Digital transformation drives sustainable business practices in 2021

Published February 11, 2021

There’s a long way to go before sustainability becomes more important than profitability, at least in the eyes of large retail enterprises. Big brands like Burberry and Nike have had a history of destroying millions of dollars in excess merchandise annually to maintain their exclusive appeal. Yikes. After public outcry, Burberry has since stopped the practice, but if they were (and others still are) recklessly disposing of end products, it’s hard to put much faith in how they prioritize responsible production.

But, thankfully, consumer values are shifting. Eighty percent of consumers say they value sustainability, and more than 70 percent say they would even pay more for products from eco-friendly brands.

Sustainable business practices are the reassurances that businesses offer these consumers. They promise that a brand will take whatever measures necessary to lessen their impact on the environment and boost eco-friendliness in their operations.

Businesses that undergo digital transformation find it easier to introduce environmentally friendly practices. These digitally renewed processes match the values of today’s consumers, improving brand perception and driving sales. So, yes, it is possible to be both profitable and sustainable.

How does digital transformation drive sustainability?

Digital transformation drives sustainability mainly by giving businesses a very clear picture of what their environmental impact is. This is made possible through data collection and analysis.

The data collected is anything related to sustainability—resource consumption or carbon emissions, for example—and is most efficiently collected through the use of IoT sensors. These sensors collect and transmit data wirelessly in real-time, giving businesses precise insight into how they can improve.

According to Deloitte’s Sustainability Analytics Guide, “Thanks to the latest [digital] tools and techniques, companies can now conduct real-time (or near real-time) sustainability analysis on vast quantities of data in three dimensions of time: past, present and future.”

AI and machine learning have big roles to play, too. 

Armed with the right data, machines and equipment can automate decision-making processes that reflect the sustainability goals of the business. An article by Wayne Thompson, Huy Li and Alison Bolen of SAS states: “Artificial intelligence (AI) brings with it a promise of genuine human-to-machine interaction. When machines become intelligent, they can understand requests, connect data points and draw conclusions. They can reason, observe and plan.”

Related: Humanizing digital banking through conversational AI

“Thanks to the latest tools and techniques, companies can now conduct real-time sustainability analysis on vast quantities of data in three dimensions of time: past, present and future.”

AI-monitored resource use at a facility leads to a better understanding of how wasteful production is. Machine learning algorithms can actually decipher this data in real time and then, within seconds, optimize processes for less waste. Similarly, automated reporting of greenhouse-gas emissions keeps the business informed of where changes need to be made so they’re in line with sustainability objectives. 

Which areas can businesses focus on digitizing to increase sustainability?

Companies can begin by focusing on three core business areas: supply chain, waste management and manufacturing. All three have the potential to make the biggest environmental impacts because they’re interconnected with it and consumers are aware of that.  

Buyers want to know that their products were made from ethically sourced, renewable, raw materials. They also want to know that waste from production doesn’t end up floating in the middle of the ocean for decades.

Supply chain

Digitizing the supply chain (mostly) means making it completely transparent. As Harvard Business Review defines it, “Supply chain transparency requires companies to know what is happening upstream in the supply chain and to communicate this knowledge both internally and externally.”

This requires businesses to collect data at every link in their supply chain and make that information available wherever it’s relevant. This demonstrates that the business is willing to disclose proof of their sustainability efforts, and it holds them accountable for how they source materials.

But how does a business keep track of all that information? SaaS brands like Optimity have designed high-tech software with sustainable supply chains in mind. From demand planning to business visualization, these types of tools give businesses the digital ability to deliver that transparency to consumers. 

Related: Retail analytics answer the “why” of business performance

Waste management

Man-made materials poorly disposed of wreak havoc on the environment. It’s no secret that plastic in landfills can take up to 1,000 years to biodegrade, and a lot of the refuse used in production shares characteristics with plastic.

This is especially concerning when businesses don’t make any attempt to recycle or redistribute products. And while waste is all but inevitable in consumer production, responsible businesses need to have a plan in place for disposing of or repurposing waste. 

And there are brands making it their mission to innovate waste management, all with sustainability in mind.

Enevo, a Finnish company that uses technology to provide better waste-management solutions, is galvanizing the bond between digital and sustainability. They use a combination of their revolutionary sensor and dynamic analytics platform, as well as their routing and planning capabilities, to achieve this. It’s a way for the company to give businesses around the world the ability to collect, analyze and use data to improve their waste disposal systems.


Sustainability in production processes is partly about waste but mostly about greenhouse-gas emissions from manufacturing. With millions of facilities across the planet pumping toxic emissions into the atmosphere 24 hours a day, the threat is very real.

For businesses that operate sustainably, it comes down to knowing precisely what the impact of their production processes is making and taking action to reduce it. The introduction of “smart factories”—digitally integrated manufacturing facilities that combine the philosophies behind digital transformation and sustainability—are the future.

Take Stratus, for example. They’re a leading brand specializing in using automation and AI to refine and optimize industrial processes. They apply these concepts in a manufacturing sense to automatically maximize yield while staying within environmental regulatory guidelines and protecting businesses’ reputations. 

Why are sustainable business practices so important?

Sustainable business practices matter not only for the longevity of the planet but also in how a company is perceived by consumers, prospective employees, partners and investors—and what this means to their bottom line.

Consumers prefer buying from eco-friendly brands, and their interest in these brands’ activities isn’t just superficial. A study by Maryville University discovered that 64 percent of North American respondents and 84 percent of European respondents, respectively, said sustainability must be a core part of a brand’s agenda, which was echoed by 89 percent of respondents everywhere else.

64% of North American respondents and 84% of European respondents, respectively, said sustainability must be a core part of a brand’s agenda, which was echoed by 89% of respondents everywhere else.

Job seekers are also more interested in working with companies that actively practice sustainability. Nearly three-quarters of surveryed millennials say they’d be fine with lower pay if the company they worked for was environmentally responsible, with a staggering 10 percent even willing to take a $5k-10k pay cut to work for a more sustainable business.

Partnering with like-minded brands causes a ripple effect where they thrive off each other’s sustainable business practices. This is most evident in the supply chain, where, if your suppliers are environmentally conscious, it reflects well on your brand.

These combined efforts of prioritizing sustainability increase a brand’s reputation and their chances of attracting investors.

Digital for a sustainable—and profitable—future

Sustainable business practices aren’t just a means of clearing business conscience or staying on-trend. They’re a practical way of securing business growth and solidifying brand position, with digital sustainability at the forefront of public interest.

By taking a data-driven approach, leveraging AI and automation and applying it to key business areas where it makes the most sense, businesses can be confident they’ll win more than just respect and admiration.

Remember, it’s possible to be profitable and sustainable. Stay green!

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