Selling green these days should be a slam dunk, right? Perhaps in theory but reality is painting a much different picture. Execs these days aren’t easily swayed into purchasing technology or services solely on the promise of ‘being greener.’ Despite the belief that this hesitancy is rooted in the economic climate, the inability to generate significant traction by highlighting environmental gains has more to do with message and approach than the willingness of prospective clients to advance their commitments to sustainability.
In the rush to brand everything green, too many are losing sight of what makes a value proposition compelling in the first place - namely the ability of a solution or service to generate significant financial and/or operational gains. Trade Wings’ President, Mark Portu, revealed the key to building a stronger business case for sustainability during a recent gathering of technology executives. Check out this short video of Mark’s closing remarks.
Last Wednesday the analysts at Heavy Reading hosted their Green Broadband Conference in NYC. Now in its third year, GBC is the redux of the Green Telecom Conference put on last spring by the same group. Most interesting to me was its singular focus on energy consumption. Listening to the speakers – ranging from corporate execs to network architects and heads of sustainability for the nation’s leading telcos and OEMs – the calculable wins involve using less power, using alternative power in far-flung regions (off the grid), and fleet fuel reduction via GPS technologies, hybrid vehicles, home garaging, etc.
In a moment of opening consensus among the panel members was recognition that in addition to the politics of it, perhaps the biggest challenge to achieving their sustainability goals, is the considerable cost of upgrading legacy network equipment to more energy-efficient devices. “The cost of new technology can make it very, very difficult to see the business case for green," they said. Naturally, my response to this would be the overwhelming need to look beyond just the device itself to find financial and environmental metrics that outpace the number of kilowatts consumed. Among all the impressive stats and creative thinking in the room that day, the term “supply chain” never came up.
In a second moment of overwhelming consensus, panel members vehemently disagreed with findings of a recent Heavy Reading survey that shows nearly 80% of respondents feel the current economy has stymied their sustainability initiatives. Even without allocated funds, execs from Verizon, Alcatel-Lucent and Comcast agreed that if there is payback – measurable ROI that drives shareholder value – sustainability, or any initiative for that matter, will get the “Green” light.
For any exec looking to tie these thoughts together, you might want to check out a practical reuse framework for your organization. One large client was able to reduce spend on capital equipment by $35 million in the first year, reduce electronics waste by 80%, and substantially lower CO2 output by limiting unnecessary shipping and other transportation costs.
During a recent call with the Director of Sustainability for a large global Telecom manufacturer, we mused the growing body of metrics employed by them to measure progress against corporate sustainability goals. As discussed and publicly documented in the company’s 2009 CSR, their sustainability efforts have focused in 3 areas:
Internal operations (supply chain, etc.)
Product/technologies
Corporate citizenship
Relative to the first, they have admittedly produced no large-scale monetization of carbon credits to date, but religiously conduct audits on $’s and kilowatts saved, and how their products are moved modally for example. (eg. air-to-alternative and carbon/ton-miles)
By way of introduction to these “modal" measurements, Carbonfund.org’s shipping calculator utilizes three user generated inputs to determine a unit called a ‘ton-mile’ (e.g. a ton of freight traveling 1 mile, or a half ton of freight traveling two miles, etc.):
Total number of shipments
Average Weight of Shipment (lbs)
Average Shipping Distance (mi)
From this information we determine the shipment(s) ‘ton-miles’. So if you have 50 shipments (A) of 100 lbs (B) each traveling an average distance of 500 miles(C), you multiply A*B*C, 50*100*500 to get 2,500,000 lbs-miles – to get to ton-miles, divide by 2204 to get 1,134.3 ton-miles. Once you have that figure, multiply it by the appropriate emissions factor depending on how you are shipping the package. So 1134.3 ton-miles being shipped by truck (0.3725 lbs CO2 per ton-mile) gives you a total emissions of 422.52 lbs CO2. Shipping Emissions Factors:*
Air cargo - 1.7739 lbs CO2 per Ton-Mile
Truck - 0.3725 lbs CO2 per Ton-Mile
Train - 0.2306 lbs CO2 per Ton-Mile
Sea freight - 0.0887 lbs CO2 per Ton-Mile
It always comes to down to math, but solving the equation requires unprecedented visibility into inventory data, such as product weights, and material flows from location to location. And ideally, you want choices. Such as the choice to ship a replacement/spare part from Amsterdam to Barcelona, instead of Dallas to Barcelona. Trade Wings offers this level of visibility, and we’re making a difference for our Telecom customers, including Ericsson and others who have been recognized year after year for their outstanding efforts to address issues of sustainability through asset intelligence.
As a result of his company's diligence, the Director of Sustainability of the aforementioned large, global Telecom OEM reported to us that they have reduced their carbon footprint by 13% (in carbon/ton-miles) year/year. He also left us with this observation: As customers become more sophisticated in their environmental commitment, business imperatives will drive innovation and 'sustainability' will become synonymous with 'strategy'...and those who don't get it will be left behind.
*The calculator provides an emissions metric for shipping by Zeppelin. I have omitted this from my list, but if prefer to know, give me a call on +1-603-766-7000.
We’ve been making the rounds in the industry analyst community, introducing many of the top firms to Trade Wings and our approach to extending the lifecycle of high-value assets. Reuse strategies may not yet be the focal point of published research but the response has been no less enthusiastic. Our perspective on the market and the value we’re able to bring to different client situations continues to be really well received.
One of the most popular discussion points to date has been sustainability. There’s a lot of interest in looking at the issue beyond efforts to simply reduce power consumption. Yesterday, for example, we had a great call with Gartner’s Bettina Tratz-Ryan and talked at length about the need for a more end-to-end approach to sustainability and ways in which companies can bridge the gap between the desire to be greener and the pressure to achieve financial metrics. As the notion of sustainable business practices becomes more entrenched within telecom companies, how well these two areas are addressed will go a long way toward determining the long-term impact of innovative programs and initiatives. To learn more about our take on sustainability and ecology management within the industry, be sure to check out this report.
Great to see Ericsson garner kudos for its various sustainability initiatives. Earlier this month, Greenpeace ranked the company no. 2 on its latest ‘Cool IT’ leader board, and yesterday came news that the company won further praise from the group in its latest CSR study. All this comes on top of Ericsson winning a 2010 Green 15 award from InfoWorld magazine. Check out their Green 15 press release here. Trade Wings is proud to have played a role in helping Ericsson make its global Hardware Support Services more efficient and eco-friendly. Click here to read the InfoWorld article.
Sustainable Sourcing: One Half of a Really Good Idea
I’d say there’s little doubt that environmental stewardship is climbing the ladder of corporate priorities. Within the Telecom industry, there’s much conversation taking place around reducing the energy consumption of network devices, driven by 15 founding members of the powerful Green Touch consortium, and supported in the messaging of prominent equipment manufacturers at last month’s Mobile World Congress.
At one of the conference sessions there, ‘Moving Toward a Sustainable Green Future,’ a global carrier outlined its own corporate responsibility strategy. One of the aspects of their approach was the innovative concept of ‘Sustainable Sourcing.’ In addition to traditional factors such as price and capabilities, this company has begun to incorporate sustainability into its equipment purchasing decision-making processes. I suspect that as time goes on, we’re going to see more and more of this, with companies placing greater emphasis on the ‘greenness’ of products and services.
As positive as greener sourcing is though, it’s really only half of the equation. No matter how energy efficient a piece of Telecom equipment is when it’s manufactured, at some point in time it will be decommissioned and a lack of visibility will make it susceptible to a reverse logistics process that could have it abandoned in a warehouse consuming energy, carted from one location to another without a plan, or worse – sent to a landfill.
As we continue to explore new ways to make the Telecom industry more eco-friendly, we need to recognize that aftermarket service and supply chains, if not managed properly, can undo a lot of the good work being done on the front-end of the development and manufacturing process. A well thought-out reuse strategy provides the level of visibility into internal stocks and the global market that can help ensure those green assets are put to their highest potential throughout their useful life, and when necessary, disposed of in an environmentally-friendly manner and in full compliance with WEEE.
