Industry Voice: Rising energy costs - a catalyst for sustainability in the channel

clock • 5 min read
Industry Voice: Rising energy costs - a catalyst for sustainability in the channel

With the price of electricity surging for both businesses and consumers, saving costs has never been more important. New research from CRN and Schneider Electric has found more than 70 per cent of end-user organisations agree they are under increasing pressure to reduce energy consumption in the face of the energy crisis. But how is this impacting the channel, and what steps can businesses take to begin improving efficiency while helping customers to mitigate rising costs?

In many respects the energy crisis has been a catalyst for energy efficiency and modernisation across the spectrum of IT and critical infrastructure. Operating costs have increased by up to a factor of five, and in some cases more, meaning end-users have had to quickly pivot to identify ways of driving efficiencies within their computing and digital infrastructure systems. From cloud hosted applications and on premises data centres, to distributed IT applications at the networks edge, IT efficiency and sustainability have become integral for today's organisations.

Sustainability in the channel

Interestingly the move towards net zero and sustainability has quickly gained traction in the channel. Many Resellers, Distributors, MSPs, and consultancies are already taking steps to reduce energy usage and emissions. This, in part, is driven by customer expectations, a greater awareness of the impact of climate change, and a need to partner with like-minded businesses to reduce scope III emissions. Customers also have a key role to play, and increasingly want to engage with businesses - be it vendors or service providers - committed to environmental sustainability.

Indeed, the new research report from CRN and Schneider Electric found more organisations are looking to their partner ecosystems to help reduce their environmental impact. In fact, 60% agree that having the right channel partner is now integral to meet their Environmental, Social, and Governance (ESG) and sustainability ambitions. As we look to the future, sustainability has indeed moved from a ‘nice to have', to both a prerequisite and a business opportunity for channel organisations.

Energy efficiency and consultancy

With energy costs surging and a growing impetus for sustainable change, IT partners must fundamentally adapt to changing macroeconomic and market conditions, while growing their businesses both sustainably and profitably. This means working with their customers consultatively, and recognising that while a net zero is essential, cost, resilience, and security, will continue to remain vital considerations when procuring new technologies. In fact, the research found that for IT decision-makers, the most important factors when purchasing and managing infrastructure are still cost and security. So, with net zero now so vital, what's missing? 

From both a sustainability and an energy efficiency standpoint there are two approaches to consider. Some organisations are evaluating the long-term benefits of sweating their legacy systems, while others are undertaking significant modernisation programmes. Key outcomes being sought are the need to reduce energy usage, emissions, and costs. While some progress is being made, however, there also remains confusion on how, or where to begin. 

For example, when asked how easy it is for their organisation to calculate and understand the energy efficiency or sustainability of their IT or data centre infrastructure, confidence, according to the research, was minimal. Just 13% of end-user respondents rated the ease of assessing their infrastructure as greater than 8 out 10. This presents a major opportunity for partners to step in and support end-users with energy efficiency audits or consultancy services prior to hardware replacements and modernisation - the business case for which can be complex.

Some organisations, for example, might consider ‘rip and replacement' strategies to be at greater detriment to the environment. Yet retaining inefficient servers, UPS or other legacy IT components can be far more detrimental, especially if an organisations' primary goal is to reduce emissions or energy usage over the lifecycle.

Importantly, making energy efficiency one of the key criteria for product selection is vital, and if the technologies being implemented are inherently more sustainable, energy efficient, or there are circular strategies such as recycling or take-back programmes in place, many of these concerns can be alleviated.

Data driven insights

On the road to greater efficiencies and sustainability, another crucial aspect to consider is the visibility of distributed IT, edge computing, and data centre environments. To begin reducing the carbon impact of these systems, IT decision-makers must first understand the whereabouts of their critical assets, and the sheer number that need to be addressed.

Here, the ability to monitor IT systems in real-time becomes vital, and for many partners, it is the first step in helping their customers to establish a baseline on which improvements can be made. The analytical insights offered through vendor-agnostic software platforms, such as Schneider Electric's EcoStruxure IT, can help end-users to gain a granular understanding of their energy usage, while providing partners with key data detailing where improvements can be made.

For channel organisations seeking to establish new revenue streams via sustainability and energy management services, harnessing the power data is absolutely vital, and will ensure that sustainable progress can be both documented, and that continued improvements can be made.

 Changing the conversation

Underlying the key challenges surrounding sustainability is a need to change the conversation from capital expenditure (CapEx) to sustainable, or tangible outcomes. This requires IT decision-makers to engage with procurement and C-level teams at the start of the process and move the conversation forward from initial budgetary investments to cost and environmental savings.

In many respects these outcomes may best be demonstrated through consolidation of inefficient IT assets, reduced energy consumption and carbon footprint, and long-term savings on both energy and maintenance costs. However, without buy-in from all key stakeholders, sustainability strategies are likely to fail, or at least, experience significant setbacks.

At Schneider Electric, our mission is to be your ecosystem partner for sustainability and efficiency, and we believe that right now we're only just beginning to see the impact of sustainability in the channel. Looking forward, developing the right partner ecosystem will be essential to help end-users achieve their net zero aspirations, and help businesses reduce the environmental impact of their IT infrastructure.

To learn more about CRN's latest research alongside Schneider Electric into approaching sustainable business, read the full report here.

This article is sponsored by Schneider Electric.

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