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Green IT strategy has nebulous ROI. So why bother?

By | November 16, 2009, 1:53pm PST

Summary: Computer Economics research shows only half of companies are reporting a positive ROI from Green IT initiatives.

Research firm Computer Economics has published a report indicating that the return on investment (ROI) for “Green IT” initiatives continues to hard to pin down.

According to the research firm’s survey of more than 200 IT organizations, slightly less than half (47 percent) are reporting a positive ROI within a two-year time period. Another 30 percent said their Green IT efforts broke even, while 23 percent reported a negative ROI. The results are published in a report called “Green IT Taking Root Despite Uncertain Payback.”

Oh-uh. So you may be wondering why your organization should bother. After all, if you can’t prove a return on investment, chances are you’re not going to do it.

Actually, another reality check is definitely in order: The survey ALSO shows that total cost of ownership (TCO) actually fell in line with the expectations of 70 percent of those surveyed, which means at least Green IT projects are reasonably predictable.

Of the folks surveyed by Computer Economics, 24 percent are already managing a Green IT strategy and 32 percent are considering adopting a policy in the coming months. As you might expect, the largest companies surveyed were mostly likely to have a Green IT policy in place. BUT small organizations (those with annual revenue of less than $350 million) were more likely to have a Green IT strategy than midsize companies ($350 million to $1 billion in size). Not surprisingly, small and large organizations were more likely to report a positive ROI for their Green IT efforts.

I would argue that pretty much every Green IT strategy demonstrates positive ROI, when you take into account things outside the actual IT budget, like shareholder value and overall corporate sustainability strategy. Or you factor in energy costs savings. It just takes a broader vision.

Here’s a link to the executive summary for the report. There’s also information at this site in case you want to purchase the whole thing.

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Topics

Heather Clancy is an award-winning business journalist with a passion for green technology and corporate sustainability issues.

Disclosure

Heather Clancy

Writing publicly about what the high-tech industry is actually doing to help itself and the world get greener or more sustainable is one way I figure I can contribute more meaningfully to said effort. I am also a big OMG-kind-of-fan of smart leadership, which is why the goodly folks who publish this blog let me go on about this topic and why I am always on the hunt for forward-looking business management ideas.

My daily writing is focused on looking for topics for my blogs, GreenTech Pastures and Business Brains. I also write often about emerging technology trends such as mobile computing, unified communications and cloud computing. Occasionally, I will pop up at an industry conference in some sort of speaking capacity. In cases where a speaking engagement involves a sponsor that may be covered in this blog, that fact will be disclosed in coverage as appropriate.

My corporate writing work usually consists of crafting research white papers about some aspect of technology. In the event that my commentary (in written, audio or video form) mentions a company for which I have provided consulting advice, I will disclose that fact. However, there is no connection between these projects and the topics that I am covering in my blog.

Biography

Heather Clancy

Heather Clancy is an award-winning business journalist with a passion for green technology and corporate sustainability issues. Her articles have appeared in Entrepreneur, Fortune Small Business, The International Herald Tribune and The New York Times. In a past corporate life, Heather was editor of Computer Reseller News, where she was a featured speaker about everything from software as a service to IT security to mobile computing.

Heather started her journalism life as a business writer with United Press International in New York. She holds a B.A. in English literature from McGill University in Montreal, Quebec, and has a thing for Lewis Carroll.

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RE: Green IT strategy has nebulous ROI. So why bother?
mshoer@... 16th Nov 2009
Interesting stuff Heather, thanks for posting it. I agree with some of the findings and your feeling that even in small organizations, like my clients, there is return, though it may not be directly quantifiabe to the budget. Green IT is here to stay. Whether it will map to hard dollars is another story. Is it the right thing to aim for, of course it is.
0 Votes
+ -
I wouldn't bother either, it's embarrassing
Richard Flude 16th Nov 2009
Finally the smoke screen is beginning to clear:

"An internal document from the National Grid, seen by the Sunday
Express, says wind turbine energy will at times cost over 3,000 per cent
more than conventional power."
http://www.express.co.uk/posts/view/140456/-250bn-The-real-cost-
of-wind-power

In the real world, not the world inhabited by eco fantasies, this cost must
be paid for by someone.
0 Votes
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Good info. tnx.
CounterEthicsCommissioner-23034636492738337469105860790963 16th Nov 2009
nt
0 Votes
+ -
That is great we can do without!
Use_More_OIL_NOW 16th Nov 2009
Barry Sorento wants his peasants to do
without A/C, Cars/trucks, and OIL!

This sounds like his DREAM!
Interesting stuff Heather, thanks for posting it. I agree with some of the findings and your feeling that even in small organizations, like my clients, there is return, though it may not be directly quantifiabe to the budget. Green IT is here to stay. Whether it will map to hard dollars is another story. Is it the right thing to aim for, of course it is.

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