At the upcoming International Conference on Information Systems, Daniel Rush will be presenting new research empirically examining the association between enterprise information systems capabilities and greenhouse gas emissions in large organizations. The research, co-authored with myself, Ron Ramirez, and Kevin Kobelsky, suggests that IS capabilities may be a critical enabler of achieving corporate sustainability goals. The program session is Tuesday from 3:00 – 3:30 pm. in the Convention Center. Drop by to hear more from Dan!
[Full disclosure: I’ve worked with CDP over the years and have used its data for research purposes.]
Reviewing CDP’s latest information request, I’m struck by the lack of questions about the digital systems companies use to capture, store, analyze, and report the data requested by CDP.
Why is this important?
Reason #1: Data quality
The quality of these systems affects the quality of the information reported. For example, a dedicated cloud-based system with real-time access to the latest emission factors has clear advantages over an in-house developed spreadsheet. Yet CDP provides zero insight into the quality of foundational information systems used by respondents.
Reason #2: Complexity
Investing in and implementing the right information system to fit organizational objectives is non-trivial, evidenced by the high failure rate of IS projects.
Reason #3: Governance
Information systems are typically governed by information systems personnel, or jointly by IS and a particular business function. My own research reveals that for energy and carbon IS, facilities and sustainability experts are leading the charge. Is this optimal? Who should manage these systems? What sorts of governance structures might mitigate risk and ensure robust systems over time?
Reason #4: Regulatory Compliance
In many areas of the world, binding regulations are in place regarding corporate reporting of carbon emissions. It would make sense for investors (and other interested stakeholders) to have some transparency into the information systems (technologies, processes, and people) that produce these numbers. Moreover, one can foresee an audit function analogous to that for accounting information systems used for financial reporting (source):
Bottom line: Either CDP and other third-party data platforms need to request data about information systems used for carbon emissions management, or, we need a robust carbon accounting IS audit function to assure the validity of processes, technologies, and human work practices used to report carbon emissions. Otherwise, doubts about data veracity will likely persist and hamper the positive efforts of reporting firms and data collection agencies.
Accenture’s use of a digital platform for speed, scale, and efficiency.
In mid/late-2000s (when I started this blog), the role of digital information systems seemed to be an afterthought in the corporate environmental sustainability conversation (no sources to back this up: just based on my own observations. exception: Peter Graf at SAP). It’s one of the reasons I started this blog.
Digitization transformed organizations and enhanced corporate financial performance in decades past (and continues to do so). Likewise, digital systems enhance/transform corporate environmental performance (reduce carbon emissions, raise energy productivity, enhance water stewardship, etc.). Mainstream corporate sustainability appears to be waking up to this enormous opportunity.
The IIRC emphasizes the systems nature of digital information systems: “The IT strategy should extend beyond hardware and software considerations alone to identify the role of emerging applications, establish related policies and align technology-related decisions to strategy”
But there’s a long way to go…
Using digital information systems to transform environmental sustainability practices within organizations is complex and risky, involving people, processes, and technologies. Research is needed to inform salient questions, such as:
- Who should lead such strategic initiatives?
- Where to begin?
- Which specific technologies are most effective in which contexts?
- How to determine ROI of such initiatives?
- How to bridge the culture gap between industrial ecologists/facilities and IT personnel?
As usual, more questions than answers.
The Internet of Things, or IoT for short, refers to a network of physical devices connected via sensors with data and intelligence capabilities. In a way, it’s merely an extension of the Internet of computers to an Internet of physical things like trains, people, and wind turbines. For example, the network may look like a wind farm in which one turbine senses a change in wind direction, alters its blade pitch to optimize efficiency, and tells the other turbines to do so.
The basic ideas have been around for some time, but recent advances in storage, communication, and processing have enabled the vision to become a reality.
One implementation of the IoT is by GE, which refers to its IoT as the “Industrial Internet”. GE is developing a platform that allows developers from any company to quickly develop apps to power their own equipment and leverage GEs infrastructure of storage, processing, etc.
In the energy domain, C3 has just announced its own Internet of Things platform called Cyberphysix. According to the email I received this morning, this is a “platform for deploying industrial-scale cyber physical applications for the energy industry” that “offers [an] integrated suite of services for developers to rapidly develop and deploy IoT applications in an open, scalable, secure environment.” C3 says that Cyberphysix is used now at “numerous” large global companies. An example is Enel:
“Enel, the largest power company in Italy and the second largest in the world, is deploying C3 Energy Smart Grid Analytics solutions as its software platform for enabling Enel smart grid and smart city services. The rollout of C3 Energy Smart Grid solutions across 44 million meters in Italy and Spain will be the largest software‐as‐a‐service (SaaS) smart grid applications deployment in the world with the potential to deliver €15 per meter in annual economic benefit.
So what does this mean for the future of energy management? It’s hard to say at this early stage, but a few things are clear:
- As predicted years ago, energy is being transformed by digital technologies, leading to new business models and potentially enabling a new wave of energy efficiency, deployment of renewables, and reduced GHG emissions.
- The future energy management leader knows as much about PAAS, IoT, cloud, and BI as she does about kWh, line voltage, and FERC regulations.
- There will be platform competition and a potential winner take all market (see iTunes).
It will be interesting to see how these platforms evolve as their success will depend to some extent on how many members join and succeed.
Nick Robins, head of the Climate Change Centre of Excellence at HSBC, discusses benefits, costs and risks of a transition to a low-carbon economy last September at the Stockholm meeting of the Global Challenges Foundation.
Nick calls this “disruptive change” and describes a “digital networks” wave of disruption giving way to a “climate business” wave of disruption. I would agree, though I think the interesting opportunities lie in the transition from digital networks to climate business.
The keynote speaker of the annual HICSS conference, happening now, is Shwetak Patel, director of the Ubicomp lab at UW and Green IT innovator. Shwetak is reviewing many of the problems I’ve talked about in this blog, in particular, poor information on energy and water use in the home. One angle on this is “Single sensors,” which use machine learning to back out which appliances are drawing which currents.
The choice of Shwetak to address the entire conference in this keynote session underscores the importance of the role of IT in enabling and transforming environmental sustainability, energy reductions, and so forth. The conversation that a few of us began years ago finally appears to be gaining mainstream acceptance. Well done to the conference organizers for making this insightful choice.