and time share terminal. Not only did we have to pay for the computational costs, in five second increments, we incurred long distance charges for the connection.

In the early '80's, we started to see real time process control systems but they did not communicate with the business systems.

Today innovation proceeds by leaps and bounds daily. Even the smallest companies can employ total management control systems. I am grateful my career has spanned this particular time frame. It has been and continues to be enjoyable to see the rapid development and the savings they produce today even in small companies. It is especially exciting to have a ring side seat with SAP and marvel at the latest innovations.

I am regularly inundated with cybercrime reports, and they all have at least two data points in common: ransomware is one of the most popular attack types used by threat actors (read: cybercriminals), and the manufacturing industry is one of the most popular targets for ransomware attacks. 

With Apple's new VR/AR headset looming on the horizon and Meta announcing their newest VR/MR headset, extended reality (XR) devices are being discussed more than ever.

Whether you know it or not, within the last 48 hours, likely, you’ve probably had several interactions with the Internet of Things (IoT).

In the dynamic world of the Internet of Things (IoT), data integration plays a crucial role in harnessing the full potential of connected devices. By seamlessly combining data from diverse sources, data integration enables organizations to unlock valuable insights, optimize operations, and make informed decisions. This blog will explore the significance of data integration in IoT environments, its, techniques, benefits, and future trends.