Be pound poor and become Penny rich

Energy management is and should be perceived as a long-term investment by organisations. Having said this, the need for all organisations to implement energy management strategies now cannot be overstated as these strategies will save their costs of running the business in future.

Many organisations may shy off from implementing energy efficiency measures in place opting to save the associated costs or to use the cash for other projects that may be perceived as high priority in the short run. This is most likely to occur when cost cutting is a priority. Long-term planning is however critical for energy efficiency programs. Taking steps to improve building management and energy efficiency will and does pay dividends in the near-term and may be a competitive tool in the long-term.

Be energy smart
All energy management projects begin with being energy smart which calls for the understanding of energy usage. Use of Smart Meters that give real time readings of energy usage, can dramatically help businesses understand the benefit which energy management brings to the organisation.

Smart meters also cut the amount of time businesses spend on administration by allowing them to pay accurate bills, based on accurate readings. Some suppliers also support businesses to identify areas of energy wastage/inefficiency and help setting targets for energy reduction that guide behavioural change with regard to energy in the organisation.

Use of technologies that record the energy usage at the water or electricity meters putting data into a system where the users can graph it has made it easy to compare energy consumption in various departments, sites or buildings. Appropriate measures can then be implemented to improve the efficiency.

Partnerships between businesses and energy suppliers
Since the long-term benefits of reduced energy consumption is beneficial to both suppliers and consumers; the responsibility of managing energy consumption is being taken by both. Businesses should work with the suppliers on cost reduction strategies through identifying areas where energy is being wasted and advising businesses on how to save energy. Of key importance when choosing an energy supplier therefore is their depth of understanding of a business’ energy management needs.

Capitalise on government incentives
Businesses should always explore varied financing mechanisms for their energy efficiency programs e.g. government schemes generating electricity and selling it to the grid.

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Recognizing Your Carbon Footprint

Countless times we have heard of the term ?carbon footprint?. Perhaps we have seen and heard it on TV or read it in newspapers, magazines and published articles. Indeed, it has been an expression familiar to everyone as it is always associated with climate change, carbon emissions, global warming, pollution and other environmental issues. Carbon footprint is real. It exists and, in fact, continues to affect the world we live in.

Defining Carbon Footprint

Two essential words comprise the term carbon footprint. Fundamentally, ?carbon? means the carbon dioxide circulating in the atmosphere. It is also the general word used for other greenhouse gasses emitted into the air. On the other note, ?footprint? refers to impact or effect.

Think about the footprints people leave on the beach sand upon walking on the shore. That is exactly what carbon footprint is like. It’s about the impact humans leave on the earth in the form of carbon dioxide and other greenhouse gases.

Calculating Your Personal Carbon Footprint

The food we eat, products we use, vehicles we ride on and electricity we consume emit carbon dioxide. In fact, our activities, lifestyle, homes, and countries contribute to climate change. And carbon footprint is the best estimate we can get of the full impact our doings affect the earth. It quantifies the amount of our carbon emission. With this, knowing how to calculate your personal carbon footprint is important.

There are various standards in calculating one?s carbon footprint. There is the so-called ?lifestyle assessment? and the input-output analysis. Lifestyle assessment works by adding up all the feasible emission pathways while the input-output analysis involves determining the total emissions of a particular country, dividing it by the carbon-emitting sectors and estimating the overall emissions of each sector. The input-output analysis makes sure that no emission pathway is missed out.

Calculating your carbon footprint manually is an effective way for you to understand your emissions better. You just need a lot of patience to learn how each footprint is generated. Moreover, there are also several resources online that can help you calculate your carbon footprint. Online carbon calculators are abundant across the web. To make your life simpler, you can opt to try those online calculators and easily determine your carbon emissions. However, such calculators vary in scope. So make sure that the online carbon calculator, you choose, is one that?includes emissions both direct and indirect.

Avoiding Toe Prints

A toe print is a portion of a footprint. Sometimes, people are misled in their calculations because they only get a carbon toe print instead of a footprint. The idea is that, you should cover a smart scope of your carbon emissions. Not only measuring a portion, but the whole.

Say for example, running a conventional car. The carbon emitted from the car is not only the fuel combustion from the diesel or petrol.? Likewise, the carbon released as the gas was processed and transported to your nearby gasoline station is also an addition to your carbon footprint. If you do not understand this, you will end up calculating your direct emissions while neglecting the indirect ones.

Be wise in calculating your carbon footprint. And when in doubt, whether you are an individual or a business entity, you should seek help from experts who can do it right.

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What is Servitisation?

In the current generation, innovation has transformed industries, businesses, economies, and livelihoods. Those who’ve accepted to embrace the changes have prospered and remained afloat and relevant in their respective industries.?

However, failure to embrace change has seen companies like Blockbuster pushed out of business by more innovative and technology-oriented companies like Netflix.?

What does this tell you?

That the only way to stay in business, despite the many challenges your business could be facing, is to remain alert to the dynamic demands of customers, many of which are dictated by technological advancements.?

So, if you’re a manufacturer and you’re keen on diving deeper into technology to stay on top of the game and beat your competition, you must also be expectant of the fast-approaching servitisation-centred economy. Companies like Rolls Royce that have already embraced servitisation are making great gains in their areas of expertise.?

What is Servitisation?

Servitisation can be defined as the transformation of a manufacturing firm from the mere offering of products to the market to providing innovative and invaluable services alongside their products. By so doing, the sale becomes an ongoing engagement and not a one-off event. Cranfield University professors call it “the innovation of an organisation’s capabilities and processes to better create mutual value through a shift from selling a product to selling product-service systems.”?

As foreign as it may seem for some professionals, servitisation has been a need that, though not embraced, its demand remains evident. Nonetheless, firms have hesitated to implement it. Shifting from manufacturing products only to incorporating product-centric services alongside the products is not a walk in the park. It boils down to completely changing the company’s entire structure and processes.

All the same, change is never comfortable, and that’s why it’s always best to focus on the positive for motivation.

Servitisation Case Study

Some manufacturing firms have already embraced servitisation, and they’re reaping big from it. They’ve understood the benefits of offering more value to customers at less cost. What Rolls Royce is doing currently with its “power-by-the-hour” program is a good example of servitisation.

Instead of selling Aero Engines and letting customers take charge of maintenance and uptime, Rolls-Royce now offers a full package that includes a product and relevant services.?

Essentially, what the company is creating is an intimate and long-term relationship with its customers.

The total care package by Rolls Royce means it’s essentially renting out its engines to customers and monitoring data for potential maintenance needs. The plan guarantees that maintenance is only done when necessary and avoidable damage detected in good time. As a result, there is a clear reduction in the overall cost.

Initially, Rolls Royce would make money by basically selling and repairing engines. That meant that the worse the engines, the more repairs required and the more the money the company would make.?

However, things changed when the company realised there is no demand for a product that’s constantly in the repair shop. That prompted Rolls Royce to embrace servitisation.

Servitisation aligns the interests of the customer and those of the manufacturer to ensure everyone benefits. Rolls Royce has been offering this package to airlines since 2010, and the company has seen significant returns as a result.

Benefits

There are several benefits of incorporating servitisation into your manufacturing firm. Below are three of the strongest benefits

  • Financial Stability– Servitisation establishes a more secure revenue stream because of the long term connection between manufacturer and customer. This also translates to loyal customers, meaning more profit.
  • Strong Customer Retention Rate– Being more experienced about the equipment and the constant tracking and monitoring that comes with servitisation; manufacturers are realising that they can keep more customers.
  • Selling a Solution And a Product– Today customers are not just looking to buy a product, instead, they want both the product and the solution to their problem. Meaning you make more money for the product you manufacture and the service you offer to your customers.

Implementation of Servitisation in the Industry

To effectively implement servitisation, there must be an effective two-way flow of information and data in the supply chain. Meaning you may require software like FieldElite for scalable condition monitoring of performance. With FieldElite, for example, servitisation is made easier for you because it enables you to monitor the performance of your assets remotely.

Maintenance and monitoring of assets were traditionally very expensive and time-consuming until the arrival of intelligent software that makes work easier and cost-effective for manufacturers. FieldElite uses advanced learning algorithms to remotely automate the entire process, allowing you to detect, in real-time, the performance and need for maintenance on your asset.

Required Organisational Changes

A few important steps include;

Companies that invest in continuous training and development always have a more competitive edge than their counterparts. Meaning an important step towards servitisation is training the workforce. This is important, considering that the company structure, focus, and process will have to change.

Set up a team that is focused on the challenge, change, and creation. With this, you can easily adjust to industry changes. The team should always work on knowing what should be adjusted and when it should be.?

In the shift to servitisation, adopting a comprehensive service technology is an important step. Such service technology software includes FieldElite. This technology will ensure that you’re able to monitor your product in real-time, meaning you can maintain good performance for as long as possible.

Because servitisation essentially focuses on the customer, take time to study customer behaviour. Knowing what your customers need and want will help you remain relevant in the industry.

Conclusion

As the demand for more benefits and long-lasting relationships with dealers grow, so is the need for manufacturers to adjust. Hence more and more manufacturing companies are leaning towards embracing servitisation as a solution to the growing demand.?

In turn, manufacturers who’re attaching service contracts to their product sales are making more than those who remain stuck in the traditional approach to sales.?

Essentially, servitisation will ensure that, as a manufacturer, you remain relevant to your customers now and in years to come. This is a much better arrangement in terms of saving costs and making more returns. Remember to be successful, you have to be flexible enough to change with demand.

ESOS ? Why we must have it

The 9,000 big UK businesses directly affected by the new Energy Saving Opportunity Scheme could save UK?250 million between them, or an average UK?27,000 each, if they reduced electricity consumption by just 1%. The total amount is equal to the output of five power stations, at a time when Britain?s grid is under strain.
On 26 November 2014, UK Energy and Climate Change Secretary Ed Davey met with over 100 opinion makers from businesses, charities and universities at the Institute of Directors. The gist of what he presented was:

  • ?Britain?s big firms are spending around ?2.8 billion extra each year on inefficient energy technologies ? the equivalent output of nearly five power stations;
  • Now is the time to seize the opportunity with ESOS ? and organisations up and down the country are already gearing up to make changes to save energy, save money and save the environment.
  • If business did what business is supposed to do [that is innovate to make money] and act and invest, it will save ? and that’s the bottom line.?

The environmental benefits are as important although EcoVaro agrees with Ed Davey for taking a pecuniary approach. Businesses above the threshold of 250 staff and a balance sheet of UK?34 million would have not achieved their status unless they spent their money wisely.
The discussion panel included Rhian Kelly (Director of Business Environment at CBI), and Paul Ekins (Director UCL Institute for Sustainable Resources & Deputy Director of the UK Energy Research Centre). Hugh Jones, Managing Director, Advisory at the Carbon Trust responded to Ed Davey?s remarks by commenting:

  • ?At the Carbon Trust we have already engaged with hundreds of businesses on ESOS, helping to explain how they can achieve compliance while also making significant energy savings and cutting carbon.
  • Businesses often aren’t aware of opportunities in energy efficiency, or they don’t realise how attractive the paybacks can be. By requiring companies to understand exactly how they can make cost-effective investment in energy efficiency, they are far more likely to take action.
  • From the interest we have seen so far we expect ESOS to benefit British business by helping companies to reduce overheads and increase competitiveness.

The UK?s Energy Saving Opportunity Scheme ESOS is a gold mine of opportunities for big business, the environment and the population that breathes the air. Measurement of critical energy throughputs is the beginning of the process. EcoVaro is standing by to help you convert your data to meaningful information.

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