How Ecodesign Can Help the Environment and Your Bottom Line

While many commitments to building a circular economy have been signed around the world, industries are still consuming more resources than can be regenerated. Today, it would take 1.75 Earths to feed global demands.

In addition, only a little more than 7% of materials is preserved for further use, while the rest is sent to waste disposal (a sequence called “linear use of resources”). Thus, there will be more supply risks and price peaks ahead, putting economic growth at risk.

The linear use of resources endangers our environment. Natural resource extraction contributes to both climate change and more than 90% of biodiversity loss, according to a recent study by the Ellen MacArthur Foundation.

So humanity has good reasons to get to work fast and implement circular economy principles in global businesses. In doing so, we can decouple resource consumption from growth in absolute terms. We can do more with less.

The Circular Economy and Ecodesign

What’s key to successfully transitioning from a linear to a circular economy? It’s product design. Up to 80% of a product’s life cycle environmental impact is determined by its design. And that’s where ecodesign comes in.

How does ecodesign work?

While traditional product development focuses primarily on factors such as usability, safety, cost, and quality, ecodesign emphasizes ecological factors. This means finding ways to reuse materials, while maximizing the safe use and value of the product.

Unlike traditional approaches to product design, ecodesign takes the entire product life cycle into account, including resource extraction, procurement, prototyping, series production, multiple product use, the end-of-life phase, and all logistics and transportation processes. Ecodesign product development goes far beyond the company gates, from “cradle to grave.”

Implementing ecodesign represents a significant change for any organization. Making the strategy work requires the commitment of top executives, and it means teams must embrace new ways of thinking and working.

Robust Eco Design: Three Phases

In 2020, Siemens introduced a dedicated, holistic ecodesign approach to its development processes called Robust Eco Design (RED). With RED, Siemens aims to systematically identify ways to achieve the same or greater customer value, while consuming less energy and fewer resources, minimizing the dissemination of nonnatural substances into the environment, and managing the required technical and biological resources in a circular loop.

On their way to environmentally compatible products, Siemens’ design departments follow a three-step-approach.

First, teams specify environment-related customer requirements, such as energy efficiency or product longevity, and regulatory targets, such as the E.U.’s Circular Economy Action Plan.

Then they collect comprehensive data on all inbound and outbound material and energy flows from the entire life cycle, including emissions to air, water, and soil as well as resources taken from nature. Subsequently, they quantify different designs’ environmental impacts and effects on human health and make those findings transparent to their stakeholders.

Finally, they give recommendations for environmentally optimized design specifications that don’t require trade-offs in areas such as safety or quality. Recommendations might include an increased use of recyclates or changes that allow for easy reuse, repair, refurbishment, remanufacturing, or recycling.

How Digitalization Boosts Ecodesign

Some may argue that adding new environmental parameters to product design doesn’t make decision making any easier. And to some extent, that’s true. Organizations might face more conflicting requirements, such as stronger materials that enable more product longevity but also require more energy-intensive processes.

However, digitalization and simulation can solve such challenges. “Digital twins” of real-life products can simulate the repairability or robustness of a product without wasting real-life resources. They can also support factories in cutting energy and resource consumption, CO2 emissions, and waste production by simulating production processes. Future-forward organizations need to bring in the technology and expertise that help them integrate these powerful tools with their operations.

Digitalization also allows organizations to share emission data without disclosing strategic secrets. In open, cross-industry networks like Estainium, manufacturers, suppliers, and customers can exchange trustworthy product carbon footprint data.

A Strategy That Makes Sense

Ecodesign is not just a matter of protecting climate and biodiversity. It’s also a smart business strategy.

By adopting ecodesign principles, companies can simultaneously reduce costs, minimize waste, and gain a competitive edge. The potential benefits are significant, including billions of dollars in cost savings for materials and new revenue streams through innovative business models like anything-as-a-service (XaaS). Collaboration across industries in open ecosystems can further amplify environmental and economic advantages.

Taking the leap into circular economy practices is a major transformation. So make your sustainability efforts worthwhile and focus on product design, because that’s how you maximize your impact—on both your bottom line and our environment.

Learn more about ecodesign and how to build your “circular advantage” in Siemens’ white paper Ecodesign: Multiplying impact, shaping the world.

>>> Read full article>>>
Copyright for syndicated content belongs to the linked Source : Harvard Business – https://hbr.org/sponsored/2023/06/how-ecodesign-can-help-the-environment-and-your-bottom-line