Indian SMEs lead Investment in Energy Efficient IT

by CXOtoday Staff    May 18, 2009

According to a global study jointly released by IBM and InfoTech Research Group., even in a very difficult economic environment, Indian small and medium enterprises (SMEs) are eager to actively invest in initiatives that reduce the environmental impact of their information technology.

The study is based on a survey of more than 1,000 information technology executives at  companies with between 100 and 1,000 employees across industries and in a dozen countries including the India, United States, Canada, France, Germany and the United Kingdom.

The findings show that more than 55% of Indian companies are going to, or have already  commissioned  third-party  environmental audits, purchased emission credits, or have made improvements in their supply chain efficiency to reduce energy consumption. 63% of Indian IT enterprises have completed a retrofit of existing server rooms to increase
energy efficiency, or have a pilot project underway.

Almost two-thirds of all companies globally are currently, or are planning within the next 12 months, to add virtualization technology to their servers, consolidate storage systems, or retrofit their server rooms.

Businesses around the world have discovered that going green isn t just good for  the  planet;  it s good for their  bottom line, said Ramesh Narasimhan, director, General  Business, IBM India/South Asia. Green IT strategies are leading to savings in operational expenditure; lower space and power and higher ROI.  The findings in this report highlight how mid-size companies are realizing significant cost savings when they adopt Green IT initiatives.

Significantly, there are compelling business benefits associated with going green and reducing the negative impact on the environment is a welcome addition. The driving factor pushing companies to adopt Green IT to reduce their costs while reducing the negative impact on the environment is an obvious additional benefit.

The study found companies typically fall into one of four IT personalities; green advocates, smart spenders, green observers and green seekers. Green advocates, companies that integrate environmental considerations into all areas of their business, makes up about 25% of the companies surveyed.  Smart spenders make up 38% of the survey group and are defined as SMBs willing to make upfront investments to achieve a long-term cost  reduction. Green observers, who make up 30% of the survey group, do not have specific environmental goals and need management support for initiatives to improve energy efficiency. Green seekers, at 7%, are interested in adopting energy efficient technology but are unsure of where to start and how to quantify results.

Saving electricity requires the measurement of IT electrical consumption, something many companies cannot do.  However, the survey finds that more than 50% of companies have implemented some form of energy measurement for their information technology infrastructure, and about one-quarter plan to do so in the year ahead.

About 60% of the total respondents weigh the importance placed on business benefits against environmental benefits, suggesting that IT initiatives to help improve energy efficiency must yield financial returns in order to get the green light.

Countries with some of the highest fuel prices in the world have not, up to this  point, turned to remote conferencing and telecommuting initiatives to reduce both cost and energy consumption. The survey found while 50 to 60% of Indian, Brazilian, North American and British businesses are up and running  with telecommuting and virtual  conferencing capabilities, Germany,  France, and,  to a lesser extent, the Nordic countries have been slower  to adopt these technologies.  Initiatives intended to reduce travel are clearly  receiving the most attention from geographically big countries over the  next 12 months. From Brazil to Canada, more than 30% of businesses will aggressively pursue remote conferencing and telecommuting strategies.

Virtualization is also being perceived as a major step in help achieving energy efficient  business  operation. The rate of server virtualization across most regions (with an average implementation rate of 48%) is evidence that initiatives with a business case comprised of clear cost savings and environmental benefits will win first. For new initiatives to gain acceptance from stakeholders who may be skeptical, a clear case for cost containment, savings or other business benefits must be made first Data indicates that IT equipment  recycling has shown good progress. Overall, 56%of the companies surveyed have either completed or are implementing outdated hardware recycling programs.  Approximately 23% of IT departments report plans to adopt IT equipment recycling and energy  measurement  practices within the next 12 months. 65% of all implementations, the  study  found  organizations initial goals for these projects are met or exceeded.

The Indian marketplace boasts of more than 35 million small and medium businesses and is now competing globally. They will need to gain a competitive edge to win amidst global competition and technology provides them this edge. IBM offers services, research, hardware and software specifically tailored for the SME market in India that can help midsize companies to be both greener and leaner.

Related Links: Efficient Datacenters Through Green IT 
                       Go Green- But Are CIOs Aware?