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| January 23, 2013
Industrial Energy Management Improves Operations
IEM can be used to improve energy efficiency, reduce costs, and help operations perform better by aligning people, processes and technology with operational excellence.
Implementing a successful Industrial Energy Management (IEM) framework can improve a company’s abilities to perform both financially and operationally. IEM spans business process and technology, and helps to coordinate a company’s ability to manage the procurement, use and reporting of energy.
IEM can be used to improve energy efficiency, reduce costs, and help operations perform better by aligning people, processes and technology with operational excellence. As described in the Enterprise Sustainability Management Framework, industrial companies find the most success with new initiatives by building on past successes in operational excellence. The case is no different for IEM.
Because IEM touches so many areas of business, it takes a well-thought-out plan to properly align people, processes and technology resources. Employees have to be unified and working toward a common goal, processes have to support an environment for continuous improvement, and technologies have to be used effectively for streamlining and centralizing information to improve decision-making capabilities.
>> Industrial Internet=Optimization: Will more sensors on the plant floor translate into energy optimization in 2013? Visit http://bit.ly/awslant056
Although processes and technology facilitate many of the tasks needed for organizations to meet IEM goals, the human capital behind those processes and technology are integral for success. Without proper buy-in from leadership all the way to factory workers, communication, collaboration and expertise, initiatives often fall short.
IEM requires strong leadership and a motivated culture, which can be supported by the following:
• Development of Chief Sustainability Officer (CSO) role;
• Coordination of activities between the CSO, Energy Director, and plant level energy czars;
• Recognition for successes in energy management;
• Culture that fosters and supports collaboration; and
• Use of third parties for subject matter expertise and audit capabilities.
One of the keys to success around business processes is standardizing them across the enterprise. This means centrally managing end-to-end business processes for continuous improvement, reporting, energy procurement, energy use and the approval of energy efficiency projects. Leading companies are standardizing these processes across geographies, product lines and plants.
Main focus areas include:
• Continuous Improvement: ISO 50001, SEP, Energy Star
• Industrial Partner Programs: Guides for Best Practices
• Corporate Social Responsibility, CSR Reports, and Carbon Reporting
• Evaluating Energy Efficiency Projects
• Measuring Energy Intensity and Energy on the Bill of Materials
• Energy Optimization across Procurement and Use
• Industrial Energy Management Software
Leveraging IEM software
Companies should choose a software application that supports its leadership and processes. Because the field of solutions is vast, we’ve created the infographic shown to help companies understand IEM software’s three distinct areas of IEM software: procurement, usage and reporting.
The LNS Model for Industrial Energy Management Software focuses on the demand side of the industrial energy use equation. It provides a model for understanding how energy flows through the organization as well as how data must flow back through and inform decisions.
Executives that focus on building the IEM framework of people, processes and technology into operational excellence models will position their organizations for success.
>> Matthew Littlefield, [email protected], is president and principal analyst for LNS Research based in Brookline, Mass.
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