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Sustainable SAP

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SAP co-CEO Bill McDermott at SapphireNow 2010

I attended SAP’s Sapphire Now conference in Orlando earlier this week along with around 12,000 others.

It was a very interesting few days of talks, meetings, and showcases.

SAP’s commitment to Sustainability was evident throughout the event. The two keynote speakers invited by SAP were Al Gore and Richard Branson, for example – both of whom talked about the importance of sustainability to help mitigate climate change.

For me though, the most impressive statement that SAP considers Sustainability a strategic imperative, not just a sop to marketing, was the fact that both co-Ceo’s addressed Sustainability at length in their keynote addresses.

In my interview with Diversey’s CEO Curt Johnson a few weeks back he made the point that

CO2 is waste, so if you minimise CO2, you minimise waste and you maximise efficiency and increase profits

In his keynote on Tuesday morning, SAP co-CEO Jim Hagemann Snabe made the same point when he said that saving carbon emissions meant saving money. He concluded his keynote discussing SAP’s carbon reduction targets and how SAP’s sustainability solutions will help SAP’s customers reduce their emissions.

This ties in very strongly with the SAP Sustainability strategy which SAP Chief Sustainability Officer Peter Graf set forth during his presentation. SAP are committing to being an Exemplar and Enabler. By that they mean SAP will be an exemplar organisation in terms of its own sustainability initiatives and through its software solutions, it will enable its client companies to do the same.

Peter told me some time back that though SAP’s CO2 emissions were around 500,000 tonnes, their customers’ emissions were 10,000 times that! That’s a lot of emissions to be able to influence.

To that end, SAP’s on-demand Carbon Impact application seems to be coming along nicely now. I saw a pre-release of the upcoming version and it is starting to go beyond carbon impacts in terms of emission management, so I wonder how long before we have a re-brand! And SAP’s Sustainability Performance Management tool is a big help for companies wishing to track and communicate sustainability performance

SAP co-CEO's (and bottled water!)

SAP co-CEO's (and bottled water!)

I have written about how good their 2009 Sustainability Report was and how customers have been asking SAP to productise it. I asked Peter Graf during his presentation when he planned to deliver a Sustainability Report Generator to enable customers to also produce awesome sustainability reports but there are no imminent plans to release it it seems, which is a pity.

Despite the fact that both co-CEO’s had bottled water beside them during their keynotes at Sapphire Now (see pic), SAP have been quite consistently pushing the sustainability message for a while now. It is great to see. Hopefully some of SAP’s competitors will take note and the term Sustainability will go away because it will be synonymous with business as usual.

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SAP’s latest Sustainability Report is teh awesome!

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SAP's 2009 Sustainability Report using OAuth!

SAP released its 2009 Sustainability Report during the week and if last years Sustainability Report was good, this one is outta the park!

SAP released their first Sustainability Report in November 08 reporting on the 2007 year. It was a good initial effort (prepared in accordance with the GRI guidelines and achieving a ?C? level certification) delivered in your typical PDF format. The main innovation the first year was that there was a separate site for readers to leave feedback.

Then in May 2009 SAP released their 2008 Sustainability Report. This report achieved a B+ GRI rating and was far more interactive than the previous report (or any Sustainability Report I had previously seen). It allowed readers to interact with the data and showcased the interactive Sustainability Map which categorised core business processes related to sustainability and mapped them into distinct categories. Again SAP solicited feedback from users.

Now the 2009 Sustainability Report takes this to the next level. It:

  • achieved an A+ GRI rating by reporting on more sustainability GRI indicators and by adding new metrics, including Renewable Energy, Business Health and Culture Index, and Employee Satisfaction
  • includes the new edition of the Sustainability Map
  • establishes short- and long-term goals for many of SAPs metrics beyond carbon footprint
  • contains more embedded interactive dashboards leveraging data sourced from SAP Carbon Impact and SAP Business Objects Sustainability Performance Management
  • enables readers to comment on SAPs performance and solutions in the context of the report (no longer on a separate site) and
  • SAP will now produce quarterly updates on their carbon performance

There’s also the Materiality Matrix and the Create Your Own sections where you can try out different scenarios to see how they would affect SAP’s goals.

What do I love about this report?

  • I love how the two co-CEO’s went beyond simply putting their name to a letter at the start of the report (that’s so 2009!). They took the time out to record videos to introduce the Sustainability Report and talking about SAP’s commitment to sustainability.
  • I love the ability to leave comments on every page. The comment system allows you to login using your Twitter, LinkedIn, Yahoo, FaceBook, Google, or AOL credentials and uses OAuth for account verification. The geek in me just loves that (hence the screenshot above).
  • I love how the performance summary presents the data in stunningly simple to digest format. Clicking on the data here drills down into more detail on those numbers. The detail section is often highly interactive. For example in the carbon footprint section of the report you can see the carbon footprint by quantity, or by employee, by region or overall, by emission scope and clicking on a year gives a breakdown for that year specifically. Also, clicking on the printer icon allows you to print, while clicking on the Excel icon lets you download the data! and
  • I love how this report makes SAP’s sustainability data and their targets so transparent

Scott Bolick, SAP’s VP Sustainability Solutions, informed me that readership of SAP’s Sustainability report went from 3,500 for the 2007 PDF report to approx 30,000 readers for the online 2008 report. On top of that, many of SAP’s customers after looking at it, asked if they could purchase the technology to produce a similar report themselves! That’s a ringing endorsement right there.

It will be interesting to see what the readership of this report will be – you gotta suspect it will blow way past the 30,000 that last year’s report had.

[Disclosure – SAP are GreenMonk clients]

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Smart Grid Heavy Hitter series – SAP’s Stefan Engelhardt

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In this, the second of my Smart Grid Heavy Hitters’ interviews, I talk to SAP’s Head of Industry Business Unit for Utilities, Stefan Engelhardt.

It was a great interview – in it we talked about:

  • Stefan’s definition of a Smart Grid
  • The benefits of Smart Grids to both the utilities and the customers of the utilities
  • The state of Smart Grid rollouts to-date
  • What an ideal Smart Grid would look like
  • What barriers are holding up Smart Grid rollouts
  • Which regions are further along in Smart Grid rollouts and which are lagging behind
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This is a very opportune time to be investing in sustainability management software!

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Greenhouse gas emissions

Photo credit James Jordan

I wrote about SAP’s launch of their Sustainability Performance Management software recently. This is a space which is of massively growing importance given the increasing regulations around greenhouse gas emissions, for example.

I was heartened then to hear in a recent discussion with SAS that their Sustainability Management software was launched in April 2008!

For background, SAS are a business analytics software company with with an enviable record of 34 years growth and profitability reporting global revenues of US$2.31 billion in 2009 up 2.2% over 2008. SAS invested 22% of 2008 in R&D (an unusually high figure in the industry) have over 11,000 employees, and 45,000 customer sites in 100 countries. This is a significant company with a serious track record in research and development.

No surprise then that their solution, like the SAP one, is also very comprehensive, encompassing industry templates (GRI, CDP, IPIECA, etc.), customisable pre-built KPI dashboards, reporting, forecasting, scenario modeling (using the AMEE universe of data for scenario analysis – [disclosure – AMEE are a GreenMonk client]).

And, according to Alyssa Farrell, Marketing Manager for SAS Sustainability Solutions, the software is extremely inter-operable:

SAS also recognises that organisations may have other technologies in-house, so our software can be adapted to whatever environment they may already have. SAS has read/write access to any ERP system, we work within the Microsoft Office environment, so you can even use Excel to pull down SAS Analytics. SAS recognises that there is not one solution for everybody and so all the different solutions from SAS recognise that we need to work within this very complex technology application environment.

SAS have had some big customer wins with their Sustainability software:

With Microsoft and CA also entering this space, I think it is fair to say, Sustainability software is here to stay. In fact, Groom Energy Research reported that climate venture capital investment in Enterprise Carbon Accounting (ECA) firms topped $46m last year, the number of companies offering carbon software solutions grew from 40 to 60 over the course of the year and they predicted that the emerging US market for carbon reporting software is set to grow seven fold over the next two years.

Obviously aware of these trends when we asked Alyssa about pricing, she responded:

The way that our solution is priced is scaled to the size of the organisation [or a division of an organisation] and recognising that it is an early market and we need to get out there and seed our customers, this is the time to buy SAS for Sustainability!

Now, it would seem, would be a very opportune time to be investing in sustainability management software!

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SAP’s Sustainability Performance Management software launched

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SAP BusinessObjects Sustainability Performance Management

I wrote a piece on SAP’s new Sustainability Performance Management (SPM) tool a few weeks back. At time of writing it was very much in the realms of speculation as the product was, as yet, unreleased.

Last Thursday, Dec 10th, SAP announced the release of the software and having been given a preview of the software the previous day by SAPs Charles Zedlewski, I thought it time to circle back with an update on my previous speculations.

It turns out that I jumped the gun a bit when I posited that:

SAP have taken the next logical step with their Sustainability report. They have productised it!

The current version of the SPM will not output a sustainability report similar to SAP’s hugely innovative one of earlier this year although executives I talked to would not rule out that coming in future versions.

What the SPM will do for organisations is reduce the amount of time spent tracking down, collating data and creating reports. It can automatically collect KPI data across all sustainability dimensions (economic, social and environmental) from a variety of sources, so customers can move beyond manual data collection and spreadsheet-based recording.

The library of nearly 400 KPI’s includes a variety of sustainability metrics, including those based on the Global Reporting Initiative (GRI) standard as well as the Walmart sustainability index. If you require customisation (and what organisation doesn’t?) building your own custom KPIs or editing the installed ones is quite straightforward.

The data can be pulled from existing SAP apps within the organisation, it can integrate with 3rd party systems or information can be entered manually and then quickly reported either internally or externally. Audit trail functionality helps ensure integrity and transparency of the data.

Two further things I would like to see from this application are:
1. The ability to output at the touch of a button a Sustainability Report similar to SAP’s recent one and
2. An on-demand option (on-demand is SAP for SaaS!) – an on-demand version would ensure that organisations are always using a version which is abreast of the latest green regulations

Having said that, this is a very solid looking v1 with an intuitive UI and a very comprehensive back-end.

I have a call with SAS this afternoon to learn more about their SAS for Sustainability Management product – it will be interesting to see how it stacks up beside SAP’s SPM.

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SAP’s new Sustainability Performance Management tool could be a real game-changer!

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SAP BusinessObjects Sustainability Performance Management

Sustainability reporting is a bit all over the place. Standards, such as they are, are many, not widely agreed on, and are loosely observed.

One of the better sustainability reports to emerge this year was SAP’s. Unlike the staid PDF documents most companies put out, SAP’s is a website which allows reasonably deep linking ( here’s the section on SAP’s 2008 Carbon Footprint, for example – notice how you can change it to see footprint by region, KTon or Kg/employee, and get extra info by rolling the mouse over the charts). SAP also rolled out a discussion area where people can comment on SAP’s materiality and the Sustainability report.

Hugely impressive stuff from SAP and extremely innovative.

SAP regularly in discussions around sustainability make the point that while their carbon footprint of almost 500,000 tonnes per annum is significant, the combined footprint of their clientbase is 10,000 times their own! SAP are taking the line that while it is important for SAP to reduce their own emissions, helping reduce their clients carbon footprint could produce a far better long-term planetary outcome. As long as companies remember that, as I have said before, the correct order is Planet first, then People, and then Profit.

SAP have taken the next logical step with their Sustainability report. They have productised it!

Now the technology to produce a sustainability report similar to SAP’s will be available to all SAP customers. The app will connect into most ERP apps to pull out the data for Sustainability Performance Management reporting so being an SAP customer is not a pre-requisite for getting this to work, as far as I understand it.

The app comes with a library of 100+ sustainability framework reporting KPI’s, it comes with a ton of scorecards and dashboards for reporting, which allows companies to focus on improving sustainability performance as opposed to gathering data and compiling reports.

The product is not finalised yet and won’t be made available for another month or two but if it delivers on half of what it promises, it is a potential game changer in the world of sustainability reporting.

I hope to interview someone from SAP shortly to get more details on SAP’s Sustainability Performance Management tool, and as soon as I do, I will post the interview here.

[Disclosure – SAP talked to me about their Sustainability Performance Management at SAP TechEd 2009. They paid for my travel and accommodation to attend this event]

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Never run a conference at a venue that can’t provide water dispensing machines, instead of bottled water

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Bottled water is bad

I attend a lot of conferences.

The two most recent ones I was at were both run by SAP. The first was the International SAP for Utilities conference in Munich, the second was the SAP TechEd conference in Vienna. Both events were very interesting for a variety of reasons but both conferences left a nasty (dry) taste in my mouth because the only water available to drink was bottled water!

What is the big deal about using bottled water, you ask?
Well, according to Food and Water Watch:

Bottled water wastes fossil fuels and water in production and transport, and when the water is drunk the bottles become a major source of waste. It takes more than 47 million gallons of oil to produce plastic water bottles for Americans every year. Eliminating those bottles would be like taking 100,000 cars off the road and 1 billion pounds of carbon dioxide out of the atmosphere. Each one of those bottles required nearly five times its volume in water to manufacture the plastic and may have caused the release of nickel, ethylene oxide, and benzene. Then, rather than being recycled, 86 percent of them are thrown away. Breaking down these plastics can take thousands of years, while their components seep into our water supplies.

And don’t just take their word for it, check out the NRDC’s page on bottled water. See also Lighterfootstep.com’s 5 Reasons not to drink Bottled Water and even Wikipedia’s entry on bottled water vs tap water, which tells us amongst other things that:

In the United States, bottled water costs between $0.25 and $2 per bottle while tap water costs less than US$0.01. In 1999, according to a NRDC study, U.S. consumers paid between 240 and 10,000 times more per unit volume for bottled water than for tap water. According to Bottledwaterblues.com, about 90% of manufacturer’s costs is from making the bottle, label, and cap.

What’s worse, a significant proportion of bottled water is simply tap water which has been bottled! No, really. Both Aquafina from PepsiCo and Dasani from The Coca-Cola Company originate from municipal water systems, for example!

Despite all that, an estimated 50 billion bottles of water are consumed per annum in the US and around 200 billion bottles globally.

Come on SAP. You are working hard on improving your sustainability message. And by and large are doing a good job at it but really, bottled water? In 2009?

Here’s my challenge to SAP (and all conference organisers) – make commitment that you will never again run a conference at a venue that can’t provide water dispensing machines, instead of bottled water.

Seriously, if you are negotiating with a venue about holding your event and you mention that that is a dealbreaker, they’ll provide the machines.

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Klaus Heimann espouses SAP’s smart utility of 2020 at International SAP for Utilities conference

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I attended the 7th International SAP for Utilities event in Munich last week.

Having attended the SAP for Utilities event in San Antonio last year, I had reasonably high expectations from this conference and I wasn’t disappointed. At the San Antonio event SAP talked very much about the ‘State of the Now’ talking up their, then recently launched, Energy Capital Management software. At this event however, Head of SAP Service Industries, Klaus Heimann keynoted introducing SAP’s vision for the utility company of 2020!

In what was a very forward-looking address, Klaus confidently predicted that:

In two years time this will no longer be a Utilities conference, it will be en Energy conference

This must have had a lot of the people in the room squirming in their seats because, as Klaus himself said, “Utilities are not known as being good at change!”

But change they must.

Just a few of the upcoming major changes utility companies are going to have to cope with include the growing imperative to move to a greater penetration of renewables in the generation mix, the impending explosion in the numbers of electric vehicles to be charged, and the need to roll-out smart grids and take in distributed generation.

Klaus’ vision for the utility company of 2020 is summarised in the video interview I conducted with him above, but briefly he talked of an energy market vastly more complex than today’s. An energy market:

  • where customers can be consumers and producers (via micro-generation)
  • where customers may have shares in a wind-farm which sells electricity to the local utility
  • where customers receive rebates on kWh’s saved during times of peak demand (compared to avg previous day’s use at same time, for example)
  • where utilities will have special renewable-only power offerings (I wish they had that now)
  • where utilities will need to be able to bill customers for energy used to charge electric vehicles, away from home (at the office) or even in different countries and
  • where utilities will need to be able to offer real-time consumption information, generation data and a control interface to the customer’s appliances

Nothing too earth-shattering in that list to be honest. But, when put against the types of changes utilities have gone through in the last 100 years, this is an enormous upheaval. This is probably a good time to be a change management consultant in the utilities sector 😉

For this vision to become real (and any utilities who don’t start to move in this direction can start writing their own obituaries now), there needs to be massive changes in utilities communications infrastructures and their data handling capabilities.

With big change, comes big opportunities so it is not surprising to see SAP are all over this and helping the utilities visualise where they need to go.

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The Electricity 2.0 revolution has begun

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Smart meter projects globally

This is a map of current smart meter/smart grid projects globally overlaid on Google maps.
Screenshot credit Me(!)

I wrote my first Greenmonk post about Smart Grids and Demand Response back in April 2008 and followed up with a few more in the next few weeks including one in June 2008 where I said the electrical distribution system needed to be more like the Internet. Those posts were extremely cutting edge at the time but the world has caught up considerably in the last 18 months due in no small part to the election of Barack Obama and the focus on energy efficiency in his stimulus package!

Under Obama’s administration the US Dept of Energy announced in June of this year the rules for $3.9billion in Smart Grid stimulus grants. The first winners of $3.9 billion in smart grid stimulus grants will be announced in mid-November according to DOE deputy press secretary Jen Stutsman.

In a very positive move earlier this week, US Energy Secretary Steven Chu endorsed the importance of Demand Response as part of the solution when he said that electricity costs should move to reflect demand. Secretary Chu went further though arguing for the kind of automated Demand Response we have proposed here on GreenMonk when he said:

“Price signals do matter, but you can’t just simply use a price signal,” Chu said. “You really have to make it very easy to save energy.”

Consumers need to have a very simple system that will provide them with specific information about their energy use and they should be able to adjust their appliances so that they run mostly during non-peak energy hours

Adrian Tuck, CEO of Tendril announced last week that mass market home energy management is three years away. Obviously, being the CEO of a company in the space, he would say that, wouldn’t he? But looking at the slew of announcements which came out of the Gridweek conference (see below) it is hard to fault his optimism.

And just yesterday U.S. Commerce Secretary Gary Locke and the National Institute of Standards and Technology (NIST) presented for public comment a major new report on Smart Grid interoperability standards. The approximately 90-page document [pdf] identifies about 80 initial standards that will enable the vast number of interconnected devices and systems that will make up the US Smart Grid to communicate and work with each other.

You know that the administration is taking Smart Grids seriously when the Commerce Secretary presents for public comment a report on standards!

This week saw the GridWeek conference happening in Washington DC and with it a massive slew of Smart Grid related news. I’ll try to do a quick round-up of the main stories:

Partnerships

Acquisitions

Smart Cities

Launch

Other Announcements

With finance, administration backing and so many announcements (many of which are worthy of blog posts in their own right) there is no doubt but that the Smart Grid train has well and truly left the station. There are still a significant number of issues to be addressed by companies involved in the Smart Grid space. Some companies will founder, some deployments will fail (esp as utilities are notoriously bad at customer communications!) but there is no doubt that finally the Electricity 2.0 revolution has begun – there’s no turning back now.