Logica Cuts Costs With Own Sustainability Tool

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The IT services company is keen to cuts costs even though it claims its customers don’t “buy on price”

Anglo-Dutch tech services company Logica has become the latest supplier to offer IT tools to help businesses measure the sustainability of their operations despite claims by its chief executive that price isn’t a major factor for customers during the recession

In a statement released this week, the company, which has faced questions about its own internal efficiencies in the past, said its Sustainability Indicator Reporting Application (SIRA) should help firms measure their environmental impact and help comply with legislation.

According to Judith Halkerston, UK managing director for Energy, Utilities and Telecoms at Logica said that organisations today need to navigate their way through a maze of international environmental regulation. “Often, this requires a significant investment in resource and raises challenges to present the data in an intuitive and engaging manner,” she said. “SIRA is designed to be implemented quickly and flexibly and will help an organisation identify immediate improvements and savings in its sustainability reporting, as well as reducing risk and exposure to potential fines.

Logica claims that it is using the tool internally this year to help with its own sustainability drive “SIRA will build on current cost savings of approximately £3.6 million over two years in energy costs and £7 million in travel costs. In addition Logica has avoided almost £5 million in travel costs through increased use of video and teleconferencing. SIRA also incorporates best practices around reporting and monitoring,” the company said.

Like many businesses Logica has been under pressure to cut costs over the last 12 months. In February, the company posted full-year results that beat analyst expectations and saw its share price rise by 10 percent. Sales increased by 5 percent to around £3.59 billion pounds.

But despite the apparent efficiency drive, Logica chief executive Andy Green recently told analysts and shareholders that price wasn’t a major factor for customers looking for IT services during the global recession.

“I don’t believe any clients – of any stature – buy on price,” he said. “They understand that they need to buy something that is going to work for their business in these big services contracts. It isn’t a price war out there. It is always about the effectiveness of the value delivery I think.”

Despite claims that its customers weren’t overly concerned with costs in the downturn, Green said that Logica was itself investigating ways to save money during the tough economic times. The company recently held an international meeting purely using video conferencing technology which Green said saved the business around 500,000 Euros.

In 2007, Logica’s then chief executive Martin Read, pushed his retirement forward following poor financial results by the company. “In the light of the unsettling speculation following the company’s recent trading update, Martin Read has decided to accelerate his retirement plans,” the company said in statement at the time.

Read is now an adviser to the treasury and recently led the IT and back office elements of the Operational Efficiency Programme (OEP), which has been underway for a year, and recently stated that the UK’s public sector could trim around 20 percent of its current £16bn annual spend on IT by 2014.

The company claims that its moves around sustainability have led to its inclusion in the Climate Disclosure Leadership Index provided by the Carbon Disclosure Project.