Arriva Rail North (Northern) is a passenger rail franchise that spans the whole of the North of England. We have over 5,300 employees providing more than 2,500 services every day, making us the largest train operator outside London. 100 million passenger journeys are made each year and our trains call at over 500 stations of which we manage 476.
We cover a vast geographical network and were one of the first companies in the world to have our companywide environmental management system (EMS) certified to ISO 50001:2011 (energy management standard) in July 2011 and ISO 14001:2015 (environmental management standard) in September 2015.
We have successfully implemented energy efficiency projects that range from LEDs, voltage optimisation, synchronous burner heating controls, lighting controls, automatic meter readers (AMRs), tenant sub-meters and low level infrared heating.
So what are my top tips for energy managers to engage with the board of directors and get financial approval?
1. The business case
A good energy project business case would ensure all financials are included. Take LEDs as an example, you know that installing LEDs at a cost of £15,000 will reduce energy consumption by 40-50%, saving you around £2,500 a year giving you a payback of six years. Add in the reduction in maintenance costs due to the longer life span of say £800 per annum and the carbon reduction commitment tax of £200 and you get a five year payback.
Don’t stop there; your finance team are there to help so use them. Set them a challenge – ask them whether they can help you with inflation, ask them to approve your calculations and whilst they are at it, are there any other ingenious ways that they can help reduce cost out of the project to get to a four year payback? The better and more comprehensive your financials are, the more credibility the business case will have.
2. Trust and personal buy in – what is your credibility? Do they even know you?
Do your directors trust you to deliver what you say you will? If they don’t it doesn’t matter how well thought out your business case is. Start with quick low cost projects such as behavioural change or lighting/heating controls projects and report successful projects with full data analysis of both energy and cost. This will help you earn trust by proving yourself competent and trustworthy.
The world of business is built on people; directors are only human (believe it or not). If they know you then they will be more inclined to help support you in approving your proposal. Make your own luck, be bold and make the effort, work out of offices where you know the finance director or the managing director will be, introduce yourself, ask some pertinent questions, tell them something about you, make it personal and make it memorable.
3. Directors need motivation – what’s in it for them?
Everyone has different motivations to do anything. Hit one motivation and you may get an interest, hit two and you may get your proposal read, hit three and you may get the backing you want.
The profile of your board of directors will differ from person to person; generally I have found that if you hit the following three motivations you will have a positive influence:
i.Improve profit
ii.Improve profit and
iii.Improve profit
But seriously, it is the board of directors’ responsibility to keep the company sustainable on a financial footing so they will have profit at the forefront of their minds. They will also be the current custodians of that company so reputation of the company will be important. Does your proposal include an external communications plan to increase the reputation of the company.
Also in my experience to get to director level there needs to be a spark, a drive to achieve something that no-one else has – a legacy that they can point to. Can you show them within your proposal that there is a vision that they not just buy into but want to lead an entire company on?
4. Devolve responsibility – will it help meet a director’s target?
If you can devolve your energy reduction targets to areas of the business, and ultimately a director, then you will be offering a solution to help them meet their target. Reporting is a great way of doing this and this is where a successful EMS is a great tool. If you can report to the board of directors every month on where the company is with the energy target, broken down per directorate, you have instantly created a league table for the directors to compete against. Do this at each management level you can with the data you have as this will promote healthy competition and you should find people coming to you for help for once.
5. Language & credibility – is this just another hippy sustainability initiative?
Find out the business rhetoric – what are the values and behaviours the business publishes and promotes; what policies and key performance indicators are published and tracked? Find these out and weave them into your business case to tell a story. This not only makes the business case interesting but shows that you are completely embedded with the company’s ethos and not just an add on with unrealistic ideas to save the world.
The use of an intensive EMS and the holistic collaborative approach outlined in the steps above has helped drive down energy consumption at Northern. Our non-traction energy has reduced by 12% since 2009 even with the backdrop of more equipment being installed at stations such as lifts, ticket machines, and customer information screens as well as a brand new engineering depot and station coming into operation in 2012.
Our new franchise has extensive investment plans worth £1 billion over the next nine years most of which increase our energy consumption. Using our proactive approach we will still be looking to reduce our absolute energy from our infrastructure and improve our energy efficiency from our trains, both by at least a quarter by the end of the franchise.
