Company Name: SAP Labs China
Project Name: SAP Cloud for Sustainable Enterprises
Award Category: Innovation Sustainable Product
Product / Service Introduction
The SAP Cloud for Sustainable Enterprises solution portfolio is the second-generation all-cloud sustainability solution launched by SAP in 2021. It builds upon the first-generation product from 2009 and encompasses four parts: climate action solutions for achieving zero emissions, circular economy solutions for achieving zero waste, social responsibility solutions for achieving zero inequality, and a comprehensive reporting plan for achieving a global perspective. According to statistics, this solution has helped SAP's customers increase their ESG scores by an average of 73% and reduce their CO2 emissions by an average of 24%. Looking ahead, SAP aims to assist over 400,000 customers and leading enterprises in reshaping their operational and development models, thereby introducing a sustainable development paradigm that positively impacts the economy, environment and society on a global scale.
In the realm of circular economy, the SAP sustainable solution has been continuously refined through collaborations with NGOs such as the Ellen MacArthur Foundation, the World Economic Forum, and the World Wildlife Fund. It has successfully assisted thousands of customers in achieving closed-loop models from design, procurement, manufacturing, transportation, tracking, to recycling stages. This transformation towards a green circular economy is achieved through waste reduction, material reuse promotion, and the transition to recycling business models.
The utilization of the SAP sustainable solution portfolio is extensive, including evaluating the sustainability, carbon emissions, and tax implications of different materials in the design and manufacturing stages; selecting suppliers providing sustainable materials in the procurement stage; assisting companies in determining destinations based on ingredients and formulas, as well as national freight regulations during the transportation stage, and ensuring supply chain transparency and traceability; utilizing technologies such as IoT and digital twins to detect equipment status and enable predictive maintenance in the production stage; and ensuring compliant waste disposal and minimizing environmental impacts in the recycling stage.
Leveraging the latest generation of ERP S/4HANA, along with products like SAP Responsible Design and Production, SAP Waste Management, and SAP Business Network, SAP provides precise and trusted data capabilities as well as seamless integration across multiple systems. Advanced technologies including blockchain, AI, predictive analytics, and IoT are harnessed. Customers can circulate and trace ESG information of raw materials across various production stages within their enterprise and among multiple upstream and downstream companies, achieving traceability, reuse, and recycling throughout the product lifecycle. In 2022, SAP's sustainable solution was recognized as an exemplary case at the World Internet Conference Wuzhen Summit.
Explanation of Circular Economy Practice
Combining the circular economy principles proposed by the Ellen MacArthur Foundation, the SAP Sustainable Solution portfolio supports business circular economy practices from three dimensions: redesigning products and business processes to reduce waste and avoid pollution, offering cross-value chain solutions to maintain the value of raw materials and promote closed-loop systems, and designing renewable business models to rebuild ecosystems and leave more space for nature. The following are several examples of the positive environmental and social contributions made by the SAP Sustainable Solution:
80% of a product's environmental impact is determined during the design phase. The SAP Responsible Design and Production product within the SAP Sustainable Solution portfolio assesses the recyclability of product materials, identifies key waste reduction processes, and incorporates sustainable low-carbon designs for products and packaging. It takes into account extended producer responsibility (EPR) regulations and raw material taxes issued by multiple countries to maximize the positive environmental impact of good design while saving business costs. According to assessments, it is expected to help companies reduce EPR fees and plastic taxes by 10-28%, enhance EPR and plastic tax compliance production efficiency by 50-80%, and increase revenue by up to 5%.
The SAP Rural Sourcing Management product within the SAP Sustainable Development Solution enables the connection of smallholder farmers and suppliers in rural areas with global agricultural enterprises and consumer product companies, ensuring complete traceability of raw material origins. (Video: link) In collaboration with the Ghanaian government and the World Economic Forum, SAP tracks plastic collection in Ghana, aiming to increase the annual plastic recycling volume by 840,000 tons and improve the livelihoods of plastic collectors. Nigerian company CBilL utilizes this solution to support 850,000 farmers and integrate them into the agricultural value chain.
GreenToken by SAP is a quality-balanced material traceability and transparency solution that focuses on blending materials that are difficult to trace. In 2022, in partnership with Unilever, GreenToken completed the procurement of 188,000 tons of palm oil fruit in a pilot project, using blockchain technology to achieve supply chain transparency and traceability, supporting Unilever's goal of achieving a deforestation-free supply chain by 2023.
Overview of Product/Service Lifecycle
Product Design:
For Product Design phase, with SAP Responsible Design and Production, companies can balance the various trade offs at the design phase, from reuse models through how to get materials back into use as well as balancing things like the carbon footprint of logistics.With a good design of product, the next critical step is to ensure the materials sourced have cricularity well considered and social responsibility included. With SAP Rural Sourcing Management, it’s possible to monitor all attributes of the materials at all points in the value chain, as well as other important metrics such as participation rates, recycling rates, gender and diversity, as well as things like access to welfare, protective equipment, training participation, and the volume of prices of different materials.
Production:
At Production phase, SAP Asset Intelligence Network can enable companies of business models like “pay to lease”. It leveraged technology like “digital twins” to provide visibility of where products are after they have been shipped, how they perform with the customer, etc. Meanwhile, it provides a digital platform for collaboration on equipment definition and maintenance processes. It enables business partners to collaborate across asset life-cycle, resulting in better asset performance, longer asset life cycle, operational costs reduction, and safer operations.
Useage:
SAP‘s solutions mainly take effect during products‘ design, production, sourcing, transportation, recycling phases. Useage phase basically is out of SAP‘s solutons‘ managing scope.
Recycling and Recovery:
At Recycling phase, SAP S/4HANA for Waste and Recycling can optimize the management of waste collection, recycling and environmental service contracts, to reinforce regulatory compliance and speed up the implementation of waste collection and recycling processes.SAP Business Network Material Traceability leveraging Blockchain technology can track bi-directional provenance of components and flow of materials and products; provide visibility to product genealogy from raw material to finished product, and locate the origin and batch of affected products across the end-to-end supply chain. It can help enterprises to recycle more efficiently.
More Product / Service Highlights (Optional)
SAP solutions for sustainability innovate a new path to green economy by enabling the right balance between the bottom line and the green line.
Capitalizing on the real-time data sources on a single platform, SAP infuses sustainability into the end-to-end business processes and cross-system business network, achieving unified management of the resource circulation data, and shifts from traditional retrospective analysis to predictive analysis, helping enterprises make decisions that drive both financial and environmental outcomes. SAP offers actionable solutions for balancing sustainability with the bottom line, which will be realized in three steps: ensuring compliance with data transparency, promoting cross-industry collaboration with sustainability embedded into business processes and business networks, and innovating economic model with a fully data driven approach.
Boasting a global digital base and 50 years’ expertise in resource management, SAP is positioned to help the world go digital and green.SAP's customer base, which include 94% of the Global Fortune 500, represent 87% of the world’s total trading value, and cover the core business of more than 40,000 end customers in more than 190 countries, have become the base of the global digital economy. In addition, SAP has worked on sustainability solutions for nearly 20 years. 85% of the companies with the highest greenhouse gas emissions in the world are SAP customers, and the carbon emissions of the top 2000 customers alone account for 1/3 of the world’s total emissions, reaching 10 billion tons. After adopting digital solutions for sustainability, SAP customers have seen an average increase of 73% in ESG score and an average decrease of 24% in CO2 emissions. SAP has been the software industry leader in the Dow Jones Sustainability Indices (DJSI) for 15 consecutive years and maintained its position as a DJSI front-runner in the software industry in 2021. SAP was recognized as a leader in environmental transparency and action by CDP, an international organization that is viewed as the gold standard of environmental reporting and made it to CDP’s A List. Reaching a customer base with the highest carbon emissions and the most urgent needs for carbon reduction, SAP's digital solutions for sustainability are reinventing the way to run and grow businesses, in an effort to boost green development and build a community with a shared future for mankind.
