CHICAGO, IL — For a company that started out -- 170 years ago -- making weapons, Schneider Electric knows a bit about changing business strategy.
Last century, the company gained first a foothold and then a comprehensive presence in the electrical market: One of Schneider Electric's vice presidents said the firm has power devices in 70 percent of the world's buildings. But a combination of the collapsing economy and the rise sustainability has led the company to undertake a similarly fundamental shift, this time to being an end-to-end energy efficiency solutions provider.
At the company's 15th annual Editors' Day, I got a chance to talk with a number of Schneider executives and customers to see how this transition is taking shape, and how it aims, among many other aims, to bring IT and facilities management in close sync, and bring building energy efficiency to the cloud. (Disclosure: Schneider Electric covered my travel costs to Chicago for the day-long event.)
Redefining Energy Management
During the opening discussion, Jeff Drees, the U.S. Country President for Schneider Electric, spelled out how a company that has been known primarily as a conglomerate -- "a circuit breaker business," is how he described it -- is changing how it operates.
"We have a dynamic business we're trying to address through the energy management space," Drees said. "Fifteen percent of all power in the U.S. goes through a load center that we have in your home, and we're going to change those to make you an active participant in your energy management."
As Schneider defines energy management, it's not just about power, it's about efficiency. The company has long been focused on efficiency, and it was a thread throughout the event this week. But sustainability is an increasing part of its focus as well, although Drees put a qualifier on the impact of sustainability.
"Green is a great concept," he said. "But green has never sold a project. You've got to make sure it translates to a financial model that works for the client. The fundamental issue of energy management is ROI."
Schneider, of course, is well suited to make energy efficiency work for its clients' bottom lines: Throughout the course of the event, executives explained that 20 percent reductions in energy use had become commonplace, a result of gathering up the low-hanging fruit.
"[Twenty percent reductions are] no problem -- it's bread and butter for us," said Barry Coflan, Senior Vice President of Buildings Business. "Getting to 30 percent is more work, though we want to make that our bread and butter."