Green IT payback a must for midmarket CIOs

Haworth Inc., a furniture maker in Holland, Mich., is in the middle of rebuilding its corporate headquarters. The project employs such green IT design principles as desktop videoconferencing, Voice over Internet Protocol, virtualization and centralized printing.

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While all the changes have positive environmental impacts, there's also a compelling cost savings. The new phone system, for example, saves the company almost a quarter of a million dollars. And server virtualization means that 14 servers can run 162 virtual servers, saving $400,000, reducing the power load by 118 kilowatts and heat output by almost half, and lowering air conditioning costs as well.

"Building from the ground up gave me a great opportunity," CIO Ann Harten said. "We make our decisions on the basis of 'Is it sustainable and economically feasible?' Some sustainable options are not economical. But for the most part we find they make good partners."

Haworth isn't alone. Last October, for example, Forrester Research Inc. in Cambridge, Mass., surveyed 140 IT professionals and found that 38% were using environmental criteria in their evaluation and selection of IT equipment, up from 25% six months earlier. While only 15% said that they have an overall plan for implementing green IT programs, 25% were in the process of creating a plan, and another 39% were considering it.

Making IT more efficient is good for both the environment and the bottom line. In many midsized firms, IT represents up to 10% of overall energy consumption. According to the Environmental Protection Agency, U.S. data centers eat up 1.5% of total U.S. electricity.

Sustainability is an area where a CIO can be a real leader, Forrester analyst Christopher Mines said. He suggests that CIOs take the initiative to put together a green IT plan that combines cost savings and environmental action.

"I encourage CIOs to be proactive," Mines said. "Don't wait for that knock on the door from the CFO. Create a plan and take it upstairs. The first chapter is we can save some money. The payback period is pretty short. Hard-dollar ROI is gained in the near term. I like to think of IT leading. Not only taking responsibility for its own actions but acting as an enabler for the whole company."

Mines said CIOs need to partner with facility managers, who are often rivals for resources, so the two domains can share in the costs and rewards.

"It's amazing to me how separate those two organizations -- IT and facilities -- are," he said. "That's a crucial link."

For most CIOs, however, it still comes down to costs.

"We don't do it because it's green, but if it winds up being green that's fine," said David E. Mannering, CIO at Lincoln Electric System, a utility in Lincoln, Neb., that has adopted server virtualization.

We don't do it because it's green, but if it winds up being green that's fine.

David E. Mannering, CIO, Lincoln Electric System

"We used to have computers sitting under people's desks as test servers," he says. "We got rid of all of that. It's also better for disaster recovery. Those are the main reasons for virtualization. The green reason is just a nice tagalong."

At Haworth, where the first half of the building project was completed in February, the company publishes a yearly sustainability report that outlines its goals and progress. This year it began benchmarking its environmental impact against best-of-class enterprises.

"We've been talking about sustainability for quite a while," Harten said. "The sustainable story started at the top, but people very quickly took to it and embraced it. Now many ideas come from members. It's a journey."

Range Fuels Inc., an ethanol company in Broomfield, Colo., is breaking ground on a data center and looking to make it as green -- which is to say, as efficient -- as possible, said director of IT Joe Thielen.

"Every purchase we look at, we ask, 'Is there a better green option?'" he said. "If you're looking at two switches, it's not always clear which one uses less power. It would be nice if there were a rating like with appliances. We've called Cisco and HP to get more information. The vendors aren't quite there yet. We're at their mercy."

Server virtualization and buying only flat-panel monitors (which use up to half as much power as CRTs) are two early steps. And, of course, recycling.

"We have big recycling bins and tiny garbage cans," he says. "We hardly throw away anything."

Michael Ybarra is a monthly columnist for SearchCIO-Midmarket.com and a former senior writer at CIO Decisions magazine. He is also the author of Washington Gone Crazy. Write to him at editor@searchcio-midmarket.com.

This was first published in March 2008

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