Information Systems for Environmental Sustainability

IT, Resource Productivity, Environmental Preservation, and the Fourth Industrial Revolution

ROI of Carbon Management System

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Verdantix has a simple summary of the NPV of carbon management software implementation (see below), indicating a payback period of just under 1 year. Considering the immense challenges that organizations faced when implementing similar types of enterprise-wide software systems in the past, it’s difficult to say how believable these figures are. A few questions that come to mind include:

  • How were the time-savings figures computed? What do they include? What “baseline” times were used? 
  • How were the implementation cost figures computed? What do they include (software, customization, training, tying to existing data flows, inputting baseline figures existing in baseline systems like Excel, maintenance, etc.??).
  • What are the confidence intervals of these numbers? What reasonable factors may drive them higher or lower? What is the sensitivity of these figures to modeling assumptions?
  • What risk factors were or were not included?
  • Do costs and savings disappear after 2012?

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Author: nigelpm

Associate Professor of Information Systems, Stephen M. Ross School of Business, University of Michigan - Helping organizations to navigate digital transformation.

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