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Can small & medium manufacturers jumpstart sustainability innovation in the midst of COVID-19?

Life at a young technology company is often likened to a wild roller coaster ride. But the deafening silence of the market during the first few weeks of the COVID-19 lockdown, seemed more like a freefall experience without a parachute. And yet, as individuals and businesses regained their grip, reemerging online and returning to business, a trickle of interest broke the deafening silence at ECO-OS, a sustainability data management platform, quickly becoming a roaring torrent of inquiries and new opportunities. To our great surprise, the surge in interest is not limited to our typical larger industrial clients. Inquiries are coming in from small and medium businesses, primarily manufacturers, and from a broad range of geographies not necessarily associated with stringent regulatory requirements.

What is happening? Why now?

It turns out that the COVID-19 crisis creates the perfect storm for SMBs to evaluate core values and contemplate a sustainable future. In speaking to a number of owners, CEOs and (mostly newly-appointed) sustainability managers, a rather uniform picture emerged for businesses as diverse as manufacturers of fashion and textile, food and agriculture, electronic equipment, plastic products and construction materials suppliers:

  • There has always been an interest in sustainability, but SMBs never had the time, resources or incentive to truly invest in exploring the opportunities it may hold.

  • Technical demands and various auditing and disclosure requirements from strategic clients raised the bar on operational performance, but never really caused SMBs to consider more strategic, innovative or disruptive actions.

  • Short of providing anecdotes regarding a specific process or material, SMBs were unable to answer basic questions regarding overall sustainability performance, let alone define their goals and targets. SMBs simply didn't have any targets of their own choice, independent of regulatory or client-driven requirements.

  • After a period of logistical and operational chaos, COVID-19 and the ensuing economic crisis, effectively liberated SMBs from the quarter by quarter treadmill, bringing them to consider their business’s resilience and long-term prospects.

  • Finally, COVID-19 also drove home the realization that other supposedly theoretical risks scientists are warning from, may indeed be inevitable in our lifetime.

Keep in mind that the majority of small and medium manufacturers are family and employee-owned. These are businesses where the connection between business and personal prosperity is strong and direct.

In serving these manufacturers and suppliers, we realized that while motivation is high, time and cost are of essence and a lack of expertise may hamper the best of textbook processes. So now, together with a number of consultancies working with us, we provide SMBs with what might amount to “Sustainability in a Box”. A streamlined process with rapid onboarding and immediate actionable insights, that while far from perfect, focuses the business on fundamentals, setting them on the right track for their core activities. Here’s what we do in a nutshell:

  1. Take a hard look in the Sustainability Mirror. We load any relevant historic data the business can set its hands on to ECO-OS in order to get a clear picture of knowledge and performance gaps. This data also serves to customize the platform for the users’ needs, train and onboard them in a more familiar data-rich environment. Shortly after they’ve been onboarded, the Sustainability Mirror created on ECO-OS allows SMBs to understand their primary impacts and vulnerabilities.

  2. Adapt Universal North Star Goals. SMBs do not have the resources for extensive and lengthy market studies, materiality analysis or stakeholder dialogue. And yet, there is plenty of external information regarding these topics for just about every major manufacturing sector. We’ve captured this external logic in the metrics and methodologies on ECO-OS, allowing businesses to use metrics that were found to be fundamental to their industry and determine their North Star Goals. In fact, many industries, well beyond manufacturing share some universal North Star Goals. Zero fossil fuels, 100% renewable energy, zero waste-to-landfill, keep hazardous materials in closed-loop processes or recover all materials released as products, are just a few of the universal goals we’re all designing and striving for.

  3. Study and Set Your Course. Three trajectories combine to set the range of paths an SMB could take: technological advances, operational and logistical optimization and business innovation. SMBs are usually masters at working out their priorities with regard to these trajectories. Once SMBs have a clear mirror in hand and a clear view of their guiding star, they are quick to examine their options and set course on all three trajectories. They know exactly which suppliers to trust with new technology, they know who best can help optimize specific operational processes and exactly which client they could approach to share a new business opportunity with. Unlike the conditions within large businesses, knowledge and decision making are simply not hampered by multiple corporate executive layers and action can be set in overdrive virtually overnight.

  4. Take Action where COVID-19 provides Tailwinds. The SMBs we’ve taken online realize a fascinating aspect of this current crisis: chaos is such that you may encounter barriers and boosters in the same field. For example, while many financial institutions are holding back funding, significant governmental green growth programs are seeking to fund businesses with universal North Star Goals. It’s also the best of times and worst of times for hiring talent and expertise: online communication is far from ideal, but unemployment is such that top expertise, typically out of reach for most SMBs, can now be acquired readily. Furthermore: the waiting lists and price tags for certain technologies have become quite manageable in 2020, compared to previous years. If there is logic for a certain course of action - nimble SMBs are finding the way to execute them NOW.

The spectrum of new programs is as broad as can be imagined: new circular services replacing products in the plastic packaging and home appliances sectors, alternative materials and reverse logistics in building materials and fashion industries and lifecycle optimization throughout a range of upstream and midstream food and beverage companies. Each with its universal North Star Goals, each with highly specialized niche applications.

I am awestruck by these efforts and tip my hat to this emerging class of sustainability leaders of family and employee-owned manufacturers. They are the heart of our economies, and yet all too often overlooked. These are businesses that don’t have the many privileges granted to larger corporations. They must rely on skill and initiative to succeed, and if they set their sights on sustainability - their determination and inventiveness is bound to benefit us all. For those who view COVID-19 as a great extinction event for businesses, I recommend betting on SMBs that chose sustainability as a core theme for their creative destruction.

ECO-OS is holding a hands-on workshop for small and medium sized manufacturers and suppliers on August 11. If you would like to attend or schedule an online demonstration - sign up here


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