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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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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.