With Sustainability Rising on the C-Suite Agenda, is Green IT a Game Changer?

Original posted on TechCorner, http://technet.microsoft.com/en-us/gg617967.aspx

Green IT continues to be one of the most discussed topics this year, along with virtualization and cloud computing. Those of us who have been in IT know very well that some of these things are nothing new. When the old things come back with new names, however, it usually means that they are ready for primetime, but not always.

While an increasing number of CIOs have already integrated Green IT initiatives into their overall IT strategy (from two-sided printing policies to digital archiving; from storage consolidation to virtualization), the exact status of Green IT adoption is hard to pin down. Partly to blame is the continued evolution of Green IT. While overall advancement of Green IT is laudable, it also led to the creation of various shapes, types and labels for Green IT. Organizations might be doing Green IT initiatives but simply not labeling them as such.

Let’s look at some statistics. The results of Forrester’s Global Green IT Online Survey¹, conducted in April 2010, showed that only 25 percent of the interviewed IT executives had a comprehensive Green IT plan in place. Forty-four percent of the respondents stated that they have no defined ownership of Green IT initiatives. The analyst firm concluded that some type of Green IT role manager exists in about 32 percent of organizations and expects this role to grow.

IT initiatives with high priorities in the survey included improving the efficiency of IT, improve customer management capabilities and streamline business processes. Sustainability and energy efficiency ranked low on the agenda at that time. However, Chris Mines of Forrester argued that improving “IT efficiency should be directly related to green characteristics of assets and processes, particularly in terms of energy usage.” He also stated that risk and compliance strategies are related to Green IT initiatives, such as e-waste disposal and carbon reporting.

This means that some companies that pursued Green IT initiatives – intentionally or unintentionally – labeled them differently. As for the business drivers for Green IT adoption, the Forrester report concluded that cost reduction, not compliance requirements, drives the adoption of Green IT practices.

In the future, the analyst firm estimates that organizations will spend approximately $6.85 billion on sustainability consulting services, with $3 billion going to Green IT services, $2.4 billion for IT-for-green projects, and $1.49 billion going towards green business initiatives that include an IT component. While IT energy and resource efficiency remains a dominant driver, Forrester predicts a new focus on IT-enabled green business processes in its report “Capitalizing on the Sustainability Consulting Services Opportunity”, published in October 2010.²

What can change the game for the CIOs and make them a regular in C-suite discussions? Over the past year, sustainability has become a board room topic and moved up high on the CEO’s agenda. As a result, this year’s discussion has shifted towards using the term “sustainability” instead of Green IT. Sustainability is a continuing process of refining and extending the life cycle of products, services, or environment to stimulate social and economic growth without depleting resources.³ It is about making processes so efficient that companies can decrease their environmental impact while nurturing socio-economic development. Proponents of the sustainability terminology argue that it is better suited to demonstrate the overarching role that IT can play to help organizations conduct business in a more sustainable manner.

Stirring up the discussion, the UK-based analyst house Verdantix recently claimed the end of green IT. The analyst firm’s Green Quadrant: Sustainable Technology Services⁴report approaches the market definition from the eyes of IT services providers. Analysts estimate that the revenue opportunities for firms providing sustainable technology services far exceed those associated with Green IT. The Verdantix study compares 15 of the largest global IT services firms, with combined revenues of $324bn, using 49 criteria. It concludes that companies currently have a high implementation rate in the areas of carbon and energy software, sustainability reporting IT systems and product lifecycle assessments. In addition, traditional building and data centr energy efficiency implementations remain important. In the future, Verdantix expects projects in the areas of climate change risk assessment IT systems, water management IT systems, utility smart grid IT system, renewable energy IT systems and intelligent transport IT systems to grow in importance.

Looking at corporate agendas and priorities, Green IT can be a game changer for CIOs. Green IT can get CIOs a place at the board room table. Compared to social goals, green IT metrics are currently the easiest one to measure. However, the opportunities are larger. The IT department sits at the core of making a company’s entire sustainability strategy measurable. By collaborating with other functions, such as facilities management, human resources, and travel, the IT department collects and analyzes the underlying data for a company’s sustainability strategy and measurement. IT executives can not only show how IT-led green initiatives contribute to the bottom line, they can also show how IT can measure and analyze the other hard-to-measure components of a company’s sustainability strategy.

In short, Green IT is and should be part of every company’s sustainability strategy. Sustainability goes beyond Green IT or increasing a company’s energy efficiency. Sustainability puts the spotlight on the IT department’s ability to track and measure every objective and component of a company’s sustainability strategy.

By Dennis Anderson, PhD

Guest contributors: Rogerio Panigassi, Katja Schroeder

References

¹ Mines, C. (2010): Green IT Adoption Is Driven by Business, Not Environmental, Considerations, Forrester Blogs, July 22, 2010

² Kraus, D./Mines, C./Green, C (2010): Capitalizing on the Sustainability Consulting Services Opportunity, Forrester, published October 2010.

³ This article uses the term sustainability as defined by Dennis Anderson: Sustainability is the continuing process of refining and extending the life cycle of products, services, or environment to stimulate social and economic growth without depleting resources.

⁴ Verdantix (2011): Green Quadrant: Sustainable Technology Services, published January 11, 2011.

About the writers:

Dennis Anderson, Ph.D. is Chairman and Professor of Management and Information Technology at St. Francis College, New York City (effective September 1, 2010). Prior to this appointment, he was a professor of information systems and associate dean at Pace University. He has also taught at NYU Courant Institute. He received his Ph.D. and M.Phil. from Columbia University and completed Harvard University’s Institute for Management and Leadership in Education Program. More information can be found at http://www.drdennisanderson.com.

Rogerio Panigassi is a program manager at Microsoft Server and Tools Online Division, working as the TechNet site manager responsible for the website’s learning content dedicated to develop IT professionals’ capabilities with Microsoft products. Having worked for ten years at the company, he experienced many different positions in services, marketing, evangelism, and engineering. He obtained his Masters in Electric Engineering title from the Polytechnic School of the University of Sao Paulo, Brazil in the field of Digital Systems, after getting an Electrical Engineering degree from Maua Engineering School, a university where he returned later and taught computer sciences for four years.

Katja Schroder is president of Expedition PR and vice president of the sustainability expert community NABU – Knowledge Transfer Beyond Boundaries. She has over 16 years of experience working with technology companies on globalization, innovation, and sustainability topics in the U.S., Europe, and Asia-Pacific. Ms. Schroeder holds both a Master in Information and Communication Sciences from Sorbonne in Paris, France, and a Master of Arts in Communication from Free University in Berlin, Germany. She is certified as a CSR practitioner (CSR-P) by the Centre for Sustainability and Excellence and the Institute of Environmental Management and Assessment (IEMA). Follow her thoughts on sustainability @schroek.