Insights For Success

Strategy, Innovation, Leadership and Security

Cloud computing may be better for the environment

Accenture, Datacenter, Environment, MicrosoftEdward KiledjianComment

Open any business magazine and you will be bombarded with the words “Cloud Computing”. It is the buzzword of 2011 and something your company will likely consider for point solutions. In simple terms, cloud computing is computing on demand. Like electricity, you pay for what you use without having to worry about any of the back-end magic (hydro-electric dams, generators, transmission lines, etc). When you flip the switch, the service just works.

Popular Cloud providers are Google (with their Google Apps), Microsoft (with their office 365), SalesForce.com (with their online CRM solution), etc.

Microsoft, Accenture and WSP recently released a report that compared the environmental impact of running your business solutions in-house versus using a cloud-based provider. They found that by outsourcing a company’s applications to a cloud provider, the environmental impact can be reduced by as much as 90% (energy usage and carbon footprint).

Knowing that IT accounts for 2% of worldwide energy use, this may be a welcome revelation to environmentally concerned executives. They identified energy usage savings as follows:

  • Reducing excess capacity (unused capacity)
  • Flattening peak loads
  • Employing large scale virtualization
  • Improving data center design.

Microsoft’s Chief Environmental Strategist (Rob Bernard) has a great analogy.  He compares cloud computing to mass transit. One bus equals 50 cars on the street. Same concept with cloud computing.

An interesting conclusion I want to point out is that the largest customers had the smallest benefits. Companies with 10,000 + users had benefits in the range of 30% while companies with around 100 users saw a 90% environmental impact reduction.

There are other concepts companies can use to reduce their environmental impact while improving productivity such as teleworking. I recently wrote an article about implementing a successful telework program and I strongly recommend you read it.

The conclusion is to investigate where Cloud Computing may fit in with your business plan. Shedding non core responsibilities means you have more resources (time, money and expertise) to concentrate on your core business while outsourcing the non-value generation part. Imagine if each company had to figure out how to generate the electricity it needed? How much value would that sap out of your business?