Long before Al Gore made it hip to be green, technology vendors have been trying to make their equipment and processes more environmentally friendly. However, while green IT is a growing concern for many companies it appears that other green: money, still rules when it comes to making buying decisions.Many of the vendors are certainly doing their part. In a recent report from Forrester Research entitled Tapping Buyers’ Growing Interest in Green IT, analyst Christopher Mines said that being seen as green has become a priority for many technology suppliers, particularly manufacturers. Power and energy efficiency is one key area of activity, driven not only by environmental concerns but also data centre cooling, space and cost issues.
“Until recently, IT equipment’s energy usage was an output of its design and development, which was geared solely toward performance and price,” said Mines. “Now, a product’s energy usage is an input to design.”
The green movement also extends throughout the product lifecycle, from using recyclable and non-toxic components during manufacturing to removing and recycling products at end of life. HP has a global recycling program that even accepts equipment from other vendors, and IBM sells US$1.7 billion of used equipment annually.
However, Forrester’s research found that despite the activity by many vendors to burnish their green credentials, often seeing it as a competitive advantage and market differentiator, the green card isn’t a major buying influencer – yet.
“We found growing awareness of green IT, a desire for more energy-efficient solutions, and broad agreement that green will be a bigger purchasing factor in the future,” said Mines. “However, we did not find broad base activities by IT organizations to translate their green concerns into tangible action in procurement or operations.”
Indeed, while Forrester found that 85 per cent of North American respondents listed environmental concerns as either somewhat or very important to planning their IT operations and 72 per cent had either high or limited awareness of vendors’ green messaging, only 22 per cent had green factors included in their purchasing criteria.
“We heard two reasons why green matters: energy efficiency and corporate responsibility,” said Mines. “(But) most of our respondents told us that a green purchase would only happen in the context of cost reduction.”
Greening the RFP
HP has long been a player in the green space, particularly on the printing side with programs to recycle its inkjet toner cartridges. Deb Nelson, HP’s senior vice-president, marketing and alliances, technology solutions group, said when speaking with customers over the years green concerns like recycling were often on the discussion list, but were well down past other questions such as product features, service and support. It has been continuously creeping-up in importance however, she added.
“It’s becoming more and more a key thing that people won’t consider you unless you have the right kind of green credentials, like recycling,” said Nelson. “We even see customers writing it into their RFPs, where if you can’t take back and dispose of their current equipment properly you won’t even be considered for the business.”
While HP hasn’t been actively working with its partner community to leverage a green advantage as a marketing opportunity, Nelson said HP is talking with VARs to see if this might be an area of interest and possibly something that should be emphasized more greatly in the partner program.
“We would be very interested if VARs came to us and said we’d like to do some green co-marketing efforts,” said Nelson. “We’d be very open to that.”
Not everyone is waiting, however. The printing and peripherals industry has long been ripe for green initiatives, and Oakville, Ont.-based Laser Networks had made the environment a priority in its printing and fleet management business.
“Our customers have definitely indicated to us that they want to find ways to reduce their waste and, if possible, their carbon footprint in terms of toner cartridge usage,” said Chris Stoate, president of Laser Networks. “Our program is designed to enable them to do that by overcoming the barriers to making (cartridge reuse) an effective solution compared to the use of original toner.”
Stoate said he feels Laser has overcome some of the barriers to effective cartridge reuse and recycling that have existed in the past. It starts by charging customers on a cost per page basis, with Laser responsible for printer maintenance and supplies. This places the onus on Laser to ensure maximum cartridge yields, long a concern with recycled cartridges.
Because it owns and retrieves the cartridges itself, Stoate said Laser can afford to invest in a high-quality manufacturing process to maximize quality and yield. With each cartridge the company upgrades the components to make it more reusable, such as installing a more durable imaging drum.“If you’re not sure you’re going to see that cartridge again making the investment and getting a payback on the second or third cycle is less likely,” said Stoate. “While on the first cycle we’re arguably not particularly profitable, we’re profitable long-term.”
Despite the green-friendly factor of getting more life out of each toner cartridge, Stoate admits if Laser wasn’t able to compete on price as well it just wouldn’t be successful.
“We’re able to be typically significantly less than an OEM solution with disposable cartridges, from 20 to 30 per cent,” said Stoate. “The customer ends-up with complete service coverage as well as their toner for what they would have paid for, toner only, with an OEM.”
Green factors are rising in importance, and Forrester’s Mines said IT buyers are looking for more information from their suppliers on green options. Vendors need to demonstrate the ROI that companies can realize by going green, and relate it back to a dollars and cents issue.
Building a green message
Vendors need to bust some of the common myths around going green, said Mines, such as that it’s a more expensive solution approach. They also need to train their sales forces and partners to sell the green advantage, and take a holistic approach.
“The most effective vendors will take a wide-angle view of green IT rather than getting mesmerized by one aspect, such as energy efficiency or recycling,” said Mines.
“Wrapping together the disparate elements of a green IT strategy, internal and external, brings additional credibility and punch to vendors’ customer-facing efforts.”