ICT Sustainability

In "Enabling ICT", we looked in general terms at how ICT systems can be used to make organisations more sustainable. Now we will look in more detail at Business Process Improvement (BPI): a systematic approach to optimising the functions of an organisation. BPI is a general purpose tool, but in this case we are applying it to the use of ICT in organisations to reduce energy and material use.

Three steps to BPI

1. Define strategic goals: What is the purpose of the organisation? What business is it in? Why does it do what it does?

2. Determine the stakeholders: Who are the customers and other important groups for the organisation?

3. Align processes to goals: Identify business processes which can achieve the organisation goals.

Business processes

Business processes (methods) are related, systematically structured activities (tasks) to produce a specific service or product for a particular group of customers.

Three types of business processes:

1. Management: governing the operation of the organisation.
2. Operational: The core business of the organisation. Can include Purchasing, Manufacturing, Marketing, and Sales.
3. Supporting: Ancillary to the core processes, such as: Accounting, Recruitment, Technical support.

Each business process should address a customer need and result in need fulfilment. A process can consist of sub-processes. The analysis of processes and sub-processes can be carried on down to the activity level.

Analysis of Business Processes is intended to eliminate any activity which does not add value for the customer. A well designed business process should increase effectiveness and increased efficiency. Normally these are measured in terms of financial measures (cost reduction and revenue). However, energy efficiency, greenhouse gas reduction and materials use can be used as sustainability measures.

Techniques such as Business Process Modelling Notation (BPMN) can be used for diagramming business processes in a workflow. BPMN is intended to be readable for both technical and business users.

High level models are used purely to describe business processes, whereas detailed models may able to be executed using specialised software.

BPI for non-radical change

Claims have been made for BPI making radical changes in the performance of organisations. In the case of greenhouse gas emissions the target of, for example, a 15% reduction in emissions may be on performance of an organisation, rather than a series of incremental changes.

BPI for Energy Reduction

BPI makes use of measurable results and benchmarks. The process owners, need to be identified and measures of success/failure of the process set. In addition to the success/failure levels, "control limits" for the process provide a check on if a process is meeting the desired customer objectives.

In the case of Green ICT, measures such as energy use or greenhouse gas emissions may be used. A problem with accountability energy measures for data centres has been the split in responsibilities between facilities management services providing the building and the ICT or data centre management who run the computers in the building. The facilities manager may be responsible for the electricity bill for the building the data centres is housed in, but unable to make decisions as to the computer equipment purchased and thus not make decisions to reduce that expenditure.

Methodology of BPI

1. Define the existing structure and processes.

2. Determine what outcomes would add value to the organisation.

3. Reorganise processes, resources and work force.

ICT Examples

Telstra has estimated that use of telecommunications could reduce Australia's greenhouse gas emissions 5% by 2015. Three examples from Tesltra are:

1. Efficient deployment of field work forces with GPS: Wireless broadband and GPS can be used to schedule personnel between jobs at remote sites to reduce the distance travelled. As well as reducing fuel used (and therefore greenhouse gas emissions from vehicles) this also reduces unproductive time while staff are travelling.

2. Flexible working for knowledge workers: Knowledge workers can work remotely using broadband at home or a satellite office and use wireless broadband to work at customer premises. This saves in office space.

3. Replacement of business air travel with video conferencing: Telstra claims that high definition video conferencing can replace business air travel. The widespread availability of higher speed broadband allows higher quality video and for companies to set air travel reduction targets.

Are Bitcoin and Blockchain Bad for the Environment?

Bitcoin is a form of digital currency which uses a linked list of transaction data (blocks), secured using cryptography. Copies of the entire linked list of transactions (the Blockchain) is kept by each node in the system (a "miner"), which validates the transactions. Vranken (2017) estimated that bitcoin's ‘proof-of-work’ algorithm, uses 500 MW of energy. Unlike other computing protocols, which could be improved using a more efficient algorithm, or a faster processor, the inefficiency of Blockchain is an essential part of the protocol.

In the original paper proposing Bitcoin and Blockchain, Nakamoto (p. 1, 2008) wrote "... the longest chain not only serves as proof of the sequence of events witnessed, but proof that it came from the largest pool of CPU power...". Vranken (p. 3, 2017) traces the evolution of bitcoin "mining" computers, which started using general purpose CPUs in 2009, then GPUs in 2010, FPGAs in 2011 and Application-Specific Integrated Circuits (ASICs) in 2013. Each change in technology brought about an improvement in energy efficiency, from CPUs with an efficiency of up to 0.1 Mh/J (million hashes per Joule of energy). Four years later the ASICs were up to ten-thousand times as efficient, at 10,000 Mh/J.

Vranken (p. 5, 2017) speculates about possible improvements in the energy efficiency of bitcoin mining hardware, however, the Blockchain design has built into it a mechanism which increases the computation required as hardware (or software) becomes more efficient:

"To compensate for increasing hardware speed and varying interest in running nodes over time, the proof-of-work difficulty is determined by a moving average targeting an average number of blocks per hour. If they're generated too fast, the difficulty increases." (Nakamoto, p. 3, 2008).

This proof of work is used not only to reduce the possibility of fraud, but also to combat inflation of the digital currency (Nakamoto, p. 4, 2008). Those processing the transactions are rewarded with newly generated "coins". If this becomes too easy, then there would be runaway inflation.

Apart from the hardware, the major cost in bitcoin mining is the energy to run the equipment. As Vranken (p. 7, 2017) notes bitcoin's proof-of-work wastes energy, and there have been proposals to replace it with some useful task and alternative schemes to prevent fraud and inflation.However, the current proof-of-work scheme has proved remarkably effective.

Giungato, Rana, Tarabella and Tricase (2017) carried out an analysis of the sustainability of the Bitcoin digital currency:

"... bitcoin is a digital currency based on a peer-to-peer payment system created as an open source software. The creation and transfer of this virtual currency is made under cryptographic connections, and for this reason bitcoin is also referred to as a 'cryptocurrency'. Bitcoin is based on 'blockchain technology'”, which relies on highly secure cryptographic algorithms and sophisticated peer-to-peer technologies that are the base of a distributed and democratically-sustained public ledger of transactions. Although a definition of sustainability has no full applicability to cryptocurrencies, we should consider that bitcoins are entities living in a different ecological ecosystem, the digital one, which consists of all hardware devices, program and data files that a user needs to share with other users Bitcoins are non-material technological objects. Bitcoins as virtual money can be environmentally sustainable since it requires few natural resources (e.g., fossil fuels) to sustain and maintain the exchange system of value in comparison with other payment or banking circuits (like credit cards)."

However, Giungato, Rana, Tarabella and Tricase (2017) conclude that it is not clear if Bitcoin is sustainable. The creation of new bitcoins is computationally intensive, but this may be offset by the velocity of transactions (using each coin more often).

Now Read

1. Defining Business Processes (Video), Weske (2018)
   
2. Business process, Business Process Modeling Notation, Wikipedia (2011).
3. Using Telecommunications to Reduce your Organisation's Carbon Footprint, Guerin (2008).
4. Sustainability of bitcoin and blockchains, Vranken (2017).

Questions

1. Business process issues with replacing paper invoices: On the face of it, replacing paper invoices with ones sent by email and paid with Internet banking should provide environmental benefits. In terms of business processes, what needs to be considered before making this change?
2. Energy saving from replacing paper invoices: Consider what energy saving, greenhouse reductions and materials savings there could be from replacing paper invoices with electronic ones. Consider what might be the environmental downsides of electronic invoices.
3. Blockchain for Sustainability: Consider what energy saving, greenhouse reductions and materials savings there could be from blockchain technology.