By Mark Atterby – Senior Staff Writer

As part of its continuing focus on providing solutions for the utilities industry, Capgemini opened a Smart Energy Centre of Excellence in Melbourne last week. The centre is part of a global network of centres that aim to leverage knowledge, expertise and capability from across the globe to deliver Cap Gemini’s Smart Energy solutions.

Perry Stoneman, Vice President and Global Leader of Capgemini’s Smart Energy Services line says, “The Energy and Utilities sector is important for Capgemini worldwide. We have a strong presence globally and our new Centre of Excellence in Australia complements our market leadership and will play squarely to help strengthen our solutions offerings.”

The opening of the centre is quite timely, with the recent introduction of the Carbon Tax in Australia. One of the key areas the centre will be used to demonstrate solutions for sustainability and carbon accounting outsourcing.Carbon accounting outsourcing could very well be the next big thing in the multi-billion business process outsourcing (BPO) industry.
Stoneman comments, “Managing carbon accounting in-house has proven a major obstacles for companies world wide due to the complexity of data sources, report formats and the shortage of resources. To effectively manage and generate reports requires a single system of record keeping that is part of the organisation’s day-to day business processes.”

The second objective of the centre is the development of solutions around Smart Grid Technology that can manage and monitor a decentralised power grid that is more reliable, sustainable and accommodate distributed generation. According to Stoneman the existing grids in Australia are based on centralised generation with one-way distribution to a selected region. The current grid is not capable of adequately managing multiple generation points and power flows that take into account renewable and micro generation sources.

Finally, the centre will also be looking at Smart Meter Technology for the home. Capgemini will leverage its capabilities from the Smart Energy COE in collaboration with its partners, including but not limited to the Smart Energy Alliance (www.smart-energy-alliance.com), to deliver Smart Meter solutions for the home. In the new year, Capgemini will be announcing a range of partners in the utility and telco space to bring a range of new services and applications for the home energy user.

Dominic Del Giudice, Leader of Capgemini Australia’s Energy and Utilities sector says, “The Energy and Utilities sector is a focus for our business in Australia; we are making investments to support our clients’ business and technology priorities. Our Smart Energy COE will support our Energy and Utilities clients through access to our thought leadership, innovation and smart solutions that we leverage from our global COEs in India, Europe, Nordics and North America and develop for the Australian marketplace.”

By Martin Conboy, President – Australian BPO Association

As we are coming to the end of yet another eventful year, I thought that it might be a good idea to ponder upon what next year will bring.

I believe that we will still see even more concentration on lower operating costs as companies try to survive in an ultra competitive environment, and we will see more ‘Green’ initiatives in the way that good companies go about their business.

Will we or won’t we have a US double dip recession?

We hope not. However, economists in the US doubt consumers can keep spending like they did in the northern summer without actually earning more. Consumers are already struggling with higher prices for basics like food and petrol. For spending gains to be longer lasting, employers will need to hire more people and that’s not looking very promising. In recent months, US job growth has stagnated and employers have only added about 75% of the number of jobs needed just to keep up with population growth. I believe that it will be hard for the US to justify sending jobs offshore with nearly 20 million people on the unemployment list. We have heard of a number of BPO projects being repatriated and companies using that as a marketing edge. That will cause a slow down in BPO activity in this part of the world as most large projects come from America
This will in part be offset by the acceleration of Shared Services. Next year will be the year when Shared Services comes of age, especially in Australia. It has reached the tipping point and is just about there or there about. I believe that Shared Services will become a very important part of the BPO value chain and move offshore in an accelerated manner. The cost efficiencies will be too compelling for companies to ignore and will dictate the offshoring of non-core services.

We are going to hear a lot more about China next year. We believe that China will have little or no impact on BPO in the broader region, but it will all be about internal growth. There will be fantastic opportunities to sell consulting services into China as they gear up to service their own market. Just remember that over 60,000,000 people took an international holiday out of China last year and their middle class is growing very quickly.

The cloud finally seems to be getting traction and organisations are starting to get their heads around the cost savings, such as no infrastructure costs and the efficiencies of centralized and standardized databases. Converging technology and the further blurring of the lines between devices like smartphones, tablets and laptops and an emphasis by the cloud players to develop mobile computing applications so that people can access data anywhere, anytime anyhow will have a dramatic impact of its uptake.

Online shopping will offer cost savings to consumers of up to 50% and will drive competitive savvy companies to offer BPO customer support behind their shopping websites as a way of establishing competitive advantage.

We believe that with inflation set to stay around the target set by the Reserve Bank, Australian economic growth in line with the long-term trend and unemployment broadly steady, there will be no need to move interest rates upwards to put a break on the economy.

The Australian dollar will still stay at its record highs, which will only amplify the cost difference between Australia and less expensive BPO Asian destinations. The Australian call center outsourcing sector will really start to shake itself out next year, and we expect to see a lot more mergers and acquisition activity and maybe some players withdrawing from the market altogether.

The Realities of Environmental Responsibility in Outsourcing
By Jerry E. Durant, Chairman Emeritus – IIOM

Behaving green is not simple.

When a business adopts a green policy it is often driven by very personal reasons. These reasons can motivate as a form of value statement of the business or more virtuous based on an overwhelming desire to do something that is socially important. Regardless of the reasons each and every step taken contributes positively.

In 2009 the Black Book of Outsourcing conducted a Green Outsourcing Survey. In this comprehensive report tremendous insight into the effectiveness and extent of green policies was revealed. At that time only 17% of companies have environmental policies met or exceeded their goals. Low achievement was influenced heavily by fiscal/cost cutting issues. But the more interesting aspect was that low levels of achievement were also caused by the further sourcing to other suppliers.

Environmental policy is not implemented in a vacuum; it relates a series of events that unfold either as a result of decisions that are made and how they subsequent proceed through to final transformation (either recycled or neutralized).

A Case Example

To illustrate the complexity of a sound ecological policy let’s take a journey. It all starts with a company deciding that it wishes to adopt a sound green policy. As was our case at the International Institute of Outsource Management (IIOM) we chose to concentrate on the:

• Use of paperless technologies;
• Acquisition and use of energy saving equipment (primarily computers but also included low energy lightening and environment conditioning);
• Low carbon travel & transportation footprint;
• Purchase of green recycled materials; and
• Following confirmed technology asset disposal channels.

It is our intent to focus on the leading areas where we know that a change in behavior would produce good results. From this experience we believe this will help with future changes that will be incorporated. If we assume that IIOM is a buyer of outsourcing services our environmental policy would be totally useless if we select a provider who has no policy or an ineffective program. A number of the tier 1 outsource service providers have programs (e.g. Accenture, Xerox, CSC, Wipro, SITEL, Convergys…) but the contradiction is that where Sweden (93%), US (77%) and the UK (74%) have high adoption rates, India at 33%. The diminished compliance with green policy adoption in provider nations increases carbon emissions and energy consumption which defeats, with volume, the diligence created by buyer nations. Economics has a dramatic influence on service providers. Sustaining cost control and competitive pricing places tremendous pressures on adopting and following a green policy. While paperless technologies and mass storage represent two strong adoption areas the program is compromised when access to recycled materials, and green disposal channels are not available. Buyers and providers need to also realize that any savings that occur have to provide respectable value return to offset carbon footprint created by engagement travel. The advancement of dashboards, net meetings and even simple email serve as alternatives to travel. But one should never expect that travel can be eliminated, face time is essential and should never be avoided simply because of having a green policy. This brings up the operating elements, such as travel or non-environmental friendly materials that are required as a part of operating a business should be clearly stated in your green policy.

The Global Contradiction

While business struggles with the implementation of green policies the influence of the economic downturn and global unrest place at risk ecological endeavors. Our focus is quick diverted to attend to more pressing matters that are threatening our operating survival. Countries like India (#3), China (#1), and Russia (#4) in the CO₂ can make small adjustment to non-environmentally friendly social aspects and achieve massive results. But for the US and EC (#2), Japan (#5), Germany (#6) and Canada (#7) who have substantial environmental protection measures diminish carbon output requires massive reshaping of industrial operations. With economic pressures these are difficult to consider and makes outsourcing green but only to the extent of shifting the responsibility to provider nations.

The computer which was produce in Thailand, purchased in Kansas City, and dispensed to a provider in Bhopal does stop the carbon cycle there. In fact the materials necessary to manufacture the computer in Thailand in the first place required petroleum to fuel the machinery and boats to capture the raw materials, electricity to manufacture the computer, and more petrochemicals to transport it to the US buyer and then reship it to Bhopal. Assuming that it was energy efficient we will have saved on electrical consumption (if not energy efficient we waste resources). Once in Bhopal it again goes under power generated by dominantly coal (but alternatives like geothermal, nuclear, and hydro sources help to reduce non-green effects.

Finally at the end of its life, and assuming that no additional life exists, the computer reaches its resting place… the scrap monger. Here it will be stripped, recycled and disposed of in a not so deliberate fashion leaving opportunities for improvement and lots of irreversible ways.

Green with Envy

Behaving green is not simple. While goal setting and policy statements help in setting the tone for ongoing socially responsible behavior it doesn’t get the job done. Whether you are changing purchasing behavior, controlling carbon emissions or reducing cradle-to-death asset disposal a company must make a concerted effort to understand the full life cycle. In the context of global sourcing, far or near shore providers may find answers in using advisors to start implementing a green operation policy.

Our (IIOM’s) decision to adopt a green policy was for self-purposes, we wanted to make a difference no matter how small it might be. We concentrated on those areas that we knew that we could do a better job with, and in areas were our goals could be met. Behind the scenes we are hopeful that more can be done in the future and that positive perceptions can encourage others to Go Green.

New BPO service from Capgemini targets environment and sustainability management

By Mark Atterby – Senior Writer

Capgemini and CA Technologies have announced a partnership to develop a global Energy, Carbon and Sustainability BPO services. Targeting organisations in industries such as manufacturing, fuel and utilities that have a significant carbon footprint, the service will help organisations to better manage complex sustainability data collection to address increasingly challenging reporting demands.

Capgemini believe the new service will offer them significant opportunities within their existing client base and with new clients, Michael Alf, VP Capgemini Australia, says, “The issues surrounding sustainability and for companies to manage their responsibilities are becoming far more crucial. Organisations need to be providing accurate and meaningful reporting to ensure they are meeting their compliance requirements and are active in addressing their corporate responsibilities.”

“Given the trends around sustainability and the significant pressure for organisations to do something about it, we see significant growth opportunities in this area”.

The partnership aims to leverage Capgemini’s BPO experience and expertise and CA Technologies CA ecoSoftware solution, to provide customers with ‘actionable insight’ into their level of sustainability, which will help support and accelerate achieving their environmental objectives.

“Unfortunately, for organisations the necessary data is spread around the organisation in various locations and various formats. They lack the standards and processes for collating and managing that data or for analysing and producing results. This is where the new BPO service comes in. We help customers better manage the complex sustainability data collection process and increasingly challenging reporting demands so they can focus on sustainability strategy and carbon reduction activities”, comments Alf.

According to Michael Alf compliance will be a leading but not a prime driver behind this area of outsourcing. Forward thinking enterprises have recognised the significant competitive advantage in adopting sustainable development principles, including greater efficiencies and cost reduction, improved compliance performance, and brand protection leading to greater support from regulators and stakeholders.

Over the last view years a range of Indexes and standards have evolved, in Australia and overseas, to evaluate the environmental and sustainability practices of different companies. As such there is the Australian SAM Sustainability Index, the Corporate Responsibility Index (Australia), the Dow Jones Sustainability Indexes and the FTSE4Good Index.

Investors and shareholders are increasingly evaluating these indexes to determine which companies they should invest in. Relatively recent research conducted for the Responsible Investment Association Australasia showed that, in the overseas shares and balanced growth categories, managed funds that prioritised responsible investment outperformed mainstream funds over a period of seven years, up to June 2009.

The Capgemini BPO Sustainability Service aims to help companies take a comprehensive and rigorous approach to embedding sustainability into their organisation. Mr. Alf says, “From the analysis of the process to the implementation within a robust data management tool, we help our clients: Drive efficiencies and reduce costs; Reduce risks and effectively manage compliance obligations and; Support clear and effective communication with all stakeholders to protect and enhance market reputation. “

To deliver its service Capgemini will be deploying CA technologies, energy and sustainability management software, ecoSoftware, for collating and managing the relevant data.

By Martin Conboy
President – Australian BPO Association

I am prompted to write this after seeing the incredible damage done by the flooding that is currently happening in Australia. We keep hearing about once in a century weather events, however they seem to be happening more frequently than every hundred years. There is definitely something wrong with the planet and only those with their heads in the sand can deny it.

Going green is a lot more involved than simply turning off the lights; changing to energy efficient light globes; using double-sided photo copy paper; not throwing waste into the sewage system; recycling; or designing buildings that work with nature to heat up or cool down as the case maybe, although that at least is a start.

We are seeing positive initiatives in some quarters as a ground swell of concern is racing ahead of political debate. There are many green initiatives around efficient utilisation and conservation of energy, water and natural resources. Key features include climate responsive architecture (using natural daylight); recycling of sewage; drip water irrigation; solar water heating systems in place; air quality monitoring with CO2 sensors; use of materials with low volatile organic compound emissions for interiors and maximum use of eco-friendly recyclable materials.

David Suzuki, the much admired environmental scientist and broadcaster in his final “legacy lecture” says that as humans, we must realize that “all other species are our kin”. We are not the only species on this planet; we do not just have a relationship with the environment, ‘we are the environment’. He stresses, “We have to come to grips with how powerful we’ve become. As a species, we are not any more dominant than the other creatures we started out with in Africa. The only thing that sets humans apart is our memory, our curiosity, our inventiveness and self-awareness. We have foresight to imagine the future, whereas other animals do not. Over the years we have expanded and multiplied at a staggering rate, so that we now occupy every continent on the planet”.

According to Joel Cohen, Professor and head of the Laboratory of Populations at The Rockefeller University and Columbia University, It took hundreds of thousands of years for the human population to reach 1 billion, around the year 1800 and another 200 years to reach 6 billion and by 2050 it is estimated to be 9 billion.

Suzuki reminds us that it is because of the size of the human herd that we need to realize our impact on the planet. “We don’t know our own strength. So many of us have become disconnected to the earth. Our future depends on choices, on the choices we have made in the past and those we will make today and in the future. We cannot continue the exceptional growth of this last half of the 20th century without experiencing consequences. Think about this, every time that the global population doubles there are more people currently alive than the sum of all the people who ever lived.“

Also consider this for a moment; the combined wealth of the 200 richest people on earth is more than the combined wealth of the bottom 2 billion.

“The way we see the world shapes the way we treat it”, stresses Suzuki. He provides examples of Native Peruvian school children that revere a nearby mountain as a god, and therefore respect and honour it and that determines how he or she will interact with the environment. The juxtaposition is the modern suburban child who sees the nearby mountain as unimportant or unessential in his or her life. They will just see the mountain as a place that contains materials that can be exploited? We are consuming too much and using our environment as a toxic dump and it’s simply not sustainable.

Suzuki reminds us that in previous centuries, farming was a main source of income and was the livelihood of most people. Therefore, most people lived in rural areas. Nowadays, most of the people in the world live in urban cities. According to Suzuki, this has shifted our focus from environment to economy. What we have forgotten though, is that “an economy is made possible by the biosphere.”

Being ‘green’ is not just an option any more; it has become a necessity, especially as more and more organisations prefer to do business with companies who have initiatives in place to reduce the carbon footprint of an operation. Many business deals in the coming years will depend on the carbon neutrality credentials of an enterprise. Be that as it may, if we have the ability to change the way we treat our environment, surely then we have a responsibility to do something about it. It’s all very well being rich, but all the gold in the world will be useless if you cannot breathe!

Thinking green has become an important part of an organization’s corporate social responsibility. Slowly but steadily we find companies taking positive steps towards setting up operations that comply with environment sustainability points.

“We define a green company as doing three things such as integrating corporate responsibility — including green — directly to the business strategy; making it easy for customers to buy, operate and dispose of your products in an environmentally responsible way; and being as transparent as possible about your green initiatives and operations, and very public about your environmental goals,” says Mahesh Bhalla, executive director, and GM, consumer division, Dell India.

“To be environment friendly, the company has to have efficient power consumption; recyclable/reusable packaging; recycling offers for older equipment; use of non-toxic materials; and making investments in future green concepts such as alternative materials,” says Bhalla.

Proper use of outsourcing and cloud based IT lowers carbon emissions by allowing people to work from anywhere without having to commute, these days they ‘Telecommute’. By shifting business processes away from environments that require workers to use private transport to get to work, to environments that have fully utilized mass public transport systems must have an over all impact on carbon footprints. If a company is outsourcing some of its business processes, it will require less real estate as it will have a reduced work force and thus will have lower heating/ cooling bills.

Fellow citizens of the planet and members of our global BPO community, I challenge you to find ways to minimize your carbon footprint and via this forum to share these ideas with us all. Let us take the lead on this important matter.

mconboy@abpoa.com.au

The National Outsourcing Association (NOA) remains optimistic about the future of ‘green sourcing’ despite global leaders not coming to an agreement at the recent Copenhagen summit. To date, there are a small number of ‘green’ outsourcing contracts that signed without considering the outsourcing supplier’s ‘greenness’.

The NOA has spearheaded its Green Steering Committee as a guide for the outsourcing industry on what ‘greenness’ really entails in sourcing. This will increase the effort in understanding this segment of the industry, helping to make ‘green sourcing’ a better established segment.

This year will also herald more developments in green products and services that affect a business’ green credentials.

Government requirements like Carbon Reduction Commitment (CRC) makes way for new opportunities in business process outsourcing. A pioneer in this space is Advisory First Carbon, a division of ADEC, which grabbed the opportunity to offer ‘carbon accounting’ to businesses that need to assess and cut down their carbon footprint. As expected with outsourcing, this will enable companies to focus their efforts in following this legislation and in growing their businesses, leaving tedious processes to outsourcing suppliers.