Business

A new IBM consulting offering can help clients lower their environmental impact, increase efficiency and reduce costs by applying Lean Six Sigma principles to energy and water usage throughout their operations.

"There's a fundamental truth to understanding and improving any aspect of a company's performance -- if you can't measure it, you can't manage it." said Dave Lubowe, global leader of IBM's operations strategy consulting practice. "This applies as much to a company's energy and water consumption as it does to anything else, and our new offering can help clients apply this principle to make their businesses greener."

IBM's Green Sigma(TM) consulting offering is based on Lean Six Sigma, a business strategy for carefully analyzing operations to improve overall efficiency, lower costs, increase quality, and add, change or eliminate activities and processes to improve overall performance.

This new offering applies these principles wherever energy and water are used throughout a client's operations -- transportation systems, datacenters and IT systems, manufacturing and distribution centers, office facilities, retail space, research and development sites, etc.

The constraints and costs of energy and water usage are rising at an accelerating rate, with a significant impact on business operations and financial performance. In addition, companies are coming under increasing pressure from governments, advocacy groups, investors, prospective employees, and consumers to make their operations, products and services more socially responsible, particularly regarding the environment.

IBM's own conservation efforts have saved 4.6 billion kWh of electricity and $310 million in costs, and avoided over three million metric tons of CO2 emissions since 1990. The company's work-at-home program for employees saves roughly eight million gallons of gasoline annually.

Click here to learn more about IBM's operations strategy consulting offerings.

High energy prices are making the cost of running a company's technology operations skyrocket. In a recent Forbes article, Bob Worrall, chief information officer at Sun Microsystems, offers some advice on making some top-to-bottom improvements to green data centers, and improve efficiency and cost effectiveness.

As he explains, "Sun has seen power savings of more than $1 million annually, and the company avoided $9 million in construction costs. At the same time, compute performance increased 450% while using 88% fewer rack positions. The numbers make the most compelling story. The total return on investment of greening the data center--both financially and environmentally--can no longer be ignored."

Forbes: "A Green Budget Line"

The World Business Council for Sustainable Development (WBCSD) has launched the Measuring Impact Framework to help companies measure and assess the impact of their business activities. The Framework is designed to help companies understand their contribution to society and use this understanding to inform their operational and long-term investment decisions and have better-informed conversations with stakeholders.

The Framework includes 3 components:

1) Business case for measuring impacts entitled “Beyond the bottom line”, highlighting the experience of several WBCSD member companies

2) Four-step methodology to identify, measure, assess and manage impacts

3) Excel-based user guide that helps companies carry out an assessment.

Measuring Impact Framework

North America looks to be moving to make up some of the lost ground in addressing greenhouse gas emissions in the region. A major step in addressing large final emitters (LFE) - namely cap and trade systems - look to be finally gaining momentum. Once implemented this has the potential to reduce a significant amount of the CO2 produced in North America.

While this is great, we wonder if there is a fundamental design flaw in regard to sourcing carbon credits. The Western Climate Initiative has proposed that credits must be sourced in Canada, America or Mexico (download Draft Recommendations). Due to regional political considerations, it is likely that other cap and trade systems in the continent will follow the same design.

Unlike the EU, cap and trade systems that are currently being proposed by governments across North America will not recognize credits from carbon reducing initiatives in China, India or other places that are producing a lot of carbon as they go through their industrial revolutions. As carbon doesn’t obey national or continental boundaries we wonder if only allowing North American LFEs to source carbon credits from North America is the right way to go. At the same time, last we checked we are producing a lot of carbon too, so what is the right way to go on this?

Adam Johnson is a Principal with the Earnscliffe Strategy Group, one of the oldest independent public policy strategy firms in Canada, and a leader in government affairs and strategic communications.