Why Sustainability is Good Business – and How Good Data Can Get You There

An interesting shift is taking place with respect to the issue of sustainability: a growing number of companies are recognizing that a strong sustainability program is good business. There’s sound logic for the shift, too – it’s because the tools now exist to prove it. Early discussions about sustainability focused mostly on “green” technologies or energy efficiency. Early adopters often were companies that thought that sustainability served as table stakes for their business, something they were willing to do even if it cost them money. Think Patagonia or Seventh Generation. Now sustainability has evolved to the point where, if it’s not mainstream, it’s certainly a pragmatic and effective way to reduce costs and improve business performance. If companies prioritize sustainability initiatives correctly, perhaps focusing first on low-cost or no-cost initiatives, they can demonstrate results that pave the way for larger efforts. Soon, sustainability becomes an enterprise-wide initiative – and it becomes everyone’s’ idea. In many companies, sustainability has become the Total Quality Management replacement of the 21st century – what I’ve heard referred to as Six Sigma with a heart. It benefits the environment, reduces greenhouse gases, and conserves water and other resources – all while benefiting a company’s bottom line. What’s not to like? What has really made sustainability resonate with corporate executives is the ability to overlay data from sustainability efforts with relevant business performance information. If you can compare the amount of electricity your company uses to the number of products it manufactures or number of customers in your stores, for example, it helps bring the issue to life in a way business teams understand and embrace.  And when you can measure it, you can actually do something about it – and ultimately relate the impact back to the company’s bottom line. Similarly, tools now exist to enable companies to benchmark their environmental efforts against their own historical performance or those of other similar companies. In so doing, you can identify outliers, the areas where your performance is significantly out of whack with the norm. Schneider Electric’s Resource Advisor, a software-as-a-service offering, will also show you how much you can save by addressing those outliers. I recently participated in a webinar where I used the example of one company that uncovered about 18 million kilowatt-hours of electricity savings potential by simply addressing its outliers. That translated to almost $2 million in electricity and associated costs – the kind of savings that most definitely garner attention from the upper echelon of any organization. Another example I used in the webinar is The Blackstone Group, a high-performance private equity firm that is among industry leaders in improving the financial performance of the companies in its portfolio. One of the ways it does that is by using Resource Advisor to help achieve financial savings with respect to energy. Blackstone benchmarks each of the companies in its portfolio and uses the resulting data to prioritize sustainability efforts. Resource Advisor is a great tool for such efforts because it can be used in each individual company and the results can roll up to a centralized version that Don Anderson, Blackstone’s chief sustainability officer, uses to get a view of the whole picture – a model that can be used in any large enterprise. When we asked Don why he chose Resource Advisor over the myriad of available options, he said, “It was the combination of portfolio-oriented diagnostics and project management tools, which are perfect for organizing and prioritizing both disparate and interconnected elements of an effective sustainability program.”  He went on to say it helps him prioritize his efforts to generate the greatest financial savings – no surprise coming from the global sustainability leader for one of the world’s greatest financial management companies. To learn more about the kind of savings you can achieve from sustainability efforts, and how tools like Resource Advisor, built on Windows Azure, can help, check out the webinar “From Sustainability Strategy to Project Implementation: How Technology Can Get You There.”  I’m joined by Kathryn Wilson, Director, Cities Solutions at Microsoft, our Global Alliance and EcoStruxure Technology Partner in sustainability efforts. I think it’ll be an hour well spent.

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