OEPI: A Network Solution for Managing Organizations Environmental Performance Indicators

Size: px

Start display at page:

Download "OEPI: A Network Solution for Managing Organizations Environmental Performance Indicators"

Homer Cameron
5 years ago
Views:

1 EnviroInfo 2012: EnviroInfo Dessau 2012, Part 2: Open Data and Industrial Ecological Management OEPI: A Network Solution for Managing Organizations Environmental Performance Indicators Ali Dada 1, Katrin Müller 2, José Antonio López Abad 3, Shane Bracher 4 Abstract Companies use Environmental Performance Indicators (EPIs) such as CO 2 emissions and water consumption to monitor and reduce the impact of their operations and products on the environment. Various IT solutions are used today to manage these EPIs, however, these suffer from three shortcomings. They do not sufficiently address the business user, they barely touch upon the inter-organizational aspects, and they typically suffer from data availability and quality issues. Addressing these challenges is the aim of the research project OEPI whose approach and results are the subject of this paper. OEPI proposes a new solution aimed at the business user, designed for extensibility, and with particular mechanisms that foster inter-organizational cooperation and high-quality data incorporation. The goal is to provide a many-to-many business network that enables users to easily provision, share, and manage their EPIs. 1. Corporate Environmental Actions Companies are increasingly taking action to monitor, reduce, and report their environmental impact. For example, more than 700 companies reported their 2011 sustainability performance following the Global Reporting Initiative (GRI), a de-facto guideline for sustainability reporting. Companies see real business value in this exercise as investors, shareholders, and customers are asking for it more often. For example, the FTSE4Good Index Series and Dow Jones Sustainability Indexes (DJSI) are used by investors in their decision-making. An additional initiative also worth noting is the Carbon Disclosure Project (CDP), whose 2011 questionnaire to collect organization-level CO 2 emission data was sent on behalf of investors with US$71 trillion of assets, and resulted in over 400 responses from the biggest 500 companies. Carbon dioxide and greenhouse gas emissions in general have been the subject of particular emphasis due to global warming, and this is reflected in reporting initiatives such as the CDP but also standardization efforts such as the Greenhouse Gas Protocol. The latter was originally focused on organization-level emissions but recently new standards appeared to cover the supply chain and product levels. The need to broaden the scope of environmental considerations beyond the own organization into the supply chain and product life cycle is evident in further examples. First, the CDP added a supply chain reporting initiative in addition to the above-mentioned organization-level reporting. Second, focal players in the supply chain, e.g. Walmart and Unilever, have issued mandates requesting their top suppliers to provide specific environmental information and trigger them to continuously improve. Third, life cycle assessments are increasingly used and results are often reported in the form of an Environmental Product Declaration (EPD), and inter- 1 SAP Research, SAP (Schweiz) AG, Blumenbergplatz 9, 9000, St. Gallen, Switzerland 2 Siemens AG, Corporate Technology, Siemensdamm 50, Berlin, Germany 3 Ericsson España S.A., C/ Abraham Zacuto, Parque Tecnológico de Boecillo, 47151, Boecillo, Valladolid, Spain 4 SAP Research, SAP Australia Pty Ltd, 52 Merivale Street, South Brisbane QLD 4101, Australia ali.dada@sap.com, katrin.km.mueller@siemens.com, jose.antonio.lopez.abad@ericsson.com, shane.bracher@sap.com

2 organizational initiatives such as the International EPD System and The Sustainability Consortium have been active to promote common ways to calculate and disseminate these product indicators. 2. Three Major Challenges Companies use a wide range of IT tools and solutions to account for and manage their EPIs on company, supply chain, and product-levels. These include spreadsheet-based and homegrown solutions, traditional enterprise planning and costing tools, and special purpose EPI management software (Dada et al. 2010, Jacobson 2010). However, state-of-the-art solutions suffer from three major shortcomings. The first shortcoming is that the current solutions are mostly aimed to be used by sustainability domain experts and not the business users who take decisions that can lead to environmental improvements (Nawrocka et al. 2009). The current environmental actions are often separate from the daily operations, e.g. procurement, product design, service outsourcing, etc. Whereas domain experts use specialized software to manage the environmental impact and initiatives, business users execute the traditional operations in the respective enterprise systems without seeing the resulting environmental indicators. The second challenge is that today s tools provide a much higher focus on the intra-organizational aspects of EPIs, whereas most emissions are known to occur beyond single-company walls (Scipioni et al. 2010). For example, high-tech brand owners such as Siemens and Kone assemble final products, but most environmental impact is due to raw material extraction and the end product s energy consumption. Currently, the process of collecting inter-organizational EPIs from suppliers and customers is tedious, errorprone, and not easily repeatable with state-of-art tools. Finally, the state-of-the-art does not sufficiently address the challenges of data availability, transparency, and quality. Brand-sensitive companies require high quality data from suppliers who in turn either do not want to share the often-sensitive data or do not see the motivation to invest time and effort in that (Schliephake et al. 2009). This leads to no-data or low-quality data, e.g. from industry averages (which cannot be used to differentiate suppliers or product alternatives). The problem is not only a business challenge but also a technical one: data from multiple sources has different, incompatible formats. Connecting to these sources in a common way is a technical challenge that has yet to be addressed convincingly. 3. The OEPI Solution Approach This section provides an overview of the proposed solution approach developed in OEPI: a many-to-many network solution for EPI management that is designed for use by business users in both, intra- as well as inter-organizational scenarios, with specific mechanisms that foster the availability of high quality data. In each of the following paragraphs we describe one of the four solution aspects: the frontend portal, the backend platform, the community network, and the semantic mapping for external data incorporation. 3.1 Frontend Portal The first aspect is around targeting primarily the business user rather than the environmental expert. Since the former has much less time for and exposure to environmental issues that the latter, the system should be particularly intuitive and easy to use, thereby enabling on-boarding with minimal training. Also, the frontend should be very customizable and flexible to support many different users and application scenarios. This led us to opt for an enterprise portal approach based on Liferay, the leading portal in the open source world, with a thriving community and a set of built-in features that fitted well our needs. Portals are a mature technology approaching dynamic web application design using a component model based on aggregation of markup fragments into pages. Each chunk is generated by a portlet and the portal server com-

Figure 1 shows two example portlets providing benchmarking functionality for organizations or products. Figure 1 Benchmarking editor and visualizer portlets 3.

3 bines them into a single web page. The OEPI portal has many portlets that provide the functionality needed for business users, e.g. an organization portlet to connect to and communicate with external stakeholders, an EPI portlet to define new indicators, and portlets to manage unit processes, activities, and products. Figure 1 shows two example portlets providing benchmarking functionality for organizations or products. Figure 1 Benchmarking editor and visualizer portlets 3.2 Backend Platform There are many different business scenarios and users who need access to common EPIs and underlying data, so our goal was to enable different frontends to be built for independent and extensible use cases on top of a common data layer. We opted for a modular architecture comprising a lean platform layer containing the commonly needed data and the respective access methods, in addition to a loosely coupled frontend on top that supports sample scenarios. Such a configuration allows many different applications to build on top of a common data access and storage layer. The OEPI platform offers a set of REST services for external applications to access its EPIs and related data for organizations, products, and processes. From a high-level perspective, the OEPI platform follows a 3-step process - illustrated in Figure 2 - to provision environmental information to end users. First, the services exposed by the platform listen for incoming requests from end-user applications. An example of an end-user application is the OEPI portal, but other applications with different use cases can be considered. Second, the platform processes incoming requests by searching its data sources for the requested environmental information. Finally, the information is returned to the end-user application as a response message. This 3-step process highlights the simplicity of the OEPI platform and provides a general understanding of how it functions. Figure 2 End-user application interfacing with the OEPI platform services 3.3 Community Network The next aspect of OEPI addresses the inter-organizational challenge. Namely, we opted for a many-tomany network solution that connects the participating companies in a similar way to how social networks connect friends, leading to an increase in the availability of EPIs and their application in business. The

4 various supply chain partners would share the indicators with the community, and would use the EPIs published by others. This leads to a higher leverage and lower cost, because suppliers publish an indicator once instead of responding to various queries. In addition, in a network approach, the system can assist the non-expert business user by providing a list, say, of the top EPIs on the network, thereby borrowing concepts from social networks. A very powerful capability of such an approach is the ability to benchmark performance, either of suppliers, or of your own with respect to (anonymous) competitors and industry averages. Finally, we leveraged the community network approach to build special inter-organizational functionality, e.g. including the EPI of a supplier or one of its components by simply dragging and dropping this EPI into your own organization or product portlet respectively. This represents a major advancement in comparison to the tedious process in which external EPIs are requested, collected, and used internally. 3.4 Semantic Mapping of External Data The last challenge that OEPI addresses is that of data availability, transparency, and quality. First, it is important to note that the many-to-many approach is crucial in improving this: companies are motivated to provide more and better data because it s easier to share them with many clients at once, but also due to specific incentive schemes that we introduced based on the community network aspect. However, here we focus on the technical challenge of incorporating external, incompatible data. The OEPI approach was to develop an ontology that unambiguously describes an EPI and its relevant data irrespective of its source or application. The OEPI ontology serves as a formalized language that can be used to map different EPIs from disparate sources into a common format which is then stored persistently into semantic databases. These triple stores can then be queried using SPARQL queries by the OEPI platform which is not aware of how the external data was represented before the semantic mapping. The OEPI platform returns the query results to the frontend application as it would with data that is internally stored. In the project, we implemented such a semantic mapping proof-of-concept for each of three example data sources: the European Reference Life Cycle Data System (ELCD) database, the SimaPro life cycle assessment tool from PRé, and SAP s Sustainability Performance Management (SuPM). 4. Business User Insights Twenty-four business users from five organizations tested the system over a period of four weeks. The testers covered different areas of expertise; from the environmental and business domains. The following highlights have been reported by most users as major added-value of the OEPI system: (1) Benchmarking capability with network and external sources, (2) access to primary data at lower costs, and (3) a very flexible system providing a quick overview on product and organizational EPIs. There were two criticisms when it comes to data availability and time reduction. The reason for the former is that it resulted from a test case in the telecommunication sector which replied on simulation data due to the lack of real data. This sector-specific issue has been not in the focus of the OEPI project. The latter resulted from a person who already uses a specific tool and had the opinion that using yet another system for environmental indicators only would increase his work-load. However it is not the intention to substitute tools but to connect them and enable useful exchange of results within the network.

5 Bibliography Dada A. (et al) (2010): Towards Continuous Environmental Improvements across the Product Life Cycle, 16th Americas Conference on Information Systems, Lima, Peru. Jacobson S. (2010): How EH&S Providers Can Claim a Slice of the Sustainability Software Market, Manufacturing Operations, AMR Research. Nawrocka D. (et al) (2009): ISO in environmental supply chain practices, Journal of Cleaner Production, 17(16): pp Schliephake K. (et al) (2009): Making resources work more efficiently - the importance of supply chain partnerships. Journal of Cleaner Production, 17(14): Scipioni A. (et al) (2010): Voluntary GHG management using a life cycle approach: A case study, Journal of Cleaner Production, 18(4), pp

St. Gallen, Switzerland

St. Gallen, Switzerland Preface The first decade of the twenty-first century showed an exponential growth in interest around sustainability in general and its environmental pillar in particular. Academia, industry, and policy-makers