Transformation has changed for good, as small and medium-sized businesses uncover the value of moving sustainably into the future. At their most fundamental level, businesses have three goals: to drive revenue, reduce costs and mitigate risk. New SAP Insights research shows sustainability is a key consideration in economic growth, and, as these experts suggest, it could be a deciding factor in all three of these goals.
Successful transformation is linked to sustainability
Allan Mills, partner, Deloitte
When lots of people do transformation projects, they typically have a single destination in mind: we’re going from here to there, and it’s going to look like this. I’m not sure we can be that precise any more. You need to design what that transformation might look like with a 1.5C future or a 2.5C future.
SAP is really good at asset management, for example. The way assets operate in those two different scenarios is going to be significantly different, to the point where you might invest or make capital allocation choices very differently. The transformation itself still needs to happen, [but] it needs to be flexible enough to accommodate both.
The most important part is that they’ve got a good understanding of how data and information will flow in the future, from things outside the organisation to things inside, through to their customers.
We [Deloitte] have a really positive mindset around climate change. The basic narrative goes: the world is changing, whether we like it or not. There is going to be significant investment over the next 10 years; if we redirect a portion of that investment so that it is sustainably invested, we’re making better climate choices, and consequently, as a global economy, we’re going to be better off.
Sustainability has become a top concern for businesses
Katri Bloomfield, head of sustainability ANZ, SAP
Our figures show sustainability has skyrocketed to become one of [businesses’] key priorities. Executives do view sustainability as a core revenue generator, ranking it as one of their top priorities, now on par with some of the traditional drivers such as creating new products and improving customer experience.
Our survey respondents made it clear that sustainability and transforming their business was having an impact on their bottom line, so they are looking to increase business performance, better respond to risks, and try to remain competitive. Sustainability plays a big part here: nearly 90% of the surveyed leaders saw a positive relationship between their profitability and competitiveness, the organisation’s business transformation, and the impact of sustainability.
Investors are already moving capital towards organisations with robust plans to take action. Finance organisations are already tying capital to new projects which have sustainability metrics. Consumers are already shifting their demand towards sustainable products and services.
Businesses need a modern and flexible range of partners who can support them on the journey and advise them as they go through. Needs can change over time, but those core processes of bringing things together to be able to make better decisions will be always important.
They view it as more than an environmental compliance issue, but something they need to deal with in order to have long-term growth and profitability, and to drive themselves to become one of the organisations that will continue to thrive.
Sustainable transformation can be life-changing
Adam Levin, chief information officer, Device Technologies
We’re a medical devices organisation. We provide medical devices to healthcare professionals to drive patient outcomes – and that means saving people’s lives.
We had been on an old architecture. When you look at the size of the organisation, projections of our growth, and where we want to be three years from now, the platform we had wasn’t going to meet the requirements and the needs of our business as we grow. So, the organisation embarked on an upgrade roadmap.
Through that journey, we’ve rebuilt the platform, upgraded our technology stack. We’ve added it to the SAP S/4HANA platform, which has now given us significant capability for the future. What’s been amazing is we were able to transact and trade, pick, pack and dispatch and deliver product from day one. We’ve had a very successful upgrade.
Unleashing the capability of the SAP platform is what’s key for me, and bringing SAP into our organisation as a trusted partner. We’re looking at levels of automation: how do we automate mundane tasks? How do we maximise the data we collect to allow us to make better business decisions?
What we’re seeing is a trend where investors and shareholders are now wanting to see plans around sustainability: what are you doing as an organisation to provide sustainable outcomes? We’re looking at that ourselves. A reduction in CO2 emissions: how do we do that? Do we change our transportation routes? Or, is it around packaging? Is it what we’re doing in the office spaces? That data helps those decisions become clearer in terms of the impact on your business if you made this change.
Learn how growing companies are transforming to drive revenue, efficiency, and innovation, in the Transformation Mindset report.
