People, Planet, Profits & Projects

A variety of electronic sensing devices are being used in projects to reduce energy costs and help the bottom-line.  The interesting thing is that they can be integrated into present manufacturing with little or no cost difference.  When sustainability is planned in, it can be a lot less costly than retrofit. 

A prime example of this is in the car industry.  We all know that it will be a long time until we are weaned off of fossil fuels to power our automobiles.  Therefore, it is critical to be able to stretch the limited supply we have.  Let’s say you are a project manager working for a major automobile manufacturer and your project is the implementation of a new transmission (or engine, or even a steering system).  As a stakeholder in the company (they do pay your salary), because of your position within the organization, and your interest in sustainability, you may want to ask the question as to whether all sustainability options are being considered for this project. 

One company, ZMDI, is providing solutions to help auto manufacturers squeeze out every ounce of efficiency to increase fuel economy and reduce greenhouse gases (GHGs).    Using their “smart sensors” ZMDI is providing “Advances in transmission, engine and steering systems deliver greater power density and fuel efficiency so that today’s lighter and smaller power trains can provide significantly more output power and fuel economy than traditional designs.”  It also provides integrated circuitry in: battery monitoring “Monitoring the status of the car battery with our smart battery sensor solutions enables automatic start-stop features in cars, which can reduce fuel consumption up to 8%”, ethanol sensing:  “ZMDI’s IC solution enables optimization of fuel injection based on the real ethanol value and therefore helps reduce emissions”, and electronic steering,  "ZMDI’s IC solution enables using magneto-resistive sensors, which can enable an electronically controlled motor in the steering mechanism instead of using an hydraulic servo steering mechanism.”

The above graph and statement below were from http://www.zmdi.com/why-pink-new-greenand the 2013 data is based on ZMDI’s forecast.

The graph above shows the fuel savings and greenhouse gas (CO2) reduction achieved through ZMDI products in the automotive segment per year. Because the number of new energy-efficiency products introduced each year has increased, the savings in fuel could be significantly raised each year.

The fuel savings achieved in 2012, approximately 4500 M liters of fuel, corresponds to the loads of approximately 20 supertankers.

The accumulated annual savings since 2004 is approximately 18,000 M liters of fuel, which corresponds to the loads of approximately 80 supertankers.

The above graph shows significant savings in fuel savings and the more these types of integrated circuits, and e-sensing devices are utilized, the more the savings will be both in fuel costs and in GHG emissions. 

One of the more e-sensing technologies and a popular choice for renovation and new building projects is motion sensors.  The major advantage of motion sensing technology is that it eliminates the human factor, for the most part.  Lights are turned on and off and heat and cooling can regulated depending on the movement within an area, regulating the need for energy.  How many times do we walk out of a room and forget to turn out the light.  E-sensing technology can be used to keep a room at a constant temperature depending on the heat load generated without human intervention turning the thermostat up or down.  Of course humans will have to program the devices.  For motion sensing devices, that might include setting the arc around the sensor for activation, for instance.   But once set, it is repeatable.  Sustainability also includes the “people” element (planet, profits, and people).  In an effort to reduce the “germ” factor, sensing technology is being used to open and close bathroom doors so that people don’t have to touch the door handle.  Similar motion sensing technology is used for handicap access and for advancing paper hand towels. 

The more information we can possess the more influence we will have.  As sustainable project managers, our quivers contain a lot of arrows.  One of those arrows is the consideration of e-sensing/motion sensing technology on our projects.

Some of you may be familiar with the phrase "All Your Base Are Belong To Us", which has become somewhat of an internet meme with its own Wikipedia entry and acronym: AYBABTU.  It's a result of a poor translation from Japanese in a popular game called ZeroWing.

The phrase became so popular it shows up (in one form or another) on church signs...

and T-shirts...

That's when you know you've made it as an expression!

But we bring this up not because of t-shirts or churches or even video games, but rather because of a short but intensely interesting and powerful post by Elon Musk, the CEO of Tesla Motors, who used this internet meme as a basis for the title of the post - to be cute and yet memorable with a very important message for innovators.  Musk said, in short:

Tesla Motors was created to accelerate the advent of sustainable transport. If we clear a path to the creation of compelling electric vehicles, but then lay intellectual property landmines behind us to inhibit others, we are acting in a manner contrary to that goal. Tesla will not initiate patent lawsuits against anyone who, in good faith, wants to use our technology.

This is long-term thinking in a company that was built on long-term thinking.  We simply invite you to read the post and let us know how you feel about what, in effect, is open-source development of electric vehicles.

How would this work in your industry?

Does this have implications for projects and project managers?  We think so.  A penny for your thoughts?  Maybe... a whole base for your thoughts?

We all know that there are external factors that affect our projects.  Regulations are one of those factors that have to be considered by the project manager.  Depending on what industry you are in, has a lot to do with what factors we need to consider.   Because of their nature, some industries are more susceptible to risks from regulations than others.

The U.S. energy industry (I am concentrating on the U.S. by it is more global than that) is one of those industries that seem to be at the whim of congress.  Perhaps whim is too severe of a word to use, but it certainly seems appropriate when one considers that energy production and usage is a political hot potato.  Tightly control it, loosen the controls, supplement and reward alternate energy use, expire alternate use incentives, all of these approaches make it difficult to access project risk when energy is a component. 

The most recent event to affect project risk is the new U.S. Environmental Protection Agency (EPA) limits on green-house gas production and the different ways to mitigate the effect.  The elephant in the room, for energy production, here is coal.  According to the U.S. Energy Information Administration, coal is used to generate 39% of our electrical needs.  Natural gas is second with 27%, followed by nuclear (19%), renewable, including hydro-electric (13%) and petroleum (1%).    The EPA is proposing a cap on carbon emissions; reducing 2005 levels by an average of 25% by 2020 and 30% by 2030. It also gives credits to those states and utilities already working to reduce carbon emissions. 

As with most of government regulations, the green-house reduction proposal is so complicated that it will take some time for utility companies to sort is all out.  Talk about increasing risk.  If stakeholder expectations (U.S. EPA in this instance) are not well understood, then what kind of risk management plan can be put into place?  Let’s look at two possible mitigation strategies for this issue.

Cap and Trade Policies

Here is the best explanation I could find and it comes from the EPA.

Cap and trade is a market-based policy tool for protecting human health and the environment by controlling large amounts of emissions from a group of sources. A cap and trade program first sets an aggressive cap, or maximum limit, on emissions. Sources covered by the program then receive authorizations to emit in the form of emissions allowances, with the total amount of allowances limited by the cap. Each source can design its own compliance strategy to meet the overall reduction requirement, including the sale or purchase of allowances, installation of pollution controls, and implementation of efficiency measures, among other options. Individual control requirements are not specified under a cap and trade program, but each emission source must surrender allowances equal to its actual emissions in order to comply. Sources must also completely and accurately measure and report all emissions in a timely manner to guarantee that the overall cap is achieved.

A well-designed cap and trade program delivers:

• Greater environmental protection at lower cost
• Broad regional reductions, facilitating state efforts to address local impacts
• Early reductions, a result of allowance banking and market incentives
• Environmental integrity and transparent operations and results
• Fewer administrative costs to government and industry
• Efficiency and innovation incentives
• Incentives for doing better and consequences for doing worse
• Accounting for all emissions
• Partnership with existing requirements to ensure protection of the local population and environment

To summarize the intent, cap and trade is not meant to allow a particular company to continue to emit significant levels of GHGs in perpetuity.   It is temporary measure to allow companies to minimize the effects of their emissions by “averaging them out” while working to permanently to improve the quality of their emissions.  Further information can be found at http://www.epa.gov/captrade/basic-info.html.

Carbon Taxes

For a comprehensive explanation of carbon taxes, I looked “down under” to Australia’s policy. From (http://www.carbontax.net.au/what-is-the-carbon-tax/), “At the centre of the government’s policy on climate change is pricing carbon. Many commentators and politicians have referred to this as a “carbon tax”. The idea is that polluters will pay per tonne of carbon they release into the atmosphere. This cost will initially be set at $23, and increase gradually until 2015, when we will shift to a trading scheme that will let the market set the cost. This is widely thought of as the most effective and least costly mechanism to reduce carbon output and reduce the level of climate change that is occurring. 

Right now, when you purchase a product that relies on carbon-intensive materials or manufacturing processes, the price you pay does not represent the cost incurred by the environment. The iron ore used to create the product could be sourced from the highest polluting mine in the world, the electricity used to power the manufacturing plant could be provided by the dirtiest coal mine in the world, and the trucks used to transport the product to its final destination in a supermarket could run on the dirtiest fuels in the world, and it would make no difference to the price. With a price on carbon, this equation would change. The amount of carbon pollution involved in producing a product would start to be factored into its final price. Products produced through dirty processes will become more expensive, thereby making it possible for other products produced through cleaner processes to compete on price.

Yes, that’s right. The price of certain goods that are reliant on carbon pollution for their production will go up. However, the majority of Australians will be compensated for this cost, and this cost will be relatively small for most items.

How will this drive a move towards a cleaner future you might wonder.  Well, it’s not hard to see that if pollution-intensive processes make goods more expensive, companies will look to reduce their pollution footprint in order to lower their costs. That’s what businesses do – improve efficiency year on year. It’s one of the key drivers of growth. For this reason, it is actually not necessary for the consuming public to change their practices, although that would help drive you own costs down.”

Project risk needs to consider sustainability to cover all their bases.  One of our founding and guiding principles says it best.  “Project Managers must first understand (all) the green (sustainability) aspects of their projects, knowing that this will better equip them to identify, manage, and respond to project risks.”

Growing up in New England as we have, we know and love our New England accent.  To us, in fact, it's not an accent.  All of the rest of you have an accent, we speak, well, we speak  noahmahlly.

We always get a kick out of those movies in which actahs (actors) from out of our region try to "do" the New England accent.  They get it horribly wrong.  When they try to play, for example, President John F. Kennedy, to us they may as well be speaking in Tamil.  It's just not proppah (proper).

Well, now you have the chance to hear the accent in all of its glory because Boston native, UMass-Boston alum, and US Environmental Protection Agency (EPA) Director Gina McCarthy (pronounced "m'cahh-thy") yesterday addressed the nation on the proposed limits to power plants to reduce cahhbin (carbon) generation.

Below is the video.  You don't have to watch the whole thing but we want to draw your attention to 3:52, where she makes an errah (error).  At least, she misuses a project management term if compared to the way we are told we are supposed to use it by the Project Management Institute (PMI®).

At that point in the video - wait for it, wait for it, THERE - she says, "we'll turn the risks of climate into business opportunity".

We know as practicing PMs that risks can be positive or negative.  Positive risks are opportunities and negative risks are threats.  Therefoah (therefore) she should have said, "we'll turn the threats of climate ito business opporutnity". 

A small sticking point, perhaps but one which has been a calling card for us for 5 years.  In our book, Green Project Management, the very cover makes this point by showing a tree that yields paper money.  The concept of a triple - or really at least quadruple - bottom line is one we've blogged about as well for years, and indeed is the name of the blog you're readning now - People, Planet, Profits & Projects.  We assert that there is a benefit to long-term thinking that means it pays off to consider social and environmental concerns and not only financial considerations - and that this 'extra' effort in long-term thinking is not wasted, often coming back around to provide short-term financial gain.

In McCarthy's reference we can also see the short term opportunities in the form of new projects to reduce carbon from power plants and to move effort to renewable energy - all of which will require a crop of sustainability-aware project managers.

By staying tuned to this blog and an upcoming book (yes, we finally have a follow-up book to Green Project Management, more about that later) you can be part of that crop and you can help gain yourself some powah!

Stakeholder management has always been important.  The new PMBOK® has placed additional emphasis on it by creating an entire knowledge area “Project Stakeholder Management.”  We’ve all seen the various power/interest grids, assessment matrices, and other tools, including analytical techniques, all to determine the influence of a stakeholder. 

How about a tool to determine the where stakeholders are along a sustainability continuum?  As sustainability continuum, what is that?  One of the more popular concepts we developed to help determine an individual’s greenality is The Hugger-Hummer (H-H) Scale.  We’ve talked about this scale before in general terms, but never really defined or explained it.  The H-H scale is configured with the two extremes, those who are tree huggers, or environmental fanatics, to Hummer drivers, or those who really don’t care how much fuel they consume.  I’m not saying that every hummer driver disregards the environment; there are good reasons for some driving larger, less fuel efficient vehicles, like towing trailers, accessing rural areas in bad weather over questionable roads, etc.  I’m also not saying that every hugger is an environmental fanatic that takes saving the environment to the extreme.  It’s just that we needed a scale and those two terms seem to fit the extremes.  As a matter of fact, most of us (if I can speak about most of us) hover around the middle, one side or the other from top dead center.   For instance, I have a fuel efficient car as well as a powerful pickup truck.  The car I use for commuting or daily travel, and the truck I use to tow a camping trailer and to tow a boat (separately) so I can enjoy the outdoors more.

This is what makes it a little difficult when you are assessing stakeholders.  I am interested in the environment, and have a gas guzzler (for a reason).  Your stakeholder may be in the same boat, excuse the pun.  It also makes the H-H tool useful.  To be able to assess a stakeholder along a scale is like using an objective standard.  To be most effective in developing the objective standard, expert judgment can be used to validate the incremental differences along the continuum. 

More and more stakeholders are becoming aware of sustainability issues, on both ends of the H-H Scale.  It is helpful for a project manager to know where the most influential stakeholders appear on the scale.  Combining a power/interest grid with the H-H Scale, helps the PM better understand the stakeholder’s needs and desires.  There are no guarantees for project success, which is why we need to use all tools available.   

To put it in perspective, ignoring the sustainability interests of stakeholders only adds to what?  Project  Risk!  Adding the H-H Scale to your quiver will help you better understand potential risks to the project, therefore “will better equip them to identify, manage, and respond” to those risks, and will add to better stakeholder management.