In June 2020 SAP Product Carbon Footprint Analytics was introduced as the first product of SAP to address climate change and sustainability as part of their Climate 21 Program.
As described in this blog, SAP Product Carbon Footprint Analytics is focused on carbon emissions in producing, marketing and delivering products. The aim of the application is to calculate the CO2e emissions for a single product. The application takes data from SAP S/4HANA and third-party sources (manual upload) and analyzes it within SAP Analytics Cloud.
Source: itelligence SAP Analytics Cloud demo environment
Of course it is clear that Product Carbon Footprint Analytics is just the first small step and additional solutions are developed and planned by SAP to help companies further assess and execute their climate plans.
Sustainability at SAP TechEd 2020
When the registration for SAP TechEd 2020 openend early November of this year, my first search therefore concerned the availability of any sessions on sustainability.
I was happy to see that three sessions were fully dedicated to this topic mentioning both current and future SAP solutions to make sustainability an important factor when making operational and strategic business decisions.
In addition sustainability was addressed during the key-note of Juergen Mueller and in a dedicated Expert session on the main Teched Channel 1.
Keynote: Sustainability as one of three main challenges
In his opening SAP TechEd Executive Keynote, Juergen Mueller started to clearly address three major global topics that require us to take action and lead by example, being racial injustice, of course COVID-19 but also sustainability.
Source: United Nations Sustainable Development Goals
It is the goal of SAP to become CO2e neutral by 2025 and to support customers in that same direction. Therefore SAP will embedd sustanability metrics in their transactional and analytical applications to enable customers to take action.
Expert Session: How SAP Enables Customers to Run Green
In this expert interview with Gunther Rothermel, senior vice president of SAP S/4HANA sustainability management, and Prabhoo Priyadarshini, vice president and head of product management, the Climate 21 Project was clarified. It was explained how this initiative can help customers to minimize the carbon dioxide footprint of their products, operations, and supply chains.
Succes of companies must be measured not only based on the traditional financial KPI’s, but also sustainability metrics like CO2e footprint, energy consumption, water and land consumption should be embedded as dimensions of succes.
Sustainability is high on the agenda of SAP (as examplar and enabler), but should be on the agenda of every CEO as well, since it is becoming more and more important in decision making for investors, authorities, customers and employees.
The most important challenge for companies however is the availability and quality of the data relevant to assess sustainability. This is where the SAP Business Technology Platform as part of the Intelligent Enterprise can support Sustainability Management to collect, combine and present the data from different (open) sources.
Source: SAP Intelligent Enterprise Strategy
The other good news is that market standards on sustainability are evolving while demanding easy access to relevant, transparant and reliable data. This will be the key for success for companies that really want to take action in the area of sustainability.
Solution Sessions: Start Climate Actions with S/4HANA
When going into more detail in the three sessions with Rupert Lange, Chief Product Expert for S/4HANA Product Management on Sustainability it becomes clear that the Climate 21 Product direction and vision of SAP is to embed sustainability as a new dimension of success into analytical and transactional applications to enable companies to improve decision making and to optimize their resources. Not only for their own and individual enterprise, but ultimately across the whole value chain and for the entire product lifecycle.
Source: SAP TechEd 2020 – Session DT124 – Lab Preview
The first step for customers is to assess and understand their sustainability impact. There SAP will and has started with CO2e, but the end goal should be to include other sustainability dimensions (e.g., water, land use, social indicators like working conditions,…) as well. The primary focus will initially be the own enterprise, but this will be extended to a larger scale and holistic view across the value chain and product lifecycle.
The second step for SAP customers will be to optimise and enable their business to run better by designing new or improving current processes, products, services and supporting organisational structures by taking sustainability factors into account. In optimizing end-to-end (E2E) processes for sustainability, SAP will start by offering solutions in SAP S/4HANA for the Source to Pay area.
This will enable companies to include sustainability metrics in strategic and operational decision making for sourcing and procurement. No longer will materials automatically be sourced from suppliers that perform best on price, reliability, leadtimes and quality but also their related footprints can then be taken into account. This will be a new and hopefully the most important dimension for decision making in SAP S/4HANA.
Source: SAP TechEd 2020 – Session DT124 – Lab Preview
Holistic footprint management at scale by managing this business data and sustainability content while assessing and optimising sustainability footprints in a hybrid environment of course will only be possible with the supporting foundation and solutions within the SAP Business Technology Platform.
Allthough SAP was not specific in that area yet, my expectation is that existing SAP Cloud solutions in the area of Data, Analytics and Integration supported by the use of Intelligent Technologies will be developed further to support the Climate 21 Business Architecture.
Sustainability Outlook for 2021
Like mentioned at the beginning, SAP enables customers to start their sustainability journey with the Product Carbon Footprint Analytics in SAP Analytics Cloud, but additional Cloud based Solutions are planned to be introduced with S/4HANA 2108 embedded in the primary E2E processes starting with Source to Pay and Cradle to Gate business activities. Really looking forward to this new functionality in SAP S/4HANA supported by the SAP Business Technology Platform!
SAP S/4HANA Solution Architect
itelligence – Global Field Consulting