Slowdown Greens

Blue and not green, has been the color that has descended upon most Indian
enterprises, much like the foreign counterparts. Over the past few quarters CEOs
and CIOs of most organizations are in a fire fighting mode, trying to maintain
the ship by trimming whatever is not necessary. Cost-cutting is the mantra of
the moment. In this race to keep afloat, what happens to green? Will it fade
like a passing fad or will it survive the downturn?

Beginning at the very beginning, India, Inc had recently woken up to green.
They realize that green necessarily didnt mean environment but greenbacks that
can be saved by making the right investment. In fact many of the Indian
companies were coaxed into adapting green because of the escalating costs,
namely in terms of power consumed and space utilized. By using green IT
solutions and practices, CIOs were able to reduce power consumption within the
organization by as much as 30-40%. Thus, in essence green was not about altruism
but hardcore business goals.

In the grand survey of approximately 300 organizations done by Dataquest a
few months back, the biggest motivation to go green was, not surprisingly,
reducing costs. Over 75% of the respondents of the green survey termed reduction
of costs as the primary motive. It is obvious that with the increasing costs of
resources, most importantly, power and real estate, the CIO seems to have taken
on some of the responsibilities of the CFO as well.

But with all that change with the coming slowdown, is it possible that since
companies are readily reducing their investments, be it tech spend or marketing
costs, could the green agenda take a back seat as well? This is one question
that seems to be baffling all the experts, CIOs and vendors alike. Will the
economic blue prevail over green?

Green and Lean

The green fears, so as to say, could well be unfounded according to quite a
few experts who are tracking the investment climate in the country. According to
them, the tightening of the purse might push the green agenda in a major way
since green is synonymous with cost savings. In fact, in a recent report
published by Forrester Research, it was stated that the slowing economy will not
derail efforts to make IT operations more efficient and less environmentally
harmful. Of responding companies that are changing the pace of their green IT
activities in response to the economic outlook, those going faster outnumber
those slowing down by 2 to 1. So the central value of green IT programsthat
greener IT also means saving moneyis taking hold among corporate IT practioners.
The survey, our fourth on this topic over the past two years, also reveals
steady uptake of foundational green IT practices, including greener procurement
criteria, documenting of action plans, and engagement with green IT service
providers, the report stated.

The report surveyed around 1,500 IT global operations and architecture
practitioners, with a bulk of companies headquartered in the US and Europe. The
message from the survey was that there would be little or almost no impact of
the slowdown on the investment to be made by the companies. Only a small
percentage of the respondents (5%) stated that there would be a slowdown in the
green IT initiatives, while the rest thumbed their support for the same. Hence,
the slowdown could well bring out the very opposite of what conventional wisdom
might suggest; it could result in a boost in spending.

A Winner All the Way

One of the biggest boost to green IT could come from virtualization as
enterprises across the board look at cutting down the servers in the data center
and the CIOs look at optimizing on their IT spend. The numbers that list out the
amount of saving that can be achieved out of virtualization is pretty amazing.
In fact, it is estimated that over a period of 12-18 months enterprises can
achieve 40% RoI from virtualization initiatives. Little wonder that
organizations such as Jet Airways, Maruti Udyog, and Perfetti Van Melle, India
have invested in application virtualization and have seen great savings in
investments.

A Rejoinder: Both these surveys were conducted before January 2009 when the worst impact of the slowdown started getting felt

And not only on the server side, virtualization can be a great solution on
the desktop as well. A lot of the high-end studios that undertake VFX
development are looking at ways to streamline their IT infrastructure through
the means of desktop virtualization, which can cut the TCO by as much as 40%.

Green was on our dashboard earlier also, and it still is on the agenda for direct cost saving benefits Rajat Sharma, sr GM, IT, Shree Cement	There has been no change in the investment planned for green IT initiatives Chandan Sinha, CIO, GHCL

Given the current economic scenario, wherein enterprises are looking at ways
and means to curtail costs, virtualization could come in handy as a tool to
achieve the same goals. By using the technology, they can reduce their overall
infrastructure to a significant level. For instance, Reliance Communications had
its data centers spread across the different parts of the nation and opted for
server consolidation using virtualization as a tool. And it has been quite
successful for them.

Data Center Slowdown?

One of the areas that could actually see a slowdown in terms of tech
adoption is the data center front. And data center here refers to the auxiliary
hardware that goes into the server room. Most organizations, which had earlier
planned to refurbish their data centers and turn them into modern behemoths
might just put the plans on hold for the moment.

A number of organizations are also looking to shut down their own data
centers and host their non-critical applications on to the web. Cloud computing
or remote hosting could be a big thing in the coming days, simply due to the
cost factor. A lot of mid- and small-size companies in India are already on the
hosted model and this is going to increase as time passes.

Green Vendors and CIOs

One of the biggest challenges faced by the vendor these days is the decision
to continue making investments in advertising and marketing, even as the topline
continues to shrink. As the enterprises cut-down on their own expenses and
costs, the vendors are also weighing the option on cutting their own overheads
as well. But it is more now than ever before that importance of a campaign needs
to be understood and it should talk about specifics rather than inane stuff.

Recently, Dataquest & CIOL had organized a major event in Kathmandu, where a
small questionnaire was sent to all the CIOs present. They were asked to raise
their concerns in terms of how the slowdown will impact green investment within
their own organizations. Most CIOs stated that since green is also about saving
money, not much difference would be made on the green IT budget within their own
organizations. On the contrary, many CIOs hinted at the possibility that the
spend on green IT might increase rather than decrease in these times.
Enterprises in India are also waking up to the need to make individuals
responsible for the green initiatives within the company, most of the time it is
the CIO who is (but in certain cases even the admin and HR departments) asked to
take the onus for greening the enterprise.

Another trend picking up in organizations is looking at green procurement.
That means purchases are done looking for greener options. This trend will only
increase in the coming days with companies incorporating the green specs at the
RFP stage itself.

In conclusion, it seems possible that green IT would not be affected by the
slowdown or recessionary trend, as enterprises and companies become more
stringent in terms of every penny that they spend. They will have to
increasingly look at both hardware and software options with which they can
drastically improve their productivity, and in light of this, green IT will
prevail as a cost cutting technology if not a path breaking one.

Shashwat DC

shashwatc@cybermedia.co.in