In this episode of CXO Bytes, host Sanjay Podder speaks with Marc Zegveld, Managing Director of ICT at TNO, about the competitive value of green IT. Drawing on the recent Green IT Value Case, real-world case studies, and research, they explore how sustainability initiatives can enhance business performance—from cost savings and supply chain clarity to talent attraction and regulatory preparedness. Marc emphasizes that green IT is not just a climate imperative but a strategic differentiator, requiring top-down leadership, grassroots innovation, and effective change management. Together, they discuss how businesses can embed sustainability across operations to thrive in a tech-driven, low-carbon future.

TRANSCRIPT BELOW:
Sanjay Podder: Hello and welcome to CXO Bytes, a podcast brought to you by the Green Software Foundation and dedicated to supporting chiefs of information, technology, sustainability, and AI as they aim to shape a sustainable future through green software. We will uncover the strategies and a big green move that's helped drive results for business and for the planet.

I am your host, Sanjay Podder.

Marc Zegveld: Hi, Sanjay. Thanks for inviting me on this, on this podcast. I'm really happy to join. I think it's very important and relevant topic what we discussed. My background is, I'm now a two year Managing Director of the Unit Strategy, Policy, ICT at TNO. We are an independent research organization based out of the Netherlands.

But we work internationally. We do that for both business to business as well as business to government, both in industry as well as in, for defense. My background before that, I've been working 15 years at IBM. And mainly as a European services leader for the industrial sector.

And before that I've been teaching innovation, high tech at the TU Delft, at my own consulting firm. And I used, I was a columnist for the leading financial newspaper in the Netherlands. Now I'm an engineer by background, but also, I got my PhD in business strategy economics.

I'm intrigued by competitiveness and what triggers competitiveness. That's, one. And just to elaborate on that a bit, and then we go to the second, is, so competitive is not something which comes easy. You need to stand out, you need to invest, you need to, build.

It's based on,

most of the time, hard work, technology, but also reputation. It's a lot of elements which you need to bring to the table to gain and sustain sustainability. And I'm pretty convinced that from the green IT movement, this is competitive, by heart. And creating competitiveness by heart.

As it's, you're able to combine a reduction of cost if you organize it well. It can bring you more clarity in your complex supply chain.

It gives you a better insight in decision making from an investments perspective, but also from a Marceting reputational side it can enhance your position. But only if you're able to combine all these different threats into one specific aspect of competitiveness. And I think that's where I'm intrigued, and that's why, we did this study together with Accenture, and picked out some relevant cases and draw some conclusions.

But that's one. There's another step I'm intrigued by, is the following, we hear, we read and hear a lot about, let's say the doomsday clock or whatever. About that we have a small earth that we have a lot of carbon emissions, et cetera. And if you're an optimist, if you're a pessimist, I perfectly, I don't care.

But there's something we can do just better, improve, compared on what we do without losing quality of life, quality of on what we do for planet as a whole. Now finding that whole combining with competitiveness, I think that's the strengths which should unique companies, which should unique all other organizations around the globe to see what we can do together.

Sanjay Podder: Wonderful. And, you know, one thing that really strikes me here is you started with competitive space, right? Because this is a space where people primarily drive the conversation with concerns around climate change, the greenhouse gas emissions. What you did talk about in the second part,

you know, we are, the planetary boundaries. We are a small planet. But typically in my own experience, I have seen that, given the challenging business environment that we are seeing today, the leading this conversation with greenhouse gas emissions is not as appealing to business as competitiveness that you mentioned.

Right. And cost efficiencies, operational efficiencies and competitiveness. Many businesses do not see that part today. They can still relate to cost efficiencies, which is equally attractive, improving their bottom line. But competitiveness, you know, is very rare for people thinking that green software, green IT, green cloud, green AI is a competitive differentiator. Right. And I'm glad you started the conversation with competitiveness, which I think it'll be great if you can throw a bit more spotlight, because that to me is the most critical point in this whole conversation for businesses to realize that this is not some altruistic thing they're doing for the planet, but this is for them to survive, to thrive and be ahead of the rest of the competition.

So Marc would love to hear a little bit more, and I'm sure you put a lot of it in your Green IT value case. Right. So, you know how have you articulated that?

Marc Zegveld: No, it's a fair point, Sanjay. And, absolutely, competitive first.

And I'm not sure how you see it, but for me, it's all about change. And change starts with the action. So, internally within companies, you need to fire up you need to ensure that indeed there is action and then competitiveness or the underlaying parameters in boosting competitiveness is key to start that change.

And once more companies, more organizations, understand and work that way, I'm convinced, without being altruistic, but I'm convinced that indeed, a greener IT, a greener situation, a healthier planet can be can be started. But if we start that discussion from a planet perspective, we can agree or disagree, but we more have a debate than that what we have in action.

And I'm more an action-oriented person. And I think that's what companies, and that's why I like this conversation, as well, Sanjay is, with you, with your team. You're more action-oriented. And I think that's where the trigger and that's where it really starts.

So competitiveness, for my end, is a multifaceted aspect.

It's about not only attracting capital and of course within, we have more and more sustainable capital providers, it's also about attracting talent, the new kids from school, I would say, attracting them, gen Z and others, it's more difficult to attract them and to keep them.

And once you, your part, when you tell your story about green IT, about the relevance of green IT that it's indeed not only strong for their environment, but definitely it's strong for boosting the company. It's strong for their career. It's a relevant aspect on being competitive as well. It is a competitiveness indeed for the full supply chain backward looking, but also forward looking. Most of the supply chains are very complex. If indeed we're able to detangle and create some more clarity also from a sustainability perspective, from a green perspective.

In most of the cases we've seen, we're able to reduce cost. We were able to optimize. So there's several aspects, and I think instead of going to the root of only cost cutting, here, competitiveness is a multifaceted aspect, and especially if we're able to create that interplay between these different facets, then we really can build strong, stronger, more competitive organizations, more competitive companies.

Sanjay Podder: Wonderful. And, you know, I think you touched upon various aspects like the talent getting attracted to companies which embrace sustainability. Right? And you spoke about the supply chain. I think another area where, though it might not be an imperative today, it might turn out to be of an important area for business is regulations coming up in this space. Today, the regulations are fairly voluntary. Even the EU AI Act when it comes to, you know, environmental impact, you know, it's much more stronger on the social aspects of responsible AI and stuff like that. I think that would be another area for business to be ready for the future when regulations are much more stringent around these areas, at least in certain part of the geographies, right? So that would be important. So, Marc, one of the thing that I wanted to discuss more is examples of businesses that are turning this into a competitive differentiator. I remember in some of my early conversations in the field of sustainable AI, when we would talk about techniques like quantization, pruning of models, creating smaller models fit for purpose. All that seemed great from a theory point standpoint, theoretical standpoint, right? And, but the moment DeepSeek did all of this and suddenly came out with, you know, large language models much more cost effective.

You know, they built, they trained the model and a fraction of cost compared to other large language models, and we could see that they used the green principles and they have converted it into a competitive differentiator, creating something very unique. You know, and suddenly people started thinking, "do we really need so much compute?" Right. And, the outcome was good enough. Now, have you come across, such examples, in your own study, in the light of the green it value case as well, where you felt that certain organizations or certain industries have changed the outcome or rather, brought this green practices to further enhance outcomes. So are there any examples that come to you, top of your mind?

Marc Zegveld: Yeah, there's several examples, Sanjay. Think more, probably more examples that then we have time for this specific podcast.

I'm sorry you about that one. But there are definitely a few. But if you're okay, and please step in if you want to deviate from it, but I think the regulation part, which you alluded on, is highly relevant. And sometimes it sense that regulation is, comes from top down. It comes from governments or European bodies, whoever. And then it is, it's killing innovation or it is pressing energy or power in that sense from and pressing competitiveness down downwards.

And I think there are lots of examples indeed where it is, where that does happen. So the trick is to create some regulation where indeed companies can thrive and take the action and thrive from, on their competitiveness in the direction of it's green, or it is sustainable, or it is responsible or what it is.

And I think that's a very thin line, and it's always difficult, specifically now today with all these trading blocks, to create a global view. But regulation, also within companies, that's where I like to make the bridge, is highly relevant. 'Cause in the cases, and we'll have some cases, I want to elaborate on or discuss with you.

It's also where the top would identify what's the KPI. So what is the target we are in for? And maybe we don't see it as a regulation in a sense, but internally in an organization it's a KPI. And we all know that a KPI is driving behavior, which how we run our organizations, which is fine, but so identifying what is the KPI is highly relevant. So just to give two examples here, so we have a hospital in the Netherlands who wants to, wanted to reduce its carbon emission. And normally, organizations like hospitals and others, they will look internally and in having less waste or having other kind of initiatives. And they were thinking the other way around.

It was like, if we have less patients visit to the hospital, we have less people driving their cars, if we, through automated kind of

dialogue and assessments and monitoring patients, we have a better insight, then from a full value chain and value system perspective, we have a much better in view, inside view and reduction on carbonization than otherwise.

And so, the KPI here was relevant, but only relevant indeed If they would not look at it from their own organization, but from the full value system. And so that's a highly relevant aspect. So that's also with KLM, Air France, the airline. They do, I would say, these green laps and it's not only internally, but they do it with their partners.

They do it with their clients. Just not only looking internally in their own organization, but in the full value system on what they can gain and what they can do. And here you see a very interesting effect because they take the initiative, it strengthened their relation with their partners.

They have a better, a much deeper insight in the full value system, in their value chain, and as a result, their competitiveness are, however difficult to measure, strengthens. And here you see finding the KPI, identifying what to do and how to drive it. Different organizations will play differently.

Phillips is doing something different. ABM AMRO, which we've, we as Accenture analyze, is doing something different as well. And I think that's where indeed the, there's so many ways to pick that up and to drive it that at the ends, it's more interesting to see about what we did, these 20 or 15 companies and organizations and just distill, what is possible and what are the triggers and what can you do, initiate yourself, for your own organization to start going.

Sanjay Podder: Good.

No, absolutely. I think you have addressed both the, how organizations are using it as a competitive advantage, as well as on the regulations. And I'm with you on the point that you don't have to wait for regulations to come, you know, businesses who are the leaders in their sector, they set up those standards, their own business standards, and then they try to make sure that their business processes are within those guardrails, right, as they operate. Now one of the things that I often, you know, observe is that when we talk about green ICT or green software, there are many terminologies, people typically think it is only about writing green code, code that takes less energy or in the process, emits less carbon. But as even your value case, you know, puts a spotlight on, there's a lot more things for an organization to become green. Right? It is, you mentioned the supply chain itself, procurement practices, for example. So, how do you see organizations grappling with embedding these green practices end to end?

Because this is not something confined to one department or couple of people, right? If you want this value, this competitive differentiation, it is a change management process, a complex change management process. In your research, did you find organizations having developed a good way to do this or are there challenges?

What's your observation about this change management process?

Marc Zegveld: So let me, if you're okay, let me just elaborate a bit on my experience and our studies, but also Sanjay would really hear on from your experience from the Foundation and see where it matches or where it differs.

Sanjay Podder: Yep.

Marc Zegveld: I think there are three key aspects. The first one,

it starts from the top.

Senior management, the board, needs to lead by example. Maybe not in an extremely detailed way of what needs to be done and the KPIs, et cetera, but definitely it's a relevant aspect. And you can bring that also towards a message on competitiveness, a message on why we do business and how we should do business.

That's, I think, where it starts. Then we have on the, I won't say the bottom part, but at the operational part, also in your organization, Sanjay, but in a lot of let's say global or larger organizations we have lots of people, extremely smart, extremely hardworking and driven with a certain purpose.

So let them speak. Let them try. Let them give, let us give them some time on bringing up ideas and suggestions. I think that's motivating people and if we'll do that via small laps or various initiatives, it's all possible.

And then we have, what I would say, the people in the middle, which in many of the cases, let's say also in management reports, they defined as the people who always block.

it's not my experience in a sense. I think these are the people who needs to organize with the various initiatives on the various ideas, and really make that work and ensure that the people on the operational level are able to deliver, and are able to facilitate it. And I know this is all, let's say, highbrow managerial talk, but then we can go through the various initiatives and if it's Philipps or it's ABM AMRO, or it's KLM or it's AWS, I think that's where it happens.

And then once we see some pearls of indeed the real action and progress, then the top can step in and say, "Hey, this is a great example. I want to have more of these examples. Hey, this is what we did in this business unit. Let's see what we can grasp in other business units as well." And then we have a kind of wheel rolling, and get started.

And I think we have enough, quite some examples over there on how that works. Would it mean that if we would completely organize it all every round, that it won't work?

No. But on the majority of the cases we've seen, that's how we combine the motivation, the energy, the ideas, the suggestions, the smartness of people with the sense of direction, the board would identify this is highly relevant to go. How would you see that, Sanjay, from your experience?

Sanjay Podder: Yeah, no, I think I agree with everything you mentioned. You know, I would, I can relate both from my role in the Green Software Foundation as well as in Accenture as we embraced the green software practices. Right? So starting with our foundation, when we started the foundation, we realized that we wanted, you know, people to do green software without even defining, clearly having, what is green software? What are the tools? How do you measure, you know, you can only, you know, reduce emission once you start measuring. Right? And, I think, some of the foundational elements that we did upfront was getting the collective

intelligence of our members, right? So who has best, like Microsoft had a great principles of green software training, which we made available to all members, and that helped us baseline that people know, what are the key terminologies, what is carbon aware, what is carbon efficient? How do they relate to greenhouse gas emissions, for example? And that training has been appreciated by not only the developers, but many of the CIOs I talk to, they say "we love that training. The first thing I did after taking the training, I told each of my direct reports, you need to take that training."

Right? So that was like, you know, making sure that we are all talking the same language. Right. And then there has been plethora of tools. Some of them are open source tools, some of the best guidelines, we created the awesome tools list for people to go through it and see which of these tools are relevant for them.

And then, the third thing was about measurement. How do you measure emissions? How do you measure and express it? And I think one of the big achievements, in my tenure during the chairmanship, was the ISO standard that the Green Software Foundation helped create, called the Software Carbon Intensity, which talked about not only operational emissions, but also embodied emission. And how do you express it in a common way? You know.

So that has been an excellent outcome from the collective effort of our foundation members. And we are now trying to extend that to the AI space with, you know, SCI for AI as an example. So, the way we have tried to bring this culture change or to this change management, is we have, you know, created all these working committees where we have me all member representations, and then these groups, they work together to come up with the standards, tools and so on, so forth. And then our members are, you know, Accenture is one of the member, as an example. So we are, we can then take some of those best practices and bring it into our own organization and sometimes it's a reverse. Some of our best practices go into the Green Software Foundation, for example. Now

reflecting on my own experience within Accenture, I think this change management process is not straightforward. It is, especially because we are a huge organization, so all the elements you said, you know, it has to come from the top. Absolutely. The leadership mandate has to be there. And then we have to make sure we are embedding it into all our processes, methods, into our tools so that, you know, it becomes, by default you are getting, if you are generating code from a code generator, the code you are getting is a green code.

You don't get a code, and then the human in the loop trying to make it green, the code generator gives you a green code and you can always enhance it, right? So how do you integrate it in your methods, in your tools, in your training, for example? And many organizations are doing gamification.

They want to recognize the best teams. They have done something great and make it like a role model for others. Right? And I've heard this from MasterCard and many other, organizations who have been in this podcast, you know, so these are like, some of the ways one can do. I also, we were very happy to have the Singapore government, IMDA, they are very active in this field.

Setting up standards for Singapore and, in fact, they have played a big role in SCI for AI conversation, you know, that we are doing in the foundation. And what the Singapore government has been doing is the Green Software trials program where they're taking all the best practices of things that work and making it available to the ecosystem in Singapore.

Marc Zegveld: Nice. Yeah.

Sanjay Podder: So small medium industries can now use this practices. So, you know, these are like great examples, very inspiring examples, all led by some few fantastic leaders. Right? You know, so, I think the change management is complex. That has been my first observation. But, you know, a lot of things, interesting things we can do around it to make sure that people absorb this.

Right. And, this gets translated into a competitive differentiator, as you rightly pointed out. Now, you know, slightly in an adjacent area, Marc, we are looking at a very interesting time, a time where that is clearly a sustainability challenge. A time where technology is getting more powerful than ever before, right? With artificial intelligence, generative AI, in particular, large language models, business is transforming. What do you feel will be the future of leadership, therefore, in these changing times where, you know, leaders will have to grapple with technology, the sustainability challenges and various other challenges that we are all seeing today. Right. Do you have any perspective on, in this new green world, if I may put it, what kind of leadership we need?

Marc Zegveld: Oh, that's a very difficult, but a highly intriguing question, Sanjay. And we're, I personally as well, but we're also try to understand and work on that. And that's specifically more let's say on the, what kind of dialogue do you need to have within the board, indeed combining that competitiveness with IT

in fairness, more AI both on opportunity, threats, risks. And what kind of leadership, but also what kind of dialogue do you need to have and who should be in their boardroom? But if we distill that from what kind of leadership there is or there should be, specifically with IT and now AI, we have something pretty unique and in my word, invasive, coming.

It is that, we all talk about it, but the number of people who truly understand what's going, who understand not directly the technology, but its ramifications, implications for a reputation, for a supply system, for relationship within the organization is pretty limited. So we need to have a

and I think that's what we're gonna build up in the upcoming 5 to 10 years is a leadership who really leads and sets a pace, sets a direction but combines that with having big ears and really willing to learn and to listen within the organization, around the organization, on what the new technology, on what AI, what IT is doing, can do, what it brings to people, what the risks are, and what we can do about it. And I think that's not a, based on the last 50 years, that's not a standard archetype kind of leadership. 'Cause we are well known with the people who know and set the direction and set the pace and set everything in motion.

And then everybody will start spinning and doing. Then we have the people, whether for a limited time, who said, "okay, we have all these business units and you just take the initiative." And from a capital allocation perspective, we see, 'cause we are convinced that the sum of the parts will be bigger than the whole, and now we need to. have a leadership who sets the pace, sets the direction, but how we do it and how all these interrelationships work. specifically from an AI perspective, nobody will know beforehand. So we need to be very adaptive and we need to be eager to learn, eager to listen, and to play with the information that we have.

And that's a, I would say, unique typology of leadership.

And definitely there are examples on where we see it happen. But that will be my, that would be my two cents now based on where we are. So with the study and based on our assessments.

So from your experience, Sanjay, what will you see from that leadership role, of the leadership perspective? What will change?

Sanjay Podder: I think given the dynamic times we are looking into, the days of command and control structures are over, right? And leaders, in some sense, more from being the face of the organization, they have to be the coach of the organization. You know they, because they need more leaders, every organization will need more leaders given the pace of change, the number of areas and organization will have to fight, which means you need more leaders. And those leaders, the senior leadership will have to be the mentor, coach, and I think it's, in some sense, sometimes we call it leading from the back. But the, in the future, the future model of leadership will be, how do you, not only do you lead your role, but you create more leaders in the process, right?

That is the, that is one of the way you create team of teams in the process, right. And how do you bring outside in innovations? so for example,

the Green Software Foundation is a great example, right? You know, where people are collaborating, trying to solve for a common challenge, which is a planetary challenge, like climate change. And then we are bringing those learnings back into the organization to fine tune our own process, right? So leaders will have to have an open mind. They will have to be like a mentor, a coach. They'll have to generate more leaders internally. Everyone becomes a leader in that sense. So it's going to be a very interesting, model in my mind, keeping the dynamic nature of organizations that we are looking into going forward, from the traditional command control that we are, we have been used to. But again this, you know, it is a lot of intellectual power is going into it. I'm sure people are learning everyday new things with the AI and everything else that's coming around us. We are still grappling with what impact AI will have in our lives, in our work.

So it'll be an interesting observation. How does leadership change as a result of it?

Marc Zegveld: Oh, definitely. Yeah.

But I think where you have, where you started with the Green IT Foundation, and we from a TNO perspective, we did our study, which is limited compare to what you and your organization have been pulling off. I think it's a great example of indeed leadership where from, let's say individual companies, organization's perspective, there's there's found common ground to learn from one another and to see where you can accelerate. And that's based not only from data transparency, it's also from all different angles. And I think that's a great example also in, let's say in the future ahead.

If we look at it from an AI perspective or other perspective, if we talk about regulation, et cetera. I think this is a way forward.

Maybe it's not the fastest way, but it's, at least it's a way where

indeed we're all able to cooperate, to collaborate and we can learn from one another because we all know if you need to do it yourself, it's too costful, it's too painful, too risky.

Sanjay Podder: Absolutely. So, Marc, this has been such a great conversation. For anyone who wants to dig deeper into the Green IT Value Case or connect with your work, where should they go?

Marc Zegveld: Go to the website of TNO, tno.nl, and there you will find more information about the Green IT Value Case and the work that we do. And specifically from the unit IcT Strategy Policy. Yeah. And if there are, if you can find it, please send me a note, Marc Zegveld.

Sanjay Podder: Great. So, Marc, we're at the end of this podcast. And probably if there's any area you'd like to talk more about to let me know, then I can further explore. But I think we are fine for the day, otherwise.

Marc Zegveld: Great. Thanks. Was a joyful hour, Sanjay. Thanks.

Sanjay Podder: So, well we have come to the end of our podcast episode, all that's left for me is to say thank you so much, Marc. That was really great. Thanks for your contribution and we really appreciate you coming on to CXO Bytes.

Marc Zegveld: Great, Sanjay. Thanks for inviting me.

Sanjay Podder: Awesome. That's all for this episode of CXO Bytes. All the resources for this episode are in the show description below, and you can visit

podcast.greensoftware.foundation to listen to more episodes of CXO Bytes. See you all in the next episode. Bye for now.

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