Executive Briefings

Four Steps to Building a Business Case for Efficiency

Many large organizations have lofty efficiency goals, but struggle to turn them into reality — often because there’s limited buy-in where it truly matters.

Four Steps to Building a Business Case for Efficiency

One of the most critical, often-overlooked steps to launching successful efficiency- and environmental-management programs is creating an effective business case that not only promotes projects internally, but helps to ensure success during the implementation phase and beyond. Far too many plans either don’t get approved, or are approved and then stall, earning the “poor performer” tag and positioning resource efficiency poorly on any future priority lists.   

So how can energy managers turn their efficiency dreams into a company-backed reality? They should start by following these four steps as they build a business case to fund critical efficiency programs:

1. Establish early buy-in at the executive level.

For any resource efficiency plan to work, it must have top-level commitment. The first place to start to secure that commitment is to align your efficiency goals with your company’s public goals. Energy can’t be viewed as a separate objective that’s attached to corporate initiatives as an afterthought. It must be integrated as a visible element of the company’s strategy, and preferably one of the official goals of the company. Getting executives to integrate energy and resource efficiency into overall corporate goals often means helping them see how related measures complement other key priorities.

For example, a well-run energy efficiency program can improve margins, increase production and mitigate risk, all while addressing government mandates, industry regulations and public demands for sustainability. But to be truly effective, corporate energy initiatives must also align with site-level objectives, especially for large companies with multiple facilities and global footprints. That means all stakeholders — from the shop floor to the top floor — must be involved in identifying and prioritizing efficiency and performance expectations.

2. Map current performance baselines.

Once everyone is apprised of the efficiency plan, it’s critical to ensure that the company’s performance baselines are appropriate and accurate. That means ensuring that the company has an enterprise-level view into its energy data, and that this visualization incorporates all data to compare sites, prioritize opportunities and flag challenges.

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One of the most critical, often-overlooked steps to launching successful efficiency- and environmental-management programs is creating an effective business case that not only promotes projects internally, but helps to ensure success during the implementation phase and beyond. Far too many plans either don’t get approved, or are approved and then stall, earning the “poor performer” tag and positioning resource efficiency poorly on any future priority lists.   

So how can energy managers turn their efficiency dreams into a company-backed reality? They should start by following these four steps as they build a business case to fund critical efficiency programs:

1. Establish early buy-in at the executive level.

For any resource efficiency plan to work, it must have top-level commitment. The first place to start to secure that commitment is to align your efficiency goals with your company’s public goals. Energy can’t be viewed as a separate objective that’s attached to corporate initiatives as an afterthought. It must be integrated as a visible element of the company’s strategy, and preferably one of the official goals of the company. Getting executives to integrate energy and resource efficiency into overall corporate goals often means helping them see how related measures complement other key priorities.

For example, a well-run energy efficiency program can improve margins, increase production and mitigate risk, all while addressing government mandates, industry regulations and public demands for sustainability. But to be truly effective, corporate energy initiatives must also align with site-level objectives, especially for large companies with multiple facilities and global footprints. That means all stakeholders — from the shop floor to the top floor — must be involved in identifying and prioritizing efficiency and performance expectations.

2. Map current performance baselines.

Once everyone is apprised of the efficiency plan, it’s critical to ensure that the company’s performance baselines are appropriate and accurate. That means ensuring that the company has an enterprise-level view into its energy data, and that this visualization incorporates all data to compare sites, prioritize opportunities and flag challenges.

Read Full Article

Four Steps to Building a Business Case for Efficiency