Circular IT: for a Better World and Better Business | Risk Advisory | Deloitte Netherlands

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Circular IT: for a Better World and Better Business

Think big, start small and act now

Circular IT can have a substantial positive impact on the environmental footprint of organisations. However, IT suppliers and their corporate clients still encounter many barriers on the road to Circular IT. This Point of View analyses and tries to break down those barriers and helps organisations to think big, start small and act now.

Circular IT is still in its infancy, and that’s not due to a lack of ambition. Sustainability is high on the agenda for both leading IT suppliers and major IT users. The why is clear: a linear value chain that continues to use virgin materials while simultaneously disposing of valuable used materials is way past its prime. The new and sustainable economy is circular: a future-proof economy that extracts maximum value from resources in use and maximises circulation of materials through processes such as reuse, repair, recycling and redesign.

However, while the ambitions are clear, actions are not. Similar to commitments on climate and decarbonisation, organisations are defining circularity goals, aiming to be fully circular by 2030, 2040 or 2050. Most of the leading IT suppliers are working on or already have prototypes of circular IT assets like laptops or mobile phones. However, in between ambition and action lies a large gap that needs to be bridged.

In this Point of View, we hope to help bridge the gap between ambition and reality. We’ll start out describing the current status of circular IT and the barriers hindering or slowing progress. Then we’ll discuss how both IT users and suppliers can overcome these barriers and contribute to the circular economy.

Ten Barriers to Circular IT

Despite big ambitions and various initiatives around circular IT, there are quite a few barriers standing in the way of a rapid transition. Find below an enumeration of the 10 largest. More information can be found in the downloadable POV.

  1. Circular design is not yet the industry standard.
  2. There’s not enough recycled material available at competitive prices to reach circularity ambitions.
  3. Technical limitations mean the main parts and materials of IT assets cannot be repurposed.
  4. IT suppliers are not able to provide data on the circularity of their materials and products.
  5. The industry’s data architecture is not ready to include granular circular data.
  6. There are limited circularity incentives for suppliers.
  7. Circularity is currently not a differentiating factor in procurement.
  8. End-of-life strategies are often not included during procurement, preventing optimised and supplier aligned processes when assets are discarded.
  9. There is a mismatch between long-term ambitions and short-term accountability.
  10. Ambitions around—and definitions of—circularity vary significantly across the IT industry.

Breaking down barriers to Circular IT

Many of the barriers we’ve mentioned perpetuate each other. IT suppliers need demand in order to invest, while IT buyers want to be able to choose what they buy. A breakthrough is needed for both IT suppliers and their clients. In the Point of View, a list can be found with the most important recommendations for breaking down the barriers for IT buyers and IT suppliers.

The Future of Circular IT

Deloitte wants to make an impact that matters. That is why we want to contribute to the breakthroughs needed for the transition to a circular economy. We bring together IT suppliers and their clients to discuss overcoming these barriers, and we are helping both IT suppliers and IT buyers translate their ambitions into reality. Our starting point? Think big, start small and act now.

More information

Do you have circular ambitions? Are you looking for a sparring partner? Please contact us to start the conversation or for more information about Circular IT via the contact details below.

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