More people are focusing on how to make energy a strategic asset rather than a cost center; and for a good reason, too. Based on a recent global survey of over 1,500 energy decision-makers (The Distributed Energy Future Trends Report), energy-conscious companies outperform their competitors. While energy is unlikely to be the sole reason for winning in the marketplace, the research also shows a sharp increase in concerns over remaining compliant with energy legislation and regulations. These trends confirm that energy has moved from being a basic business requirement to a strategic asset.
Extrinsic forces also place increased pressure on companies to responsibly address environmental sustainability, which the research shows as a top-three issue globally. Consumers are becoming more selective in their buying behaviors, increasingly choosing suppliers that have a lower environmental impact, and governments and regulators are taking action to see that their constituent companies reduce carbon emissions. The organizations that combine these economic and ecological drivers, the ‘sustainable businesses,’ understand that energy plays a significant role in ensuring ongoing success.
To elevate energy as a board-level topic, managers have to overcome four primary challenges.
First: close the gap between the CEO’s expectations and the day-to-day priorities of the energy manager and make a member of the leadership team responsible for the energy strategy, roadmap, and plans. The roadmap should set out the investment in energy technology, with a focus on resilience, and include specific targets, actions, and budgets.
Second: ensure the resources are in place to integrate the energy transformation plan with other large-scale initiatives. Digital transformation, for example, can either be at odds or work in concert with an energy strategy. Doing both well requires a long-term view on critical issues and a combination of internal expertise and relationships with qualified external resources.
"The organizations that combine these economic and ecological drivers, the ‘sustainable businesses,’ understand that energy plays a significant role in ensuring ongoing success"
Third: understand and account for the risks associated with large scale energy projects and the risks posed by power outages. Interruptions to your supply chain, processes, or systems can be extremely costly, so ensure a holistic approach which cascades knowledge throughout the organization.
Fourth: take active steps to discover how else your organization can lower its carbon emissions. This analysis should extend into the supply chain and working with partners who are aligned in your mission to be socially and environmentally responsible.
Successful energy projects must consider the energy challenge of the business holistically and understand the organization’s goals, business requirements, and technical constraints before presenting recommendations to management. Be sensitive to potential confirmation biases of energy service providers, and ensure that these third-party advisors keep the focus on finding the best solution to your organization. Finally, apply data-driven insights to drive decisions about technology for individual sites and the sites as part of the whole network. When you keep sight of the business aspects of your energy challenges, you unlock the opportunity to drive the business forward.
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