Process-driven sustainability: How business can fight climate change while outrunning inflation, supply chain risks

"Sustainability touches every aspect of your business," said Janina Bauer, Global Director of Sustainability for Celonis, during a keynote panel. “The environmental footprint of your operations, how you engage your people and your communities and how you mitigate risks.”

SEE: Corporations need to focus on climate change adaptation, quantifying supply chain risks

During the two day event, Bauer sat down with Tom Smith, Acceleration Economy and Cloud Wars analyst, to discuss how the process mining and execution management company is working with customers and partners to make business processes more sustainable. For example during Celosphere, the company announced Celonis EMS integrations with EcoVadis, IntegrityNext and Climatiq.

https://delivery-p141552-e1488202.adobeaemcloud.com/adobe/assets/urn:aaid:aem:82b5ea24-028e-4321-8b5e-391c5d4f8c32/as/6k9cZbyFbHmbjFK2xURb32.jpg
https://videos.celonis.com/watch/6k9cZbyFbHmbjFK2xURb32

The following is a transcript of the interview, edited for readability.

The Celonis Way: Earth is our future

Tom Smith: Today's kind of like Sustainability Day here and we've got the Director of Sustainability, which is great. Can you tell, just tell the audience more about your role, what areas of responsibility you have exactly?

Janina Bauer: No, my pleasure. So I'm responsible for the overall sustainability strategy and program at Celonis, and our sustainability program has two sides to it.

One is obviously what we do as a company and how we can run in a sustainable way and have our own operations under control. So we track our own carbon footprint, we work on diversity initiatives, and we increase the engagement of the employees.

SEE: Sustainability training: Free online courses from Celonis Academy

But the second even bigger part is how we work with our customers to help them become more sustainable by using the Celonis Execution Management System, and for that we have a dedicated product team. Now we have a dedicated go to market team, and so that all is the sustainability organization at Celonis.

Sustainability starts with people, data and action

Tom Smith: Okay, and as of roughly today, it's not just Execution Management anymore, you also have some new sustainability applications, right? Can you tell, talk a little bit more about those and how they will benefit customers?

Janina Bauer: Yes, it's my pleasure. Today is super exciting for us.

For the last, I would say one and a half years, we have been working with customers understanding their sustainability challenges that I saw, and we have seen challenges in three different areas.

One was always the people. It's very hard to get alignment with other people, people work in silos, and so sustainability usually was for the people with sustainability in their job title.

Then we saw challenges on the data piece. The data is scattered. People had a lot of hard work, very manual work, to get that data collected and consolidated to get sustainability insights.

And then most importantly we saw the action problem that I want to cause. So most people stopped at reporting but it was hard to actually reduce emissions or improve supplier sustainability or take action towards your sustainability goals.

And all of these challenges we took together and we realized that the Celonis Execution Management System with very targeted applications on top can actually help them for all these three challenges.

New Supplier Spend Management and Shipping Emissions Reduction apps

Janina Bauer: And then we picked two areas where we want to start having an impact, and they are crucial from a sustainability perspective. They're both in the supply chain, because that is where all of your carbon footprint lies and where your risks are especially.

Tom Smith: Kind of biggest bang, the biggest opportunity.

Janina Bauer: It's the biggest bang, it's the Holy Grail as well. And then we decide, let's have a look into procurement and into order management, speaking of shipments and transportation. And for these two areas, we're launching two new apps today.

One is called Supplier Spend Management and the other is called Shipping Emissions Reduction application. And both are out there in beta for our customers and help them operationalize their sustainability goals in procurement and for shipping emissions.

SEE: What is sustainability in business? The process, returns, KPIs and everything you need to know

Tom Smith: So really that whole notion of operationalizing, that's just a big discussion topic here at Celosphere. I think it applies to a lot of things, but from what you're describing, maybe sustainability more than anything else, it's, as you put it a minute or two ago, it's nice to have the data or to know where you're at, but it's, you really have to take the next step and put the data into action or use the insight to go and have an impact, right?

Janina Bauer: Exactly, and especially empower the people in your various departments to also take action against the sustainability vision of the company. It's usually something that they really want to do, but they don't really have the tools at hand, the technology, the insights or the ability to make better decisions. And so what we want to do with the Celonis EMS is that we give them exactly that visibility, the productivity, and the intelligence so that they can all accelerate meeting the company's goals.

Partnerships are crucial: EcoVadis, IntegrityNext and Climatiq

Tom Smith: That's great. There's a big partnership component here, developer partners, some customer co-innovation seems to be a really core part of the strategy. Can you tell the viewers more about that?

Janina Bauer: Yes. So it has been a part of the sustainability vision of Celonis from the start, that we want to do this together with our customer community, with their feedback and their input. But the other piece of that is that we couldn't do these applications alone because usually in sustainability you bring in entire new data pieces, you need supplier ratings, you need carbon emission factors, you might need some more risk data, and that comes from partners. And so in our two applications, we actually have three partnerships.

SEE: Sustainability Business Bootcamp: Get the ingredients for corporate ESG success

So the procurement application, a sustainable spend management app works with EcoVadis and IntegrityNext data, both are leading providers of sustainability ratings. And many of our customers actually use one of them already. And so now we help them integrate that data that they might have in a different platform and bring that into the EMS and then continuously steer, monitor it, and proactively work on it.

And the exciting part for the emissions piece is that we have Climatiq, a new strategic partner, and they have an API-driven approach to emission factors. And so they can bring carbon emissions into any business process. And we start with shipping now, but we can go from there to any other supply chain process and ingest it with carbon emission factors and by that have the environmental impact of process activities and process actions.

Delivering value on the top line, bottom line and green line

Tom Smith: We heard the big vision for the company from Alex yesterday. And sustainability, I know, one of the core val.. or it is one of the core values of the company. Can you relate some of the new products and partnerships and all the whole sustainability strategy that you're responsible for to that larger vision for the company? How those two fit together?

Janina Bauer: Yesterday was all about adding perspective and getting to this new perspective on business execution. And in today's world, honestly, a high performing company is one that is efficient and sustainable. We need that to have future proof companies. And so it's quite natural that once we improve the processes, not just single process field, but also multiple processes altogether, see the interdependencies, and see how they work even across companies, that is what is required for sustainability and also for better business performance.

And I think what's nice is that with yesterday we started this first step into a new century where we don't see sustainability as a siloed aspect of business execution, but we much rather say, no, it's included. And we go basically from 2D to 3D, not just with the product innovations we saw yesterday, but also in terms of defining business execution. Previously, we said it's the top and bottom line, it's cost and revenue. Now we bring in the green line as the third dimension, and by that we have a 3D business execution.

We need a “decade of action” on sustainability

Tom Smith: As you look forward into 2023, we certainly, we know that in 2022, sustainability is a boardroom level priority. CEOs not only care about it, but they're trying to get their companies moving in the direction of greater sustainability, but also they're dealing with lots of other challenges at the same time. Are you concerned that sustainability could kind of go to the back burner or where do you see it? How do you see that playing out in 2023?

Janina Bauer: I think it will be very interesting. So when we came into the 2020s, everyone said it's the decade of action, so let's go from vision to action. So we're two years in. I think we can still do a lot more action. What I have been seeing is that as soon as more crises, more market forces come in, people tend to move away from sustainability because the impact and also the value of that is still a bit more in the future. So it's very hard to understand how will that affect us today.

SEE: How inflation, supply chain and sustainability could drive efficiency gains

And so what will be crucial next year is that companies start focusing on these win-win situations, and I want to call it the year for process driven sustainability. Because by that people focus on their operations and the immediate impacts, which can also be cutting costs, saving time, making the teams more productive, but also with a sustainability lens into it and seeing where these aspects that we have to do to be future proof also have a sustainability impact. And then once people see that value and feel it, I think they have a better chance to then go into the next step and taking the real crucial decisions and actions that are even more needed for sustainability transformation. But I think we have to get the basics right.