Agile Development Blog

As part of our goal to have a zero carbon footprint by 2020, we calculate our total carbon footprint each year including building facilities, travel, commuting, IT and waste.  As we get more accurate every year, we are adding in the impact of using Software-as-a-Service (SaaS) to that calculation. I have been unable to find a benchmark of other SaaS companies carbon footprints, so I am putting out a call for SaaS companies to share their footprint per user.

Rally’s benchmark – 8 tons of CO2 per year for every 100 users

At Rally, we have been growing steadily (227% in 2005-2007, 242% in 2007-2009) at the same time working hard to limit our carbon footprint.  Unfortunately, as a company grows, its carbon footprint often grows with it.

We have been able to keep carbon per 100 users flat at 8 tons per year for the last two years – the same amount produced by a single person flying from New York to Deli, India round trip 4 times. In addition, we estimate that our SaaS customers are avoiding an additional 1 ton per year of CO2 as compared to running an application in a robust manner in their own data center.

What is your SaaS carbon footprint per 100 users?

Lacking any other information, I used our figure – 8 tons per 100 users per year – to calculate our carbon use per 100 SaaS seats for each of our SaaS suppliers including: Google Enterprise Apps, Salesforce Unlimited, NetSuite, Big Machines, Eloqua, Xactly, and Open Air.  I assume our numbers are conservative because we are not the scale of the Google or Salesforce, and we count airline miles and employee commute in our footprint.  Can any other SaaS providers tell me your carbon per 100 users to increase the accuracy of our calculations?

Like Salesforce, we buy renewable energy credits from NativeEnergy to offset the carbon of hosted operations.  This is a very small portion of our overall carbon footprint -  about 7 tons per quarter.  However, it does a couple of things for us: 1) It supports our SaaS service being carbon neutral since 2008,  2) It keeps us learning about carbon credits at a national and local level, and 3) most importantly, it keeps us focused on our goal of zero carbon by 2020.

Do you want to partner?

In addition to our efforts to battle climate change in our industry, we are also working hard in social responsibility by following the 1% model started by Marc Benioff and Suzanne DiBianca at SalesforceFoundation.org.  Last year, we hit our 1% target of volunteer time with over 2,500 hours helping 90 charities.  This year, we are in search for a strategic non-profit partner to help us focus our corporate social responsibility efforts and volunteer time in one of three areas:

1. Reducing the environmental burden from the IT industry (carbon, e-waste, toxins, take-back efforts)
2. Decreasing the digital divide in society (universal access to the Internet)
3. Increasing the level and engagement in corporate social responsibility behaviors

If your non-profit believes it can leverage the 3000+ volunteer hours from a company in Colorado, North Carolina and the UK to help on one of these efforts, please contact us.  We are looking for a true partner who wants to start developing a relationship in 2009.

The importance of sustainability at Rally

Our efforts are based on trying to stand on the shoulders of Ray Anderson from Interface. See Ray’s Fortune interview on pushing through on sustainability in light of the current economic crisis that is radically affecting his commercial carpet business.  Since then, Google’s efforts and Salesforce’s efforts in the SaaS IT space have kept us moving forward.

We look forward to driving zero footprint data centers, increasing remote collaboration technology and having a zero footprint campus in the next decade. We are preparing a sustainability report for 2008, following the Global Reporting Initiative format.  It is not a small project, but it was the clear next step for our sustainability efforts that started in earnest in 2007.  Our goal is to release it by July 1st so stay tuned.

ADDED After Publishing and based on comments:

A better video of Ray Anderson is his speech at TED in 2009, it gives more background, and more data.  – Thanks to David Koontz

Graphic below to provide clear breakdown on sources of Carbon in our business – 6/17/09

Original F4 Technologies logo 2002-2004

I know what you are thinking with the title of this post – I am drinking the Kool-Aid. Just bear with me  for a minute. Back in 2002, when I started working on Rally, it was originally known as F4 Technologies. It was known as F4 because I did not want to work on anything that did not have the potential impact of a Factor of Four, for example a 4X increase in productivity or effectiveness.   There are two reasons for this:

1. Andrew MacAfee and John Gourville at HBS have shown that you need a 9X improvement with a new tool, technique or method to un-seed the incumbent.
2. According to Paul Hawken in Natural Capitalism, we need a 4X productivity increase in the use of natural resources to get to a sustainable place with the current population in the world.  Chapter 7 of that book helped form the core purpose and mantra of Rally – “Muda, Service and Flow.”

Now seven years into Rally, we have the proof that teams – including large and distributed teams – can be 4 to 10X more productive by following Lean principles and effectively implementing Agile development.  Like the story of “Good to Great”  from Jim Collins, you can’t leap here, but you can put yourself on that path by adopting a continuous improvement approach like Agile.  If you do that, you can be a “great” software development organization that dominates your market and is 10X better than the good ones.  Great organizations that dominate in their industry also have the knowledge and resources to change world, a la Google.org, the Salesforce.com Foundation and or through my favorite the Entrepreneur’s Foundation.

My summary take-away from Good to Great is:

“Right people building the right things right”

“Disciplined people, Disciplined thought, Disciplined culture “

If you are working toward this, I believe you increase your business value by 4 to 10 times.  I am going to make the case with the help of ROI models from David Anderson.  (BTW, I love his book – it does a great job explaining the simple physics of Agile.)

From Chapter 2 - David Anderson's "Agile Management for Software Engineering"

This is a very simple model of software process.  David shows more complex ones that model all the loop backs of large shipping software, but let’s work with this one.  So, the rough equations to calculate the business benefit of the process are the following:

Net Profit = Throughput – Operating Expense 
ROI = Net Profit / Investment

In the following four pages, I am going to look at how this equation plays out for four different scenarios:

1. Good waterfall team, on the mean line of the QSMA Agile Impact Report
2. Beginning Agile team in Flow benefiting from the 25% productivity savings of an Agile teams in the same study
3. Intermediate Agile team in Pull with incremental releases of value
4. Advanced team in Innovate that cuts time-to-market in 1/2 to end early after delivering 50% of the work but 80%the value

What you will see in this hypothetical modeling exercise is the true power of Agile to dramatically impact the software development teams in the organization. For a deeper understanding of what I mean by Flow, Pull and Innovate, please Jean and I’s white paper on moving to Program Pull.

Here is the summary:

1. Good waterfall team – ROI – 0.8
2. Beginning Agile team in Flow  – ROI – 1.4 (1.6 factor better than good waterfall team)
3. Intermediate Agile team in Pull  – ROI – 2.6 (3.2 factor better than good waterfall team)
4. Advanced Agile team in Innovate  – ROI – 6.3 (7.7 factor better than good waterfall team)

Factor or Four or better – that is why there is such a rush towards Agile development.  Of course, you can’t have your cake and  eat it too.  Moving up this maturity curve takes long-term dedication to increasing discipline and agility across the entire organization, but there are dramatic benefits if you can get on the continuous improvement path and stay there.