Greening the Organization

I have been wanting to understand the journey many organizations have taken towards implementing sustainability initiatives. I happened to listen to Vijay Sethi, CIO, Hero Honda at a Green IT conference and thus began an interesting journey into the initiatives that he and Hero Honda have taken.

These are my notes.There is a buzz about Green IT today, in most corporate circles. But the question is: How does one convert the enormous potential of Green IT into tangible, measurable results. Many organizations, run on energy guzzling software and hardware and are loath to discard systems that run perfectly, “so what, if the energy bill is a bit high”.

The problem with that perspective is that it assumes “business as usual”. After 2008 there has been a fundamental shift in business, employee and consumer mindsets that states that corporations are public citizens. There are broadly 3 trends that are shaping the world around us:

  • The need to reduce carbon emissions
  • A faster pace of change in markets and consumer demands
  • Gen Y employees who demand flatter organizations and different perspectives

Green IT can play a significant role in helping corporations deal with the growing opportunities and challenges these trends bring. According to Vijay, who heads IT at the largest 2 wheeler manufacturer in the world, “What Green IT can do, depends on how you define Green IT within your own company. Green IT is not just about buying energy efficient hardware. Green IT is about using technology in innovative ways to impact how the entire organization and its eco systems function, help them reduce emissions, save energy and also bring in efficiency and solve problems”.

Take the glitzy marketing departments who are responsible for brand building, new product launches and loyalty programs. Can technology be used to reduce waste and resources? “Yes” says Vijay. “At Hero Honda, we have completely reworked our internal functioning to build around our sustainability focus. A good example is the change we were able to bring into our loyalty program. It used to consist of a 28 page booklet that was distributed to over 3 million members. These loyalty booklets had to be distributed physically across 800 locations in India and the even more difficult task was managing points and redemptions”. One day Vijay and the head of marketing were having coffee, when they started discussing, how could they possibly change the way the loyalty program functioned to build in sustainability and reduce wastage.

As a first step, they decided to completely automate the loyalty program. Today the loyalty program, named the Goodlife Program, functions through a magnetic strip card, online registration, points management and redemptions. Thus eliminating the millions of application forms, couriers and paper based loyalty booklets. According to internal estimates, the company has saved over 2000 trees from being converted into paper annually.

Many similar discussions with other departmental heads have led to process redesign and a fundamental shift in the way of functioning at Hero Honda. A similar conversation with the CFO of Hero Honda lead to the discovery that CFO was signing close to around 35,000 cheques a year. The CFO announced that he would not like to sign any cheques and would not like to see any paper payment advises. This led to most of the suppliers payments being done electronically – reducing the number of cheques being signed by more than 75 % .

What began as Green IT being a focus areas as a single line in the corporate IT policy, quickly gathered momentum, the Head of HR, Head of operations and Supply chain and other leaders also came up with ideas how IT can help their departments reduce paper or reduce travel.

Similarly a number of departments went on to a printouts reduction spree and came up with requests and suggestions for automating and creating workflows in the areas where Hero Honda had paper based documents flowing. The usage of Video conferencing also increased. Older hardware was given for recycling and new energy efficient hardware and other equipment brought in. The company also set up a new much more energy efficient datacentre and put in technologies like virtualization.

Almost all large manufacturing organizations today, are working towards building cleaner, greener products. However, many seem to be missing out on a key area – the ICT department. ICT is automatically considered to be ‘Green’ by many companies. Most are surprised to learn that efficiencies brought in by Green ICT practices can reduce carbon emissions and also help in many significant ways in improving the way the organisation deals with sustainability and emerging business trends. Using Green IT as a route to bring about internal change talks highly about Vijay’s people skills as well as his deep commitment to the environment. According to him, “Sustainability needs to be imbedded in everything you do and it has to be an organization wide effort – just the CIO or IT department can not do everything on their own”.

However, ‘this is only the beginning’ beams Vijay, with a big smile. He talks enthusiastically of how he wants to build on this momentum in the next few years, but this time instead of using the ‘Push’ based approach he used earlier he wants to use ‘Pull’ from the employees to make the organization greener and leaner. This is in keeping with the latest in management thought that is creating a buzz in business circles today – Employees First.

This post was originally posted on The Living Principles.

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