Companies are turning to digitization to mitigate climate change and business risk, reveals survey

Industrial firms are urgently investing in accurate intel to help address sustainability and economic challenges, writes Kim Custeau, Executive Vice President, Portfolio, at AVEVA

The majority of global industrial enterprises have been making business decisions without fully assessing information at their plants and assets. That’s according to a new survey of 650 senior executives across the chemicals, manufacturing, and power industries in North America, Europe, and the Middle East.

AVEVA’s “Connecting the Future” study, which was released in partnership with Wakefield Research, polled companies with a minimum annual revenue of $50M USD. It found that eight in 10 top executives say key directives are being issued without full data visibility and insights.

Today’s global economy is facing significant headwinds: ever-growing environmental regulation, fluctuating energy prices, supply chain disruptions, inflation, and talent shortages.

With no end in sight to the uncertainty, 87% of international business executives said they plan to increase their organization’s investment in industrial digital solutions over the next 12 months. Their main imperative is for intelligent data that can help them tackle growing climate change as well as geopolitical and economic challenges.

Ahead of COP27 in Egypt in November, the drive towards sustainability remains in sharp focus and top of the boardroom agenda. Almost a quarter (23%) of firms surveyed view sustainability as the most significant challenge facing them over the next 12 months.

Sector-wise, the chemicals industry in particular is prioritizing digital investments to drive an agile and environmentally-friendly future. In fact, 62% of chemicals leaders have increased or accelerated their investment in industrial digital solutions over the past few years—significantly more than in other industries.

Businesses are increasingly choosing to leverage technology to powerfully augment their workforce and enable the transition to a lower carbon economy. The bulk of industrial firms are set to invest significantly over the next year in analytics and artificial intelligence (AI), industrial IoT, cloud computing and edge computing solutions, the study revealed.

Companies the world over know that the sustainable and resilient organizations of the future will be those empower their teams with the data – and collective intelligence – to make better decisions that lead to more optimized and efficient operations.

What’s more, companies are choosing to invest in cloud-based software solutions enriched with sector-specific AI to connect their teams, drive deeper collaboration, and build the industries of the future. This gives leaders the agility, resilience, and sustainability capabilities they need to succeed in today’s fast-evolving industrial landscape.

The power of information sharing

In parallel with the drive to digitalize to manage vast quantities of operational data, we are witnessing the rise of the “Connected Industrial Economy.” This integrated, data-centric future leverages the scope and scale of cloud to empower teams and partners with deeper insights to transform faster, reduce costs, and optimize engineering and operations at scale.

According to our research, almost half of executives (45%) said that enabling the sharing of information with trusted partners through an open and interoperable ecosystem is among the top digital initiatives with the greatest potential to increase profitability and sustainability at their organization.

In fact, executives report the most common benefits of having an open and agnostic information-sharing ecosystem are greater efficiency and innovation (48%), increasing employee satisfaction (45%), and staying competitive with other companies (44%).
For example, AVEVA is working with US-based Dominion Energy to share source data with its partners and customers to meet their ESG reporting requirements.
The company aggregates data from remote wind and other assets and shares it across its North American grid network using an integrated cloud-based data management solution. This information enables its customers to verify Dominion’s use of low-carbon energy sources and provide tangible proof of their net-zero actions to investors and ESG auditors. The information now serves as a new source of revenue for Dominion, while helping to hasten the low-carbon energy transition in North America.

Another successful case study is Aker Carbon Capture’s implementation of a single engineering platform. This helped develop new sustainable processes such as carbon capture by breaking down data silos and increasing engineering and design efficiency. Using integrated engineering and project execution technologies on the cloud, Aker was able to improve collaboration between teams, resulting in increased engineering efficiency which allows them to deliver new carbon capture facilities 50 percent faster.

Skills shortage – a threat to digital initiatives

Historic labor shortages pose an urgent threat to industrial digital initiatives. Nearly half of companies (46%) report it has been ‘very or extremely difficult’ to find talent with the skill sets needed to support their industrial digital priorities.

Nearly half of firms across these industries (47%) will invest significantly over the next 12 months to support workforce opportunities outside of traditional locations and schedules, including workers on the plant floor and those involved in operations and production.

Post pandemic, employees are looking to carry out their work tasks in new and flexible ways. Ultimately, shared data and cloud-based working models can facilitate a fresh type of agile, location-agnostic collaboration, which leads to a happier workforce. These connected workers also benefit from access to intelligent collective data that allows them to be productive and make better decisions for their business and the environment.

More than ever, global companies looking to sustain their competitive edge are turning to digital innovation to drive the efficiency, nimbleness and resilience they need to succeed in this economic environment.

Using technology to boost data-sharing capabilities can unlock the insights leaders need to enable them to engineer better and operate more efficiently, and ultimately drive profitability.