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SAP’s Sustainability announcements at Sapphire Now

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SAP co-CEO Jim Hagemann Snabe at Sapphire Now 2012

SAP co-CEO Jim Hagemann Snabe at Sapphire Now 2012

Technology innovation plays a major part in creating a sustainable world tomorrow

So said SAP co-CEO Jim Hagemann Snabe at this year’s SAP Sapphire Now conference in Orlando. He then went on to predict three major trends in computing for the coming years – according to Jim, in the next five years everything will move to Cloud, everything will be in main memory and everything will be mobile.

This wasn’t just some off-the-cuff remark – these three developments are core to SAP’s product roadmap – even in the Sustainability space.

In the mobile space for example, at Sapphire Now SAP announced a new version of a mobile app for incident management. With this app, workers can now log issues from their mobile device with a photo or video, as well as an audio recording, and send it directly to an incident or safety manager for corrective action. This crowd-sourcing of safety information also has built-in tracking of the reported incident which is hugely empowering for workers who may previously have felt their voice wasn’t heard. And for the companies deploying this solution it leads to a safer work environment and a happier workforce.

This puts me in mind of an initiative IBM rolled out with the Los Angeles Unified School District (LAUSD) where they enabled students, teachers and staff to report issues like water leaks, broken aircon/heating, exposed cables and so on, by sending text messages and photos through their mobile phones. More please.

Also in the mobile sustainability space, SAP have their Electronic Medical Record app [SilverLight warning] – an app which gives doctors instant access to a patient’s electronic medical records.

In the Cloud space, SAP have made two major recent acquisitions – Successfactors and more recently Ariba at a cost of roughly $7.7bn. This is a clear indicator that while SAP maybe late to the party, it is serious about catching up.

And in the Sustainability space? Well SAP’s carbon management software, Carbon Impact OnDemand is already Cloud delivered. At SapphireNow SAP announced that they are going to rollout an on-demand service for product safety that the company is calling the SAP Product Stewardship and Safety Network. This will be a network where safety professionals can share safety information and best practices.

The irony of sustainability-related software being delivered via the Cloud, a technology which is not Green at all, is not lost on me. It does appear to be lost on SAP however – more on which in a follow-up post.

And finally in-memory computing – what is it? Well, you know how information held in RAM is much faster to access than information on disk, right? So HANA, SAP’s new in-memory database, is where the database is held in RAM for much faster data access. Also, in-memory databases can hold enormous quantities of data, and query them in milliseconds. This is a huge step forward in database technologies and according to SAP it will vastly simplify database maintenance as well because there should no longer be a need for large data warehouses.

Where do the HANA and Sustainability stories intersect? There are several examples – the first is in the area of Smart Grids and Smart meters. The volumes of information utility companies will be expected to handle after installing smart meters are orders of magnitude greater than anything they are used to. Realtime analysis of this firehose of information will allow for much better demand-side management, matching the demand curve to the supply curve, stabilising the grid and allowing for greater penetration of variable generators like wind and solar. Also, this availability of highly granular energy consumption data will facilitate the development of all kinds of new energy products and services that would have previously been impossible to offer. This is sorely needed by utilities who are in the uncomfortable position of currently (no pun) having to try to convince customers to buy less of their product.

Other use interesting cases are discussed in a great post on How Big Data Will Help Achieve Sustainability Goals by SAP’s Scott Bolick. And when you finish checking that out, head on over to Jennifer Lankheim’s post on SAP Situational Awareness for Public Sector where she discusses this new SAP Rapid Deployment Solution to help public safety and security organizations better anticipate, assess, and act on emergency situations.

We are only scratching the surface of what the implications of Big Data, Cloud, Mobility and in-memory computing are for sustainability. Expect to see far more announcements in this space in the near future.

Disclosure – SAP is a GreenMonk client and SAP paid my travel and expenses to attend Sapphire Now.

Photo Credit Tom Raftery

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Utilities need to offer innovative energy services or risk being sidelined

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Elderly man

The EU has mandated a rollout of smart meters to at least 80% of households by 2020. What are some of the transformative ways we will we use the extra energy consumption information these meters will bring?

Last November I wrote a blog post about new energy services and business models for utilities which the granular energy consumption smart meters measure will enable. In the post I noted that

according to the US Census Bureau:

The world’s 65-and-older population is projected to triple by midcentury, from 516 million in 2009 to 1.53 billion in 2050.

Further, there are currently 30 million solo-single households in the United States (more than the number of households containing married couples with children) and about one-third of these solo singles are men and women 65 years of age and older. The percentage is even higher in Europe.

Now, if I have an elderly relative living alone, wouldn’t it be a very useful service if I could receive a timely message from their utility company if there are deviations from the normal patterns of energy usage (if the lights aren’t turned off at 11pm or the coffee machine/kettle isn’t powered up at 8am)?

I have been positing this idea of using exceptions to normal energy use as triggers for alerts, especially for family members interested in the care of an elderly relative for quite some time. Every time I mentioned it though, I always received technical reasons why it wasn’t feasible. Until very recently that is.

A few weeks back I attended the SAP for Utilities event in Madrid. There I had a meeting with Axel Memminger where we were talking about SAP’s in-memory database HANA. Because HANA runs in-memory, it allows for very fast querying of massive datasets. This is fantastic for seeing trends in historic data but not for examining realtime info.

During our talk, Axel happened to mention that as part of the Sybase acquisition SAP now had picked up a realtime event processing engine called Event Insight. Event Insight was built to parse massive amounts of data looking for exceptions and triggering alerts in realtime.

It immediately occurred to me that this was the missing piece needed to allow utilities rollout enhanced energy services like the monitoring of elderly relatives I outlined above. When I explained this idea to Axel his eyes lit up and he started architecting the solution in his head as we discussed it.

“Would you be willing to pay for something like this?” he asked me at one point. “If this were offered for something like €5 a month, I’d pay it in a heartbeat” I replied. And I strongly suspect I’m far from unique in this.

With utility companies facing reduced incomes from energy sales, it is only by providing imaginative energy services like this that utilities will secure their long-term viability.

Nor will they be alone in plying for this business. I can see services like this being offered by telcos as well and even more likely, it is a natural extension of services from care companies who typically already offer remote monitoring.

Unless utilities are innovative in the energy services they develop and offer, they may find themselves sidelined in their core-market. Who’d have predicted 10 years ago that Apple Computers would be the dominant player in music sales?

Photo Credit Tom Raftery

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GreenMonk Sustainability Customer Reference series – AkzoNobel

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I have recently started a cool project – it involves my going to SAP customers and interviewing them about the sustainability solutions they have implemented. The first SAP customer I visited was AkzoNobel in Sweden.

There I chatted with Lisbeth Svensson about their rollout of the SAP product safety solution.

Here’s a transcription of our conversation:

Tom Raftery: Hi everyone, welcome to the GreenMonk Sustainability Customer Reference Series, sponsored by SAP. With me I have Lisbeth Svensson from AkzoNobel. Lisbeth can you tell me a little bit about your role in AkzoNobel and also a little bit about AkzoNobel itself?

Lisbeth Svensson: Yes, I am a Development Manager in the area of regulatory affairs and in my role I have been managing implementation projects and development projects in the area of product safety.

Safety is, of course, very important for us to give the correct handling information, risk reduction measures and such.

Tom Raftery: Okay and AkzoNobel?

Lisbeth Svensson: And AkzoNobel is the largest global paints and coatings manufacturer and also a major player in the area of specialty chemicals.

Tom Raftery: With your job function being around regulation and your company being involved in producing chemicals, I imagine there are a lot of issues that you have to deal with.

Lisbeth Svensson: Yes, chemicals need to be regulated in different regulations all over the world and we have to comply with that and its differences from one country to the other. And to do that of course we need to have some — some IT solutions for — to support the product safety area. So I have been involved in implementing solutions for — to support REACH and GHS, which is Globally Harmonized System, and classification and labeling requirements.

Tom Raftery: And you recently rolled out the SAP product, safety solutions, how does that help you meet these challenges?

Lisbeth Svensson: It’s helping us in a way that we can manage input data from one location and still manage to get the compliant safety data sheets and labels in different countries all over the world.

And that helps us also if we want to put a new product on the market, that we already have a system in place to manage the safety data sheets and labels for that country.

Tom Raftery: Okay and finally Lisbeth what are your plans for the SAP product safety solution going forward?

Lisbeth Svensson: In the next few years, we will finalize all the implementation in the business units in specialty chemicals and when we have done that, all our safety data sheets and label will have the same look and feel across all the countries, all the business units and that will give us a perception of one AkzoNobel.

Tom Raftery: Lisbeth that’s been great, thanks a million for talking to us today.

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Danone’s carbon reduction collaboration with SAP has additional cost, recruitment and retention benefits

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Danone

Most of the news these days is around energy efficiency wins, so it makes a welcome change to hear a pure carbon reduction story from Danone.

In 2008 Danone set very aggressive carbon reduction goals for itself. It decided to reduce its carbon emissions 30% by end of year 2012. This was a deliberately ambitious aim because it meant galvanising everyone in the company to become involved, if the aim were to be met. On a call with Danone CIO Jean-Marc Lagoutte last week I learned that Danone have already passed their 30% target – an impressive achievement.

How did they do it? They used a combination of information and incentives. On the incentives front, 30% of every plant manager’s bonus was made dependent on carbon reductions. While on the information front, Danone rolled out a carbon calculation and management system which made the full lifecycle carbon emissions of every aspect of every one of Danone’s 35,000 products readily available.

Danone teamed up with SAP to co-innovate on this project. SAP was an easy choice according to Lagoutte because Danone was already an SAP house, so the majority of the data their carbon system would need was already in their SAP system. It has now been rolled out to the majority of Danone’s affiliates and should be in all of them by 2013. Danone is hoping that this will become a standard offering from SAP so that it will be covered under SAP’s standard maintenance contract. SAP in turn have said that they do plan to offer the solution to new customers.

Next steps for Danone, said Lagoutte, include calculating the water footprint of its products, the effect on biodiversity and when labeling standards have been reached, making that information available to consumers.

Internally in Danone, a carbon master has been appointed for every country business unit. The carbon master is in charge of carbon reductions for that business unit. Making one person per unit responsible and arming them with the information the need to affect that change was obviously critical to the success of this program (that and the incentivising of the plant managers to ensure buy-in).

I asked Jean-Marc if it were just the carbon footprints’ of their products ingredients which were considered but he said that no, it was everything in the lifecycle, including their suppliers’ carbon footprints and the packaging. In fact, several of the carbon reduction wins that Danone achieved came from reductions in packaging. Four packs of Danone yoghurt sold in France had a cardboard surround. This has been done away with, for example, with a consequent carbon footprint reduction.

Other changes were to substitute the PET used in plastic bottles with a mix of recycled plastic and bio-plastic (from cane sugar). This change reduced the carbon footprint of Actimel bottles by 70%.

As well as reducing Danone’s carbon footprint, this project is also saving Danone significant costs on several fronts. PET was one of the most expensive ingredients which Danone used. Substituting bio-plastic, not only reduces Danone’s carbon footprint, but saves them money as bio-plastic is cheaper. Other packaging reductions also lead to easy cost and carbon reductions.

Also, this project led to Danone’s needing to revisit all their processes, many of which hadn’t been examined in quite some time. This re-assessment identified inefficiencies and led to many reductions and simplifications of processes.

And because all purchasing contracts had to be re-negotiated with a carbon dimension, all of Danone’s suppliers had to sell themselves once more to Danone. This led to big improvements in the supply contracts.

Finally, the carbon reduction program generated a lot of internal pride in Danone around the company’s goals and achievements. This has led, according to Lagoutte, to significant recruitment and retention benefits for Danone.

A win for the planet, a win for SAP and several nice wins for Danone!

Photo Credits Tom Raftery and sashafatcat

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SAP’s 2011 Sustainability Report

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SAP 2011 Sustainability Report

SAP launched its 2011 Sustainability Report this week and in terms of aesthetics and social sharing, this is one of the best Sustainability Reports I have seen to-date.

The site contains many videos with SAP staff – including one from co-CEO’s Jim Hagemann Snabe & Bill McDermott which is featured prominently on the home page. Interestingly there are also several customer reference videos as well with the customers vouching for how SAP have helped them become more sustainable.

There are also many blog posts and interesting stories from SAP employees talking about everything from Materiality, through to Electric Vehicles.

There is a whole section in the report dedicated to how SAP Empowers its customers. It includes customer video testimonials, white papers and some very impressive top line figures for savings (“5.7 million tons of estimated carbon reductions, saving $550 million in energy costs”). However the methodology for producing these data is not gone into in any detail in this section. I contacted SAP to voice my concerns about this and they assured me that in the next couple of weeks the report will be updated to include the methodologies, and the story around producing this innovative section of the report.

SAP's progress on sustainability

As you’d expect from SAP, there’s also a lot of data in the report on how they are doing on their journey to sustainability and it’s mostly positive results. Almost all of their numbers are headed in the right direction. Unfortunately the exceptions to this are in the environmental area with increases in Data Centre Energy, Total Energy consumed and SAP’s Greenhouse Gas Footprint.

On the data centre energy front, the energy increase is both in real terms, and in kWh per employee. This is likely due to SAP increasingly hosting customers data and applications through their cloud offerings. What might be interesting here would be to see a kWh per cloud customer metric, or similar. Also, one would suspect that there should be a net reduction in energy consumption for that application, if it is replacing a customer’s pre-existing on-premises application. There could be some interesting data to mine there around energy wins.

On the Total Energy Consumed page you see that energy consumption has increased from 843GWh in 2010 to 860GWh in 2011. In the report it attributes this to growth in the business (SAP bought SucessFactors during this period) but the lack of a kWh per Employee metric on this page makes this hard to verify.

On the Greenhouse Gas page, we again see an increase in emissions from the 453kTons 2010 figure to 490kTons in 2011. On this page, it is possible to see a By Employee figure and here too we see an increase in emissions from 8.7 tons per employee in 2010 to 9.0 tons in 2011. However, when we look at the emissions by ? revenue, we see a fall, from 36.3g/? in 2010 to 34.4g/? in 2011. 2011 was a good year for SAP, from a revenue perspective, it would appear.

On the upside, SAP has increased its use of renewable energy from 45% to 47%. Not a huge increase, to be sure, but at least this environmental metric is going in the right direction.

I mentioned that the site has a lot of social sharing built into it – there’s a “Share this page” on every page which allows you to share that page on your social network of choice (or print, or email!). However, in terms of interactivity, the report seems to have regressed. In the 2010 report, there was the ability to comment directly on any page, to rate comments, and see conversations taking place about the page, directly on the page. This functionality has been removed completely from the 2011 report, and to be honest, the report is the poorer for its removal. Browsing other readers comments on pages is always a superb way to gain others insights into the page content – both for consumers of the report, as well as for SAP.

From a UI perspective there are several glitches on the site (some rollovers not working; external links and links to PDF’s not made obvious; and inconsistent use of pretty permalinks etc.) but these are minor quibbles and easily fixed.

The 2010 report doubled individual visitors over the 2009 report, with the 2010 report receiving over 60,000 readers. SAP tell me they are aiming to maintain that progress and have over 120,000 visitors to this, the 2011 report. One huge advantage of having the report in the form of a website, is of course the invaluable data stream you receive from the visitor analytics to the report. Something which is impossible to achieve with a PDF.

On the whole, SAP’s 2011 report, with the removal of the interactivity and the increased energy and emissions, seems to have faltered slightly in terms of the tremendous progress it had been making to-date. To put that in perspective, SAP’s 2011 report is still one of the better produced sustainability reports.

For the 2011 report I’ll have to grade it as “very good, but could do better”.

Photo Credit Tom Raftery

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CarbonSystems EPS chosen by Microsoft for its global environmental reporting

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Microsoft

In my reviews of tech companies sustainability reporting, one very obvious laggard has always been Microsoft. Hopefully that’s all about to change.

Why? Microsoft has just signed up with CarbonSystems to use CarbonSystems cloud-delivered Enterprise Sustainability Platform (ESP) to manage its energy efficiency initiatives and for reporting its environmental performance globally.

This is big news. Microsoft has 600 facilities across 110 countries worldwide. For the first time, the full energy and environmental footprints of all these sites will now be managed from within a single cloud-delivered resource, the CarbonSystems ESP system. The levels of transparency this will give Microsoft will be immense. Perhaps now, unlike many of its competitors, Microsoft will be able to join the EU’s ICT Footprint initiative.

This move should also enable Microsoft to report on the energy and emissions associated with its own cloud infrastructure – something, like all other cloud providers, Microsoft has failed to do to-date.

This move is a big deal for CarbonSystems too. CarbonSystems are an Australian company and have done quite well there but have more recently been eying the EU and US markets. Being selected by Microsoft for a global rollout has suddenly catapulted them up the credibility charts. Had you asked me previously which 3rd party platform Microsoft might have chosen I’d probably have mentioned SAP, Hara, CA, or Enablon.

Now with this win, CarbonSystems too has a seat at the big boys’ table.

Photo Credit ToddABishop

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The whole interest in sustainability is wearing off isn’t it? SAP’s Scott Bolick answers

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At the SAP TechEd event in Madrid recently, JD-OD.com had an interview scheduled with SAP’s Scott Bolick. Scott is responsible for SAP’s Sustainability Solutions. Dennis Howlett, of JD-OD, knowing my interest in sustainability, asked if I’d like to conduct the conversation with Scott.

I was happy to oblige and so here’s a transcript of our chat:

Tom Raftery: Hi everyone. This is Tom Raftery of GreenMonk TV, doing interview for JD-OD. And with me I have Scott Bolick from SAP. Scott, would you like to introduce yourself?

Scott Bolick: Thanks Tom. My name is Scott Bolick as you said, and I’m responsible for SAP Sustainability Solutions and those solutions are across at four different areas and hopefully we can chat a little bit about those now.

Tom Raftery: Sure. So Scott, sustainability it’s a – the whole interest in sustainability is wearing off isn’t it, nobody is really into sustainability these days. Am I right?

Scott Bolick: Well I think you are wrong, I think there is a caveat. I think one of the things that we’ve seen in the market which I think is actually a good sign is that sustainability was a topic de joure in 2008, 2009. It’s still there, you still see more and more CSOs coming online but what you are seeing is instead of a centralization of power within those chief sustainability officers, what you are actually seeing is the sustainability officers setting the strategy for the company.

And then whenever you look at the actual execution, when we look at where people are actually purchasing IT that really is coming down into the LOB, so it’s R&D for sustainable products. It is the supply chain when you look at sustainable supply chain. It’s manufacturing whenever you look at sustainable operations. So I think to say that it’s not there, it is wrong, I think it’s there, it’s stronger than ever. I think what people are discovering is it’s sedimenting back into the underlying businesses and that’s where it should be fundamentally.

Tom Raftery: Okay, but I mean with the current state of the economy, are people really willing to get their –stick their hand in their pocket and spend money on sustainability solutions?

Scott Bolick: Yeah, absolutely. And I think when you take a look at why people buy for sustainability, I think there is three reasons people buy. First and foremost is compliance, and there are increasing regulations around the globe whether it be for product or whether it be not just for — whether it be safety and showing that you are increasing the safety within your operations. And so one of course whenever you take a look at that and you look at the complexity of business, it’s spread out on global operations, they need solutions that are IT solutions to be able to adhere to those regulations in a timely and in a low cost manner.

Second you continue to see people interested in those solutions that help them save money, energy management obviously being top of mind.

And third, there are those companies that are spending on aspirational, really trying to understand what is the product footprint of the products that they sell into the market and how they can lower that footprint whether it’d be carbon or whether it’d be other substances.

Tom Raftery: And where are you seeing most of the traction these days? What is the most – what is the area of the largest – well either spend or interest for SAP at the moment?

Scott Bolick: I think if you take a look at some areas that are really hitting for SAP, one of the areas is operational risk management. And if you would go back and you just look at the last couple of years, what you see are these big events that these events happen and then there is a tremendous impact on the brand reputation, there is a tremendous impact on the financial valuation of those companies. And so what you are seeing is companies on a trend, the first trend on operational risk was really about compliance, am I compliant to regulations, now you are seeing people increasingly looking at proactive prevention, how do I actually go out and report incidents before they happen, how do they then analyze those incidents, put them in a risk framework and then how do I actually execute management of change. So we are definitely seeing a tremendous amount of interest from across multiple industries.

And finally what we are beginning to see is some really interesting stuff where people are looking at the tremendous amount of data they have and trying to figure out how they can correlate that data and actually get into predictive analytics around risk. So that’s one of the areas we’re definitely seeing.

Tom Raftery: Okay and when you talk about data I mean a lot of – the various solutions have massive amounts of data associated with them, how is SAP going to handle that, the big data issue?

Scott Bolick: I think one of the things that we are fortunate is that unlike some players in the market, we within SAP have strong technology both for analytics and then when you look at big data obviously we have HANA. So some of the things that we are doing is working with customers and determining how we can leverage HANA to push them over limits that they might otherwise have. Limits in terms of their own operations and limits in terms of processes.

One of the ones I love is we have an embedded product compliance customer who is now looking at putting embedded product compliance on top of HANA. So this company has 100,000 different recipes, they produce 3000 to 4000 documents a day and obviously that’s on the backend, but on the front end they have got to really make sure during the design process that they understand whether or not the substances, whether or not the ingredients are going to be compliant to regulations. One of the things they are doing is by putting it on HANA is they can get the check back in a second rather than getting a check back in terms of minutes or hours. And obviously if you are in R&D, the last thing you want to do is your designing — is to sit in front of the computer and wait to determine whether or not it’s compliant with regulations and obviously those regulations are regulations that are country specific.

Tom Raftery: Sure. So sustainability is here to stay.

Scott Bolick: Absolutely.

Tom Raftery: Great. Scott, thanks a million.

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Data Center War Stories talks to SAP’s Jürgen Burkhardt

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And we’re back this week with the second instalment in our Data Center War Stories series (sponsored by Sentilla).

This second episode in the series is with Jürgen Burkhardt, Senior Director of Data Center Operations, at SAP‘s HQ in Walldorf, Germany. I love his reference to “the purple server” (watch the video, or see the transcript below!).

Here’s a transcript of our conversation:

Tom Raftery: Hi everyone welcome to GreenMonk TV. Today we are doing a special series called the DataCenter War Stories. This series is sponsored Sentilla and with me today I have Jürgen Burkhardt. Jürgen if I remember correctly your title is Director of DataCenter Operations for SAP is that correct?

Jürgen Burkhardt: Close. Since I am 45, I am Senior Director of DataCenter Operations yes.

Tom Raftery: So Jürgen can you give us some kind of size of the scale and function of your DataCenter?

Jürgen Burkhardt: All together we have nearly 10,000 square meters raised floor. We are running 18,000 physical servers and now more than 25,000 virtual servers out of this location. The main purpose is first of all to run the production systems of SAP. The usual stuff FI, BW, CRM et cetera, they are all support systems, so if you have ABAP on to the SAP in marketplace, you, our service marketplace, this system is running here in Waldorf Rot, whatever you see from sap.com is running here to a main extent. We are running the majority of all development systems here and all training — the majority of demo and consulting system worldwide at SAP.

We have more than 20 megawatt of computing power here. I mentioned the 10,000 square meters raised floor. We have 15 — more than 15 petabyte of usable central storage, back up volume of 350 terabyte a day and more than 13,000 terabyte in our back up library.

Tom Raftery: Can you tell me what are the top issues you come across day to day in running your DataCenter, what are the big ticket items?

Jürgen Burkhardt: So one of the biggest problems we clearly have is the topic of asset management and the whole logistic process. If you have so many new servers coming in, you clearly need very, very sophisticated process, which allows you to find what we call the Purple Server, where is it, where is the special server? What kind of — what it is used for? Who owns it? How long is it already used? Do we still need it and all that kind of questions is very important for us.

And this is also very important from an infrastructure perspective, so we have so many stuff out there, if we start moving servers between locations or if we try to consolidate racks, server rooms and whatsoever, it’s absolutely required for us to know exactly where something is, who owns it, what it is used for etcetera, etcetera. And this is really one of our major challenges we have currently.

Tom Raftery: Are there any particular stories that come to mind, things issues that you’ve hit on and you’ve had to scratch your head and you’ve resolved them, that you want to talk about?

Jürgen Burkhardt: I think most people have a problem with their cooling capacity. Even if we are — we are running a very big data center. We have a long capacity down the other side. There was room for improvement. So what we did is we implemented a cool aisle containment system by ourselves.

So there are solutions available, you can purchase from various companies. So what we did is, so first of all we measured our power and cooling capacity and consumption in very detail, and on basis of that we figured out a concept to do that by ourselves.

So the first important thing is today I think it’s standard. We have to change our requisitions, especially in the DataCenter which is ten years old, and which now also got the premium certificate. That data center, the rack positions were back front, back front, back front and we had thousands of servers in that data center.

So what we are now doing, already did to some extent in that data center is, we had to change the rack positions front, front to implement the cold aisle containment system. And we did — so IT did that together with facility management. So we had a big project running to move surplus shutdown, racks, turn whole — the racks in whole rows, front to front and then built together with some external companies, it was very, very normal easy method. Buying stock in the next super market more or less, build the containment systems and that increased where we have implemented it the cooling capacity by 20%.

Tom Raftery: Is there anything else you want to mention?

Jürgen Burkhardt: Within the last three to four years we crashed against every limit you can imagine from the various type of devices which are on the — available on the market, because of our growth in size. The main driver for our virtualization strategy is the low utilization of our development and training servers. So what we are currently implementing is more or less a corporate cloud.

When a few years ago, we had some cost saving measures, our board said, you know what, we have a nice idea, we shutdown everything, which has a utilization below 5% and we said well, that might not be a good idea, because in that case we have to shutdown everything, more or less. And the reason if you imagine a server and an SAP running, system running on it and a database for development purpose, maybe a few developers are logging in, this is from a CPU utilization, you hardly see it, you understand.
So the normal consumption of the database and the system itself are creating most of the load and the little bit development of the developers is really not worth mentioning. And even if they are sometimes running some test cases, it’s not really a lot. The same is true for training, during the training sessions there is a high load on the systems.

But on the other side these systems are utilized maybe 15% or 20% maximum, because the training starts on Monday, stops at — from 9:00 to 5:00. Some trainings even go only two or three days. So there is a very low utilization. And that was the main reason for us to say, we need virtualization, we need desperately and we achieved a lot of savings with that now and currently we are already live with our corporate cloud.

And we are now migrating more and more of our virtual systems and also the physical systems which are now migrated to virtualization into the corporate cloud. With a fully automated self service system and a lot of functionality which allows us to park systems, unpark systems, create masters and also the customers by himself. This is very interesting and this really gives us savings in the area of 50% to 60%.

Tom Raftery: Okay Jürgen that’s been fantastic, thanks a million for coming on the show.

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ArcelorMittal FCE roll out Organisational Risk Management software to unify maintenance processes

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Organisational risk management (ORM) is the new hotness in the sustainability field. It is receiving increasing attention, as SAP’s Jeremiah Stone mentioned when I talked to him at SAP’s Sapphire/TechEd event last week. One assumes that it is receiving this increasing attention at least partly because that’s where the customer dollar is focussed right now.

What exactly is ORM? Organizational risk management is “risk management at the strategic level” according to the Software Engineering Institute – think of it as kind an amalgam of the traditional Environment, Health and Safety (EH&S) and Governance, Risk and Compliance (GRC) sectors.

How do these fit into the sustainability agenda? Well, risk mitigation is all about reducing the risks of an adverse event occurring – one that either hurts people or the company reputation (or often both!). It does this by mandating procedures and processes with verifiable sign-offs. It also does this by scheduling maintenance and raising alerts when equipment goes out of tolerance. This properly scheduled maintenance of machinery will ensure it not only runs safer, but often will also mean it stays more fuel efficient. This can mean significant energy savings in organisations which use a lot of power.

While at SAP’s TechEd/Sapphire last week I spoke with Edwin Heene, who works with ArcelorMittal and is responsible for the rollout of their ORM software solution. I had a quick chat with him to camera about the project and why ArcelorMittal embarked on it.

Here’s a transcript of our conversation:

Tom Raftery: Hi, everyone welcome to GreenMonk TV. We are at the SAP Sapphire event in Madrid, and with me I have Edwin Heene from ArcelorMittal. Edwin you have been involved in the organizational risk management project rollout or are involved in at the moment for ArcelorMittal. Can you tell us a little bit about that?

Edwin Heene: So in ArcelorMittal Flat Carbon Europe we are doing a global organizational standardization project in maintenance, that including also the safety processes and this is something that we do in several countries namely eight countries in Flat Carbon Europe.

Tom Raftery: So maybe we should give it a bit of context first. Who are ArcelorMittal? You are a large steel company, but could you just give us a little bit of background about the company first?

Edwin Heene: ArcelorMittal is the largest steel producing company in the world doing — covering about 6% of the annual year production. Has a number of employees about 260,000 in 2010. And presence in Flat Carbon Europe because that?s the sector where — segment where I work in. It is covering eight different countries, and we have about 35 locations in Flat Carbon Europe.

Tom Raftery: Okay, so as I mentioned in the start you are in the middle of this organizational risk management software rollout, can you talk to us a little bit about that?

Edwin Heene: So this system we — in 2008 we selected the fact the solution has update to the support us with this harmonization and there we found out that there was a good supporting tool for operational risk management and safety processes namely the solution was PWCM –Work Clearance Management solution.

Tom Raftery: Okay, and you brought SAP in to help you in a kind of collaborative role in developing the application for yourselves.

Edwin Heene: Yeah, because in Flat Carbon Europe we had already a number of plans that are on good level of safety and managing the safety risks and so on in the operational part with some legacy systems, with a decision to go to one common system, the SAP system, we have to convince the other people with, which have already a good supporting IT tool to move over to SAP.

And therefore we found out that there were some lags still in the supporting SAP PWCM solution. So we had a number of meetings with Jeremiah Stone from SAP who is leading co-innovation programs in SAP and there we decided to, in order to close these gaps to provide these functionalities in standard SAP environment to step in a co-innovation program with SAP.

Tom Raftery: Okay and why roll it out — what was the reason behind the rollout of the application?

Edwin Heene: The reason behind the harmonization and standardization program in Flat Carbon Europe is first of all to improve the maintenance processes in effect implementing all the best practices that we have in several plants and you have a best practice in every single plant to absorb that in one common model, one common business model and implement that in all different plants. Throughout this implementation of best practices you have business results, operational results in every single plant. Benefiting of being in a large group and learning from each other, learning from the best practice from another group.

Tom Raftery: Excellent, Edwin that?s been great, thanks a million.

Edwin Heene: Thank you.

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Sustainability software update from SAP’s Jeremiah Stone

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SAP invited me to attend their combined Sapphire/TechEd event in Madrid last week. While there I took the opportunity to have a chat with Jeremiah Stone to get an update on the state of play in sustainability solutions.

Here’s a transcript of our conversation:

Tom Raftery: Hi everyone welcome to GreenMonk TV. We are in Madrid for SAP?s SAPPHIRE event and with me I have Jeremiah Stone. Jeremiah, you are on the SAP sustainability team. What is your role there?

Jeremiah Stone: So, I?m a senior director for solutions management and what that means in SAP is that I?m responsible for the business cases for producing our products, so developing new products. And then I work with our key customers as well in making sure that our products continue to meet their needs and that we do quite a bit co-innovation with customers and that?s my team that tends to drive that as well with our strategic customers and so really managing the business case and then we build and execution, and rollout of products.

Tom Raftery: So there is a business case for sustainability?

Jeremiah Stone: Well, at SAP there sure is. It?s a interesting aspect I think of our sustainability case that people typically are surprised by is that every single one of our investments is actually a bottom up business case just like any other piece of software at SAP where you have to build the customer business case first. So really what is the customers tangible pain, how much are they spending to deal with that pain today, what are their alternatives, how much can we generate in terms of value for the customer with some development, and then is there a reasonable value capture for us, in other words can we charge the customer a reasonable amount of money to justify us investing in the software. And so we do that for every investment that we make and so that also helps the conversation of course from a business point of view because then we?ve done all that work upfront, we can go to the customer, we can explain the customer business case that we?ve developed and we can validate that and from them to make sure that there is a return on that investment and then they can treat it like any other IT investment. And the other thing, you know with sustainability at SAP is its embedded into our business and so when I?m competing for development resources I?m competing right next to the guys who are developing for HANA, the people that are developing for HR, people for financials, CRM et cetera. So we would, be really treated just as any line of business at SAP, we don?t get preferential treatment et cetera and then really is based upon business case for each investment that we make.

Tom Raftery: Cool. And what is the hot button topic for people right now in sustainability?

Jeremiah Stone: It?s a good question, I think right now we see you know phasing of a development of the market, it continues to be really around management of risk and compliance primarily in the safety of operations. So and that goes really there’s asset intensive and asset non-intensive industries, so I?ve customers in transportations and logistics, major airlines, looking at how they can be safe and that is a bottom line number for them. Obviously if they are damaging aircraft or whatever they are not going to be performing well and so that there is really a safety org from a compliance point of view, that is access to markets. So as public and governmental toleration of eco-toxicity of hazardous materials et cetera is declining, there is this more and more transparency around products and their constituent chemicals et cetera and substances.

The regulatory bounds and burden is going up and on companies to declare the substances in their products so that they can sell them in those markets. That?s primary driver skill, we definitely see energy management is the fastest growing area and that?s really energy and environmental resource management, so not just energy but you can think really sort of all of the inputs into the business whether that?s energy for other resources in other words very much you could think of it as a traditional SAP strength, you think around energy. Although, it is a different challenge as you know because there is the utility as well, involved in that and that?s somewhat complex, there is definitely demand for that, is one of the fastest grown, it?s not biggest business yet, but it is the fastest growing. And then we continue to see a smaller market, but still increasing around analytics, reporting strategy management, setting targets, managing to those and then reporting out to I don?t know the global reporting initiative et cetera on sustainability performance, but for the majority where we are making our money today with our product lines is really around that risk management and compliance activities.

Tom Raftery: Okay and the whole sustainability area is a relatively new business area, is it one that you see is going to be going big time, is it, I mean we?ve seen a jump in last couple of years just because companies started getting into it, but you know is it on a hockey stick or is it kind of plateaued or where about is it?

Jeremiah Stone: Well yeah, I mean it?s very rapidly growing market. We see the overall market size growing compound annual growth rate of around 18% to 20%, so it?s a pretty significant growth in the current spending environment. Lot of that?s because of loss control. So if you think of the current global environment, access to credit isn?t available, stability of financial market we?ve learned, interested in making capital investments if they can?t ensure that that capital investment will be safe.

Tom Raftery: Yeah.

Jeremiah Stone: So in ironic way you know really is that sort of resource constraint or fear of loss that?s driving sustainability as well from any investment. So it isn?t necessarily a, you know there is a joke even people when they spend money on software for you know greed, fear or aspiration, most people assume it?s aspirational in nature when people make sustainability investments, because you want a halo or improve your brand image which — there is some of that, but most of our customers it?s really around the loss management. And to a certain extent the — you know the ambition to grow your brand, grow your business. We do have customers like Solvay for example, I think you may have gotten to talk to them over here.

Tom Raftery: I?m going to see them this afternoon, yeah

Jeremiah Stone: Okay, so I mean they — you know, really say that they are more competitive as a result of the investments that they make in sustainability. So it is a growing, it is an evolution of some older lines of business in this case environment health and safety management that has been there for a very long time. And you know we invested and purchased data that?s strategic to us a couple of years ago but we are on a pretty furious trip to double the pre-acquisition revenue relatively soon. So it is a fast growing market, we are having a lot of success with it and you know we believe that it will continue to be a strategic fast growing market, so.

Tom Raftery: Fantastic. Thanks a million Jeremiah. That was great.

Jeremiah Stone: Thanks for having me Tom.

Disclaimer – SAP paid for most of my travel, food and accommodation expenses to attend this event.