Category Archives: Green Business

The four levels of sustainability

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Many people are familiar with the four stages of competence as described by Steven Covey and others. As companies develop their energy management and sustainability programs they go through similar levels.

Level 1 – Unconscious Incompetence – These are the companies that just don’t get it. Management sees no payback in sustainable programs, so any interest by employees in this area is quickly extinguished. They don’t see the point to industry or government regulations and will often try to circumvent even the most basic of regulations. They’ll often have comments like “energy management/sustainability doesn’t apply or doesn’t matter to our business”.

Level 2 – Conscious Incompetence – At this stage management still isn’t sure that there is a payback to sustainable practices, but they’ll let interested employees develop programs and take some steps, as long as they don’t have to spend money and it doesn’t take too much time. Any green initiatives are usually started by individual employees who are passionate about the topic and are willing to put their own time and effort into promoting it. While they meet government standards and regulations, they’ll only meet minimum standards.

At this level companies will be doing things like replacing their lights (but only if it is paid for by government subsidies), putting up posters to promote energy savings, having brown bag lunches and other  “feel good” activities. Programs are heavy on clichés without any in-depth understanding of the issues. If the employees that started the programs leave, the programs will likely not continue.

The approach at this level is tactical (see our other blog Energy Management – Is a Tactical or Strategic Approach Best For You?), the belief that technology alone can make a difference. Savings due to green initiatives are often hard to prove and will often diminish with time.

Common comments heard from these companies are “you can do a lot without spending money”, “little things make a big difference” and “it’s hard to get people to change”.

Level 3 – Conscious Competence – Management is supportive of sustainable programs at this level and are willing to spend money and time, but results do have to have a return on investment. In larger companies there will be employees whose job description includes energy management or sustainability, and they might be as high up as middle management. Green Teams will be prominent and actually have some influence over how things are done. Programs are driven by policy, not individuals, so they will continue even if individuals leave the company. Senior managers may have goals related to energy efficiency or sustainability written into their annual objectives.

A deeper understanding of the issues is evident and companies are implementing systematic procedures and implementing software to identify baseline activities as well as develop long-term plans for identifying energy savings and other sustainable issues. Carbon tracking software is used in smaller companies while larger firms are implementing EMIS (Energy Management Information Systems) or M&T (Monitoring & Targeting Software) to identify trends, prioritize spending and maintain increased gains over time.

The approach at this level is strategic, and it is understood that behavioural changes are the key to long-term success and planning.

Level 4 – Unconscious Competence – The progression from tactical to behavioural continues, at this level sustainability is ingrained as a cultural issue. Everything from the company’s products to it’s buildings and offices are developed with energy management and sustainability being primary considerations in all decisions. Management wholeheartedly supports, promotes and leads by example in all areas of sustainability, and there will be someone at the “C” level whose primary function is in this area. Most if not all employees will have annual sustainability goals in their annual objectives.

They’ll often ignore government regulations because they feel that they set the bar too low!

Probably the best known example of a company at his level is Interface, Inc. and their CEO, Ray Anderson. They changed everything including their products and manufacturing processes to further their goals of sustainability. They’re also profitable and set a high standard for others to follow.

Unfortunately most companies never rise above Level 2. Where do you think your company stands?

Energy Management – Is a Tactical or Strategic Approach Best For You?

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Energy never used to be a problem. For industrial or manufacturing companies it may have been a major cost, but it was relatively stable and seldom a concern.

That has changed dramatically. Costs are changing all the time, with electricity costs in Ontario slated to be the highest in North America in the next few years, gas and oil are bouncing near record highs, natural gas costs are actually going down, but who knows for how long. Your customers are greening their supply chains and expect you to prove that you are green and getting greener. Utilities are being forced to reduce consumption and expect you to help them. The media is quick to jump on any “dirty” industries that aren’t seen to be doing their part to improve the environment. Even investors want to see quantified energy savings as they fear exposure to potential liabilities.

For these and many other reasons developing an energy management strategy has become a priority for many companies. Whether by plan or by accident, most strategies fall into two main types that I’ll call tactical and strategic. It isn’t a case of one being better than the other, more of what fits better with your goals.

In a tactical approach, the big question is what can I do now to reduce energy use? The usual first step is to have an energy audit performed on your facility. This will identify sources of waste and offer recommendations which most frequently relate to upgrading lighting, HVAC or compressed air systems. These are one time upgrades that are likely covered by a grant through the OPA or other agency, and once they’re done there is no further action. For something like a warehouse/distribution centre, office or light manufacturing facility this might be as much as can be done without making modifications to the building, which can be expensive or just not possible if you don’t own your space.

While the savings can be significant with a tactical approach and you can claim “green” points, there is no long term plan put into place. Behaviours don’t change, there are no ongoing goals or targets to encourage further energy conservation. And if your facility has a complex energy profile with many energy consuming items, it can be difficult to prioritize or see the results of any changes that are made. (See  How an M&T System Can Reduce Equipment Operating Costs)

With a strategic approach, results over a longer time are key. In this case the question is more likely to take the form of how can I reduce my energy use by 10% each and every year? A long term goal which has senior management support and is incorporated into employee annual performance goals can be very powerful. It creates an atmosphere that supports a culture of energy conservation and behaviour change, which has proven to be a far more effective tool than technological changes alone. While the same tools are used as with a tactical approach, the emphasis is on continuous improvement, not just one-time upgrades. Energy conservation becomes a “participation sport”!

Those who are familiar with Lean Manufacturing will see the similarities in approach. An emphasis on continuous improvement and the journey are key.

The best tool to help implement a strategic energy management plan is an Energy Management Information System (EMIS) using Utility Monitoring and Targeting (M&T) software with modeling capability. It allows you to develop benchmarks to identify and quantify current energy usage. By developing models based on production data, weather or any other energy drivers unique to your situation you can track and quantify performance over time as energy management plans are put into place. The cost benefits of changes in activity or capital investments can be quantified before any investments are made so projects can be prioritized to get the best returns. Once implemented, energy savings can be compared to expected results to ensure equipment is working as promised or if additional work or even refunds are necessary. All stake holders both within the company and externally can be shown actual quantifiable and ongoing results to foster confidence in the plan and encourage additional conservation activities.

Whether you take a tactical or strategic approach to energy management depends on your specific circumstances and goals, but “business as usual” is no longer an option when it comes to energy!

Can a small business reduce it’s carbon footprint?

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You’ve heard about the benefits to your business of “going green”. Sustainability is first and foremost about reducing waste in all its forms, which means reduced costs. Buyers like Walmart are choosing suppliers based on their sustainability scores. It improves your reputation to be seen as being green, which means improved branding plus more potential employees are attracted to your company. Or like many people, you want to leave a better planet and company to your kids. But if you’re a small company, perhaps just a group of people working out of a rented space, what can you do to make a difference?

Actually, there’s a lot that you can do. But there are three crucial factors to think about before you get started:

Talk to the boss – It’s crucial to have the support of senior management. Unless the boss approves of the time and money commitments and holds people accountable, your green initiative won’t go anywhere.

Plan and Measure – Before you start making changes, you need to know where you’re starting from and what effect your actions have. You need to quantify results to avoid charges of greenwashing, plus it keeps people motivated if they can see the results of their efforts. It’s the same as dieting, if you step on the scales every day it’s rewarding to see results and a motivator to continue your efforts.

The best tool for this is Carbon Footprint software. GOBI is a great example, it’s an inexpensive, easy to use carbon management software package that organizations of all sizes can use to measure, report and reduce their carbon footprints and GHG emissions.

The Critical Choice – While it’s charming to lease space in an old mansion, unless it’s seen major renovations recently it’s likely a carbon sinkhole. Look into LEED certification and make sure the building you work in is built and maintained to current standards, otherwise managing heating, cooling and lighting could be problematical.

Now that you’ve laid the groundwork, what steps can you actually take? Sustainable Waterloo is an impressive organization that promotes sustainability in businesses and their annual report describes the measures that their small company clients have found to be effective. Some examples:

Think out of the box – Getting to and from your “box” (otherwise known as your office) can have a big impact. Instead of driving their cars, can your employees carpool, take transit or bike to work? Work travel is a big source of GHG (greenhouse gas emissions). While face to face contact is still crucial in business, other options are increasingly available and accepted, such a teleconferencing, webinars, etc.

Flick the switch – An office building found that their peak energy use for the entire year came at 3AM on a Tuesday morning in February. It was like a science fiction movie, heat on full blast, all the lights and computers were on, coffee was brewing, but no human had been or was going to be in the building for many hours. With peak energy pricing in effect, this was a huge waste of money and energy. Turn it off or turn it down!

Think before you throw – Somewhere around 40% of printed documents aren’t necessary, and a significant portion of them are forgotten and don’t even get picked up from the printer! By reducing and recycling paper, bottled water, paper towels and other materials you can make a big impact.

By developing and implementing a plan and measuring the results with GOBI, even a small business can significantly reduce their carbon footprint. If you buy carbon offsets to match what you can’t eliminate, you can actually reduce your GHG emissions by 100%!