Dynamic Business

The New South Wales and Queensland State governments have also taken action, introducing green policies and requirements for government department purchases of IT services. In New South Wales, hardware procurements require certification that they will be disposed of sensitively, whilst in Queensland, departments may only purchase from approved suppliers who have proved that both the supply and disposal of their products conform to particular green standards.

Businesses and Industry Response
So what response have we seen from industry? Both consumer businesses and the ICT industry have reacted to global environmental concerns, and have introduced strategies to reduce their carbon footprints and power bills.

Corporate Australia has recognised the potential cost savings. The Australia and New Zealand Banking Group (ANZ) estimates that 40-50 percent of its power consumption is directly related to its ICT infrastructure. By simply banning the use of screensavers in the office, ANZ was able to reduce its energy consumption by 4 percent and save $500,000 in electricity costs.

In addition to cutting energy consumption through company policy, the environmental concerns of businesses are now also flowing through into contracts. Purchasers of IT services are increasingly including “green” standards in their vendor selection process. A survey conducted revealed that 18 percent of companies considered the “greenness” of their vendors a valid selection criteria, and 30 percent expect it to become a factor in the future.

One of the more nimble telco companies in Australia, Macquarie Telecom has comprehensively embraced “green” technologies.  It recently awarded a major ICT contract to Sun Microsystems, passing over its incumbent supplier on the basis that Sun had better environmental credentials and would therefore help Macquarie to reduce its carbon emissions and power usage. 95 percent of the components in Sun’s products can be recycled, re-used or re-manufactured and steps have been taken to remove hazardous substances by replacing PVC components with steel or aluminium.

Many ICT providers have become involved in consortiums such as “Green Grid” and the “Climate Savers Computer Initiative” which aim to develop energy efficiency standards and metrics for the industry. At an operational level, a number of ICT vendors including Apple, Dell, HP, IBM and Sun Microsystems have all developed more energy efficient ICT products and services, and are branding their organisations as environmentally friendly. These vendors are focussing on enhancements to their product offerings in relation to cooling techniques, energy efficiency, recycling and green manufacturing.

New eco friendly technologies are diverse, and include:

• server virtualisation and thin client technologies;
• power management applications;
• more efficient server configurations and hardware;
• improved cooling systems for servers (especially in data centres); and
• the replacement of traditional telephone systems with IP phones.

Environmentally Friendly ICT Purchasing and Procurement
The shift in the ICT market towards environmentally friendly products and services is already having a significant impact on customer ICT procurement behaviour. Vendors who can demonstrate eco-friendly ICT solutions that respond to customer environmental concerns will win the business.

The move to more eco friendly technologies and tougher economic times present SMEs with a real opportunity to reduce technology spend whilst maintaining performance and capability. Whether customer or supplier there is no avoiding the green spotlight any more. As eco-friendly contracting becomes the norm, customers will vote with their feet. As an SME are you confident that you have the expertise to maximise your organisation’s ability to take advantage of an environmentally aware ICT market? Make sure you are not left behind!

—Dudley Kneller is a Partner with law firm Middletons (www.middletons.com). He specialises in information technology and outsourcing and has recently advised a number of clients on their green ICT contracting requirements.