Flevy Management Insights Q&A
How is AR contributing to the development of sustainable business practices?
     David Tang    |    Augmented Reality


This article provides a detailed response to: How is AR contributing to the development of sustainable business practices? For a comprehensive understanding of Augmented Reality, we also include relevant case studies for further reading and links to Augmented Reality best practice resources.

TLDR AR is revolutionizing sustainability in business through improved Training and Education, optimized Maintenance and Operations, and enhanced Product Design and Customer Engagement, leading to reduced waste and increased efficiency.

Reading time: 5 minutes

Before we begin, let's review some important management concepts, as they related to this question.

What does Sustainable Business Practices mean?
What does Augmented Reality in Training and Education mean?
What does Predictive Maintenance Strategies mean?
What does Customer Engagement through Interactive Experiences mean?


Augmented Reality (AR) is rapidly emerging as a transformative technology across various sectors, playing a pivotal role in advancing sustainable business practices. By enhancing real-world environments with computer-generated perceptual information, AR offers innovative ways for organizations to reduce waste, improve efficiency, and foster a more sustainable and responsible corporate culture. This technology's unique ability to overlay digital information onto the physical world opens up new avenues for sustainability in areas such as training, maintenance, product design, and consumer engagement.

Enhancing Training and Education

One of the most significant contributions of AR to sustainability is in the realm of training and education. Traditional training methods often require physical resources, travel, and energy consumption, which can be substantially reduced with AR. For instance, AR can simulate complex machinery or processes, allowing employees to gain hands-on experience without the need for physical prototypes or travel to training facilities. A report by Accenture highlights the potential of AR to revolutionize workforce training, noting that organizations adopting AR for educational purposes can reduce material costs and carbon footprint by minimizing the need for physical resources.

Furthermore, AR facilitates a more engaging and effective learning experience, leading to better retention of information and a deeper understanding of sustainable practices. For example, an AR application can demonstrate the lifecycle of a product, from raw materials through to disposal, helping employees understand their role in minimizing environmental impact. This immersive form of learning not only enhances employee skills but also fosters a culture of sustainability within the organization.

Real-world examples include companies like Honeywell and Boeing, which have implemented AR for training purposes. Honeywell has used AR to provide virtual hands-on training for their field engineers, resulting in improved operational efficiency and reduced travel emissions. Boeing has utilized AR to assist technicians in wiring aircraft, which has led to a significant reduction in wiring time and errors, thereby reducing waste and improving efficiency.

Are you familiar with Flevy? We are you shortcut to immediate value.
Flevy provides business best practices—the same as those produced by top-tier consulting firms and used by Fortune 100 companies. Our best practice business frameworks, financial models, and templates are of the same caliber as those produced by top-tier management consulting firms, like McKinsey, BCG, Bain, Deloitte, and Accenture. Most were developed by seasoned executives and consultants with 20+ years of experience.

Trusted by over 10,000+ Client Organizations
Since 2012, we have provided best practices to over 10,000 businesses and organizations of all sizes, from startups and small businesses to the Fortune 100, in over 130 countries.
AT&T GE Cisco Intel IBM Coke Dell Toyota HP Nike Samsung Microsoft Astrazeneca JP Morgan KPMG Walgreens Walmart 3M Kaiser Oracle SAP Google E&Y Volvo Bosch Merck Fedex Shell Amgen Eli Lilly Roche AIG Abbott Amazon PwC T-Mobile Broadcom Bayer Pearson Titleist ConEd Pfizer NTT Data Schwab

Optimizing Maintenance and Operations

AR also plays a crucial role in optimizing maintenance and operations, which is essential for sustainable business practices. By overlaying digital information onto physical assets, maintenance personnel can identify and resolve issues more quickly and accurately, reducing downtime and the need for replacement parts. This not only conserves resources but also decreases the environmental impact associated with manufacturing new parts. A study by PwC indicates that AR can enhance operational efficiency by up to 30%, highlighting its potential to contribute to sustainability goals.

Moreover, AR can predict maintenance needs, enabling a shift from reactive to proactive maintenance strategies. This predictive approach ensures that resources are used more efficiently, extending the lifespan of equipment and reducing the overall environmental footprint. For instance, AR applications can visualize wear and tear on machinery components, allowing for timely maintenance that prevents larger, more wasteful repairs.

Companies like Siemens and GE are leveraging AR for maintenance and operations. Siemens uses AR to visualize and analyze data from their gas turbines, enabling engineers to conduct maintenance more efficiently and accurately. GE has developed AR applications that allow technicians to perform inspections and repairs with greater precision, reducing errors and the need for rework.

Improving Product Design and Customer Engagement

AR's impact on sustainable business practices extends to product design and customer engagement. By enabling designers to visualize products in real-world contexts, AR can help in identifying opportunities to use more sustainable materials and design products for easier disassembly and recycling. This approach not only reduces the environmental impact of products but also aligns with consumer demand for more sustainable options. A report by Gartner suggests that by 2025, organizations utilizing AR in product design will see a 25% improvement in time to market and a 20% reduction in product development costs.

In terms of customer engagement, AR offers interactive experiences that can educate consumers about sustainability. For example, AR can show the environmental benefits of a product or demonstrate how products can be recycled or reused. This not only enhances the customer experience but also promotes a brand's commitment to sustainability. IKEA's AR app, which allows customers to visualize furniture in their homes before purchasing, is an excellent example of this. It not only reduces the likelihood of returns (thereby minimizing carbon emissions associated with logistics) but also engages customers in sustainable purchasing decisions.

Overall, AR's ability to enhance training and education, optimize maintenance and operations, and improve product design and customer engagement demonstrates its significant potential to contribute to sustainable business practices. As organizations continue to explore and implement AR technologies, we can expect to see a more sustainable and efficient approach to business operations, ultimately contributing to broader environmental and social goals.

Best Practices in Augmented Reality

Here are best practices relevant to Augmented Reality from the Flevy Marketplace. View all our Augmented Reality materials here.

Did you know?
The average daily rate of a McKinsey consultant is $6,625 (not including expenses). The average price of a Flevy document is $65.

Explore all of our best practices in: Augmented Reality

Augmented Reality Case Studies

For a practical understanding of Augmented Reality, take a look at these case studies.

Augmented Reality Integration for Aerospace Maintenance

Scenario: The organization is a leading aerospace company facing difficulties in maintaining high operational standards due to complex machinery and a global workforce.

Read Full Case Study

Augmented Reality Deployment in Construction

Scenario: A mid-sized construction firm specializing in large-scale commercial projects is facing challenges integrating Augmented Reality (AR) into their workflow to enhance precision and efficiency.

Read Full Case Study

Augmented Reality Deployment for Industrial Equipment Manufacturer

Scenario: The organization is a leading industrial equipment manufacturer seeking to incorporate Augmented Reality (AR) into their assembly and maintenance processes.

Read Full Case Study

Healthcare Provider Innovates Patient Engagement and Training with Augmented Reality

Scenario: A mid-size healthcare provider implemented an Augmented Reality strategy framework to address its patient engagement and training challenges.

Read Full Case Study


Explore all Flevy Management Case Studies

Related Questions

Here are our additional questions you may be interested in.

What metrics should executives use to measure the ROI of AR initiatives in their organizations?
Executives should measure the ROI of AR initiatives through metrics like Revenue Enhancement, Cost Reduction, Customer Engagement (CSAT, NPS), Operational Efficiency, and Employee Performance, to inform Strategic Decisions and foster Innovation. [Read full explanation]
How can companies ensure data privacy and security when implementing AR technologies?
Companies can ensure data privacy and security in AR technologies through Strategic Planning, Risk Management, implementing a robust data privacy framework, advanced security measures, and enhancing user awareness and control. [Read full explanation]
What are the key challenges in scaling AR solutions across different departments within an organization?
Scaling AR solutions involves overcoming Technological Integration challenges, executing effective Change Management, and ensuring Scalability and Performance Management to drive innovation and efficiency. [Read full explanation]
What role does AR play in enhancing the interconnectivity and automation of smart factories?
Augmented Reality (AR) is revolutionizing Smart Factories by improving Interconnectivity and Automation, offering real-time data, enhancing operational efficiency, and integrating with automated systems for better productivity and quality. [Read full explanation]
How are AI and machine learning being integrated with AR for smarter, more adaptive applications?
Integrating AI and ML with AR is transforming industries by revolutionizing customer engagement, operational efficiency, and driving Innovation, offering significant Strategic and competitive implications for organizations. [Read full explanation]
What are the implications of 5G technology on the deployment and effectiveness of AR applications?
5G technology significantly enhances AR applications by providing faster speeds, lower latency, and increased capacity, enabling real-time, immersive experiences and supporting a vast number of connected devices for Strategic Planning and Innovation. [Read full explanation]

 
David Tang, New York

Strategy & Operations, Digital Transformation, Management Consulting

This Q&A article was reviewed by David Tang. David is the CEO and Founder of Flevy. Prior to Flevy, David worked as a management consultant for 8 years, where he served clients in North America, EMEA, and APAC. He graduated from Cornell with a BS in Electrical Engineering and MEng in Management.

To cite this article, please use:

Source: "How is AR contributing to the development of sustainable business practices?," Flevy Management Insights, David Tang, 2024




Flevy is the world's largest knowledge base of best practices.


Leverage the Experience of Experts.

Find documents of the same caliber as those used by top-tier consulting firms, like McKinsey, BCG, Bain, Deloitte, Accenture.

Download Immediately and Use.

Our PowerPoint presentations, Excel workbooks, and Word documents are completely customizable, including rebrandable.

Save Time, Effort, and Money.

Save yourself and your employees countless hours. Use that time to work on more value-added and fulfilling activities.




Read Customer Testimonials



Download our FREE Strategy & Transformation Framework Templates

Download our free compilation of 50+ Strategy & Transformation slides and templates. Frameworks include McKinsey 7-S Strategy Model, Balanced Scorecard, Disruptive Innovation, BCG Experience Curve, and many more.