Navigating the maze of incoming battery legislations and sustainability regulations poses a daunting task, as data collection and reporting demands challenges the capabilities of even the most sophisticated ERP systems and supplier communication tools. Regulations, such as the EU battery legislation, have extensive and diverse reporting and data requirements. These would ideally be answered by collecting data from centralized ERP systems and centralized tools that communicate with suppliers. It is difficult to imagine that many larger companies, especially OEMs with tens of thousands of suppliers, have access to such ideal systems.
When we start working with OEMs, we investigate how long it takes them to collect a list of data requirements via a simple excel sheet… The process of collecting even a simplified example excel sheet for an individual battery can take several weeks!
When we start working with OEMs, we support them to collect a list of data requirements for the legislation via a simple excel sheet. We have found that the process of collecting even a simplified example excel sheet for an individual battery can take several weeks, as several departments are consulted and several legacy software are involved. For economic operators who look after tens of thousands of batteries per year, it is imperative that the production of necessary data for each battery passport is as efficient and as painless as possible.
It is normal for OEMs to rely on a mix of legacy systems and manual software to identify and collect data. Their internal data flows are designed for efficient production and not efficient data collection for reporting purposes. As such, the way the legislation is orientated also means that different departments, who would not regularly interact with each other, are responsible for different data batches. For example, the supply chain responsibility team may use different software for the data than it is used by the team that is responsible for documenting any repair processes that occur. When the different data requirements are put into consideration, it is clear that a centralized interface for managing the data needed for battery passports - and then the passports themselves - will be required.
The key question then is: how can this interface make the lives of everyone easier, instead of becoming an additional login screen to be managed? To answer this, companies have to manage two trade-offs.
- Decide between in-house and outsourcing
For the first trade-off, companies must decide how much work they would like to do in-house vs how much they want to provide to an external party. For example, would it be better to hire third party experts for calculating emissions requirements or would it be better to build that knowledge in-house?
- Choose the best ways to collect data for your process
The second trade-off would be to manage what data is collected via integrations and then what data is collected manually. For example, on the one hand, it might make sense to connect the state of health information directly via an API. On the other hand, it might make sense to collect supply chain mapping information separately and then upload that information to the software only once confidential information is preserved.
- Design your own efficient way through exercises with data
It is difficult to prescribe any recommended trade-off because each company will need to find its own internal balance that suits its processes and company politics. To be able to identify these trade-offs, we encourage companies to spend a couple of weeks on mapping exercises. The rather ‘simple’ excel sheet would become a guide for mapping which data comes from which software and department. The best way to then work with the identified maps is by assigning an internal or external battery passport task force with the authority to make decisions on behalf of all stakeholders.
In our experience, we have found a wide range of solutions that can be used for creating battery passports. For example, some companies prefer completely separate legacy software that different departments use to upload their portion of the data. Others preferred an integration that saw passports directly created through their SAP at the find endpoint.
- Repeat the mapping exercises and create the process step by step
It is important to acknowledge that although an initial mapping system can be slow, it is an exercise that cannot be skipped. Once a baseline for one product is set, companies can repeat the same mapping exercise for different products. Unless radically different, repeated mapping exercises go much more quickly as there is an understanding of the ecosystem that feeds the creation of a battery.
Deep thinking will create the foundations needed to reorientate data handling and collection for meeting the challenges of the circular economy.
Such a company’s deep thinking will create the foundations needed to reorientate data handling and collection for meeting the challenges of the circular economy. The intention of the European Union as a whole the past few years, and battery legislation as a part of it, is to encourage transparency and behavior that would make supply chains and ESG records more transparent. Although the steps to get there will seem initially unnatural to many, they also do come with other benefits.
Reorienting data collection in such a manner will also bring unprecedented opportunities for business and data analytics. Once the process is done, it will be, for example, easier than ever to identify poorly performing supply chains or potentially risky midstream and upstream suppliers.
As you can see, the first steps for creating a battery passport involve a large (possibly metaphorical) whiteboard. Every company must find its most suitable path to how it cares to respond to upcoming legislation. There is no single, uniform, path forward, but there is a recipe for identifying which would be most efficient for individual use cases. At Minespider we are happy to help you find your specific use case, our team of consultants has a regulation readiness program that brings with a few weeks of mapping and consulting to help you understand where you like with your trade-offs.
For more information, visit the page about the EU Battery Regulatiion.