Is there a difference between a Green IT business case and a conventional one? And if so, what are the key factors in making a successful case for investment in a Green IT initiative?
Conventional business cases define the benefits of carrying out some kind of change. Typically, these changes are in-line with the organisation’s overall strategy that is already in place. Business cases in themselves don’t challenge the strategy – or if they do, they are usually rejected on exactly those grounds.
What makes the Green IT business case different is that it may not fit within the current strategy. In fact, it could represent a radical departure from it, especially if the organisation doesn’t already have a CSR policy and CSR initiatives. The Green IT business case in itself can be a catalyst for change – a transformational tactic in its own right. Why? Because ‘triple bottom line’ accounting comes into play.
Triple Bottom Line Accounting
Triple bottom line accounting is the practice of taking three different kinds of benefits into consideration – planet, people and profit – rather than just financial gain.
Be prepared to change the way that things have always been done if your organisation does not currently take the triple bottom line approach. There are other considerations than profit and this will be the most difficult part of the Green IT business case to sell. This is why we’ve previously discussed winning hearts and minds and aligning with CSR. If CSR is already in place, it will be easier to gain acceptance for the Green IT initiative. If not, prepare to do battle for hearts and minds.
Green IT Business Case Basics
Just because we are departing from the conventional, it doesn’t mean that the normal rules of business don’t apply. I would say that we have to be even more careful than normal to construct a rigorous and financially sound case. Here are the basics:
- Define the business goals clearly. It isn’t enough to say that you want to improve the reputation of the organisation (although that is an important consideration). Be specific about what you are trying to achieve in terms of people, planet and profits. Refer to the Green IT life cycle and show how each of its stages is a clear opportunity to improve the organisation
- Analyse costs. What is the current situation in terms of costs of delivering IT, including energy costs? This is about understanding exactly where we are today. Describe the costs of doing nothing, which may be financial, reputational or relate to competitiveness. Consider all of the same areas that you would when analysing benefits (see below)
- Develop KPIs. In order to be convincing, there must be a clear way to measure today’s situation and compare against the way things are when Green IT is implemented. You have to know what these measures are now, upfront. Designing Green IT measures is non-trivial. For example, in the data centre, will you use PUE or CUE, or both? Ensure that the KPIs cover all areas of the Green IT life cycle so that you consider manufacture, procurement, use and disposal.
- Analyse benefits. What will the future situation be? Use the KPIs you have defined to make this clear. This is also where to specify the very factors that make the Green IT business case different to conventional organisational changes. So you will want to explain all benefits of the Green Initiative, both tangible and intangible…
- Directly attributable financial savings at every step in the Green IT life cycle
- Higher profits and shareholder value
- Sustainability as a core value
- Higher staff morale as associates and executives take the initiatives to heart and see them as benefiting not just profits, but people and the planet
- More enthusiasm for innovative working practices including a ‘war on waste’, social and community engagement, and personal responsibility for reducing the carbon footprint
- Improved reputation and customer acquisition and retention
- A genuine reason to engage with social media channels to improve brand perception
- Improved use of IT to enable non-IT initiatives
- Improved use of IT to monitor and control energy consumption
Any thoughts on how to build the Green IT business case? Let us know!