By Enterprise Innovation Editors | Jul 8, 2009

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Business applications such as supply chain management software have a key role to play in helping organizations meet their growing environmental responsibilities, according to Ovum.

Businesses of all types face growing pressure from consumers, investors and regulators to be “greener” by reducing the consumption of energy and raw materials, and pollutants emitted in their products’ life cycles, Ovum says.  Achieving this goal creates a “green software” opportunity because measuring, analyzing, reporting and optimizing for environmental factors is a business process similar to those already managed by applications such as enterprise resource planning, business intelligence and supply chain management.

Supply chain management solutions will be crucial to sustainability because of the need for accurate “cradle to grave” environmental information for products of all types. But the challenge is complex because meaningful results require common standards and methodologies, as well as coordination across industry, geographic and regulatory boundaries.

At the moment, various industries, governmental and non-governmental organizations are developing standards for aggregating environmental data over the product life cycle. However, it is not yet clear which of these efforts will gain traction, so both vendors and customers must familiarize themselves with as many as they can and understand the challenges and opportunities of each.

Enterprise application vendors must acquire or partner for environmental expertise if they want to retain the role of strategic advisor. They must offer solutions that can be easily tailored to different industries’ unique requirements, which will favor service-oriented platforms to replace rigid legacy systems.

Meanwhile, the need to analyze environmental data alongside financial and business-process information will favor integrated solutions over stand-alone applications. It will take several years for mature solutions to develop, but vendors with foresight are moving now to position themselves in this emerging market.