Could IBM Be the World's First Green Business Behemoth? (22-Aug-07)
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Full article: Could IBM Be the World's First Green Business Behemoth? (22-Aug-07)
IBM could be about to enter another phase in its history. The company's focus has remained steadfastly on the world of IT. But there are indications the company could be returning to its eclectic roots, and it is the burgeoning demands of the low carbon economy that appear to be driving this diversification.
- IBM's recent partnership with U.S. electricity provider CenterPoint and its investment in research into smart grid technologies capable of smoothing the path towards adoption renewable energy and dramatically cutting energy consumption by providing people with real-time visibility over their energy use.
- The company's newly revealed interest in in-car technologies, provides Exhibit B. The focus on the development of a car operating system capable of ultimately automating driving may not seem like a particularly green initiative, but when you consider one of the prime goals of such technologies would be to optimise fuel efficiency and ease traffic congestion it is clear a pattern is beginning to emerge.
- Of course, these initiatives along with the overarching Project Big Green commitment to limit IBM's carbon footprint and enhance the energy efficiency of its servers and other data center technologies still fit into IBM's core IT portfolio.
- But perhaps the most compelling clue that Big Blue could diversify comes in the form of reports that it is investing heavily in developing photovoltaic technology. According to a recent story over at the Cleantech Blog IBM is using its expertise in semi-conductors to make rapid progress in developing photovoltaic solar technology.
Demand for green products and services is set to soar, but at the moment the supply side of this market remains extremely immature. Consultancies such as SustainAbility and the myriad of cleantech start ups may have experience in the sector, but they all lack the scale large corporate customers will look for when procuring green products and services. Meanwhile, those large multinationals that have been most vocal about their green product lines are either entirely consumer-focused operations, such as supermarkets, or energy and car firms guilty of running their green divisions as niche concerns alongside their traditional polluting businesses.
In contrast, IBM, and several other large IT companies for that matter, are perhaps the best positioned to meet the demand for green services:
- they provide the software and hardware that underpins all modern businesses;
- they boast relatively low impact business models compared to heavy industries;
- they have the engineering expertise in house that would allow them to diversify into other cleantech sectors;
- and they often run large consultancy arms already well versed in managing business transformations.
IBM is as well positioned as any company to become the first green business multinational.
Text of Article
Source James Murray, Business Green
There is something a bit strange going on at IBM of late.
Perhaps unsurprisingly for a company that has been going in one form or another for over 120 years IBM has enjoyed many incarnations, and now clues emanating from this most sphinx-like of multinationals suggest it could be about to enter another phase in its history.
It may be famous for its computers, but in the first half of the last century IBM and its forerunners churned out everything from bacon slicers to rifles and engine parts. However, ever since it landed upon the mainframe in the 1950s, the company's focus has remained steadfastly on the world of IT and it has deviated little from this core business as it has grown into one of the world's most powerful corporations.
But while its IT focus remains steadfastly intact there are indications the company could be returning to its eclectic roots, and it is the burgeoning demands of the low carbon economy that appear to be driving this diversification.
Sadly, confirmation of this new approach has not come from IBM itself, a company which with Sam Palmisano at the helm -- a man so garrulous he makes J.D. Salinger look like Jay Leno -- is not exactly big on public strategizing. But there is intriguing evidence to suggest changes are afoot.
Exhibit A comes in the form of IBM's recent partnership with U.S. electricity provider CenterPoint and its investment in research into smart grid technologies capable of smoothing the path towards adoption renewable energy and dramatically cutting energy consumption by providing people with real time visibility over their energy use.
The company's newly revealed interest in in-car technologies, provides Exhibit B. The focus on the development of a car operating system capable of ultimately automating driving may not seem like a particularly green initiative, but when you consider one of the prime goals of such technologies would be to optimise fuel efficiency and ease traffic congestion it is clear a pattern is beginning to emerge.
Of course, these initiatives along with the overarching Project Big Green commitment to limit IBM's carbon footprint and enhance the energy efficiency of its servers and other data center technologies still fit into IBM's core IT portfolio.
But perhaps the most compelling clue that Big Blue could diversify comes in the form of reports that it is investing heavily in developing photovoltaic technology. According to a recent story over at the Cleantech Blog IBM is using its expertise in semi-conductors to make rapid progress in developing photovoltaic solar technology, and while it is more likely to work at the component level than become a branded supplier of solar panels, the company expects to become a serious player within the market within 18 months. Furthermore, the site points out that IBM has recently filed for over a dozen U.S. patents for solar and photovoltaic technologies.
Whether or not these various research projects herald a genuine change in direction for IBM remains somewhat opaque, but there is no denying such a move would make sense.
Demand for green products and services is set to soar, but at the moment the supply side of this market remains extremely immature. Consultancies such as SustainAbility and the myriad of cleantech start ups may have experience in the sector, but they all lack the scale large corporate customers will look for when procuring green products and services. Meanwhile, those large multinationals that have been most vocal about their green product lines are either entirely consumer-focused operations, such as supermarkets, or energy and car firms guilty of running their green divisions as niche concerns alongside their traditional polluting businesses.
In contrast, IBM, and several other large IT companies for that matter, are perhaps the best positioned to meet the demand for green services: they provide the software and hardware that underpins all modern businesses; they boast relatively low impact business models compared to heavy industries; they have the engineering expertise in house that would allow them to diversify into other cleantech sectors; and they often run large consultancy arms already well versed in managing business transformations.
IBM is as well positioned as any company to become the first green business multinational the only question is whether or not it has the nerve and agility to diversify an IT-focused portfolio that has served it well for much of the last century.
It's too early to tell if IBM has the courage of its convictions, but let's just say the signs are hopeful.
James Murray is the management editor of ITWeek, and runs the BusinessGreen blog, where this article originally appeared.
- Source: Greener Computing
