How to set up a Scope 1/2/3 pilot for success
Emissions targets, reporting, mid- and long-term targets, climate certificates… That’s all good and dandy but a bit “been there, done that” for you? What’s next?
If you are in the limbo of past-commitments and pre-reductions, you are not alone. It sounds like you are ready to own and drive the next step: Emissions reductions and supplier involvement.
A climate strategy requires foundational change across the organization – but it doesn’t have to be jarring. You can test out your ways of working and new tools for minimum risk and maximum gain – with the existing resources, and most importantly, with existing data.
The word you’re looking for is pilot!
Read our guide and streamline how to use the resources and data you already have to set up a successful emissions management pilot for any Scope, tailored to the needs of grocery retailers.
An overview
- Introduction
- Project pilot 101: Kick-off meeting agenda
- The horizontal pilot
Scope 3 and supplier emissions are important to us - The vertical pilot
Scope 1+2 and our own product line are important to us - The triangular pilot
Scope 1/2/3 are equally important to us - Expert insights
Introduction
Download the guide for your emissions management pilot and prepare for take-off 🚀
Emissions reduction work in Scope 3 and supplier involvement is systematically maturing. But it is still early days and the giants mobilizing now have many unknowns. Since the ultimate stage of climate work is behavioral change across the organization, its success depends on building on a solid foundation.
As incremental as the foundation is, it doesn’t have to be jarring. It is fully possible to test things out for minimum risk and maximum gain – with the existing resources, and most importantly, with existing data. With a pilot, you start your project at a small scale with minimum input, and learn what insights you need to scale up.
Here is how to use the resources and data you already have to set up a successful emissions management pilot for any Scope.
Project Pilot 101: The kick-off meeting agenda
Setting the scene
The most important boundary to keep in mind with any pilot is that you are testing feasibility on two dimensions:
a) The software solution
b) Your internal processes
Overlooking the latter often results in a common mistake: Involving only technical people… Which brings us to the next point.
Participants
Invite resources from both the technical and the business side of the organization. In addition, include a representative from management. Their buy-in is critical for two reasons:
1) If the pilot doesn’t address a business risk or opportunity, the transformation will be dropped or not sufficiently prioritized.
2) If the pilot doesn’t have the green light from upper management, the project team involved will have too much to prove and too little mandate to prove it.
Start your meeting presenting the following:
- What business opportunities are you addressing?
- Who will be on the project team?
The Pilot Scope
As you are setting up a pilot, the scope should be as limited as possible. When you have covered the why and the what, start designing the how with the following question:
What is the most limited pilot we can do to check whether your priority can be addressed and how – the fewest products possible, the smallest team possible, the shortest time possible?
The answers to all these questions have 3 dependencies:
a) They lie in both upper management and the technical teams – so ensure that the business opportunities/risks are pinned down.
b) They scale-test the piloted software to answer whether you can do what is important to you and how.
c) They define the scope of the pilot.
Emissions management pilot – Meeting agenda:
- The business case for change
- The desired end-state after the change
Questions/Action points
- What is important to us and difficult to do right now?
- What is the shortest time we need to test the solution?
- What is the smallest sample we can use to test the solution?
- Who is involved in the project team?
- What are the success criteria for the shortlisted platform(s):
- How hard is it?
- How long did it take?
In the context of food systems and emissions reductions, there are 3 possible priority outcomes from this meeting, they are all correct and can be scale-tested in a few months.
OPTION 1: Scope 3 and supply chain emissions are important to us
The horizontal pilot
Welcome to the horizontal pilot! What is important to you is supplier emissions management and what is difficult to do is data collection, harmonization, and supplier communication.
The Scope
With the horizontal pilot, your climate intelligence starts with product climate footprints for a large part of your portfolio, with minimal SKU information. In other words, you start with quantity and you aim to increase the quality.
Possible data input needed from you would be:
• Bill of material
• Origin of ingredients
• Name and contact information of suppliers
• Address where produced or processed
• Packaging materials, weight and origin
Step 1: What to expect from the software
As a baseline, you should expect accurate and harmonized product climate footprints. For the calculations to have any impact on your business, you should expect to get actionable emissions insights for the calculated product range and for upstream emissions on an aggregated level.
Depending on your set business priorities, here are some questions that can help you benchmark the actionability (and insightfulness!) of the software:
• What are the products and ingredients with the highest climate footprint?
• What are your most used ingredients?
• What percentage of your emissions does each supplier account for?
• At which gate do most of your emissions occur?
To assess the success of this step, ask:
- Did we get the insights we need to take the next step?
- Could we prioritize supplier engagement?
- How long did it take?
- How easy was it?
Step 2: What to expect from stakeholders involved
This intel will help the project team prioritize where to increase data granularity: your most critical and impactful suppliers. They can then select the minimum number of suppliers to onboard. Keep in mind that a single supplier is a perfectly good start.
Your selected suppliers will be onboarded by your software supplier and start their own emissions mapping. With CarbonCloud for example, your suppliers’ PCF is calculated and the emissions upstream are mapped as part of calculating your baseline. Your suppliers simply unlock the product emissions map and increase data granularity.
To assess the success of this step, ask:
- Were the selected suppliers successfully onboarded?
- How long did it take?
- How easy was it?
Setting up the horizontal pilot for success
We hope the software you chose to pilot has engagement automation capabilities, so that you can avoid timeconsuming email exchanges with your suppliers. Nevertheless, a project owner -or depending on your company and portfolio size, two- who will manage communication and soft aspects of engaging suppliers is a key success factor of your pilot.
The project owner(s) should communicate the following:
• Ensure that the selected suppliers are profoundly aware that you are taking Scope 3 reductions seriously.
• Highlight that climate data provision and targets from suppliers are or will become a procurement requirement.
• Inform them about potential incentives they can leverage for reductions as well as sanctions for noncompliance.
What does scaling up look like?
As you scale up and add more suppliers post-pilot, your data granularity should gradually increase with minimum time and effort, starting with the most impactful areas of your portfolio.
Scaling up a horizontal pilot is twofold:
• On your organization’s end, you scale up the calculations to your full portfolio and based on the full scope of insights, reprioritize suppliers or data granularity hotspots if needed.
• On the suppliers’ end, scale up the number of suppliers you want to onboard based on the prioritization you did during the pilot.
OPTION 2: Scope 1+2 and our own product line are important to us
The vertical pilot
Welcome to the vertical pilot! What is important to you is your own product line and what is difficult to do is get a manageable overview of your Scope 1 and 2 emissions.
The Scope
With the vertical pilot, your climate intelligence unlocks the emissions map of every product all the way upstream in a digital twin to reduce per product emissions in your operations. Your R&D specialists can experiment with recipes, ingredients, and production processes for climate optimization. In other words, you start with granularity, and you aim to scale to more SKUs.
Step 1: What to expect from the software
The test on the software will be how quick and easy it is to refine the digital twin and what actionable insights you get from it.
You should be able to test how quick and easy it is to map one or two products and pinpoint the emissions hotspots at an ingredient level and production stage.
Depending on your set business priorities, here are some questions that can help you benchmark the actionability (and insightfulness!) of the software:
• What scenario-testing capabilities can you test in the digital twin?
• Do you have quality insights for cost-benefit analysis and at what depth?
• Where would increased data granularity with supplier involvement make a difference?
The software should enable you to easily explore different initiatives and make confident purchasing and product development decisions. Your findings will shape operational and purchasing decisions towards emissions reductions.
To assess the success of this step, ask:
- Can we take any decisions and reduction initiatives based on the intel?
- How long did it take?
- How easy was it?
Step 2: What to expect from stakeholders involved
Appoint a project leader or team who will oversee climate optimization of the digital twin(s), assess the feasibility of the scenarios, and has the mandate to drive the materialization of selected initiatives in the rollout phase.
The project team will use their expertise to explore the feasibility of the following:
• Using your software’s secondary data library, are there any changes in procurement they could initiate?
• Are there any production processes that can have an impact to the final footprint?
• Do you know of any suppliers of this product who are doing their bit to reduce their emissions? How would they stack up compared to the benchmark data?
To assess the success of this step, ask:
- Did the team get insights they can act on to transform this product?
- How long did it take?
- How easy was it?
Setting up the vertical pilot for success:
It is imperative to the success of your project that your project team is mandated to materialize the scenarios in the rollout phase. If other departments are involved in the materialization, like procurement or supply chain management, ensure they have bought in to the project, they can budget changes, and will prioritize it. With the right resource insights and control, the success of the rollout depends on acting on the intel.
What does scaling up look like?
As you scale up, you would naturally want to add more SKUs and this is something you should be able to do easily and quickly. So, assess how much of your baseline mapping can be automated with your software of choice so that you can minimize the calculation part and rollout to insights as quickly as possible.
At a later stage, you will also want –or need to– involve your suppliers and increase your data granularity. Ideally, the same software enables you to get your suppliers on board and use their primary data seamlessly. If the idea evokes both dread and intrigue, or if this scaling capability is important for you to test, we strongly recommend you keep reading!
OPTION 3: Scope 1/2/3 are equally important to us
The triangular pilot
You’re ambitious, and when the ambition in question is emissions reductions there is no universe we would discourage it! If you prioritize Scope 3 and your own production line, you can have your cake and eat it too. Welcome to the triangular pilot!
The Scope
The triangular pilot is a combination of the horizontal and vertical pilot – both at a smaller scale. In this case, based on minimal SKU information, you calculate climate footprints per product for a part of your portfolio that is large enough to generate insights on supplier hotspots. You also select one or two products to unlock the digital twin with emissions mapping and prioritize data granularity from the suppliers involved in this range.
Step 1: What to expect from the software
Test the software on how easy, quick, accurate and harmonized the climate footprints on a product level. See that you can use the vertical climate intelligence insights and aggregated hotspots to pinpoint which suppliers have the largest impact and are worth prioritizing in increasing data granularity:
• What are the products and ingredients with the highest climate footprint?
• What percentage of your emissions does each supplier account for?
Your game-plan will be to bring them onboard.
To test the potential of reductions in your own line, identify the SKUs from your own production line you want to unlock. You should be able to test how quick and easy it is to map one or two products and pinpoint the emissions hotspots at an ingredient level and production stage.
Depending on your set business priorities, here are some questions that can help you benchmark the actionability (and insightfulness!) of the software:
• What horizontal insights do you get?
• Did you have these insights before and how easy and quick was it to get it?
• What scenario-testing capabilities can you test in the digital twin?
• Do you have quality insights for cost-benefit analysis and at what depth?
• Where would increased data granularity with supplier involvement make a difference?
The software should enable you to easily explore different initiatives and make informed purchasing and product development decisions. Your findings will shape operational and purchasing decisions toward emissions reductions.
Optimally, you combine the two tests and prioritize the suppliers with the largest impact for your in-depth tested SKU. This way, you can get a feel of the impact of supplier engagement and the holistic emissions management workflow.
To assess the success of this step, ask:
- Did we get the insights we need to know which suppliers to prioritize?
- Can we take any decisions and reduction initiatives on a product level based on the intel?
- How long did it take?
- How easy was it?
Step 2: What to expect from stakeholders involved
Your organization may not settle for priorities and there is no need to compromise that but your teams will need them. For the triangular pilot, you will need two different owners working closely together: A project owner, suitably from procurement, for the horizontal dimension –supplier engagement– and a project team, suitably from R&D, for the vertical dimension –product transformation.
1) The project owner of the vertical dimension coordinates supplier onboarding, using automation capabilities employed in your software of choice. Your selected suppliers will be onboarded by your software vendor and start their own emissions mapping. From their end, your suppliers will have to do and provide as little as possible to establish their baseline and increase your data granularity. In other words, they will in turn take Step 1 in their organization.
2) The project owner of the horizontal dimension will stress-test the capabilities of your software and your processes. Based on the software’s dataset and visualization capabilities in the digital twin, the project team should have the insights to initiate changes in procurement and production processes. With the right resource investment and control, the success of your rollout depends on acting on the intel.
To assess the success of this step, ask:
- Were the selected suppliers successfully onboarded?
- How long did it take?
- How easy was it?
- Did the team get insights they can act on to transform the selected product(s)?
- How long did it take?
- How easy was it?
If the suppliers selected for onboarding are part of the horizontal pilot, ask:
- What was the impact of increased data granularity in the digital twin?
- How long did it take?
- How easy was it?
Setting up the triangular pilot for success:
The project owner of the vertical dimension shouldn’t overlook the softer aspects of supplier engagement: Stressing the decisiveness of your emissions reductions project and informing them about both the carrot and the stick scenarios.
The project owner(s) should communicate the following:
• Ensure that the selected suppliers are profoundly aware that you are taking Scope 3 reductions seriously.
• Highlight that climate data provision and targets from suppliers are or will become a procurement requirement.
• Inform them about potential incentives they can leverage for reductions as well as sanctions for noncompliance.
The project owner overseeing your production line should, first and foremost, have mandate to materialize the initiatives relevant to your success KPIs. If other departments need to be involved, ensure that they are aware of your organization’s decisiveness on emissions reductions and will prioritize relevant initiatives.
What does scaling up look like?
As you scale up, your data granularity should gradually increase with minimum time and effort, starting with the most impactful areas of your portfolio. Additionally, you would naturally want to dive deeper into more SKUs and considering your new software capabilities, you should be able to both pinpoint which SKUs to prioritize next and what to do there easily and quickly.
On your organization’s end, you scale up the intelligence to your full portfolio and based on the full scope of insights, reprioritize suppliers or data granularity hotspots if needed. On the suppliers’ end, scale up the number of suppliers you onboard based on your prioritization of SKU deep dives.
Hey CarbonCloud, what do you think about emissions reductions pilots?
Expert insights
Who, us?! Thanks for asking! We think that a data-driven iterative process is the foundation of building new knowledge and robust change management.
In addition, especially for large organizations with a broad assortment and/or a multinational presence, lowering the threshold to a smaller scale is the only certain path to success at a large scale. On the contrary, for such organizations, starting emissions reductions initiatives for the entire portfolio and every single supplier upstream is overwhelmingly impossible, ineffective, and cannot be promised with integrity by anyone who truly wants to see global emissions reduced for real. Rome wasn’t built in a day – neither was the mainstream electric vehicle market, if you catch our drift…
So, what are your priorities? If you don’t have an answer yet, we’ll happily provide an ear!
Ready to start a carbon management pilot?
Reach out to our team for expert support and guidance on a data-driven emissions reduction pilot
