When flying through heavy turbulence into a green fog you need good instrumentation
Dave Waltho, Head of Government Affairs, SAS UK
The roots of the current financial crisis lie in the inability of some major, multinational organisations to make evidence based risk:benefit decisions, and to therefore align resources and incentives with sustainable strategic goals.
Indeed, it is not uncommon in our dealings with private sector organisations for SAS Business Intelligence and Analytics solutions to uncover that c20% of an organisation's customers are destroying c400% of their profit. However, because more than half of executives agree that they do not fully understand what drives their profit, many have been making decisions - such as investing scarce resources in and incentivising staff on high response rates from marketing campaigns to those same or similar customers - that are in fact accelerating the death of the company.
Reminding myself of this helps me to assess these research results in Green IT through a half full rather than half empty lens. If global organisations are even now managing such fundamental and long standing KPIs as profit by using gut feel and/or bad data, then it is no surprise that many Local Authorities admit that they are currently struggling to integrate, measure and prioritise the impacts of new, and harder to pin down, KPIs such as green.
Our global research shows that the majority of larger organisations across all sectors have also identified environmental issues as a key strategic issue - if only because of the increasing demand from all of their external stakeholders. But few have successfully embedded this in their strategies, corporate and business unit performance management frameworks and 'business-as-usual' operations. Fewer still really understand how to benchmark, measure and track progress and prioritise what they should do next.
Certainly it has to be highly encouraging to find that, not only do almost all councils acknowledge that green issues are vital to their wider organisational strategy, but also that nearly 70% see it as their role to act as a champion and provide a lead locally in environmental responsibility and awareness.
Furthermore, it makes absolute sense that many have started by putting a green veneer on existing cost saving initiatives. Best practice suggests that a phased approach, starting with the more obvious lower hanging fruit, is a great way of getting quick wins and generating internal momentum and buy in.
Nevertheless other parts of the research indicate that the commitment to green among many councils is built on fragile foundations. The fact that, in the short time since the research was completed and the financial crisis has worsened, some councils have already reported that green has become an 'unaffordable luxury' supports this more pessimistic perspective. For some councils at least, it seems that green was not even momentarily this seasons 'new black' but merely an even faster passing fad among accessories!
To some extent this apparent fickleness is surprising because 91% of councils identify that embedding green into corporate strategy is the biggest enabler - and 60% claim to have done this. A similar majority say that green is regarded, and indeed communicated, as complementary to other key goals such as 'Place shaping', Transformation and Gershon.
Nevertheless, other responses point to the shaky foundations and more of a 'zero sum' mentality - not least the 93% who say that insufficient budget and resources are the key barrier to greening the organisation. Perhaps of most concern is that over 50% say they are tracking green performance, but a higher proportion then admit that they do not understand the green impacts of either their current working practices or their future plans and few are using one of the established carbon accounting protocols.
This suggests that many are essentially 'flying blind' - unclear on both where they took off from and where they are headed; with no information on fuel levels, and no instrumentation or radar to steer them through the turbulence.
To make matters worse, few seem to have their qualified pilots on board! The limited involvement of both Heads of Finance and Heads of IT in the greening of councils technology estate surprised all who have been involved in commissioning and reviewing this survey. The research underlines that the latter do have a clear responsibility for leading the greening of the IT department but that they are largely missing the opportunity to make a bigger impact by evangelising how IT can help green the rest of the organisation. In contrast, it seems that Heads of Finance are almost entirely failing to engage - not even being involved in the measuring, monitoring, analysis and performance of green initiatives.
Until the strong relationship between carbon emissions and pounds - and the importance of accounting for both - is understood, then 'green' initiatives will always be the first to be jettisoned when councils hit turbulence and fuel runs low and choices between alternative routes through the storm will have to be made on gut feel.
With the long range forecast indicating that the regulatory and moral pressures on councils to not only do more with less but achieve and be transparent about their green credentials will only grow, the prospects for a crash landing for many would seem to be high.
From our experience of deploying integrated 'instrumentation and radar' in the private sector, SAS knows that the right information can make organisations both more fuel efficient and better at piloting a successful course through financial storms. Our 'IT Intelligence' solutions not only enable the 'greening of IT' but also generate many £ms in quick win savings - at the same time as reducing contingency risk. Indeed, we are so confident of these capabilities that we often enter risk:reward arrangements.
However, identifying and reaching the bulk of the fruit that is above the easy pickings line requires a more holistic approach. Investing a small proportion of the 'Green IT' savings in solutions such as SAS 'Sustainability Performance Management' - which includes carbon footprint modelling, 'what if' scenario analysis and simple and consistent reporting - enables a balanced view across economic, social and environmental issues and shows where you can be both 'green' and 'lean' going forward.
Evidence based decisions between alternative routes can then generate much larger financial and carbon savings both across the organisation as a whole (IT generally represents 2% of emissions) and also within its value chain.
The alternative is to fly by the seat of your pants. But, as the 'profit blind' private sector executives found, taking that approach in turbulent economic weather can result in lost bearings and decision making that may not only hasten the organisation's demise but also, in the case of green issues, that of the rest of the planet.