Digital is More Sustainable, or is it not?

4

October

2020

No ratings yet.

Growing concerns around climate change and the impact of human activities on global warming has resulted in a global trend of organizations adopting CSR / sustainability policies. Simultaneously, digital technologies were becoming more and more prominent in most organizations. Consequently, digital technologies changed the way business is done in a lot of industries by moving business processes online. These two trends resulted in numerous companies making ‘anti-paper’ claims about digitized processes being more environmentally friendly as it removed the dependency on paper and plastic. However, are these claims actually true? Do digital processes actually have a lower environmental footprint than traditional business processes where e.g. documentation, promotion and marketing is done on physical materials such as paper?

For this question to be answered, there first needs to be clarity on how environmental footprint is defined. In this case, environmental footprint will be defined as the effect that an activity has on the environment, and this could be an effect in terms of CO2 emissions, amount of waste produced, recycle rate or else.

The claims that digital processes are more environmentally friendly than traditional processes seem very logic. On first sight, digital processes consume less physical materials than traditional processes; saving documentation in the cloud vs printing or writing the documentation on paper. However, in reality this is not the case. Obviously, paper or other physical materials such as plastic are in principle not environmentally friendly. In the case of paper, it uses wood as its main element, uses 400 – 2600 liters of water for the production of one kilo of paper and emits on average 500 grams of CO2 emissions per kilo of paper (which is the equivalent of eating two avocados). Altogether, the paper industry accounts for 7% of the global CO2 emissions. Compared to the airline industry, which is known as one of the most harmful industries, it is three times as much. Despite these numbers, it appears that the paper industry does not have a negative influence on the vegetation. On the contrary, it is proven that forest coverage has increased in both Europe and the US. Moreover, paper is recyclable up to seven times and approximately half of all paper is already being recycled globally, this reduces the amount of waste that paper leaves behind.

Digital processes on the other hand, do not seem to use a lot of materials on the surface. However, the devices used to document and process the business operations online require a lot of energy. Per organization, the CO2 emissions of energy usage can differ significantly dependent on whether the energy comes from a renewable source or fossil fuels. Moreover, the devices in the offices are not the only pieces of hardware that need energy with online documentation. Online data storage also requires enormous data centers that consume energy 24/7. Collectively, it is expected that the IT industry will account for 14% of total global CO2 emissions, whereas this is currently only 3%. Besides energy usage, technological devices require a lot of materials among which lithium, (precious) metals and rare commodities in the production phase. Despite the fact that concrete evidence and literature are not available yet on the environmental footprint of technological devices due to its relatively short existence, it is clear that technological devices require a lot of (non-recyclable) resources and that it is very likely that this has consequences for the environment.

In short, both traditional (paper-based) and digital processes have a significant environmental footprint on the planet. Due to the complexity of the total footprints and the lack of concrete evidence on technological devices, it is very hard to determine whether or not digital processes are actually less harmful to the environment than traditional processes. Therefore, organizations should be very careful with such statements and individuals should be critical and not blindly believe such statements as it can be used as a way of greenwashing.

References:
Cambridge Dictionary, n.d. Environmental footprint. Accessed on the 4th of October 2020 via https://dictionary.cambridge.org/dictionary/english/environmental-footprint
Kinsella, J. (2017). Digital Vs Paper: A History Of Printing, In House And Outsourced. Accessed on the 4th of October 2020 via https://www.ceotodaymagazine.com/2017/11/digital-vs-paper-a-history-of-printing-in-house-and-outsourced/
Klein Lankhorst, M. (2019). De papierindustrie stoot meer CO2 uit dan de luchtvaart. Is het nog wel verantwoord om papieren boeken uit te geven? Accessed on the 4th of October 2020 via https://decorrespondent.nl/9463/de-papierindustrie-stoot-meer-co2-uit-dan-de-luchtvaart-is-het-nog-wel-verantwoord-om-papieren-boeken-uit-te-geven/509327049-b14c9d5f
Moodie, A. (2014). Is digital really greener than paper? Accessed on the 4th of October 2020 via https://www.theguardian.com/sustainable-business/digital-really-greener-paper-marketing
Project Drawdown, n.d. Recycled Paper. Accessed on the 4th of October 2020 via https://www.drawdown.org/solutions/recycled-paper
Simpel Duurzaam, (2020). Hoeveel is 1 kilo CO2? Accessed on the 4th of October 2020 via https://simpelduurzaam.nl/hoeveel-is-1-kilo-co2/
Two Sides, n.d. Electronic communication also has environmental impacts. Accessed on the 4th of October 2020 via https://www.twosides.info/electronic-communication/

Please rate this

Digital Transformation Project – Creating a sustainable non-profit monopoly

13

October

2016

5/5 (4)

Introduction

Netherlands Standardization Institute (NEN) has been supporting the standardization process in the Netherlands for over 100 years. Standards are often voluntary agreements between market players that joined one of NEN’s 480 standardization committees. They are laid down in documents managed by a standards organization, such as NEN. Popular standards include ‘ISO 9000 – Quality management’ and ‘NEN 7512:2015 – Health informatics – Information security in healthcare – Requirements for trusted exchange of health information’.

NEN is currently managing over 33.000 standards, which are available on their online store or for sale at their office in Delft. As some of the standards are required to be used by Dutch law, part of these documents are made ‘open access’ to the general public. Because NEN is a non-profit business organization, the profit margin on the sale of these standards is minimal. Parties interested in the standardization procedure bear part of the costs of the standard development process. This income, together with the proceeds from the sale of standards and the transfer of knowledge in training programs, ensures that NEN can carry out all its duties.

Standard development process

The development of a standard usually takes a few years and is divided into several stages. The first stage in the development of a standard is understanding the market demand and create a new work item proposal (NWIP). When there is enough support, stakeholders will be approached in the preparation stage. When there are enough interested stakeholders, the committee stage will occur. A committee will be formed out of the stakeholder’s pool. This committee will discuss the content of the new standard in the enquiry stage. This will occur in around-the-table meetings. Standards will be saved in Microsoft Word documents. The documents will be saved in a database called the ISOlutions program and automatically shared with other committee members. After the committee discussed and confirmed the content of the standard, there will be a ballot in the approval stage. Whenever there isn’t a majority supporting the standard, the content will be reviewed in the enquiry stage. However, if there is a majority, the standard will be approved and published in the publication stage (ISO, 2016).

Current model

The current strategy of NEN to consult its customers is to reach out through press releases. In this way, certain parties know that NEN is about to undertake a new activity that they might find interesting to join or comment on. A press release is shared on NEN’s own website (www.nen.nl) and send to specific publishers of magazines in a field coherent with the activity to reach experts on that field. Additionally, these press releases are shared in one of NEN’s sixteen email newsletters. Another more recent method of reaching out to potential customers is to share these press releases on LinkedIn with the aim of reaching a different audience (i.e. the audience that does not visit NEN’s website or reads these magazines/newsletters). However, as LinkedIn is not convenient for this approach and limited in terms of reachability (i.e. articles are usually only shared within NEN’s existing network) this method is not as effective.

Disruptive model

Through a community all stakeholders can get involved in the process of drafting standards: a community will make it easier to get in contact with other stakeholders to interact with a centralized system. Additionally, questions can be asked and answered among other stakeholders who are in the same field and therefore have a lot of inside knowledge. Also, by being active in the community answering questions, these experts will be more visible for third parties bringing additional value. Also, NEN deals currently with 150 questions a day about the norms. This can decrease when stakeholders can ask the questions in the NEN community and therefore will save NEN a lot of time.

A prospective community can be combined with NENCrowd (NEN’s crowdfunding platform) to offer additional benefits to backers. In this way, price differentiation is realized and thus a larger potential customer base can be served. This also works vice versa: If NEN’s prospective community attracts a lot of users, more and more people are getting involved. This can cause an increase in financial contributors.

Thank you for reading! Team 76

References

ISO (2016). ‘Voting and membership in ISO’ retrieved 11 October 2016, from
http://www.iso.org/sites/ConsumersStandards/voting_iso.html

www.NEN.nl

 

 

 

 

Please rate this

Is the growth of Airbnb sustainable?

4

October

2016

No ratings yet.

The rise of the sharing economy was introduced by several e-commerce, not so much anymore start-, ups. The peer-to-peer markets have replaced the traditional markets. The peer-to-peer markets introduce a business model formally unknown to the traditional markets. The markets no longer maintain their own resources to among other things decrease the costs of operating, but this also increases the risk that the growth of the company cannot be sustained. The intermediaries in the peer-to-peer market have an increasing stake in both sides of the supply and demand side of the market.  An example is Airbnb influencing the revenue made by hotels. The impact it has on the hotel market is yet not identifiable. The causal impact of this phenomenon on the market revenue created by hotels is unidentifiable because of the non-uniformly distributed impact it has on the consumers. (Zervas et al., 2016)

The rising of Airbnb
The company has outgrown the united states into a global company. The growth of the company into the European market and Asian market is facilitated by government guidelines. The European Commission is supporting the growth of a sharing economy as an opportunity for entrepreneurs and the overall economy (Taylor, 2016). The stated goal by Airbnb of 10 billion dollars of revenue by 2020 compared to the current revenue of 900 million dollars in 2015 also supports the opportunistic expected growth (Taylor, 2016; Kokalitcheva, 2015).

But is the growth sustainable
Several problems arise with the growth of such sharing economies. The rating of Uber drivers is often described as biased, with opinions influenced by among other things by racism (Harman, 2014). And, it seems that a similar effect is occurring within Airbnb. Research shows that members are able to among other things, charge more than other up to 12% because of their physical appearance. When members have increasing concerns about discrimination caused by the members despite the current policies by Airbnb against racism. It then might be justified to wonder such a sharing economy is economically sustainable. (Harman, 2014).

So at the end could the growing business model to exclude their own stock be sustainable or to secure the growth should sharing economies maintain their own stock for operations?

http://papers.ssrn.com/sol3/papers.cfm?abstract-id=2366898
http://www.cnbc.com/2016/06/01/how-airbnb-is-growing-a-far-flung-global-empire.htmlhttp://fortune.com/2015/06/17/airbnb-valuation-revenue/
https://www.theguardian.com/sustainable-business/2014/nov/12/algorithms-race-discrimination-uber-lyft-airbnb-peer

Please rate this

Tipping point of a sustainable future

28

September

2016

5/5 (2)

Humanities nature of pushing boundaries can economically be explained by the invisible hand of Adam Smith. The pushing culture resulted in short-term tendencies, which damaged our habitat. Especially energy generated from fossil fuels like gas and coal. This increasing stretch on our big blue marble comes with a price. Not for the planet as many shall be thinking, but for living organisms like humans. Kind of ironic that the outraging exploitation of our planet will not harm it, but will ultimately strike us. And kind of funny that the root for our problem, economic rational shall give us a solution.

Headlines aren’t covering it, but at this moment a silent revolution is taking place. It is driven by technology and progressive businessmen. These people realize, that besides the greenhouse effect, fossil fuels are limited. To maintain their wealth, they started to invest in alternative energy. This generated an acceleration in sustainable energy. Because of these technological developments and investment activities sustainable energy is cheaper than energy generated by fossil fuels. This tipping point is reached without governmental financial aid. Therefore, it is the economic rational that gives the ultimate solution. This incentive will speed up the transition to sustainable energy. This scenario is not a futuristic one, but a reality in countries such as Brazil, Australia and United Arab Emirates. Other countries like Spain, Germany and Morocco will reach their tipping point in a few years. How come that the Netherlands is not following these developments and increased the use of coal to produce energy? Dutch government policy about sustainability is powerless, missing a clear vision and the drive to innovate.

Looking at the five forces model of Porter you can envision that the treat of sustainable energy as a substitute of fossil generated energy in the coming decade is high. The quality of the two different sources of energy is equal, this will not change the threat. But knowing that the substitute is (becoming) cheaper and that switching costs are low may have enormous consequences for current energy suppliers. These substitute threats may be reduced by initial high capital investments and the need for economies of scale. Therefore, there will be no abundance of new entrants. But a lot of capital is flowing in the sustainable energy sector. A record of 286 billion dollars for investments and new capital can create economies of scale and hence new entrants can form a threat. You can think of large pension funds who grasp the opportunities and have a policy in sustainable development.  Will current leading energy companies make the transition earlier because of these developments? Will society profit from this in terms of wealth but also in welfare? Which technologies will be leading?

References:

6 procent van onze stroom kwam vorig jaar uit wind. (2016, November 28). Retrieved September 28, 2016, from http://nos.nl/artikel/2134785-6-procent-van-onze-stroom-kwam-vorig-jaar-uit-wind.html

Armstrong, R., & Perez-Arriaga, I. (2014, November 10). The Utility of the Future. Retrieved September 26, 2016, from http://energy.mit.edu/news/the-utility-of-the-future/

De doorbraak van duurzaam. (2016, August 25). Retrieved September 28, 2016, from http://www.vpro.nl/programmas/tegenlicht/speel~VPWON_1261670~de-doorbraak-van-duurzaam-vpro-tegenlicht~.html

Luttikhuis, P. (2016, September 22). ‘Duurzame welvaart is onze taak’ Retrieved September 28, 2016, from https://www.nrc.nl/nieuws/2016/09/22/duurzame-welvaart-is-onze-taak-4406112-a1522876

McCrone, A., Moslener, U., D’Estais, F., Usher, E., & Grüning, C. (2016, March). Global Trends in Renewable Energy Investment 2016. Retrieved September 28, 2016, from http://fs-unep-centre.org/publications/global-trends-renewable-energy-investment-2016

Porter, M. E., & Millar, V. E. (1985). How information gives you competitive advantage.

Please rate this