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Supply Chain Innovation 2021

The resilient net zero supply chain

Image provided by AMRC

Steve Foxley

CEO, University of Sheffield Advanced Manufacturing Research Centre (AMRC)

In 2019, the UK committed itself to a legally binding target of net zero emissions by 2050. In 2020, came the Prime Minister’s ten-point plan for a green industrial revolution.

Earlier this month, the Government published its £1 billion Net Zero Innovation Portfolio. There can be no doubt that in the corridors of Westminster, and as a consequence on manufacturing top floors and shop floors across the country, sustainability has become as vital a performance indicator as productivity and profitability.

Road to decarbonisation

The UK is still producing 454.8 million tonnes of carbon dioxide each year – a 44% reduction in the last 30 years, but still 454.8 million tonnes that we need to collectively address in the next 30 years. To reach net zero in 2050, manufacturers will need to decarbonise not just their own factory operations, but also those of their supply chain.

It is clear that suppliers need to address their factory emissions, not only because of government legislation, they also need to demonstrate sustainable manufacturing credentials to their customers. As a country, we are increasingly directing our spending away from companies with poor sustainability credentials. Therefore, it is instinctive that those businesses, manufacturers included, will ask their own supply chains for the answers.

To reach net zero in 2050, manufacturers will need to decarbonise not just their own factory operations, but also those of their supply chain.

However, this is not a threat, in fact, this is a distinct opportunity to build resilience.

To grasp it, there needs to be appropriate and targeted investment in sustainable manufacturing processes, ones that embrace digital technologies such as 5G connectivity, digital carbon passports, data analytics and artificial intelligence. Onshoring production to stop importing carbon emissions is not enough for manufacturers; that production also needs to embrace more sustainable manufacturing processes than their previous overseas suppliers.

Improving productivity of manufacturers

Translational research centres, such as the University of Sheffield AMRC, have a critical part to play here. We have built 20 years of success on improving the productivity of UK manufacturers – large and small – and that core activity is no different now, the only new dimension is they need to be net zero as well.

The COVID-19 pandemic exposed the fragilities of complex, global supply chains and the need for a resilient, sovereign capability. It also revealed how the most digitally astute manufacturers could pivot their operations to changing market demands.

Those same technologies that make processes agile and robust also make them sustainable. They produce manufacturers that are both resilient and green – the exact type of companies that large OEMs need in their supply chain for the next 30 years.

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