To quote Forrester’s CEO and Founder, George Colony, during his keynote at Forrester’s IT Forum EMEA event: “CEOs only care about two things: revenue growth and profitability.” How should we interpret this? CEOs do care about green if it is able to drive revenues, reduce costs and mitigate risks — all of which are essential ingredients in delivering long-term profits and shareholder value.
Evidence is mounting around CEOs' rising interest in corporate sustainability initiatives. For example, the United Nations Global Compact-Accenture CEO Survey 2010 published in June finds that 54% of CEOs globally view sustainability as “very important” to the future success of their businesses. And the Economist Intelligence Unit backs this up by finding that companies that rated their green efforts most highly over the past three years "saw annual average profit increases of 16% and share price growth of 45%, whereas those that ranked themselves worst reported growth of 7% and 12% respectively."
So does your CEO care about green IT?
Not without some convincing. And here’s why: While your CEO might care about green, they may not necessarily care about IT. As an indicator of this, Forrester found that only 16% of the world’s largest companies mention green IT in their annual reports. And as a result, CEOs are most likely unaware of IT’s role in enabling their company's green ambitions. The good news, however, is that IT is playing an increasingly central role in planning and executing companywide green strategies which will lead to C-level visibility.
[Scroll down to view Forrester’s "The Evolution Of Green IT" video… don’t worry, it’s only ~6 minutes.]
As a quick recap, part one of this video series walked through how corporations and governments are using green strategies to achieve their financial and political ends. From there, I gave a handful of examples around how green IT is helping leading organizations — like Sprint, AT&T, and Tesco — save $20m, $12m, and achieve a 17% reduction in fuel consumption, respectively.
So what can you expect in part two? In ~6:00 minutes, part two of this video series will discuss green IT's quickly expanding scope and approach. What do I mean by this? In short, green IT's scope is evolving beyond the data center into distributed IT and broader business operations. Forrester calls this the green IT 1.0 ("green for IT") and 2.0 ("IT for green") transition. Likewise, the approach to green IT is expanding beyond procuring more energy efficient equipment to also include software, services, people, and process. And the savings from these new approaches are impressive:
[Scroll down to view Forrester’s “The Evolution Of Green IT” video… don’t worry, it’s only 3:30 minutes.]
At Forrester, we’re always exploring new ways to connect with our clients and fit into their busy schedules. And as an analyst on Forrester’s IT Infrastructure & Operations (I&O) research team, I’m well aware of how time-pressed our clients can be. The I&O professional is oftentimes characterized as the “fire fighter” of the IT organization, dropping everything at any hour of the day to ensure their business’s critical IT infrastructure – from servers to PCs to mobile devices – is running without a hitch… and on-time and on-budget.
With that said, I’m particularly interested in “testing” out video to supplement my published research and my blogs on the Forrester.com website. To that end, below is part one of a two part video series on “The Evolution Of Green IT” – a topic I am increasingly receiving client inquiries on as organizations try to determine their green IT maturity and future trajectory.
The green IT track at Interop Las Vegas kicked off with a session from yours truly on “The Evolution Of Green IT: Projects That Cut Cost, Avoid Risk, And Grow Revenues” to help IT professionals plan for green IT’s current and future state, backed up with a number of real-life examples. Here are the key takeaways that I&O professionals should pay attention to:
Consider the following: AT&T expects to save $12 million per year and 123,000 tons of carbon emissions per year using 1E's PC power management software to turn off PCs at night. By turning up the temperature in the data center from 69°F to 74°F, KPMG realized a 12.7% reduction in cooling energy usage. And Citigroup expects to save $11 million and 3,000 tons of greenhouse gases annually by simply enabling duplex settings on printers and copiers.
How are they achieving this? Green IT. Even in the face of a weak economy, Green IT is on the rise with approximately 50% of organizations globally enacting or creating a green IT strategy plan. And don't be fooled: green IT is as much about the greenbacks as it is about reducing the environmental impact of operating IT and the business. In fact, financial motivation — not environmental motivation — is the driving force behind the pursuit of greener IT (see Forrester’s “Q&A: The Economics Of Green IT”).
But despite the optimism, IT “blowhards” across the globe are negating the carbon reduction benefits of green IT one breath at a time. While virtualizing servers or powering down your PCs will reduce energy spend and CO2 emissions, Forrester finds that these jabber mouths — speaking fast, loud, and out of turn using unnecessarily wordy vocabulary — are creating a zero sum game.
For the last two years Forrester has presented and most recently partnered with the Tech:Touchstone event management company that produces the Green IT 2009 Conference & Exhibition in London. Despite one year in passing and a challenging economic environment, green IT is still top of mind in 2009.
In many of my recent conversations with CIOs and IT infrastructure and ops professionals, I’m noticing an increasing interest in understanding how green IT will evolve.
Why do IT leaders want this vision? In the short-term, IT leaders want to ensure they’re not missing out any easy opportunities for savings they haven’t thought of yet. And over the long-term, IT leaders developing their green IT strategies want to strive for a broad scope of projects that reduce the environmental impacts — and of course costs — within and outside of IT.
“Was it an accident that Citibank, Iceland’s banks, and the ice banks of Antarctica all melted at the same time?”
“Was it an accident that Bear Sterns and the polar bears both faced extinction at the same time?”
In Friedman’s eyes, no, the recent economic and environmental woes are not accidental or coincidental. He explains that what the “great recession represents, if that what we can call this economic moment, is that both the market and Mother Nature hit wall at same time.” How? Because, according to Friedman, we’ve been using the same accounting system in both worlds that has massively under-priced risk, privatized gains, and socialized losses:
In the financial world, credit default swaps were sold without having adequate collateral behind them, gains were privatized to the financial institutions that sold them, and losses were socialized onto tax payers when the credits actually defaulted.
You've heard it once and you'll hear it again: You can't manage what you can't measure. This adage is relevant to any IT project — especially if you're getting serious about green IT. Forrester advises that before investing a single dollar, measure your green IT baseline — an annual estimate of the energy consumption, carbon dioxide (CO2) emissions, and financial costs of operating your IT within and outside of the data center.
With that in mind, I would like to introduce Forrester's online green IT baseline calculator — an intuitive, online tool to help IT professionals calculate their green IT baseline.
The tool walks you through the key green IT baseline assumptions, including the number of IT assets, energy draw, and hours of up-time. For additional accuracy, you can customize your price and CO2 emissions per kilowatt. The tool will then automatically calculate your green IT baseline for your review. From there, you can email the results to yourself for future reference (and you can also help guide our research agenda).