Sustainability as strategic driver for growth for IT products/services companies: business opportunity and value proposition to customer

Abstract

Motivation The motivation behind pursuing upon the topic of Sustainability is that for a long term this has been a buzzword in most firms across sectors. We always pondered over as to what is the real value in firms embracing sustainability. Is it beyond the feeling of FEEL GOOD and moral social responsibility? Most references of a firm on the lines of sustainability is in the economic sense and when we used to question whether their firm is SUSTAINABLE, most answers hold on to the financials and economic viability. Thus began our journey of understanding sustainability for a firm from an internal perspective and identifying the opportunity that exists for the environmentally sustainable solutions. We have emerged wiser as we reach a milestone on this journey. It gives us more conviction and confidence in elucidating the economic value behind the green initiatives. Summary We embarked on the journey with focus on IT products and services companies. We realized the three complimentary drivers of embracing sustainability namely cost savings, revenue opportunities and branding along with social responsibility. We studied the sustainability reports of the 6 companies (3 products HP, IBM, Intel and 3 services companies SAP, Infosys, WIPRO) chosen and then tried comparing them to identify the common areas of focus with regards to environment. We tried seeing similarities and differences among these companies in their drive for sustainability within the organizations and how it benefited them. Though the IT industry is responsible for about 2 percent of global GHG emissions1, they can act as catalyst in the operations of many other industries and can therefore support greening (for the remaining 98%). We then focused on the external world and evaluated the business opportunity that exists for sustainability offerings and how IT companies are earning their pie in this area. We also dug into the relevance of the same in Indian context by Indian companies. This was followed by literature review of Forrester research articles which gave us insights on the how the market for sustainability products and services is shaping up and how IT could be an enabler in the process. We also deciphered the barriers of adoption for these solutions by customers and we validated our secondary research from the analyst reports with customer interviews that gave us a pulse of the customer, his fears and expectations. Having realized the barriers, we also focused on how IT vendors have overcome these barriers by clearly understanding the customer pain points and also being innovative. This was followed by mapping the internal initiatives of these companies with the opportunities outside and came up with instances and insights on how the IT companies are building and delivering solutions that demonstrate a WIN-WIN proposition. Finally we narrowed down upon studying one of our own companies s offering and the value proposition of the same for the customer. We tried evaluating whether there is a compelling value proposition for the purchase of the solution and how are companies addressing the same. We conclude with our analysis and insights on the road ahead for the companies and the how they could identify new vistas in this area and fasten customer adoption of the solutions. Last but not the least, we also realized that beyond all economic sense and branding, it is vital for organizations be environmentally conscious of its actions and ensure that they not only deliver products and solutions but also a better healthier planet for the generations to come. Darwin s theory of evolution that speaks about survival of the fittest shall hold true for firms and those firms who are prepared shall be fit enough to survive.