18 The Environmental Implications of Digitalization …
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Vertical integration and connected manufacturing and logistics systems interlink
suppliers, manufacturing unit and customers, mainly through Enterprise Resource
Planning (ERP) (Mabert et al. 2003) and warehouse management systems.
18.2.2 Digital Technology and Sustainability
Along with the development of technology, its environmental impact is widely
discussed. A study by Kiel et al. explored the industrial internet of things related
to economic, ecological, and social sustainability. It concluded that higher resource
efficiency was the major benefit from technology towards ecological sustainability
(Kiel et al. 2017). Bonilla et al. investigated the sustainability implications of Industry
4.0, and linked to the Sustainable Development Goals with mostly positive impacts
(Bonilla et al. 2018).
The vision of future factories was showed with the purpose of reaching ecoeffectiveness in (Herrmann et al. 2014). Stock and Seliger identified the opportunities
of sustainable manufacturing in Industry 4.0 from Macro and Micro perspectives
(Stock and Seliger 2016).
Positive environmental implication of digital technology implementation can be
categorized as following (Berkhout and Hertin 2004):
Improved efficiency: Improved production efficiency means less processing time
required per product, as well as lower rate of scrap, loss and rework. These are KPIs
for measuring production performance. Consumption of energy, cooling fluid and
material will decrease accordingly, and contributes to environmental sustainability
KPIs.
Dematerialization: Digitalization including 3D CAD systems, CAD-CAM
connection, digital documentation, electronic instruction or information for the
workers, and bar-code traceability enables an increasingly paperless manufacturing
environment. Dematerialization means less material consumption and less waste,
which indicates better performance on the KPIs of material and resource efficiency.
Virtualization detection and monitoring of environmental change: Digital or
virtual meetings or trainings increase the efficiency of communication and reduce
the frequencies of traveling. Sensors and microprocessors support detecting and
monitoring of environmental changes, which include measuring temperature, colour,
volume of fluids and power consumption. It shows potentials on identifying bottlenecks of environmental performance by tracking the peak processes and moments
of KPIs.
Transport and distribution: Digital technology enables efficient communication
and coordination between different functions, and reduces transports by optimizing
vehicle utilization rate and travel routes. It contributes directly to the KPIs of energy
consumption and CO 2 emissions. This will become even more important in the future
when using more electric vehicles, due to their limited distance range. The closer
relationship between customers and suppliers reduces inventory level and storage
requirement, which are the KPIs of throughput time as well as energy consumption.
251
Vertical integration and connected manufacturing and logistics systems interlink
suppliers, manufacturing unit and customers, mainly through Enterprise Resource
Planning (ERP) (Mabert et al. 2003) and warehouse management systems.
18.2.2 Digital Technology and Sustainability
Along with the development of technology, its environmental impact is widely
discussed. A study by Kiel et al. explored the industrial internet of things related
to economic, ecological, and social sustainability. It concluded that higher resource
efficiency was the major benefit from technology towards ecological sustainability
(Kiel et al. 2017). Bonilla et al. investigated the sustainability implications of Industry
4.0, and linked to the Sustainable Development Goals with mostly positive impacts
(Bonilla et al. 2018).
The vision of future factories was showed with the purpose of reaching ecoeffectiveness in (Herrmann et al. 2014). Stock and Seliger identified the opportunities
of sustainable manufacturing in Industry 4.0 from Macro and Micro perspectives
(Stock and Seliger 2016).
Positive environmental implication of digital technology implementation can be
categorized as following (Berkhout and Hertin 2004):
Improved efficiency: Improved production efficiency means less processing time
required per product, as well as lower rate of scrap, loss and rework. These are KPIs
for measuring production performance. Consumption of energy, cooling fluid and
material will decrease accordingly, and contributes to environmental sustainability
KPIs.
Dematerialization: Digitalization including 3D CAD systems, CAD-CAM
connection, digital documentation, electronic instruction or information for the
workers, and bar-code traceability enables an increasingly paperless manufacturing
environment. Dematerialization means less material consumption and less waste,
which indicates better performance on the KPIs of material and resource efficiency.
Virtualization detection and monitoring of environmental change: Digital or
virtual meetings or trainings increase the efficiency of communication and reduce
the frequencies of traveling. Sensors and microprocessors support detecting and
monitoring of environmental changes, which include measuring temperature, colour,
volume of fluids and power consumption. It shows potentials on identifying bottlenecks of environmental performance by tracking the peak processes and moments
of KPIs.
Transport and distribution: Digital technology enables efficient communication
and coordination between different functions, and reduces transports by optimizing
vehicle utilization rate and travel routes. It contributes directly to the KPIs of energy
consumption and CO 2 emissions. This will become even more important in the future
when using more electric vehicles, due to their limited distance range. The closer
relationship between customers and suppliers reduces inventory level and storage
requirement, which are the KPIs of throughput time as well as energy consumption.